Ernest Jaffarian: Why Every Institutional Portfolio Needs Exposure To Managed Futures

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Ernest Jaffarian is a 30 years veteran within the alternative investment industry. He started his career as a floor trader in 1986 and quickly become a lead market maker. In 1993 he co-founded a CTA and in 1999 he set up Efficient Capital Management, a pioneer in the Managed Futures space.

Today, Jaffarian’s dream has been happening as the CTA industry in its healthiest state he has “ever seen”, and institutions carving out CTA allocations and understand the differences to hedge funds. Jaffarian believes that the daily data that can be obtained from CTAs are much more useful than “monthlies” from hedge funds, and allows for better risk management. He also explains why CTAs shouldn’t be managed “like a hedge fund portfolio”.

Ernest Jaffarian: Why Every Institutional Portfolio Needs Exposure To Managed Futures

In this Opalesque.TV BACKSTAGE video, Jaffarian shares his views and experiences on a variety of themes such as:

  • Does “trader talent” exist?
  • Can mathematically created portfolios outperform the best multi manager portfolios?
  • Is Harvard Professor Dr John Lintner’s seminal 1983 paper on Managed Futures still true?
  • What’s the degree of diversification CTAs offer?
  • How comes Managed Futures are uniquely suited to build, manage, and maximise portfolios?
  • The role of risk management
  • How Efficient Capital researches and selects CTA managers
  • Why Efficient Capital remains 100% dedicated to CTAs and why every institutional portfolio needs exposure to managed futures
  • The five most common mistakes investors do when investing in CTAs
  • A roadmap to successful investing in managed futures
  • How managed futures have evolved since 1993
  • Product innovation: Accessing multiple manager exposure through a single manager structure can pave the way for institutions that otherwise may not be able to invest.

Ernest Jaffarian is the Founder, President and Chief Executive Officer of Efficient Capital Management, LLC (Efficient), chairs the Executive Committee, and is a member of the Executive Management Group.

In 1986 he joined Chicago Research & Trading Group (CRT) as a member of the proprietary trading group on the floor of the Chicago Board Options Exchange (CBOE) and rose to position of Senior Vice President for OTC Treasury Options. Immediately prior to founding Efficient, Mr. Jaffarian was responsible for the managed futures department of Hull Equity Management, LLC and for the allocation of Hull Trading Company, LLC’s proprietary capital among trading advisors.

He graduated from the University of Oregon in 1974 with a B.A. in History. Mr. Jaffarian holds a Series 3 license, is a Chartered Alternative Investment Analyst Designee (CAIASM), and is a 30 years veteran within the alternative investment industry in the areas of trading, portfolio construction, and risk management.

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