It can't give you what the market leaves behind.
A low-cost ETF delivers market exposure — and stops there. The same capital that gives you market exposure can also be working independently of market direction — simultaneously. NovoDyn's Structural Alpha Trading Program is designed to pursue what the market leaves on the table.
Your market exposure may be working.
Is your capital?
Our framework is designed around a different premise: that the same capital used to maintain your intended market exposure through regulated futures contracts is simultaneously deployed into a separately-managed systematic overlay engineered to generate returns independently of market direction. Your market exposure stays intact. Your capital does not sit idle.
Investors typically allocate to managed futures for three reasons: diversification from equity markets, downside protection when traditional portfolios struggle, and returns that do not depend on market direction. Trend-following managed futures strategies — including most managed futures ETFs — deliver these benefits primarily when macro trends are strong and sustained.
NovoDyn's program is designed for a different objective. Rather than following market momentum, the systematic overlay deploys six independent engines deriving returns from mean reversion dynamics, carry and yield differential strategies, structural spread relationships, term structure and curve inefficiencies, statistical arbitrage, and relative value positioning — structural patterns that exist regardless of whether markets are trending up, down, or sideways. The result is a non-directional return stream designed to complement your portfolio across a broader range of market environments than what trend-following strategies typically provide.
For an investor who already participates in the market, a second return stream that operates independently of the market is not a replacement — it is what makes a portfolio genuinely diversified.
From Market Exposure to a More Efficient Structure
Investing in futures contracts preserves your intended asset allocation while unlocking capital that ETFs, passive index funds, and mutual funds keep tied up.
Construct Your Portfolio
Futures Replication of Your Exposure
Cash & Money Market Buffer
When prevailing conditions are less favorable, unallocated capital is directed toward cash equivalents or money market instruments.
NovoDyn Systematic Overlay
NovoDyn-managed components designed to provide diversified, non-directional return streams — independent of broad equity market direction.
* "Higher-opportunity" and "lower-opportunity" refer to NovoDyn's assessment of prevailing market conditions relative to the program's defined entry criteria. See FAQ below for additional detail.
The NovoDyn Structural Alpha Program
Institutional investors have long used futures contracts to maintain intended portfolio exposure at a fraction of the capital cost — deploying available capital into a separate, low-correlation source of alpha alongside existing market participation. This approach is known as portable alpha or return stacking.
The Structural Alpha Trading Program delivers three things no managed futures ETF can offer: a non-trend-following overlay built around your specific portfolio, a benchmark you select, and a fee structure where NovoDyn earns nothing unless returns exceed that benchmark (for Qualified Clients). These features are only possible in a separately-managed account structure — which is why the program is offered exclusively through individually-segregated client accounts.
Designed for Investors Seeking More Than the Performance of the Market
- Separately-Managed Account (SMA) structure — your assets are held in your own individually-segregated account, never pooled or commingled with other investors, in accordance with applicable CFTC and SEC segregation requirements
- Systematic managed futures strategies intended to complement a broader portfolio as an alternative investment component
- Two distinct return drivers: futures contracts seeking to replicate your intended market exposure, and the NovoDyn systematic overlay operating independently of market direction
- Capital-efficient market exposure implemented through regulated futures contracts
- Customizable to your portfolio — market exposure, benchmark selection, overlay sizing, and available asset classes are each determined by the investor. No two client implementations need be identical.
- Systematic, rules-based implementation supported by institutional-grade infrastructure
- Transparent account visibility through established brokerage relationships
The Structural Alpha Trading Program is designed to work alongside what you already own — adding a source of alpha your current holdings cannot provide.
The program is currently undergoing testing prior to launch.
Futures-Based Portfolio Construction
Regulated futures contracts are used to replicate the asset allocation selected for the investor's portfolio, including broad-based index exposures where suitable. This allows less cash to be tied up in fully-invested securities and ETF positions while maintaining intended market exposure.
