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Trading Systems vs. Hedge Funds

Writer: Kyle SchultzKyle Schultz

Updated: Sep 1, 2021

Traditional hedge funds are not accessible to many small investors. Although hedge funds are typically glorified in the media with an air of secrecy, they are really not that appealing for the ordinary investor anyways. By contrast, trading systems can provide similar hedge fund strategies to the everyday investor while lowering the account minimums and fees, and providing full transparency into holdings and trades. While trading systems such as Algorithmic Futures are very similar to hedge funds, here are the main differences:


Hedge Funds:

  • High Minimums - Investment accounts of more than $1 million

  • Accredited Investors - Only available to individuals with $2 million of net worth

  • Lack of Transparency - No access to holdings or trades (monthly or annual reports)

  • High Fees - 2% management fee and 20% performance fee


Trading Systems:

  • Low Minimums - Investment accounts as low as $20,000

  • No Restrictions - Available to all individuals regardless of net worth

  • Full Transparency - Access to daily holdings and trades in your account

  • Low Fees - Flat monthly or annually fee




 
 
 

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Required Disclaimer - Commodity Futures Trading Commission: Futures and options trading has large potential rewards, but also large potential risk. You must be aware of the risks and be willing to accept them in order to invest in the futures and options markets. Don't trade with money you can't afford to lose. This website is neither a solicitation nor an offer to Buy/Sell futures or options. No representation is being made that any account will or is likely to achieve profits or losses similar to those discussed on this website. The past performance of any trading system or methodology is not necessarily indicative of future results

CFTC RULE 4.41 - HYPOTHETICAL OR SIMULATED PERFORMANCE RESULTS HAVE CERTAIN LIMITATIONS. UNLIKE AN ACTUAL PERFORMANCE RECORD, SIMULATED RESULTS DO NOT REPRESENT ACTUAL TRADING. ALSO, SINCE THE TRADES HAVE NOT BEEN EXECUTED, THE RESULTS MAY HAVE UNDER-OR-OVER COMPENSATED FOR THE IMPACT, IF ANY, OF CERTAIN MARKET FACTORS, SUCH AS LACK OF LIQUIDITY, SIMULATED TRADING PROGRAMS IN GENERAL ARE ALSO SUBJECT TO THE FACT THAT THEY ARE DESIGNED WITH THE BENEFIT OF HINDSIGHT. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFIT OR LOSSES SIMILAR TO THOSE SHOWN.

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