NEW YORK (TheStreet) -- The turmoil of 2008 put managed futures on the map. In a year nearly every investment category suffered sizable losses, the average managed futures mutual fund returned 8.3%, according to Morningstar (MORN). Impressed with the results, nervous investors began pouring into the funds.But newcomers have had little reason to be pleased. Since their time in the limelight during the financial crisis, managed futures have lagged stocks. While the S&P 500 returned 26.5% in 2009, managed futures lost 5.8%. The managed futures funds also trailed in 2010 and last year. Are the managed futures funds failures? Not necessarily. Managed futures are designed to provide diversification, and the funds have been accomplishing the goal, showing little correlation with stocks.
|Managed futures funds trade securities that track a wide range of markets, including foreign currencies. This year trend followers have made money by shorting the euro.|