Recent Work

From Investment Advisor/ThinkAdvisor.com: 

Will Robo-Advisors be Terminated?

A Silver Lining of Compressed Fees: Alts are Thriving

12 Worst Financial Advisors In America: 2016

Businesses Salivate Over Trump’s Tax Ideas, But Will They Happen? 

Tech Winners, Losers Under Trump Administration

Collectibles Market: More than a Labor of Love, Potentially very Lucrative

Organized Crime has Gone Online and Hackers are Looking at You

REITS Poised for More Gains, Driven by Demographics

Farmland: An Increasingly Popular Alternative Investment

Bad News for Energy Bulls: Slowing Demand and Increasing Supply

From Morningstar ETF Conference 2016:

Mstar: ETFs: An Easier Way to Roll Into Retirement

Mstar: Pundits see More ETF Growth; Less Active Management

Mstar: Emerging Markets are Definitely Remerging

Mstar: Learning to Love Smart Beta

Mstar: 8 Facts & Fictions of Momentum and Value Investing

REITS are Outperforming, but some Sectors Stronger than Others

How Long Can this Gold Rally Last?

E*Trade’s OptionsHouse Buy Might be Right Timing

Why a Falling Dollar doesn’t always mean Big Gains for Commodities

11 Medicare Mistakes to Avoid (slideshow)

Real Estate to become its own Sector

15 Worst Cities for Retirement: 2016 (slideshow)

15 Best Cities for Retirement: 2016 (slideshow)

Perez Shrugs off Fiduciary Rule Lawsuits

Here’s Why Advisors Should At Least Consider Managed Futures

Persian Rugs: Still Priceless or a Magic Carpet Ride to Nowhere?

Stock Picking is more than Numbers Game – Morningstar 2016

Vanguard’s McNabb: DOL Got It Right, Get Used to Shrinking Fees – Morningstar 2016

Using Behavioral Goals to Help Clients Discover Goals and Set Priorities – Morningstar 2016

High-Yield Bonds: Only for Long-Term, Non-Squeamish Investors – Morningstar 2016

Market Timing Costs Investors Big: Dalbar

Private Equity: Greater returns, Greater risks

Why China’s slowdown won’t crush commodities markets

Timber: A sustainable investment that should not be overlooked

Industrial Metals: Often more precious than gold

How to invest with the best and brightest commodity traders

Collectible cars are no joke. Just ask Jerry Seinfeld

Will SEC Crash Liquid Alts Party?

Energy crash: Is it time for investors to jump in?

Putting the Hedge Back in Hedge Funds

A China Play Far from the Volatile Stock Market: Collectibles

Why Investors Shouldn’t Ignore the Power of the Sun

Land Ho! Real Estate can Thrive as Even Rates Rise

Diamonds truly are Forever, and a Good Long-Term Investment

Managed Futures: How to Get Exposure to Commodities Without Taking Delivery

Water Investments are Everywhere and Run Deep

How Investors can Grab ‘Return Gap’: Research Affiliates’ Hsu

ETF Experts: Hedging Currency is Cheap, Prudent and Getting Easier

China: Short-term Gamble, Long-term Necessary Investment

Bleak Energy Picture to Brighten in 2016, but Volatility to Remain

The Future of ETFs: Volatility, Rate Hikes and Robos

From The Trade Derivatives: Spring 2017

The Great U.S. Options Octopus

The US options market is a conundrum. Although volumes have remained flat over the past five years, the number of exchanges has expanded to 14, with the potential of another opening just around the corner. During this time, the number of market-makers has dropped dramatically, from about 60 market-makers quoting on multiple exchanges five years ago to only 15 today. Read more

From CTA Intelligence, March 2017 (Paywall)

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FCMs still haunted by the past

Like the rattling chains of Jacob Marley haunting Scrooge, the ghosts of MF Global and PFG still wander the halls at futures commission merchants today and remain alive and well in the manifested actions of CTAs who diversify their funds among brokers. But realities exist: there are fewer FCMs in…Read More

Opening a new door on an old CTA business

Last year, Chris Hehmeyer got more than he expected when he went to dinner and a Blackhawks hockey game with some long-time friends from Kottke & Associates, a Chicago-based trading firm. At one point during the evening they asked Hehmeyer if he would be interested in buying their firm. Hehmeyer…Read More

From CTA Intelligence, September 2016 (Paywall)

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Swimming Ahead of the Current: Profile of Bill Eckhardt

The corner of Ellis Avenue and 57th Street, which lies in the heart of University of Chicago’s Hyde Park campus on the city’s south side, now competes with The CME Group in importance for at least one trader on Jackson Boulevard. The William Eckhardt Research Center opened to UC students last year as a science hub dedicated to investigation of the deepest cosmic mysteries to manipulations of matter on the scale of atoms and molecules. Its benefactor is an alum (SM’70) who decided to gift $20m of his futures trading gains in support of advanced science at the university.

