Press Play Series

BY EQUINOX FUNDS


The Award Winning Press Play Series from Equinox Funds is a mini-series dedicated to explaining complicated topics in an engaging, succinct, and simplified manner. Scroll through our six part series below.

Equinox Funds wins three Web Marketing Association 2018 Internet Advertising Awards (View Press Release)

  • Best Investment Integrated Ad Campaign (2018) — The Press Play Series
  • Best Financial Services Online Video (2018) — Investor Behavior
  • Best Investment Online Video (2018) — Investor Behavior

episode one

Managed Futures

Managed futures strategies, in the hands of experienced and skilled CTAs, have the potential to generate returns with typically low correlations to most other asset classes. Historically, managed futures strategies have performed well as part of a diversified portfolio.

  • Managed futures can potentially provide long-term diversification benefits when added to an investment portfolio.
  • A CTA is analogous to a traditional money manager in the sense that a CTA is trading futures contracts, while a traditional money manager generally only trades stocks and/or bonds.
  • In 2009, Equinox Funds created the first managed futures mutual fund, providing investors with the opportunity to access an actively-managed portfolio of CTA programs through a familiar investment vehicle.

episode two

Trend-Following

Trend-following is a systematic, diversified, and reactive trading strategy in which trading decisions are based only on price.

  • Trends can be established based on various time frames. For example, a short-term trend-following program may look to identify trends that are limited to a few days, whereas a long-term trend program may be looking for trends over several months.
  • Systematic trend-following is the most common managed futures trading style.

episode three

Correlation

During equity bull markets, an investor’s natural reaction is to aim to capture as much of that climb as possible (in the form of investment returns). However, because we can’t see into the future, your Advisor will likely advise diversifying your portfolio with investments that have low correlations to equities.

Investors solely allocated to stocks during the financial crisis of 2007 would have likely seen their portfolio reduced by half.

  • A correlation coefficient is the numerical measure between -1.00 and +1.00 that indicates the difference (or similarity) in the returns earned by two investments.
  • Investments that move in perfect lock-step with one another will have a correlation of +1.00, while investments that move perfectly opposite of one another will have a correlation of -1.00.
  • Completely unrelated investments will have a correlation of zero, and are said to be perfectly uncorrelated.

episode four

Investor Behavior

We can point out or identify cognitive biases in others, but we typically fail to recognize our own cognitive biases. This is called the Bias Blind Spot. Keep this in mind the next time you find yourself thinking, “Yeah, but I would never do that…”

  • The Projection Bias is the tendency for people to assume that whatever is happening in the current moment, will continue into the future.
  • The Action Bias is the belief that doing something is better than doing nothing.
  • Herding is characterized by a lack of individual independent decision-making or thoughtfulness. This can result in people behaving in line with the herd as so not to be left behind or left out.

episode five

Hedging

A hedge is something that offers potential protection against an unforeseen outcome of loss.

  • Common everyday examples of "hedging" against potential pitfalls.
  • How and why hedging can help investors rest assured during times of market volatility?

episode six

Investor Behavior II

George and his friends are back in Investor Behavior II, an alternate ending to the original award winning Investor Behavior video.

  • Let’s take a look at that how that same situation may have played out if George took the time to connect with his Financial Advisor, instead of letting his emotions get the better of him.
  • “George, I’m so glad you contacted me, I’m aware of yesterday’s decline and was worried that folks may be nervous.”
  • This time around, George’s barbecue interaction with his friends sets off a different chain of events… “I wonder if George’s Advisor is taking new clients?”