- Capital-efficient market exposure
- Regulated futures implementation
- Ongoing margin and collateral monitoring
- Structured reporting of exposure metrics
Structural Alpha Component
Six systematic engines continuously evaluate structural pricing patterns across regulated futures, options, and securities/ETFs — each independently identifying opportunities across structural spread relationships, mean reversion dynamics, carry and yield differential strategies, term structure and curve inefficiencies, statistical arbitrage, and relative value positioning. Capital is deployed into the overlay only when an engine's predefined entry criteria are met. Positions are designed to operate independently of broad market direction — some through offsetting hedged structures, others through statistical relationships that revert over time, but none through deliberate, directional market exposure. NovoDyn's research platform actively develops additional systematic engines as quantitative research and market conditions identify new structural opportunities.
- Overlay allocation varies with portfolio design and market opportunity
- Disciplined financing and margin controls
Performance-Aligned Fee Structure
For investors not represented by a financial advisor, NovoDyn Advisors generally charges an annual management fee of 1% of assets under management together with a performance fee of 20% of returns generated in excess of the investor-selected benchmark, subject to a high-water mark. The benchmark is determined at investor onboarding.
NovoDyn earns its performance fee only when returns exceed that benchmark — not simply for managing the account.
Note Regarding Non-Qualified Clients: The NovoDyn overlay employs both futures-based and equity-based strategies. The inclusion of equity strategies triggers performance fee restrictions under the Investment Advisers Act, which under SEC Rule 205-3 limits performance-based compensation to investors who meet the Qualified Client threshold. For investors who do not meet that threshold, an annual flat fee of 1.75% of assets under management applies to the overlay in lieu of a performance fee. A separate 1% annual fee applies to the futures replication service — compensation for the active management of regulated futures contracts used to maintain your intended market exposure — for a total of 2.75% per annum. No performance fee applies to Non-Qualified Client accounts.
Compensation Tied to Alpha, Not Market Direction
NovoDyn's overlay is designed to generate returns independently of broad market direction. This means NovoDyn's compensation is not correlated with general market appreciation — it is tied specifically to the program's ability to generate alpha above the investor's selected benchmark, regardless of whether markets rise or fall.
Hedging, Financing Terms & Margin Discipline
In the Structural Alpha overlay, hedging, financing terms, margin utilization, collateral sufficiency, and liquidity are continuously monitored. Positions may be reduced, unwound, or rebalanced when market conditions alter capital efficiency or margin requirements.
Capital Use Driven By Market Conditions
The allocation to NovoDyn-managed systematic strategies may increase during stronger structural opportunity environments and decrease when opportunity is more limited.
When conditions are less favorable, capital may be held in cash equivalents, money market instruments, or other lower-risk investments consistent with the investor's risk tolerance and overall investment objectives.
Systematic Oversight and Monitoring
Execution is governed by systematic rules and ongoing monitoring through NovoDyn's regulated brokerage and futures infrastructure. Counterparty and custodial arrangements are selected based on regulatory standing, operational capabilities, and risk management infrastructure.
- Broker-level covenant and risk monitoring
- Continuous tracking of margin utilization and collateral sufficiency
- Structured performance and exposure reporting
Your Account, Your Assets
Your assets are held in your own individually-segregated account — never pooled or commingled with other investors. Where the program utilizes both futures and securities positions, assets are maintained in accordance with applicable CFTC and SEC segregation requirements. NovoDyn holds trading authority only and never custody of your assets.
Transparent, account-level visibility and structured performance reporting are provided through NovoDyn's regulated brokerage infrastructure.
Frequently Asked Questions
What is the Structural Alpha Program systematic overlay?
The systematic overlay is the portion of the portfolio allocated to NovoDyn-managed quantitative strategies designed to seek returns from quantitative market patterns rather than traditional market direction. Returns are generated systematically through rules-based execution when predefined conditions are met, independent of whether markets rise, fall, or remain flat.
What is meant by "higher-opportunity" and "lower-opportunity" environments?
NovoDyn's systematic engines continuously monitor regulated futures and securities markets for structural pricing patterns and conditions — including structural spread relationships, mean reversion conditions, and term structure inefficiencies — deploying capital into the systematic overlay when defined entry criteria are met and reducing exposure to cash equivalents or money market instruments when those conditions are absent. "Higher-opportunity" environments are those in which the program's engines identify sufficient structural conditions to justify overlay deployment. "Lower-opportunity" environments are those in which conditions do not meet the program's defined thresholds. No specific return level or frequency of higher-opportunity conditions is guaranteed.
