A STEALTH CONTRIBUTOR TO THE MARKETS EXPLOSIVE RISE??

The decline of Catalyst Hedged Futures Strategy fund, a $3.4 billion fund employing complex derivatives, is topic du jour on trading desks fixated on the surprising resilience of the post election U.S. stock rally and the long decline of volatility, or price swings. It is now down 17% for the year and almost 20% in the past 3 months.  What has stripped $1 billion of AUM from this fund in a short time and dragged the 3 year total return to -2.1% per annum??  Here’s how Catalyst got into troubleT The Catalyst fund’s strategy uses options on the S&P 500 index, contracts that allow investors to buy or sell at set prices over fixed time frames. In this case, the fund employed a “butterfly spread” that benefits the fund if the market remains stable, rises slightly or declines in any magnitude.

CONCLUSION: The strategy of 'overwriting' is a big influence on the current market

TStory image for catalyst fund from Forbeshe Catalyst Fund Continues To Decline

Forbes-Feb 24, 2017
The Catalyst Fund (HFXAX) which attracted a lot of attention 2 weeks ago as a key market driver (here) continued to decline. It is now down ...

Story image for catalyst fund from Seeking Alpha


Catalyst
Hedged Futures Strategy Fund Off The Rails

Seeking Alpha-Feb 17, 2017
Catalyst Hedged Futures Strategy Fund (MUTF:HFXIX) made headlines this week for all the wrong reasons. How does a seemingly low to ...
Volatility Trades and Explosive Shorts
In-Depth-Bloomberg-Feb 17, 2017

Story image for catalyst fund from Bloomberg

Catalyst Capital Says Don't Blame Us for Stock Market Swings

Bloomberg-Feb 16, 2017
Catalyst Capital Advisors LLC, the $5.8 billion fund firm whose travails briefly transfixed Wall Street this week, says it's not the reason for recent ...

Story image for catalyst fund from Wall Street Journal (subscription)

Fund's $600 Million Lost Week Captivates Traders

Wall Street Journal (subscription)-Feb 16, 2017
The decline of Catalyst Hedged Futures Strategy fund, a $3.4 billion fund employing complex derivatives, is topic du jour on trading desks ...

Story image for catalyst fund from Palisades Hudson Financial Group

Another 'Black-Box' Strategy Disappoints Investors

Palisades Hudson Financial Group-Mar 1, 2017
There is a good chance you haven't heard of the Catalyst Hedged Futures Strategy Fund. But this mutual fund, which manages