DBMF
iMGP DBi Managed Futures Strategy ETF
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Managed Future funds (e.g. DBMF) for diversification and hedging during uncertainty
Smooth Out Volatility in 2023 With DBMF
What's The Best Managed Futures ETF? DBMF vs KMLM vs CTA
As Earnings Misses Pile Up, DBMF Rides Market Volatility
The Almost Billion-Dollar Managed-Future ETF Making Waves ($DBMF)
thoughts on my return stacked leveraged ETF portfolios?
Thoughts on my return stacked leveraged portfolios?
thoughts on my return stacked and leveraged portfolios?
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Volatility is still relatively low, but creeping towards mid tier imo. We are still well above historical prices which is bullish for low volatility / decent rise. Money is being made, taco trade is still taco'ing. Normally, you should only hold the portfolio you can stick to, so why are you doubting now? Some signals are flashing red, like junk bonds trending down in value or people taking out short term vix positions to hedge, but other signals are flashing green. Its not rosey cheeks 6% volatility plus strong RSI like a month ago. If youre just investing in the index, id probably say just stay the course. If youre worried about recession, maybe take out some intermediate treasury exposure via IEF or direct purchase of ITTs from treasury direct (or if youre high conviction, LTTs like ZROZ), and if youre worried about stagflation... Wellll you better fight for a raise at work, and maybe learn about managed futures trend ETF offerings like KMLM, CTA, DBMF, AHLT, stuff like that.
I hedge my letfs with BTAL DBMF and gld
Ha, well I haven't fully either, just know enough to get by. Basically, there are so many types of portfolio designs. For instance, retirees and Ivy league endowment funds may invest similarly. The point is to hold assets that have low correlation to each other. You can run the asset correlation analyzer on [portfoliovisualizer.com](http://portfoliovisualizer.com), basically just plugging in different funds to see the effect. This approach of investing basically takes advantage of the Shannon's demon effect of volatility harvesting. It's not as profitable long-term as 100% equities, but it's designed so something's always up while others are down. Things like AVUS, DFAX, GLDM, EDV, DBMF, etc.
TQQQ and QLD UPRO and SSO ZROZ, EDV GLD and lower ER variants CTA, KMLM, and DBMF
Something like AHLT or DBMF probablya
> DBMFSIM/DBMFX: SG CTA Index (2000-2019) + 2.5% p.a. - 0.85% p.a., DBMF (2019-present) > DBMF is not bound to any index, but tries to replicate the gross return of large CTA hedge funds. The SG CTA Index reflects the net return of 20 large CTA hedge funds open to new investment. Thus, although they likely have similar return profiles, DBMFSIM performance before 2019 should not be taken as a one-to-one replication of how DBMF would have performed back then. [Should use this image.](https://www.google.com/search?q=survivorship+bias&oq=survivorship+bias&gs_lcrp=EgZjaHJvbWUyBggAEEUYOdIBCDU2MzBqMGo0qAICsAIB&client=ms-android-samsung-ss&sourceid=chrome-mobile&ie=UTF-8#vhid=Wdd5gVwx1EipLM&vssid=_0qR9aIuyHIDT1sQPy6LO-Q4_45)
DBMF, KMLM, and CTA are the most popular diversifiers. Add SIM to the end of DBMF or KMLM to extend the range of the backtesting dates. CTA has only limited historical data.
Gold miners aren’t the same as gold, and MSTR isn’t in the SP500 yet still. Bonds tend to be noncorrelated with equities. Managed futures such as KMLM, DBMF, and CTA are excellent diversifiers. This is all based on backtesting data for my leveraged ETF strategy, not pulled from my butt. People just don’t know it lol.
IAUM - gold CTA/KMLM/DBMF - managed futures TLT/ZROZ - 20+ year treasury bonds
I’m not saying that OP’s portfolio fits that criteria, but you definitely can diversify away the specific risk of the stock market. You could do a long/short market neutral portfolio or other hedge fund strategies that are uncorrelated to the stock market. This is not an endorsement, but managed futures funds had very high returns in 2022 when both stocks and bonds did poorly (examples in the ETF world would be KMLM and DBMF). You could also do a risk parity portfolio that, aside from stocks and bonds, invests in real assets (and perhaps other strategies like the aforementioned managed futures). In fact, the statement that if the stock market goes down you will go down, is not even true for someone that would have had a meaningful allocation towards long term bonds during the 00s.
> the ETF implementations (CTA/DBMF) are terrible ways to access this return profile, mostly due to limitations around leverage, assets held, and the 40act regs. CTA has outperformed 60/40 since inception with low correlation, which is pretty good for an alternatives holding. How much leverage and how many holdings do you need? As you go down into the more obscure commodity futures you start to add illiquidity issues without much alpha compensation.
