2020 CTA Challenge — July Rankings

Luck vs Skill: Guiding Investors Through The Noise

The CTA Challenge, by design, seeks to separate liquid alternative investment programs into multiple categories. The most relevant of which identifies investment programs that win by luck versus those that win by skill.

LUCK (noun): success or failure apparently brought by chance rather than through one’s own actions.

SKILL (noun): the ability to do something well; expertise.

Favorable market conditions come and go. An investment manager that posts good returns during favorable conditions isn’t necessarily the best at what he/she does. Any buy-and-hold strategy can seem like a winner when the markets are steadily moving in your direction; this is winning by luck. During unfavorable market conditions occur are the times we are able to see those who win by luck versus win by skill.

Just look at the US stock market from March 2009 until February 2020. Most advisors or money managers that held only “long US equities” for clients during this extended bull market period looked like a great investment manager when really they didn’t do anything other than stick to a very basic mantra of buy and hold, collect commissions/fees and hope the market would not turn against them. This is winning by luck. Enter March 2020 when the equity market crashed by +30% and those same advisors had a lot of clients wondering where the protection was and where the skill went that they were supposedly paying for.

Liquid alternative money managers can be viewed in the same way. Making money in favorable conditions (i.e., when the markets go in your direction) is the easier side of the equation. When the markets reverse or get volatile, creating adverse conditions, is when we see who is skillful and who is not. The CTA Challenge was designed in such a way that we evaluate risk-adjusted returns based on what could have happened (not just on what did happen). Our rankings strive to remove as much luck from the evaluation and highlight the liquid alternative investment managers who demonstrate and perform with real skill.

To better navigate this landscape, interested investors should contact a Coquest representative with any questions on accessing Managed Futures.

Please note that Managed Futures investments and trading in futures, in general, can carry leverage and a high degree of risk. It is not suitable for all investors. See the full disclosure notice at the bottom of this newsletter. And, as always, past performance is not indicative of future results.

Contact Us:

Are You An Investor Who Wants To Know More?
To learn more about the CTA Challenge participating investment programs, or others that are performing well in this current environment, please contact Coquest by clicking here or calling 1-214-580-4220.

Visit: CTAChallenge.com for more details.


2020 CTA Challenge:

Top 5 Ranking Through The End Of June

#1: AG Capital Investments LLC / Discretionary Global Macro Program
#2: Breakout Funds LLC / Breakout Strategy *QEP*
#3: Revolution Capital Management LLC / Alpha Program *QEP*
#4: Cayler Capital LLC / Systematic Diversified Energy Strategy *QEP*
#5: Metolius Capital LLC / Diversified Systematic Global Macro *QEP*

See the full current rankings here.

CTAs interested in participating, or investors interested in learning more about CTAs and Managed Futures investment strategies, should contact Coquest and the CTA Challenge by clicking here.


Featured CTA

Quantor Capital LLC, located in Austin, Texas operates a diversified futures trading strategy offered in managed accounts and a variety of funds. We base our investment philosophy on Nobel Prize-winning academic research, which clearly states that, over the long run, the vast majority of active managers will fail to outperform their benchmarks.

Visit CoquestTradersResearch.com to learn more about this CTA and to become a premium member of the site.


Featured Sponsor

Gemini Alternative Funds, LLC services the investment community as a Managed Account Platform (Galaxy Plus) working with dedicated managed accounts and co-mingled funds, as well as a structured product platform sponsor. Galaxy Plus provides a comprehensive platform of centralized operational services and distribution of products. The operational services provided directly by Galaxy Plus include transparency, uniform operational setup, risk and guideline management, and liquidity enhancements.

Upcoming Events – Mark Your Calendars!

MFA Forum 2020
September 9, 2020
Virtual Conference, Chicago, IL


CTA Challenge Sponsors