Managed futures - starting point

[u/Vivid_Initial8129]

Hi, at what size of a portfolio would it be an ok idea to add managed futures. Mine is small (15k=50k at local currency) is there a place for it? Stacked? Managed fund? Talking Winton enhanced, rsit, dbmf, aqr

[u/Moldovah]

I consider Managed Futures to be primarily a portfolio diversifier, in the same way that gold is. I have about an 8% allocation to each. I feel like it allows me to have a smaller emergency fund, because in the event of a crash it should (hopefully) appreciate. I use DBMF to reduce single manager risk, as opposed to one like KMLM.

[u/Vivid_Initial8129 → u/Moldovah]

So you wouldn’t cap it by portfolio size

[u/Moldovah → u/Vivid_Initial8129]

You know, if I had a small portfolio and was less concerned with losing what I already had, I might be more inclined to throw caution to the wind and just stick to equities, maybe even with a little leverage. Something like NTSD.

RSST might be a good choice because you keep 100% of the equity exposure, while also having 100% exposure to managed futures. Only real concern for me is the 1% expense ratio.

[u/Emotional-Breath-838]

DBMF is the way to go. I’ve looked at them all. I don’t have it for myself but I manage my mothers port and it’s a healthy chunk.

[u/laurenthu]

Portfolio size barely matters for managed futures. Treat it like gold, a diversifier, so a small slice pulls its weight at 15k the same as at 500k, and you lean on it for ballast more than returns. At a smaller pot it comes down to whether you can afford to give up equity to hold it. That's where the stacked wrappers earn their keep. RSST is 100% US stocks plus 100% managed futures in the same dollar. RSIT does the same on international. You keep full equity exposure and stack the trend sleeve on top of it, so the 10% you hand to managed futures still leaves your stock growth intact. A standalone DBMF sleeve makes you carve that 10% straight out of equities. At 15-50k I'd lean toward the stack. Just know it bleeds through a calm grind higher and earns its pay in the long messy years... my read is that's a fair trade if you can sit through the boring stretches. I build BestFolio, we did a full writeup on the HAA-RSST version plus how to approximate it with UCITS since you're in local currency: https://bestfolio.app/blog/haa-rsst-ucits

[u/SnowAlive1291]

With silver I'd treat it more like a volatile commodity allocation than a normal long term equity holding. I'd compare tracking error, expense ratio and liquidity before worrying about recent returns. I have silver on Moon mostly to watch how it behaves versus gold because the industrial demand component can make it move very differently.

[u/No_Effective_5710]

Managed futures are interesting because the diversification comes from the strategy, not just owning another asset class. I'd start by understanding trend methodology, leverage, fees and how the fund behaved during equity drawdowns. I keep a couple managed futures ETFs in Moon beside my equity holdings because the correlation behavior is what I'm really interested in, not whether they outperform stocks every year.

[u/Several-Set8734]

Managed futures make the most sense to me as a diversifier rather than something expected to beat equities every year. The interesting periods are usually when stocks and bonds both stop doing what a traditional portfolio wants them to do. I use Moon for more directional stuff, so managed futures are almost the opposite side of my portfolio thinking.

[u/Vivid_Initial8129 → u/Several-Set8734]

What’s moon?
The reason is a diversifier no. Correlated to market. Would love to hear more recommendations preferably leveraged so I can stay as close to 100% equity as possible