.jpg)
When investing in managed futures, how easy is it to beat the benchmark? Everyinvestment is judged on how well it does not only on an absolute basis, but also rela- tive to a benchmark. In addition to generating profits, the goal of any investmentis to beat the benchmark. If you beat the benchmark, whether by luck or skill, you will be viewed as a genius and will be compensated accordingly. If you deviate from a benchmark and fail to add value, you will look foolish and be exposed to significant career risk. As investment professionals, we live with this reality on a daily basis. It is the nature of the game and we accept it. We would all like to think that we can beat our benchmarks. We work hard to create investment processes, follow rules and take calculated risks - all with the purpose of achieving that goal. When the work is done and we see favorable results, we start to believe that outperformance of the bench-mark is indeed easy.
Click here for full details of a paper detailing the benefits of investing in Indices.