I hold DBMF, KMLM and CTA. CTA seems to be the best one in terms of design for (expected) absolute returns as it uses several strategies, so it’s diversified not only in its holdings but also the kind of factors it uses (trend following, carry, relative value and risk off). I encourage you to watch the CTA deep dive videos, where they explain their strategies. The problem is that even if it has a submanager (Altis Partners), it’s a Simplify ETF, and Simplify has a history of blowing up their ETFs. If it had any other issuer, I’d be tempted to have it as my main managed futures fund.
[https://wholesale.banking.societegenerale.com/fileadmin/indices\_feeds/ti\_screen/index.html](https://wholesale.banking.societegenerale.com/fileadmin/indices_feeds/ti_screen/index.html) since inception CTA index +167%, Trend Only Index +238% with no correlation to the spxt. im not sure what "literature" you're referring to, but its pretty plainly incorrect. CTAs/Managed Futures are a great diversifer to a portfolio of long only equities, but adds no value to retail traders, the ETF implementations (CTA/DBMF) are terrible ways to access this return profile, mostly due to limitations around leverage, assets held, and the 40act regs. you would need to open a managed account of access CTAs through a banks channels (DB Select for example) and no retail investor has the capital allocation to support it (otherwise instead of paying 1/15 youd go to your private bank wealth manager and buy a CTA tracker QIS index)
Look into dedicating a sliver of your portfolio to Trend (KMLM, CTA, DBMF, etc.).
Yes. If you're older, roughly - 20% global stocks (an all in 1 fund or 1/3 each US, developed international, emerging markets) 30% bonds 20% gold 30% trend following funds These are rounded from a risk parity estimate. A more robust, diversified All Weather + international approach. It will have about a 7% annualized volatility. With a Sharpe ratio at 0.5-1, say you get an excess return of 5% + 2% risk free rate = 7% overall nominal return in the long run. In a bad downturn (3 or 4 standard deviation event, rare like 2008), take that average, 7% - 4*7% = 7% -28% = roughly 21%. So much safer than a 50% or 60% drawdown if you have all stocks. So, could do: 20% VT 30% IEF 20% GLDM 30% divided evenly between KMLM, DBMF, CTA. If you want to be more aggressive, I'd recommend the Return Stacked suite of ETFs for all in 1 solutions. Good luck out there!
Gold is good. Managed futures (CTA, DBMF), collateralized loan obligations (CLOA), junk bonds (HYBD). I don’t hold futures or CLOs in a market upswing. I do keep gold, and junk bonds are probably less than 10% of my bond allocation.
Adding some DBMF to my IRA
Managed futures (trend) and gold are more likely to perform well during inflationary periods. DBMF, CTA, KMLM, GLD are a few tickers to check out.
40 year old Canadian. Fairly low income. Self directed TFSA @ $35000 USD NTSX 50% NTSI 15% CGDG 10% BTGD 10% KMLM 7.5% DBMF 7.5% $10000 CAD in 5 year GIC, 2 years to go. $25000 CAD in aggressive allocation options in work RRSPs
Check out a podcast called Risk Parity Radio, it's great advice for saving for a house or retirees. Basically, it depends on how long until you need the money, but the fundamental idea is the same: invest in a few different uncorrelated assets. Say, 40% equities, 30% intermediate-term bonds and the last 30% distributed between other uncorrelated, alternative investments. Often, folks include things like managed futures contracts (DBMF), gold (GLDM), preferred shares (PFF) and REITS (VNQ, etc.). If your time horizon is 10 years out or more, consider some longer duration bond funds. The closer you get to needing your down payment, take the money from equities and slowly sell for treasuries or other short-term bonds.
