Claughton Capital claughton.altavra.com

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The goal of the trading programs offered by Claughton Capital is to deliver enhanced performance and non-correlated returns relative to other managed futures strategies and traditional investments. Claughton Capital believes that its trading approach can provide a prudent diversifying component to a portfolio of alternative and traditional asset classes and investment styles. PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS.

The Institutional Program is a systematic investment program and is currently open to new client accounts. The minimum account size in the Institutional Program is $1,000,000.

From August 1993 through July 2000, Keith Ganzer traded the Multi-Sector Program at Brookville Analytic Investment Corporation, also known as Brookville Investments, a firm 100% owned by Mr. Ganzer. While the ARP strategy (as described in the Trading Approach section) was traded at Brookville and is currently being traded at Claughton Capital, the main difference is that the ARP strategy was traded with a 66.67% weighting at Brookville and is traded with a 100% weighting at Claughton Capital. Other differences between the Brookville and Claughton Capital trading include, but are not limited to (i) the markets that were traded, (ii) what dates and times these markets were traded, (iii) the substantial differences between the pit traded markets that had been predominantly traded at Brookville versus the electronically traded markets that have been predominantly traded at Claughton Capital, and (iv) the methodology employed when trading immediately before and after the release of economic figures. The Multi-Sector Program is closed to new client accounts.

The Trading Advisor strongly encourages prospective clients to view their accounts as long-term investments with the objective of seeking capital appreciation. Although accounts may be closed at any time, the Trading Advisor recommends potential clients to invest in a managed futures trading account only if they have at least a two year investment horizon. Prospective investors are encouraged to consult with independent qualified sources of investment and tax professionals to assess suitability of investing in an account managed by the Trading Advisor.

Claughton Capital uses what it regards as an innovative systematic approach to trade various markets called the Auto-Reactive Positioning (ARP) strategy. The ARP strategy is designed to dynamically allocate capital between a predominantly employed probability based pattern recognition sub-strategy and an occasionally employed sub-strategy of following the trend. The trading approach utilizes market behavior to determine what sub-strategy is most appropriate to trade at any given time with market conditions dictating when a transition occurs on an intraday basis.

The Auto-Reactive Positioning strategy was developed in 1992 as the result of an extensive research program undertaken by Keith Ganzer. The research began with an examination of traditional trading approaches to determine their benefits and drawbacks. Keith Ganzer concluded that a major drawback to traditional trading techniques is that a significant portion of major price movements (at the beginning and end of the movement) is lost in the recognition of the move. The distance between the buy signal and the sell signal is often substantial, resulting in a large cost to reverse the position.

The Auto-Reactive Positioning strategy trades actively in an attempt to mitigate the cost of reversing positions established during trending market conditions. ARP uses a strategy of trading within a consolidation range that is determined each trading day. The consolidation range dynamically shifts, expands and contracts depending upon market conditions. When a market is trading within the consolidation range, the ARP strategy trades that market using a pattern recognition methodology. When a market is trending, the ARP strategy will follow the trend in an attempt to capture profit from sustained price movements. The ARP strategy trades actively resulting in a higher brokerage commission cost than many other managed futures programs. The ARP strategy has historically traded an average annual number of contracts per given account size of between 50% and 100% more than the average of other managed futures programs. The Trading Advisor does not receive any portion of such commissions.

The Auto-Reactive Positioning strategy has historically resulted in daily non-correlation with managed futures industry indices. PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS.

Claughton Capital employs risk management controls in establishing trading positions. Every position is established with an initial stop-loss exit. Initial position sizing is calculated by taking into account an initial dollar risk (based on a fraction of the nominal account size), the current short-term volatility of the contract, and the market distance to the initial stop. Claughton Capital views an account as a portfolio of positions. Notwithstanding the systematic aspects of the trading, the Trading Advisor may reduce or eliminate exposure to any particular market or all such markets at its sole discretion. No assurance can be given that such risk management techniques will be successful.

