Much of my work is surprisingly personal in nature, since personalities and relationships underlie human resources issues. I have been called a business shrink, a career therapist. I provide a safe, objective impartial professional point of view. In last month’s NIBA Journal I told a personal story of when I refused a job offer. As the story continues…Remember I had refused a job offer because the president of the company was “rude” to me during the interview. As karma would have it, years later I ended up working with the same “rude” person….to be continued. But by then things had…...

On September 12, 2011, it was my pleasure to give a presentation for the National Introducing Brokers Association, “Grow Your Business by Hiring the Right People.” The response to my program has been gratifying and quite positive. Most remarked on the clarity of the message, especially the relevance and impact of the case studies involving real people and business situations. I derived immense satisfaction from offering these remarks, which reflect my more than 25 years advising financial institutions on human resources practices. The interview process, for example, is fraught with psychological issues. It is important to remember that the interview…...

In our previous article, the benefits of managed futures mutual funds were discussed. This article tackles some of the major issues in establishing a mutual fund. Steps Necessary for Mutual Fund Formation and Registration From a legal standpoint, the “mutual fund” is a Securities Exchange Commission (“SEC”) registered and regulated pooled investment vehicle that is required to comply a complex set of rules, regulations and statutes, including the Investment Company Act 1940 (“1940 Act”). Mutual funds are often times referred to as open ended investment companies. While SEC registered mutual funds may be organized in almost every state within the…...

Patricia Cushing Associate Director, Compliance, National Futures Association The recent amendments to NFA’s Compliance Rule 2-30 (often referred to as the “Know Your Customer” rule), the proposed changes to CFTC Regulations 4.5 and 4.13 and the increasing demands of supervising the use of social media are all contributing to an increase in an IB’s regulatory obligations. However, by making some enhancements to their policies and procedures, IB’s should be able to meet these obligations with little disruption to their operations. NFA Compliance Rule 2-30 One of the changes to NFA Compliance Rule 2-30 that became effective in January 2011 requires…...

In the last issue, we covered why a sentiment indicator should work. Now it’s time to look at a practical application. In sentiment indicators, the history being repeated is the unchanging nature of human emotion. Greed and fear drive the markets and they are measurable to some degree. A widely available is the American Association of Individual Investors (AAII) Sentiment Survey. This is a survey of individual investors which answers the question of how they feel about the market each week. Data from 1987 is available at http://www.aaii.com/files/surveys/sentiment.xls. A small part of the survey results from 2000 is shown below.…...

A proposed CFTC Rule focusing on preventing conflicts of interest between researchers and traders, and a proposed amendment to another Rule designed to enhance record-keeping and recording requirements, were two of the key topics discussed at the NIBA Sales and Marketing Conference on September 12. The Dodd-Frank Wall Street Reform and Consumer Protection Act mandates the implementation of these Rules, in some form, despite a perceived absence of any problem needing remediation and despite the clear increase in costs that compliance would entail. Feedback from member IBs in attendance confirmed that, if the final versions of the Rules resemble the…...

Managed futures mutual funds appear to clear one significant regulatory hurdle Broad distribution of managed futures through a mutual fund structure, which at one point faced an uncertain future, appears to be moving forward, according to Dan Driscoll of industry regulator National Futures Association (NFA). At a recent meeting in Chicago, the NFA brought together top industry participants with divergent interests, from commodity pool operators (CPOs) to existing managed futures mutual fund operators, who, with NFA encouragement, worked out differences to craft potential rule changes that will now go to the Commodity Futures Exchange Commission (CFTC). It is the group’s…...

In my book Jackass Investing: Don’t do it. Profit from it., I take on the myth that “Futures Trading is Risky.” I do this by first pointing out that it’s not futures that are risky, but the often reckless behavior of individual futures traders. If the proper risk controls are not in place and if leverage is abused, substantial losses will occur. But this reckless behavior is not unique to futures trading, stock investors often routinely and recklessly expose themselves to unnecessary risk (my definition of  “Jackass Investing”) by hanging on to losing positions. In fact, it’s the cornerstone of…...

A number of Nobel Prize winning theories start with the assumption that investors are rational. In the real world, many investment professionals discover through their daily interactions with investors that there are occasional bouts of irrationality. In discussing the markets with the public, it’s important to understand this since questions and firmly held beliefs could be rooted in that irrational behavior. Rational investors most likely only exist in Modern Portfolio Theory. The argument makes sense intuitively. Investors will buy the portfolio that maximizes the potential returns while minimizing their personal preference for risk. But in the rule world, emotions like…...

by Lida Citroën Principal | LIDA360, LLC Become intentional as you build your personal brand Branding gives experience to something intangible; it gives names to the qualities I feel when I work or interact with you. Unlike marketing, which is when we direct an audience to action, branding sets the emotional expectations and promises between you and your target audience. Here are some ways you can become more intentional and focused as you build your brand: You can start by becoming intentional about the words you chose, the company you keep and the way you represent yourself. Your audience is…...