Absolutely! RSST is a good one to look into, as well as KMLM and DBMF. Anyway, they are investment strategies that trade futures contracts across asset classes like commodities, currencies, and bonds (equities sometimes too). KMLM follows a systematic trend-following approach, investing in commodities, currencies, and global bonds, but excludes equities. DBMF aims to replicate the performance of top managed futures hedge funds and includes equity exposure. Both funds can go long or short on their respective markets, allowing them to potentially profit in both up and down markets. Here's a good YouTube video overview: [https://www.youtube.com/watch?v=xMZ9NOUmK2w&pp=ygUPbWFuYWdlZCBmdXR1cmVz](https://www.youtube.com/watch?v=xMZ9NOUmK2w&pp=ygUPbWFuYWdlZCBmdXR1cmVz)
Given your financial situation, here are some strategies to consider for allocating your surplus funds: Investment Options • High-Yield Savings Accounts / Money Market: Consider placing a portion of your funds in high-yield savings or money market accounts for liquidity and safety, with rates up to 4-6% APY. • Factor-Based ETFs: Search YouTube for more information, but I like the Avantis and Alpha Architect products as overlays to my broad market index Diversification • Alternative Investments: Consider diversifying into alternative investments like managed future ETFs to reduce market correlation. I use DBMF and KMLM Education and Skill Building • The Investment Checklist by Michael Shearn is an underrated one
Consider this mix: 1. S&P 500: Use an index fund or ETF for broad market exposure. 2.Small-Cap Value: Check out AVUV (Avantis U.S. Small Cap Value ETF) and AVDV (Avantis International Small Cap Value ETF) for potential high returns. 3. Emerging Markets: Go with AVES or FRDM for growth in developing economies. 4. Managed Futures: Add a sprinkle of DBMF or KMLM to hedge against volatility. This combo balances growth and risk across diverse asset classes. Happy investing!
My portfolio isn’t this clean/simple yet, but I’m working towards: 20% VOOG 20% VIOV 20% BRK/B 20% TLT 7.5% GLD 7.5% DBMF 5% whatever is cool- VGT for now.
Inflation/stagflation/inflationrecession is exactly what managed futures strategies are for. Theyre a dog when it comes to taxes since they continually distribute (forced to), but if you use them in an IRA, 401k, or HSA, you can get serious third leg diversification with a stocks/bonds portfolio. Managed futures trend strategies have very very low correlation with both stocks and bonds, and had very good returns during times like 2022, 2016, GFC, dot com. They have a lower realized return than stocks long term, and the tax treatment is a pickle. But, you can make a *very enticing* portfolio by blending in MF ETFs like CTA, KMLM, or DBMF into a portfolio https://testfol.io/?s=c5pv1hNbz0v Note how all the other options had a better max drawdown than just SPY. Juice a lil leverage on top to get back to at least 100% equity exposure, while also having room for managed futures and bonds, it looks great. Even if you dont leverage and just did 45/30/25 SPY/KMLM/ZROZ, your max drawdown is only like 18% and until this very recent huge equity bull run you were beating SPY over the last 30 years. Managed futures are an uncorrelated source of expected returns. Long bonds hedge equity crashes. Equities, even when richly valued, are our long term source of primary expected returns. Managed futures includes exposure to commodities and their trends, so i feel no need for additional exposure to something like gold. Gold by itself tends to lower portfolio max drawdown (its also uncorrelated to stocks and bonds) but it also drags down portfolio total CAGR long term.
It is not a perfect hedge but I would simply recommend adding some managed-futures trend to your portfolio as it historically (and logically) does quite well in inflationary periods, but also can do well in deflationary ones, or just about any market, especially when equities/bonds (risk assets) are doing poorly. There are even great products out there like RSST (US equities) or RSBT (US bonds) which for every $1 you put in you get $1 of the beta exposure (equities or bonds) plus $1 of managed-futures trend replication on top. BLNDX is similar but 50% equities and more diverse trend system. Don't want the beta? Plenty of other funds out there: KMLM, DBMF, AHLT, ASFYX, PQTIX, QMHIX, TFPN.
I am. It allowed me to invest mainly in Private Equity with Morgan Stanley. So invested with KKR, Pomona, Blackstone. DBMF for hedge strategy. Pre-IPO is almost impossible at $1M level. You will have the little ones that no one wants. You need to be at VC level. Private Equity is good to hedge but don’t think you will have a good profit during bull time it’s pretty low yield. Only truly benefits during bear time.
The main point of the book is that the expected risk premia for stocks and bonds is very low right now which probably means that they won’t perform as well moving forward. You can react to this phenomenon in three ways: 1) taking more risk in stocks and hope for the best; 2) just endure it, or 3) diversify beyond a buy and hold equity/bond portfolio. He says that, market timing being really difficult, the best strategy is to have a portfolio that works during all scenarios, even when stocks and bond world badly. So he proposes investing in a buy and hold portfolio of stocks, fixed income, commodities, long/short market neutral risk premia, coupled with trend following and maybe tail risk protection. He also thinks that you should build a well diversified portfolio and then use leverage if you want to increase the risk/expected returns (that’s not an original argument, but a consequence of modern portfolio theory). The kind of portfolio that he proposes is hard to implement only with ETFs. Maybe you can use something like DBMF or KMLM for trend following, or RSST or RSBT if you want to use leverage. However it’s hard to find a properly leveraged long/short ETF because of regulations. BTAL is a risk neutral long/short fund, and RSSY and RSBY are leveraged funds that include a long/short carry factor strategy.
