Home | Finance | Investing

The Role Of A CTA, Commodity Trading Advisor

By: Dwayne Strocen

Commodity Trading Advisor, Genuine Trading Solutions, a registered CTA with the CFTC, says the role today of a CTA is constantly evolving.

Dwayne Strocen, President of Genuine Trading Solutions says once upon a time a Commodity Trading Advisor was content to be known as a Portfolio Manager trading commodities and futures for a managed futures fund. There is no question today’s investor has become more sophisticated. In response, today’s selection of investment products has become ever more complex and varied, the need for the CTA to understand the uses and management of these products becomes even more acute.

So what exactly is the role of today’s Commodity Trading Advisor. Certainly trading of derivative products for a managed futures fund continues to be as important as before. A CTA has also become more involved with derivative analytics. This role is essentially focused upon becoming an analyst to structure and analyze the more multi-faceted requirements demanded by hedge funds, pension funds and structured products.

The use of derivative analytics to manage the adverse risk of an equity or bond portfolio brought about by adverse market conditions is critical in preserving asset growth. The uses of hedging to prevent volatility has long been understood by the largest institutions but is now available to the smaller sized company and to the individual investor. No doubt as products continue to evolve so too will the CTA evolve to meet the need of today’s professional money manager.

Derivative products are no longer limited to exchange traded commodities futures and options. There continues to be an ever expanding list of over-the-counter derivative products. These are SWAPS. SWAPS and privately transacted products transacted without the use of a recognized exchange. The difficulty is the buyer and seller must find each other to undertake such an arrangement, not always easy. The second problem is no liquidity. There is no one to sell this too should one of the parties wish to terminate the transaction prior to the agreed upon date.

A Commodity Trading Advisor’s role is no longer sufficient to be limited to trading. It is now imperative to understand the industry in a new light so to understand the changing investment environment. Analysis now becomes the catalyst to include a value added service to retain customers. This includes structured products, risk management and OTC derivatives. Continuing education has been and continues to be the hallmark of the best in the industry.

Article Source: Main Articles

Dwayne Strocen is a registered Commodity Trading Advisor specializing in analyzing and hedging Market and Operational Risk using exchange traded and OTC derivatives. Website: www.genuineCTA.com.

View more detailed information about Commodity Trading Advisor and understanding How to Trade Commodities.

This article may be reproduced wholly or in part without written permission provided the byline, resource area, and any hyperlinks remain in order to give proper credit to the author.

Internet search engines and directory listings are imperative to your sites existence and success. Submit Your Website to the Searchen Networks directory and search engine to achieve authoritive inbound links.

Please Rate this Article

Click the XML Icon Above to Receive Investing Articles Via RSS!

Additional Articles From - Home | Finance | Investing

	Print This Article
	Post Comment
	Add To Favorites
	Email to Friends
	Ezine Ready

	Submit Articles
	Member Login
	Top Authors
	Most Popular Articles
	Submission Guidelines
	Ezine Notifications
	Article RSS Feeds

	New Stuff
	About Us
	Link to Us
	Contact Us
	Privacy Policy
	Terms of Service

:: Top Author Businesses:

Try your luck, Play BlackJack

:: Our Supporters: