Risk Parity Radio Episode 446: Managed Futures, International Bond Funds, Risk Parity Chronicles(!) And Portfolio Reviews As Of August 15, 2025
Aug 17, 2025
Explore the intriguing world of managed futures and their trend-following strategies that help navigate market turmoil. Dive into the revitalized Risk Parity Chronicles, where community feedback shapes valuable investment discussions. Review eight diverse portfolios, analyzing performance and strategies, with highlights on gold and market comparisons. Plus, enjoy a whimsical dream about economic scenarios while learning about a charity that supports the vulnerable in D.C. Embrace an engaging atmosphere mixing finance insights with community spirit!
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Episode notes
Trend Following Powers Managed Futures
- Managed futures primarily use trend-following (time-series momentum) across many assets to capture persistent price moves.
- They exploit market behaviors that contradict strict efficient-market assumptions and benefit from trends that persist over time.
Use Managed Futures ETFs, Not Hedge Funds
- Use low-cost ETFs (e.g., DBMF) to access managed futures instead of expensive hedge funds.
- Expect fees around 0.8% for ETF replication, which is cheaper than traditional CTAs but costlier than passive index funds.
Returns And Diversification Tradeoff
- Managed futures returns generally sit between stocks and bonds and often charge higher fees than index funds.
- Their most valuable trait is near-zero correlation with stocks and bonds, making them strong diversifiers.