Futures are contracts where you agree to buy or sell an asset at a set price in a specific date. This contracts are tradable in an exchange so you can buy or sell them. They have mainly two uses: 1) they serve to transfer risk of the price of an asset, and 2) they can be used to get implicit leverage (instead of taking a loan to buy more of an asset you buy a futures contract and agree to buy that asset in the future). Managed futures are funds that invest in futures contracts. There are several strategies, like trend following (buying futures that are rising in price and selling those that are falling) or carry (investing in futures that have a significant difference in price to the underlying asset and taking the risk of the price not changing against you). Managed futures are attractive because they’ve historically have had positive returns higher than bonds, they’re uncorrelated to stocks and bonds and are positively skewed (they generally don’t make or lose too much money, but they can have explosive positive returns). They’ve historically worked well during inflationary shocks or during prolonged bear markets. They benefit from times of uncertainty because that’s when most trends develop and when people are more prone to enter futures contracts in order to hedge risks related to price changes (this means that there are better expected returns for taking those risks). You can invest in managed futures through ETFs. In my opinion the best two are KMLM and DBMF. Probably the first one is better because it’s more volatile (which means that you need less of it in order to have meaningful diversification) and because it doesn’t hold stocks futures (which means that it is even less correlated to stocks). Having said all that, don’t invest in it without doubt some research. This may be a good start: https://www.aqr.com/-/media/AQR/Documents/Insights/Alternative-Thinking/Understanding-Managed-Futures-82422.pdf
Bunch of magic soup. Algorithms that follow momentum signals for commodities, equities, etc buncha stuff. A la KMLMX, DBMF, CTA, etc
Short term bond trading based on what? There are two primary risk premia associated with bonds. Credit risk and term risk. Longer dated bonds carry more term risk (conditions changing over time may make a locked in bond appear worse. Inflation due to money printing eroded the value of long bonds and money flew into equities and short term debt (see: 2022, 1970s, many such cases). For example, look at TLT, EDV, GOVZ, ZROZ during those time frames. Theres also the credit risk premium. The riskier the debtor, the higher yield they must pay you. This is why US government debt is a low yield, theyre AAA never defaulted since the war of 1812. Buying a bond from Argentina carries more risk, so their yield will be priced at a higher credit risk (also inflation will increase the yield). Corporate bonds have higher yields than government bonds since governments have a monopoly on violence and have the ability to tax and print money, while companies do not. A single company is more likely to go under than a government, thus higher yields. But if youre trading bonds, that means youre trying to trade on price sensitivity? Bonds at their root are priced at a discount of some future value, paid in coupons and you get the principal back or held and accumulated to maturity like a CD. For you to make money swing trading bond actions, you would need to be able to know something that the 300 trillion dollar bond market doesnt already know, because whatever you can think of or read on the news has already been priced in. I would argue that the efficiency of the bond market is even higher than the equity market, so trying to outperform the bond market on a risk adjusted basis with bond trading will be... a titanic task. I use bonds for their diversification effect. Long treasuries, of all bonds, show some of the lowest correlation with the US stock market. Why do I want that? Im leveraged on large cap US stocks in part of my portfolio. If the market crashes even just 20%, in losing 60% in that. In that recession scenario, long treasuries will be negatively correlated and provide a rebalancing opportunity to sell high on treasury bonds and buy low on levered stocks. Managed futures (KMLM, DBMF) is the third leg of the stool and provides strong performance particularly in inflationary environments where long bonds would suffer even more than stocks would (2022). Based on history and the theory behind three uncorrelated/negatively correlated assets, I hope to outperform the index long term (not on a risk adjusted basis, no way) but with a similar max drawdown. A great place to learn about bonds is the rational reminder interview of Dave Plecha, global head of fixed income at dimensional fund advisors (the company that invested the first small cap value funds and beat the market over 30 years). https://rationalreminder.ca/podcast/163 Another good one is Ben Felix talking about bonds and credit spreads and all that fun stuff https://rationalreminder.ca/podcast/138
Target date is already maximally diversified from an equities perspective, and has bonds to boot. The only other things to "diversify" would realistically be gold (GLD) or managed futures (KMLM, DBMF, etc), but these are only really useful imo in a portfolio that can be rebalanced. You cant rebalance across accounts, so you could do something like VT + mf if youre looking for diversification.
Forgot to add: If you’re looking for managed futures ETFs, DBMF is the one that’s more similar to an index fund (maybe KMLM also).
