No. of Recommendations: 6
A few recent articles I've seen on Meb Faber's Ideafarm are about the benefits of following "trend" as embodied in the Commodity Trend Advisers index, run by Societe Generale - insider baseball term is the SG CTA index. They're managed futures - the index is an amalgam of 20 managed futures hedge funds.
Summarizing an article that came out in May just emailed: "trend" is slow to react and gets hurt in the first stage (up to 10% equity drawdown) just like equities do; but after that, in a protracted bear, this managed futures "sub-universe" substantially outperforms US equities - so it's said to be a good defensive diversifier.
Similar to all the historical research this merry old band was able to do into the venerated timing indicators - BearCatchers - and others. Slow to react at first, provides increasing benefit the longer & stronger the bear market ends up.
Has anyone here tried setting up a signal or an approach that switches into CTA (which only started a few years ago), DBMF, or something similar manfutures fund available through ETFs? If so, what funds might one use, and since its contrarian, what criteria useful to switch into and out of it?
FC
