Introduction to Wealth Management and CTA’s

The wealth management division within the world of finance is a very large and diversified field. ‘Wealth management’ means understanding the needs and requirements of a client (how much risk they would like to take, how much return they expect, which type of market they would like to invest in, how much money they have to invest etc.) and then deciding on the best place to put the client’s capital.
Investment managers have been using managed futures for more than 30 years. Institutional investors such as pension funds, endowments, trusts and banks have made managed futures an essential ingredient for diversifying their Investment portfolios. In 2002, over $45 billion was under management by CTAs. The chart below shows you the rapid growth of managed money over the years:

 

CTA’s (Commodity Trading Advisors) are institutions or individuals who have significant experience in financial markets and they trade the money invested by clients with them. They are registered with the NFA (National Futures Association) and re regulated by various government bodies about the information that they provide to the public. They are legally responsible to make sure that any figures they provide for past returns (profit or loss) are accurate and they have to declare their results to the public regularly. THIS IS A GOVERNEMENT REQUIREMENT.

CTA’s are professional traders who use specialised software or analysis methods to understand the market and predict the direction of the market to trade profitably. There is always the possibility of losses in the financial markets but professionals like CTA’s try to minimise the losses.

The benefit for clients looking to invest money in the markets is that the client’s money is managed by a professionally recognised and registered trader in the US and that trader has a past record of trading which is available to investors to see. The account is still opened with us but the manager is not an individual in Kuwait but it is a regulated institution in the US. Swiss International will still work with the clients offering them support and information related to their account.

Why Managed Futures?

Benefits of Managed Futures within a well balanced portfolio include the following:

Adding managed futures to a traditional portfolio improves over fall Investment quality. This is substantiated by an extensive body of academic research, including the landmark study by Dr. John Linter of Harvard University, in which he concluded that “the combined portfolio of stocks (or stocks and bonds) after including judicious Investments… in leveraged managed futures accounts show substantially less risk at every possible level of expected return than portfolio of stocks (or stocks and bonds) alone.