Honestly I don't have a diverse portfolio, it's heavily biased toward US growth. If I were trying to build the most diverse portfolio from 4 ETF's I think it would be something like the following: VT: Market cap weighted global equities BNDW: Float weighted global bonds (corporate, sovereign, fixed income securities) DBMF: Managed futures (commodities trend following) fund. Captures commodity trend following returns and offers unique correlation to equity and bond markets. Difficult to choose the last fund. GLD would be a classic portfolio diversifier, BTC might be a modern contender for an aggressive investor. If you live in the US, TIPS might be a good conservative option to protect against unexpected inflation, but it's painful for me to allocate too much to something with such low expected returns.
DBMF is a good choice, it used a trend\_following strategy to trade in commodities, a good hedge to stocks
I would recommend DBMF, it tracks the SG ATC index. This actively managed ETF tracks the performance of main trend-following strategy funds, and is a good hedge to stocks. Besides that, you can also buy some GLD, and SIV, but this DBMF helps you get involved in trading crude oil and other commodities.
Managed futures $DBMF $CTA or consider return stacking ETFs $RSST
[Try USMV or DBMF instead](https://testfol.io/?d=eJzNj1FLw0AMx79Lnu%2BhCnNwjzL2ogVBJoqMkvXS7vR2t%2BZih5R%2BdzMqWARfZXlK%2BIV%2FfhmgDWmH4QEZDxnsAFmQpXIoBBbAAEU3mybaYwB7VWgZQPdW%2BdgEFJ8i2AZDJgM15n0T0gls8TNUDVOnOS%2BEHD41jVMIPrbVyUd33r0pRgPHxNKk4JPqvA4Q8fB928eesqx8751KKRX%2B0FNM6o%2BxpvWvdPH1O%2FGUMvVKpes6ZUfimqKAvV6MZoZ3oq%2FN8HIxbg04xlY%2FOW%2F%2Br85deV8%2BX5DP6rZcX5LP5rF8%2BltnO34BI0v1Aw%3D%3D)
The sensible answer : vanguard life strategy 60 https://www.vanguardinvestor.co.uk/investments/vanguard-lifestrategy-60-equity-fund-accumulation-shares/price-performance The fun answer: 50/50 split RSSB and DBMF. Gives you 50% world equities, 50% treasure exposure (via futures) and 50% managed futures (hedge fund commodity trading strategies). Yes that is 150% so 50% leverage built in to buy bonds. Backtests show similar performance to s&p 500 with a fraction of the drawdown. If you don’t have access to US based ETFs you could achieve something similar with 60 40 NTSX and the IMGP DBi Managed Futures Fund. Downside is ntsx is only S&P on the stocks side, and the leverage is less.
Only in the US would someone say “x is basically every domestic stock, you can’t get more diversified than that”! Seriously, buy at least market cap weight ex us, developed and developing. I’d also consider some systematic ETFs. Small cap value (avuv) is paying out right now. Momentum (QMOM/IMOM) has been paying out, and if well implemented should keep paying out once the algorithm picks up on the new gainers (assuming the rotation into small caps is here to stay). Other factors such as quality/profitability can be captured in ETFs and tend to outperform, particularly in a downturn. Finally, you could add some alternatives. DBMF replicates the performance of a basket of top commodity trading hedge funds. AQR have good systematic strategies with good returns uncorrolated to equity markets (e.g. QDSIX)
You could do half HYSA and half QQQ, or you could do half SPAXX/SGOV/BOXX and half with the HFEA strategy (55% TQQQ, 45% TMF) or similar, slightly less risky strategy (75% NTSX, 25% DBMF/KMLM). Use that leverage to your benefit where you can!
Everyone seems to be ignoring the fact that you have no essential monthly expenses rn bc of your job. While it’s possible you could lose your scholarship (if your GPA falls) or your job (HIGHLY unlikely as an RA though, at least at my school), those scenarios are pretty unlikely and have very little to do with what happens in a stock market crash (RAs don’t get laid off like that). So here’s what you should do… 1. Open a Roth IRA with Fidelity to contribute however much you can toward your current annual limit. (This is tax-free money for you in the future that you can’t go back and make up for later. Also I recommend Fidelity bc they have no fees for so many things most other brokerages charge for.) 2. In the Roth IRA, invest 50% of your money into either FXAIX, VTI, or VT. Invest the other 50% into something that is not correlated at all with equities, examples being bonds, managed futures, and cash equivalents. I personally would do 50% into the leveraged stocks/bonds ETF NTSX and the other 50% into the managed futures ETF DBMF, but it’s important to only invest in what you understand! So for you, I’ll recommend FXAIX and a cash equivalent (SPAXX, SGOV, BOXX, etc., all with very nice yields). 3. If the worst case scenario happens, you can take your contributions (not your earnings) right back out of your Roth IRA penalty-free and tax-free, and since you’re invested in different uncorrelated assets, you can start with only withdrawing whichever one is not at a loss/is losing less. But the worst case scenario seems very unlikely in your situation, so just keep letting that money grow and trying to earn more money to put into that account. This will function as a back-up emergency savings account. 4. Open a credit card and start building your credit score if you haven’t already. Credit cards can buy you up to a month in most cases (or longer if you are willing to take on interest, which I don’t recommend) of extra time to pay off your expenses in that worst case scenario. There are so many good student credit cards out there; let me know if you need recs.
