Managed futures are alternative investments consisting of a portfolio of futures contracts that are actively managed by professionals.
Large funds and institutional investors often use managed futures as an alternative to traditional hedge funds to achieve both portfolio and market diversification.
Two common approaches to trading managed futures are the market-neutral strategy and the trend-following strategy.
Market-neutral strategies seek to profit from price-induced spreads and arbitrage, while trend-following strategies seek to profit by going long or short according to fundamentals or technical market signals.