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What is a managed futures account?

Managed futures account

A form of alternative investment in the United States, managed by a commodity trading advisor, that trades in the futures market.

Where have you heard about managed futures accounts?

Managed futures accounts increased in popularity following the financial crisis of 2007-2008 due to a desire for diversification and their low correlation with traditional asset classes.

What you need to know about managed futures accounts.

Managed futures accounts invest in futures contracts in commodities such as metals and grains, equity indexes and foreign currency. They’re managed by professional money managers, called commodity trading advisors (CTAs), rather than the fund’s owner.

Investors may look at a managed futures account to diversify and lower the risk of their portfolio. For example, if stocks and bonds are under-performing, managed futures accounts that track metals markets or foreign currency futures may outperform the market, thereby helping to balance portfolio gains and losses. The performance of individual funds will depend on the investment strategy chosen by the CTA and annual fees are typically high.

Find out more about managed futures accounts.

Find out why people choose to invest in futures in our guide to futures contracts.

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