Chapter 10 – Build Your Own “Synthetic ETF”

First of all, a “synthetic ETF (exchange-traded fund)” allows portfolio managers and investors to select managed account structures from within the same asset class but with different risk and trading strategies. Prior to allocating funds to a synthetic ETF or managed account, it’s important to consider the investment’s past performance, past draw downs, the length of time they have been trading, who is the counter party, do they have the right licenses and regulations etc. This strategy can be built up in several markets such as foreign exchange, digital currencies and others.