If you want some commodity exposure or other non-correlated exposures then look into managed-futures trend. DBMF, KMLM, AHLT, plenty of mutual funds etc... BLNDX is 50% stocks plus trend. RSST is 100% S&P500 plus 100% trend. Static gold has much longer periods of decline, and a lower expected return (0% real vs. trend which has had a longterm premium above inflation).
I don't know about that The usual price discovery in markets very much badly disrupted by Fed and global liquidity and ample reserves regime. John Hussman has written brilliantly about this for decades now. Also perverse incentives. Who will raise taxes appropriately or taper QE. Not the Fed if they want to keep their jobs, and not gerentocratic millionaire politician class I don't know about that The usual price discovery in markets very much badly disrupted by Fed and global liqudiiry and ample reserves regime. John Hussman has written brilliantly about this for decades now. Also perverse incentives. Who will raise taxes appropriately or taper QE. Not the Fed if they want to keep their jobs, and not gerentocratic millionaire politician class To give you a sense of how recent ATHs not so impressive, put them in inflation weighted terms and consider global liquidity flows just now picking up again as central banks again cut rates There are other strategies too Look at buffer ETFs like BUFR And managed futures like DBMF A mean reversion trade to undervalued overall market by way of RSP or cheap international stocks is also an option. Dollar can't stay this strong forever All this is besides the point. I think if you're young, keep buying. Largest generational and claass cohort just now getting into peaking producing and consuming years. In the long run, SPY and the like have been the only way to come out ahead in this shitshow fiat money system. And it's sensible. You're buying the top companies that compound growth and productivity and SPY dumps the worst annually To give you a sense of how recent ATHs not so impressive, put them in inflation weighted terms and consider global liquidity flows just now picking up again as central banks again cut rates There are other strategies too Look at buffer ETFs like BUFR And managed futures like DBMF A mean reversion trade to undervalued overall market by way of RSP or cheap international stocks is also an option. Dollar can't stay this strong forever All this is besides the point. I think if you're young, keep buying. Largest generational and claass cohort just now getting into peaking producing and consuming years. In the long run, SPY and the like have been the only way to come out ahead in this shitshow fiat money system. And it's sensible. You're buying the top companies that compound growth and productivity and SPY dumps the worst annually
Managed futures DBMF, CTA, AHLT they are doing better than stocks this year. Its basically momentum strategy in commodities, currencies, bonds and stocks that can go long or short on any of those assets. 50 / 50 managed futures and stocks and have a nice smooth line that gets better returns then bonds.
If you want some inflation protection and diversification you'd be much better off holding managed-futures trend. KMLM, ASFYX, QMHIX, PQTIX, DBMF, AHLT, AHLIX, CTA, TFPN, RSST (includes S&P500 exposure on top), etc...
My alts bucket (20% of my portfolio) is currently 50% DBMF and 50% CTA. DBMF is a good, agnostic top down replication strategy. CTA is actually 4 strategies in one fund. Nobody in this sub cares, they're all "VTI and chill".
I don't get why this is downvoted since CTAs are known to be a great diversifier and it's easy to get exposure through an ETF like DBMF or CTA.
That or the exposure needs to be actively managed — trend following is the most common. A few ETFs now offering that with low correlation to stocks: DBMF, HARD, CTA. RSST is interesting too — $1 invested gives non-recourse exposure to $1 s&p, $1 commodity trend.
I looked into DBMF which does an ETF of managed futures. However, it *is* volatile. But the expense ratio is surely better than hedge funds 2-and-20. Gold and oil are *also* very volatile. The problem is that if there was something that let you "sell at a profit no matter what", and was extremely accessible, everyone would want it and bid up the price until the returns on it were very very slim. Just look at how small TIPS real yields are.
RPAR risk parity, DBMF, FMF, TFPN, KMLM managed futures that can short or go long on bonds, currincies, commodityies and stocks long short equity strategies to.