“It’s a good mixture of theory and practice and that is why I made the choice,” says Bill (William) Eckhardt, head of Eckhardt Trading Company (ETC), which has been a CTA since 1991.

He got into the business when an old High School friend, Richard Dennis, a legendary trader himself, urged Eckhardt to use those UC smarts and trade futures on the floor.Eckhardt did trade on the floor for three years in the mid-1970s, while at the same time building a business, C&D Commodities, with Dennis.But it was when he moved upstairs in 1978, that he says his real trading began. (More, Paywall)

The Trade Derivatives (Summer 2016, page 52)

The Future of U.S. Rates

US Treasury dealers may be kicking and screaming on their way to a mandated market infrastructure change, but they aren’t the only ones affected. Read more.

From CTA Intelligence, June 2016:

Fending off the hacker threat

In February 2016, cyber thieves hacked into Swift, the global bank network used to authorise payments from one account to another, and stole $81m from one of Swift’s weakest points: the Bangladesh central bank. And that was just one attempt that was successful.

Swift is not a bunch of tubes held together with wires: it is a sophisticated network owned by the world’s largest banks and corporations who know a thing or two about protecting themselves against cyber-crime. However, this heist was done by old fashioned bank robbers who used modern technology to implant malware into a weak link within that network. So, if Swift can be hacked by modern day Butch Cassidy’s, what chance does a CTA have to keep bad guys out of their business?

Among CTAs and quant firms, the target for hackers is client data, proprietary algorithms and strategies, operational codes and other factors that are the lifeblood of these businesses. (Read more) paywall

From CTA Intelligence, May 2016:

Living in the new reality

After dealing with the massive shake-up brought upon the banking sector in the wake of Dodd-Frank and Basel III regulations, over the past year bank FCMs have not only had to work on revamping balance sheets, but review their client base too. Most significantly, bank FCMs have had to – and will continue to – deal with the constraints of efficiently using capital, and this means having to off-load unprofitable customers. Non-bank FCMs will continue to take the overflow and accept the smaller CTAs. It appears to be something of a symbiotic relationship in that despite the drop in FCM numbers, those still standing seem to be getting stronger.

Despite some outcry over the new regulations, overall the change has not hurt the largest firms in terms of segregated funds.In January 2016, the nine largest FCMs by customer segregated funds were all bank-owned, with only ADM Investor Services (Admis) representing non-bank FCMs in 10th spot, data compiled by the CFTC shows.

The total customer segregated funds held by the top ten totalled nearly $122bn, a similar figure to the 12 months earlier. Total segregated funds dropped only slightly year on year, from roughly $169bn to $167bn. The top 10 US clearing brokers now hold roughly 73% of customer funds, up from 67% a decade ago. And the number of FCMs has been rapidly consolidating, now at 72. Read more  (paywall)

CTA Intelligence, March 2016

From CTA Intelligence, March 2016:

Coming of age for ‘smart-beta’

For years CTAs have been touted as alpha-producing systematic trend-following programs and have charged accordingly. But after much scrutiny, consultants, researchers and even other CTAs have determined that much of what makes up these strategies is actually beta and demands lower fees. However there is gold in that beta as institutional clients who previously couldn’t afford the programs are asking for trend-following exposure in a big way.

Whatever name the strategy is given: smart beta, enhanced beta, alternative beta, exotic beta, risk premia or core trend, it appears to have gained huge interest in the last few years amongst institutional investors, consultants and CTAs. Many CTAs might dismiss the thought that their “secret sauce” trading programs are being reduced to a mere trend-following model that gets paid only 50 basis points a year.

But the truth is new money that may never have entered the CTA space due to fee restrictions, has now been introduced to this asset class because of smart beta programs. Read more (paywall)

From CTA Intelligence, February 2016:

Getting Inside the Consultant’s Head

Pension funds – even the largest – are increasingly using investment consultants to help recommend and manage parts of their multi-billion dollar investment portfolios. After all, these public companies are typically minimally staffed, and some say, because of the moderate pay level, don’t attract the finest investment minds to manage the lot. Read more (paywall)

From CTA Intelligence, December 2015:

Embracing managed futures

For years public pension plans, those that safeguard the retirement nest eggs of teachers, fire and police officers and state employees, have nibbled at managed futures investments.

Corporate and private endowment plans were more aggressive, finding new asset pools and management strategies that helped them push the envelope, both in garnering alpha and reducing beta.

For the most part, public fund investment committees looked on, fearful, reticent or uneducated on how to take that step.

