Global Macro and CTA – Same, same but different

Overall Macro and CTA strategies share a common characteristic of seeking to produce returns when markets move broadly, independent of direction. However, the way they exploit these trends could vary immensely. The CTA category is more homogenous in nature as it looks to detect and exploit price trends by using computer algorithms. At its core, the strategy is trend following meaning that it looks for momentum in a wide range of asset classes and buys and sells in the direction of the trend. In order for a CTA to start building positions, it needs a price trigger from the underlying market, it does not try to anticipate a market move. Trades are carried through via liquid futures contracts primarily.