What do people think about replacing bonds as the typical equities hedge with managed futures? For example, instead of a typical 60/40 stocks/bonds portfolio, have 60% stocks and 40% managed futures. For a more aggressive take, have 80% some combination of stock funds (VTI with some small cap and value funds, maybe some QQQ or tech funds or whatever your preferred tilt is) and 20% managed futures (maybe KMLM and DBMF). Back testing of the past 23 years (using some proxies like the MLM Index for KMLM and something like the SG Trend Index for other managed futures funds to fill in the older years), which include the two bear markets 2000-2009, the roaring bull market, and the past few years of volatility/rate uncertainty make this combination look very good - better returns than the overall market, much smoother, with much smaller drawdowns.
Do you use a managed futures ETF like DBMF or CTA?
Real assets might be a good choice GUNR, managed futures DBMF or a long short strategy FTLS
I always keep a position in managed futures like DBMF. Read the perspective before you buy into something like this as it may not be a good idea for you. It holds long and short futures in correlated and uncorrelated commodities and then hedges these with derivatives. Pays a 10% distribution from these options. These and short term treasuries or cash are how I hedge.
Not a father but I put my nieces' 529s in 100% stocks. They are currently younger than yours and I don't intend to reduce it until a couple years out. But you obviously have more responsibility and more money at stake. You don't want to go too high risk and be uncertain how much you (and/or they) will have / need to save, but you also don't want to go too low and give up potential gains and maybe underperform the rate of tuition inflation. You listed a bunch of distribution-focused funds, including ones that use option premiums. If a high distribution rate gives you more confidence in their performance, then I say go for it. But in general I don't see a point in shuffling money around from one pocket to the other and back again. For a medium risk portfolio: 15% VTI, 15% VFMF, 10% VXUS, 25% BNDW, 10% JPST, 10% SCHP, 10% DBMF, 5% IAU
CTAs you can buy through an ETF tend to be inversely correlated to equities. ticker: CTA and DBMF are the two best-known ones. In 2007-2009 they trend followed and got short the market.
Some people like managed futures etfs like DBMF as hedges in an environment when stocks and bonds may go down together. Gold could also work, or maybe BTC. https://etfdb.com/managed-futures-channel/2022s-top-3-managed-futures-etfs/
CAOS is best, possibly DBMF or Treasury bonds
Bonds or managed futures AVIG, DBMF
I agree, I like DBMF the most based on the article analysis and the fact that it tries to blend the strategies. CTA seems to have performed well out the gate, but a lot of their other ETFs makes me a little leery.
I agree that we don't have historical performance to look back on and of course like any strategy it involves holding through volatile times. I think the more important question to ask is how they fit into a total portfolio and will they do what they they are intended too, which is provide uncorrelated returns when equities and fixed income are in a downturn. I think they may serve a place once a portfolio hits critical mass. The diversification benefit is more important once overall portfolio value is higher to help minimize total drawdowns. And is the fee worth the potential benefits. Of the 3 I like the strategies CTA and DBMF employ the most. These strategies also tend to be less tax efficient so they might only make sense in a tax sheltered account.
Managed Futures are now available in ETF wrappers. Funds like CTA, DBMF, and KMLM. They are more expensive but arguably are the best uncorrelated diversified to stocks and bonds.
KMLM, DBMF and CTA have slightly different strategies: Here's a good rundown and comparison of which you should buy: https://wantfi.com/invest-in-managed-futures-etf-dbmf-kmlm-cta-review.html
I’d vote for managed futures. Something like KMLM or DBMF have done great since 2022 and have low correlation with equities and bonds. There’s a couple new products that mix bonds and managed futures (RSBT) or equities and managed futures (RSST) as well.
I wish there were more alternatives to RPAR. A lot of new ETFs are great building blocks, but we need more fund of funds. I manage my own portfolio right now and it's roughly 60% stocks, 20% bonds, 20% trend following. If you want to see an illustration of how it performs, here's a similar portfolio: 67% NTSX, 33% DBMF https://www.nasdaq.com/articles/corey-hoffstein-on-return-stacking-and-managed-futures
>DBMF, CTA, KMLM how do they work?
DBMF, CTA, KMLM are three of the biggest and they all have different approaches so you get a diversification benefit buying all three.
Arguably the best way to diversify beyond a stock and bond portfolio is with managed futures. KMLM, DBMF, and BLNDX are funds easily available to the general population, and there are good funds managed by AQR but they have high minimums.
I’ve got my kid’s roth in AVGE. All markets with a slight size, value and quality/profitability tilts. If you wanted a bit of leverage and treasuries then NTSX is a good US fund. They have international versions as well. If you’re splitting up international into developed/emerging then I like FRDM for not including regimes like China, Saudi Arabia and Russia. They also exclude state-owned enterprises (SOEs). And then there’s your alternatives / trend following funds that I like to mix in. DBMF and KMLM are good.