Claughton Capital's trading is conducted on a variety of market sectors. Individual markets within each sector are selected based upon liquidity considerations through which less liquid markets are “filtered out”. The Trading Advisor will generally apply its trading approach to both U.S. and non U.S. futures markets. These markets will include (but are not limited to) capital-oriented markets such as long term interest rate futures (e.g., U.S. Treasury Bond futures, German Bund futures), precious metals, foreign exchange and stock index futures, such as the Standard and Poor's 500 stock index futures, certain industrial commodities (e.g., crude oil), and agricultural markets (e.g. soybeans). In addition, Claughton Capital may trade in foreign futures contracts, and cash commodities including precious metals.

Options contracts may be used to enter or exit positions when the corresponding futures market is closed, typically due to the futures markets being locked limit up or limit down. Claughton Capital may use "synthetic futures" to implement its strategies, whereby a call option is bought or sold and a put option is simultaneously sold or bought. The Trading Advisor will later either liquidate the synthetic futures position upon exiting a trade, or swap this position with the corresponding futures position.

Claughton Capital may purchase U.S. government securities with a maturity not to exceed one year for the purpose of earning interest on account balances. If the asset level were to decline through trading losses or otherwise, it may be necessary to sell such securities and this may result in a loss.

Claughton Capital expects that between 12% and 21% of the assets in client accounts will be utilized to meet maintenance margin requirements. Higher margin requirements may apply for accounts at different brokers. These amounts may substantially increase as a result of future changes in the addition of new markets traded and potentially the allocation of more active trading programs.

If an account at any time experiences a decline of 45% (or some other percentage as agreed to by the client in writing) from the highest prior month-end account balance (exclusive of additions or withdrawals), Claughton Capital will attempt to close or offset all open positions and otherwise cease trading pending instructions from the client.

Claughton Capital’s business plan provides for on-going refinement of current strategies (both trading signals and execution strategies) and the research, testing and implementation of new strategies. Claughton Capital retains the right to revise any strategy. Since the trading methods to be utilized by the Trading Advisor are proprietary and confidential, the above discussion is of a general nature and is not intended to be exhaustive.

Keith Ganzer became registered as a Principal and as an Associated Person with Claughton Capital, LLC on August 11, 2003 and as a branch manager on September 2, 2008. During the past five years, Keith Ganzer has been a Trading Principal and the Chief Investment Officer of Claughton Capital, LLC. Keith Ganzer was an Actuarial Associate at AXA Financial Inc., a financial planning, life, annuity, and property/casualty insurance company, from January 2005 to May 2005. From November 2005 to Present, Mr. Ganzer serves as the Chief Financial Officer of Triumph Securities Corporation, a FINRA member broker/dealer where he devotes approximately 24 hours annually. Keith Ganzer has an M.A. in Chemical Engineering from Princeton University and B.S. in Chemistry with Highest Honors from Case Western Reserve University. He is a Chartered Financial Analyst member of the CFA Institute and a PRMIA Certified Risk Manager.

Eric Schreiber was first registered with the National Futures Association as a Principal with Claughton Capital, LLC on July 28, 2003. Eric Schreiber became registered as an Associated Person with Claughton Capital, LLC on August 11, 2003 and as an Associate Member on September 15, 2003. During the past five years, Eric Schreiber has been a Trading Principal and the President of Claughton Capital, LLC. Eric Schreiber received the Arthur D. Little Scholarship to attend the University of Chicago where he received an M.B.A. degree and received the Halsey S. Garlund Scholarship to attend Emory University where he received a B.S. degree in Mathematics and Computer Science.

The descriptions above are from the manager's disclosure document.

THE RISK OF LOSS IN TRADING FUTURES, OPTIONS AND OFF-EXCHANGE FOREX CAN BE SUBSTANTIAL.  PAST RESULTS ARE NOT NECESSARILY INDICATIVE OF FUTURE RESULTS.  PLEASE READ THE CTA'S RISK DISCLOSURE DOCUMENT CAREFULLY BEFORE INVESTING MONEY.