Managed futures returns mixed in 2016

Managed futures delivered disappointing results in terms of net returns over the 12 months ending 31 October 2016, according to Zenith Investment Partners' sector review.

The study also showed that the returns across the global macro/absolute return peer group were stronger.

However, according to Zenith head of alternatives research, Rodney Sebire, both groups struggled to "extract meaningful returns from traditional asset classes", at a time when equity markets provided a challenging environment with a few ‘bouts of euphoria' which were offset by episodes of extreme risk aversion.

Throughout the year, global equity markets were down approximately 5.7 per cent and the return pattern remained volatile and heavily sentiment driven.

"Managed futures produced a disappointing year in terms of net returns, with Zenith's rated managers producing an average return of -3.2 per cent for the 12 months ending 31 October 2016," Sebire said.

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"In terms of the global macro peer group, performance was stronger with an average return of 3.5 per cent over the same period."

Zenith also stressed that with RG 97 on the disclosure of fees and costs in product disclosure statements (PDSs) and period statements coming into effect in February, the disclosure requirements for managed investment schemes were about to increase, which would add further intensity to the fee debate in coming months.