Commodities (PDBC +69.2%) and managed futures (DBMF +35.36%) did pretty well as expected.
$DBMF - I'm only down about 6-7%, but trend following got murdered by the collapse of SVB and plummeting yields. One of the biggest rate moves in 50 years.
Managed futures, KMLM, DBMF, RSBT, Market Neutral, BTAL, LBAY, hedge fund replication HFND.
I too was going to suggest managed futures, so I'm glad to set this post. Just wanted to point out a typo on the rug you mentioned, it's DBMF.
I added DBMF/KMLM combo to NTSX to balance it out based on what’s been written about them on SA. Both dropped significantly in January presumably after some kind of annual dividend payout. In so far, KMLM seems to be more volatile and move in opposing direction to NTSX whereas DBMF barely moves. Just observation over the last few months. I have also considered FIG and HFND but didn’t proceed.
45% equities (15% each in SYLD, FYLD, EYLD), 30% bonds (10% each in BOND, BNDX, VWOB), 15% commodities (BCI), and 10% trend following (DBMF).
Look at the mutual fund REMIX it stayed positive every year the last three years. 50 % equities 50% trend following which is basically long short different assets commodities, bonds, and equities. You could also look into just full trend following like DBMF or KMLM, AMFAX. Most of the time the strategy is not that great until 2000, 2008, 2020 happens or even this last drop. Has really low correlation with stocks and bonds or commodities. Adding a 20% allocation greatly reduces drawdowns during crisis. Down side is there are many years with 1-3% growth or it can be negative while other things are doing great..
Maybe look at funds like DBMF or KMLM?
I've been researching DBMF a lot and I like it's diversification with stocks and bonds.
I exactly do it. I have cash allocated on the side, I short using SQQQ and Hedge using DBMF.
If beta reduction is the goal bonds, commodities and trend following which kind of combines both of those together. Look into KMLM and DBMF these will save a portfolio when everything else is doing awful because they can go short as well as long.
I DCA from my base salary no matter what is the current market condition. I reallocated 50% of investment in cash in April 2022. My plan is to re-enter after Q1-Q2 2023 earning revisions. I’m currently tactically invested in private equity, private credit, tax free municipal bonds, hedge funds (DBMF). Will see later mid-next year.
Put it in trend following DBMF and get rid of some volatility in you portfolio.
Is it the case for DBMF? if not what is the taxable rate?
I don’t get the dividend funds, they underperform stocks in good years or provide for example YTD bad performance in a bad year, in comparison Hedge Fund like DBMF or Private Equities are truly providing good returns YTD. For example, PRDGX is around -7% this year. What is the benefit in your view?
DBMF is an alternative managed futures ETF mirroring strategy of top Hedge Funds, so per say I’m betting not on a specific manager’s strategy but the average of most successful ones. I select the Hedge Fund based on strategy, allocation, Morning Star rating, YTD and last years performance. I have my financial advisor reviewing it also. It’s a risky one so I have only a small part of my portfolio invested in it. <5%.
I will recommend to keep AAPL and maybe SNOW. You need to hedge and diversify. Your are only “betting” on one sector: tech. I will go with VTI for total market, DBMF for Hedge Fund and some Bonds for next year as a big drop is expected in earnings and market.
On my side, yes to all, DBMF for hedge fund, Municipal tax free bond, Private equity/credit/real estate. I do not have global and limited exposure to emerging market.
yes to all except: Municipal Bond - no, this doesn't provide any tax benefits for me Commodity - no, but a good entry price on gold could interest me Hedge Fund - I'm vaguely interested in a small position in DBMF but not after it's just run up Private Equity - no Private Credit - no
Out of those three, DBMF has the lowest volatility and least amount of “manager risk” since they track and replicate the 20 most successful CTA hedge funds using a rules-based model that eliminates discretionary trading.
This is insane. Like DBMF is +20% YTD and VOO is -15% YTD. Why keeping only VOO and VGT. Might be photoshop, not possible. I’m sure op spend his days on r/investing saying “Just DCA and chill…”, yeah genius
Imagine having $7M and being invested in VOO and VGT 😂. Now imagine if you had a financial advisor investing into the same and also private equity, DBMF and other alternatives. You would have spent 1% fee and be already at $10M+
If you really want this, I suggest DBMF. >DBMF seeks to replicate the pre-fee performance of leading managed futures hedge funds and outperform through fee/expense disintermediation. Basically, the index funds of hedge funds. Expense ratio 0.85%. Pretty new, but very accessible to the retail investor.