But 2008 opened the broader public pension world’s eyes to the positives that managed futures could offer: transparency, liquidity, and yes, performance that didn’t correlate with their normal set of investments: equities and bonds…Continue Reading (paywall)

From CTA Intelligence, August 2015:

Esulep: Grinding Out Results by Measuring Risk First

Matt Peluse seeks challenges but is risk averse, and if these two traits seem at odds, they shouldn’t.

Peluse, principal of CTA Esulep in Chicago, believes in the long game, and his slow, steady methods – and returns – have produced an almost impossible result: a near perfect track record since the firm launched in April 2008, except for two negative return months in 2009.

At first this seems too good to be true, and Peluse says he spends most of his time proving his concept – and method – to potential investors. Continue Reading (paywall)

From ThinkAdvisor.com, 2015 Morningstar Conference coverage:

Sustainable Investing: No Longer a Backwater

Expect Shakeout Among Robo Advisors, but Embrace Them Now

Risks and Rewards of Frontier Market Investing

Bond Investing: Finding Opportunities takes Patience

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From CTA Intelligence, July 2015:

Rise of the MAPs

In the managed futures community, it appears the managed account platform (MAP) is the ‘new black’. Ever since AlphaMetrix went supernova, several new players have burst onto the scene. How they differ has caused some confusion among CTAs, many of whom are now being approached by MAPs and are trying to answer the questions: what exactly is a MAP and is being on one good for my business?

“[To be a true MAP] requires lists of multiple programs that give users of the platform a choice
[of manager], gives a user a means to get into the investment, and operates the investment for the user and has some degree of reporting on that investment. “If you don’t fit those [qualifications], you shouldn’t
be saying you’re a platform,” says Jon Stein, CEO of Chicago-based Typhon Access, which operates the Hydra MAP.

Many platforms have been developed by large banks for internal use for their clients, and many of those focus solely on hedge funds. A smaller group includes hedge funds and CTAs, and an even smaller group is CTA-centric. From there the breakdown is simpler. Behemoth MAPs include bank platforms, such as Deutsche Asset & Wealth Management’s (DeAWM) $11.4bn hedge fund platform, Societe Generale’s $7.7bn Lyxor platform and Man Group’s FRM. These host hedge funds and CTAs. Then there are the pseudo-independents: those MAPs that are developing certain niches and are more accessible to the sub-$100m in AuM, or emerging CTA. Continue Reading (paywall)

From Inside Advantage, Spring 2015

Is Pro Rata an Accident Waiting to Happen?

The New Year surprise happened fast: the Swiss National Bank announced on January 15 that the Swiss Franc would no longer be capped by the Euro and it jumped 41% in minutes. This black swan event happened just before a U.S. holiday when traders were already winding down for a three-day weekend. Those left trading included a combination of retail players, banks and some prop firms. And the market went into a frenzy. Continue Reading

From CTA Intelligence, March 2015:

ABCs for FCMs

Any broker will tell you it’s not an easy business and the numbers reflect it: during the past 10 years, the number of US futures commission merchants (FCMs) has fallen by 60%. Today there are 79 registered with the National Futures Association (NFA). Many factors have been at play: the drying up of interest income, mergers, acquisitions and failures, the proliferation of rules and regulations, the financial crisis that chased many a client away, and commissions dropping while exchange fees rise. Technology, which has increased the speed of trading and made the markets more accessible, has also come at a cost.FCMs spend to not only keep up with customer needs and competition, but also to meet exchange and regulatory requirements.Still, this is not a doomsday scenario. The retrenching of the business shouldn’t be looked upon as the number of firms, but the strength of the balance sheets. continue reading

From AllAboutAlpha.com, December 2014:

Case Study: Straits Gives Managed Futures a Facelift

When the JOBS Act is discussed in managed fund circles, it’s typically due to its elimination of the ban on general solicitation and advertising by capital raisers, such as hedge funds. Obviously that’s a big plus, but another part of the Act that gave a lift to private placement funds was the increase to 2000 in allowable accredited investment holders. Previously, going over 500 investors triggered onerous reporting requirements under the Securities Exchange Act of 1934. The JOBS Act was passed in early 2012, and signed into law in 2013. That timing was perfect for a team of investment experts who were looking to expand their product base. This is their story. Continue reading…

From InsideAdvantage, Fall 2014 issue:

Will High-Frequency Trading force a market redesign?

Notwithstanding the evident benefits of HFT in electronic markets, many market participants have argued that some HFT practitioners utilize trading techniques that are detrimental to the well-functioning of financial markets. Some of the trading techniques are spoofing, layering, and quote stuffing.

