FAQ2022-09-24T22:37:41+00:00

Your questions on managed accounts answered

I’ve put together some commonly asked questions to give you more information about managed accounts and investment solutions I offer.

If you have a question that you can’t find the answer to, please use the contact page.

NOTE: Clicking on the question will reveal the answer. You can also switch between different sections.

How Much Taxes Do I Pay?2021-04-12T18:54:42+00:00

You pay taxes only from the net profit you received (you don’t pay taxes from my share). The tax rate depends on your country of residency.

What Type of Investments Do You Use in my Managed Account?2021-04-12T18:53:19+00:00

Managed portfolios are constructed using exchange-traded instruments, like stocks and futures. Due to their structure, they are low-cost, transparent, and tax-efficient, providing the ideal investment vehicles for my managed accounts.

What Is Managed Futures?2021-04-12T18:34:10+00:00

Managed Futures is a subset of the alternative investment industry. It allows investors to get access to the institutional level of investment services. All trading decisions are taken by authorized traders who invest in derivative markets like futures, commodities, options, etc, and have deep knowledge of the market structure.

Is Managed Futures the Same as Commodity ETFs?2021-04-12T18:29:45+00:00

No. Commodity Exchange Traded Funds (ETFs) are funds in which an investor may own a slice. Also, an ETF is a security that tracks an index, a commodity, bonds, or several assets like an index fund. Managed accounts have a number of benefits over an ETF, including higher returns.

Are Futures, Options, and Commodities Risky?2021-04-12T18:22:32+00:00

There is risk in all trading and investing. Let no one convince you otherwise. Futures may be used in aggressive or conservative ways. While drawdown is not the only measure of risk it is one of many helpful metrics for evaluating a manager’s past performance management of risk. In fact, the agricultural sector (futures) is less risky than tech stocks. Because they are more supply and demand-driven. thus, less volatile and less speculative.

I’m Already Diversified in Stocks and Mutual Funds. Why Do I Need Managed Futures?2021-04-12T18:15:09+00:00

There are many factors that may cause all stocks to rise and fall at the same time (i.e. high correlation). Managed Futures as an asset class has a very low correlation to stocks or bonds giving you another basket to put an egg.

Besides, futures like the agriculture sector are less speculative and more supply and demand-driven. In other words, they offer a higher winning rate.

What’s The Difference Between Managed Futures and Managed Futures Mutual Fund?2021-04-12T18:27:05+00:00

Pay attention that Managed Futures mutual funds are a new product that offers shares of a fund that is managed by one or more CTAs. So in theory, you should be able to get the same risk/reward opportunity as they do, but the reality is way different.

The structure of managed futures is more beneficial for all parties involved. For example, separately managed accounts, generally, have lower fees because you’re not paying for the legal and administrative cost of a security product in a fund or pool. Thus, managed futures have many advantages:

  • Better liquidity
  • Better transparency
  • Lower cost
  • Greater returns
  • Greater flexibility
  • Greater security and accountability
How Accessible Is The Money In a Managed Account?2021-04-12T18:04:12+00:00

Futures are very liquid. So, you may be able to access your funds very quickly. Besides, I do not have a lock-up period. And at your direction, I can liquidate your positions at any time giving  you quick access to cash. Clients can withdraw their funds at any time directly from the FCM without prior approval from me.

What Is Managed Discretionary Account (MDA)?2021-04-12T18:00:46+00:00

Managed Discretionary Account is the account for which the customer gives the other person or register representative authority to trade on his behalf without having to pre-approve trades with the account owner.

What is Unified Managed Accounts (UMA)?2021-04-12T17:53:21+00:00

The term Unified Managed Accounts (UMA) is usually referred to reporting solution that brings together all types of investment vehicles in an investor’s portfolio. Essentially, it’s a platform that provides a single overview of all the investor’s portfolio including SMAs, IMAs, term deposits, cash, property, and a range of other asset classes.

What Are The Benefits Of Using Managed Accounts?2021-04-12T17:49:57+00:00

Managed Accounts are a far more efficient way to have managed portfolio for the following reasons:

  • Systematic balancing of investment risks relative to returns.
  • Underlying shares are owned, not units in a fund.
  • Access to professionally managed investment options.
  • Online access and consolidated reporting.
  • Full-time, attention by trader with a proven track record.
Can I Withdraw My Money When I Wish To?2021-04-12T17:32:32+00:00

I have no control over your investment. You are free to withdraw your funds whenever you wish to.

When Are performance Fees Applied?2021-04-12T17:25:03+00:00

Performance fees will be calculated at the end of every billing month, as long as there are profits on your account that exceed the high-water mark.

What Is A High Water Mark?2021-04-12T17:25:44+00:00

It is the highest peak in value that an account has reached. The high-water mark has to be exceeded before any future profit share may be calculated again.

For Example – If you opened an account with $100 000 and the performance fees were 50%.

If your profits during the next month were 10%, that would be $10 000 profit for the month.

Performance fees of 50%, which is $5 000 leave you a $5 000 net profit for the month.

Your high-water mark would be $105 000 (if you withdraw $5 000 from the account to pay a trader) which is the original $100 000 plus the net monthly profit of $5 000. If you keep all profits on the account and pay my share from a different source, your high watermark is $110 000.

If you had a loss the next month of $3 000, no performance fees would be paid. Only when your account balance surpasses your high water mark of $105,000, performance fees should be calculated and a new high-water mark will be established.

Who Owns The Account?2021-04-12T16:53:46+00:00

The investor owns and controls the account. I don’t have any direct access to investor’s accounts. Also, the account owner can see all running trades and has access to a wide range of reports. The investor can withdraw funds at any time.

Can I Deposit More Funds Whenever I Want?2021-04-12T16:51:17+00:00

Yes, it is totally up to you.

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