A few weeks ago we posted on Mack Frankfurter of Cervino Capital’s recent discussion of managed futures and whether or not it is an asset class. Mack argues that it is not, resting his case on the logical fallacies prevalent on the other side of the debate. When considering why managed futures were often described as an asset class, Mack’s explanation was simple: people are lazy.

Mack’s Cervino Capital is one of the CTAs we track, and we have a lot of respect for him and his program, so his comments gave us pause. Mack is not alone in this assessment. As Mark Kritzman of Windham Capital Management speculated in 1999,

…some investments take on the status of an asset class simply because the managers of these assets promote them as an asset class. They believe their investors will be more inclined to allocate funds to their products if they are viewed as an asset class rather than merely as an investment strategy.

We frequently refer to managed futures as an asset class on our blog and in our newsletters, so we had to wonder… were we just being lazy? Is “asset class” the wrong descriptor for managed futures?

We decided to research the idea to make our own, informed determination on the subject, but realized as we began our quest that a key ingredient was missing from the equation. It was absent from almost every piece we found, including Mack’s.

We were missing a good definition of an asset class.

How is an asset class defined? Does managed futures fit the bill? Click here to read more: https://bit.ly/ijnY6j