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Newedge CTA Index 20 Month Draw Down Worst on Record

How do you take this fact… Newedge CTA Index 20 Month Draw Down Worst on Record …a time to exit managed futures …or a time to be a contrarian? Personally as much as past performance is not indicative of future performance this statistic encourages me even more. The truth is we are only dealing in uncertainty, however when articles like this present themselves in conjunction with so called Market wizards leaving the space I am encouraged. I do not have a crystal ball and this draw down can easily continue, however human nature also continues. Trend following is not dead. Trend following worked for Richard Donchian for almost 50 years. I am sure it was never easy or a walk in the park. I am sure he always had losses and long duration’s of draw downs…however …when he least expected it…Donchian stumbled into trades that trended more than he expected. Statistically which really means nothing, it is not abnormal to have 2-3 periods of not making money in managed futures. Time will tell …however I am betting on managed futures and trend following.

Past performance is not indicative of future performance

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