Andrew Abraham

andy-0101 My name in Andrew Abraham. I have been investing in commodities and managed futures since 1994. I adhere to the philosophy of trend following. Trend following stresses a disciplined approach to commodity/ futures trading. Successful trend following and commodity futures investing requires patience, discipline and actively managing the risk. What sets me apart from other traders is that I am not only concerned about the return on investment but how much risk I will have to tolerate to achieve my goals.

Contact Details

If you are interested in contacting for speaking engagements. Please email me at Andrabr9@gmail.com or call 954 903 0638.

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Risk Warning

Futures and commodity trading involve substantial risk. The evaluations of futures and commodities may fluctuate and as a result, clients may lose more than their original investment. In no event should the content of this website be construed as an express or an implied promise, guarantee or implication by, that you will profit, or that losses can or will be limited in any manner whatsoever. Past results are no indication of future performance. Information provided on this website is intended solely for informative purposes and is obtained from sources believed to be reliable. Information is in no way guaranteed. No guarantee of any kind is implied or possible, where projections of future conditions are attempted.

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How to Handle the Long Draw Down in Managed Futures

I have been trading managed futures since 1994. This has been one of the most challenging periods ever. Not just due to the draw down but the duration of the draw down. I am not alone. I have spoken to many of the industries veteran traders who have been around since the 1980s and the general consensus is the same. One original Turtle trader told me that this is the worst he has ever seen in his career. We spoke and then he mentioned that potentially over the last 100 years this might not be so unique. Many commodity trading advisors have quit. Clients abandoned the field. Seems so many have thrown in the towel. Personally I have had clients leave. It truly has been a challenging period. Even the leading Long/Short Hedge have experienced a difficult period recently. Maybe the place to be is in cash.

Through numerous conversations with long time successful managers some ideas of how to handle the long draw down in managed futures have been crystallized.

1. Lower exposure ( I only risk between .4% to .75% on a position)…I have seen recently many managers close because they traded much larger than this.
2. Trade in smaller risk per trades
3. There are many who suggest developing shorter term strategies. I am not in agreement with this. Potentially even extend trading periods. ( I have several trading models, one in which is a long term trend following system & it has held up and is positive).

As much as past performance is not indicative of future performance…and it has been extremely tough…taking a contrarian stance, this might be one of the best times ever to invest in managed futures. This is extremely tough to do. I bought draw downs of some CTAs and their draw downs got even worse ( even to the extent of worst draw down ever).
We are dealing with uncertainty. We must accept the risks…We must have patience and discipline. The reality is that very few actually make money investing in managed futures as they do the wrong things. They buy a CTA when he is doing well and sell at the first inevitable draw down. There will always be losses and draw downs. This draw down however has been very tough…

Past performance is not indicative of future performance


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