Chicago Federal Reserve paper: Recommendations for Equitable Allocation of Trades in High Frequency Trading Environments,
July 10, 2014

In late August 2014, CME Group issued a regulatory notice defining and providing examples of “disruptive practices” prohibited on the exchange. These infractions were noted in the Chicago Federal Reserve paper as well as prohibited by the Dodd-Frank Act. However, what’s key about Rule 575, is it doesn’t so much outline new rules as finally give market participants seeking to comply with all market regulations somewhat more guidance about what constitutes bad faith trades. Continue reading…

From the Horizon Cash Management Fall 2014 Focus Special Report:

To the unschooled, emerging commodity trading advisors evoke thoughts of a lone trader setting up shop, hanging out a shingle and hoping to raise assets. But that’s an old view of emerging managers, who today often have long and strong pedigrees, are well financed and surround themselves with key personnel to run the business. And these changes could be the sign of the times with billions of dollars available for investment that won’t settle for anything less than a trader who also is smart in business. Focus on emerging managers

From CTA Intelligence, October 2014:

Inside the fall of AlphaMetrix

Representatives from the Abu Dhabi Investment Authority (ADIA), including Khalif al Mehrie, executive director of alternative investments and other senior staff, were in the Fountainebleu Hotel room in MIami waiting to discuss allocating money to AlphaMetrix.

That was when the firm’s CEO Aleks Kins stumbled in late, those present say. To read more, go to CTA Intelligence.com

From the NIBA Journal:

Two Minute primer on leveraging your brand

I’ve met many traders, brokers, and introducing brokers having covered the derivatives arena for 30 years. Some have been memorable, some not. Typically why they are memorable is for a few reasons: a) performance, especially as a trader, b) what sets them apart, that is, what makes them special, especially as a broker, and c) keeping up the relationship, in other words, they continue to keep in touch even if they don’t see an immediate benefit.

From Spring 2014 issue of Inside Advantage

In-House Im-Prop-er Trading: Proceed with Caution

MF Global is one of the more blatant examples of the danger of banks and brokers engaging in proprietary trading while also servicing client trading. In that case, monies from once seemingly secure customer segregated funds on the futures commission merchant side of the business were used to fund the firm’s broker/dealer proprietary trading – at least for a while. But those pesky regulators got in the way and the business collapsed, and along with it, customer funds went missing.

From AllAboutAlpha.com

Frank Pusateri has found there are two types of emerging managers: those who are just starting out, and those who have been around, even might have a couple hundred million under management, but only a few clients and want to expand that base.

Shattering the Myth of the Emerging Manager

From AllAboutAlpha.com

No matter which side you’re on in the hyperbolic debate on high frequency traders that Flash Boys has caused, or even if you aren’t on a side, read this book. As with all Michael Lewis’ work, it’s a great read and gives a front row seat to the inner workings of Wall Street, a different take on its players and uncovers the sickness of today’s stock market.

Unintended consequences: a not-so-random walk down Wall Street

From AllAboutAlpha.com 

n 2010 AlphaMetrix held a conference in Miami with Harry Markopolos as the keynote speaker. Markopolos’ claim to fame is that he told the regulators about Madoff”s Ponzi Scheme, but his words fell on deaf ears. In 2013 AlphaMetrix, which claimed to the be the transparent antidote to Madoff stood accused by the CFTC of moving money in ways it ought not and in 2014, the principals of the firm are asking for a jury trial. It is indeed a tangled web and it is unlikely to be un-weaved any time soon.

AlphaMetrix: We did nothing wrong!

 

Commercial releases,  sponsored marketing, blogs:

How to Sell Against Amazon.com

Internet Retailer sponsored insert, featuring three case studies by firms selling against Amazon:

2016-ir-how-to-sell-against-amazon

How to Select a B2B e-commerce Technology Partner

Internet Retail published a special issue on selecting the right technology partner. Here is case study:

Smith sponsorship piece

 

Sample blogs:

DMAXX blog series 

Sample of press releases: 

Coquest purchases Mega Capital

Energy broker Coquest Inc. recently finalized its purchase of Mega Capital, an introducing broker that specializes in managed futures. What does it mean?

mega capital purchase-1

Other releases: Coquest Advisors

Coquest Managed Assets Launched

Celoxica and Born Technology collaborate to provide institutional traders ultra low latency access to the CME Group

Speaking engagements: Have been moderator or panel guest for CTA Expo, Profit & Loss Magazine, Trader’s Expo, and The Traders Conference, as well as other global conferences.

CTA Expo

I was part of a great PR and Marketing panel at the CTA Expo in New York on April 30, 2014. My topic was how emerging managers can get the word out with better marketing through media. Presentation power point: Do’s and Don’ts of Getting Ink ctaexpopresentation

 

 

 

 

 

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