What is the difference between the NovoDyn program and a managed futures ETF?
A managed futures ETF delivers systematic futures exposure within a fixed, standardized structure — the same strategy applied to every investor regardless of their existing portfolio, benchmark, or objectives. The NovoDyn Structural Alpha Trading Program is a separately-managed account framework built around each investor's specific portfolio and objectives. For Qualified Clients, NovoDyn charges a 1% annual management fee plus a performance fee earned only on returns in excess of the investor-selected benchmark — compensation tied directly to results. For Non-Qualified Clients, NovoDyn charges a 1% management fee plus a 1.75% annual flat fee in lieu of the performance fee. In both cases, the fee structure and investment approach differ fundamentally from a standardized ETF product — in customization, benchmark flexibility, and separately-managed account structure.
What is portable alpha and how does it work?
Portable alpha is an institutional portfolio technique that separates market exposure from alpha generation. Rather than fully investing capital in securities to obtain market exposure, futures contracts are used to replicate that exposure at a fraction of the capital cost — freeing capital for deployment into a separate strategy designed to generate returns independently of market direction. The result is a portfolio that participates in the market as intended while simultaneously pursuing additional returns from a low-correlated source. NovoDyn's Structural Alpha Trading Program is built on this principle, adapted for advisor-managed client portfolios and self-directed investors through a separately-managed account structure.
How are risk and margin managed?
Margin utilization, financing terms, liquidity, and collateral sufficiency are continuously monitored, and positions may be reduced or unwound under predefined capital preservation protocols.
Is the additional return guaranteed?
No. Any incremental return depends on market conditions, structural opportunity, execution, financing terms, and margin requirements. The strategy has defined entry criteria and return thresholds. Details are available upon request.
What happens in a period where the systematic overlay generates no alpha?
The futures-based replication continues to maintain your intended market exposure throughout. In periods where the overlay does not generate returns above the benchmark, the overlay allocation may be reduced and capital is held in cash equivalents or money market instruments. You continue to maintain your chosen market exposure. Because NovoDyn's compensation is subject to a high-water mark, a return below benchmark means NovoDyn earns nothing until that deficit is recovered — your interests and NovoDyn's compensation are structurally linked. Note: for Non-Qualified Clients, the annual 1.75% AUM flat fee (in addition to the 1% management fee) applies regardless of performance.
How do I get started?
The first step is to request investor program materials by clicking the button on this page. You will be asked to complete a brief information form so NovoDyn can send the appropriate program materials and Disclosure Document. From there, a member of the NovoDyn team will follow up directly to discuss the program, answer questions, and walk you through the account opening process at your pace.
Strategy Risk. References to "non-directional," "low-correlated," "structural pricing patterns," and "quantitative market patterns" describe the program's design objectives and do not imply the absence of risk. The strategy may experience significant volatility and losses during periods of market stress, spread widening, or unexpected correlation shifts. These conditions can change rapidly, and there is no assurance the strategy will profit from identified patterns. Non-directional positioning does not guarantee reduced risk or positive returns in any market environment. Firm/proprietary trading experience and limited early investor participation should not be viewed as indicative of future results.
Derivatives, Leverage, and Instrument Risk. The program's strategies involve the use of derivatives, embedded leverage, futures options, securities options, and exchange-traded funds (ETFs) as selective tactical instruments. These approaches can increase portfolio volatility, magnify losses, and introduce risks — including margin risk, collateral risk, basis risk, liquidity risk, time decay, assignment risk, tracking error, and execution risk — not associated with traditional, cash-only investment portfolios. Options positions are subject to expiration, time decay, and the risk of total loss of premium paid. ETFs and options, when used, serve as tactical instruments within the overlay, not as the primary strategy vehicle. Collateral assets may decline in value simultaneously with overlay losses, compounding overall portfolio impact.
Operational and Fee Disclosures. References to "rules-based," "systematic," or "structured" implementation describe the program's operational methodology and do not imply reduced risk or predictable outcomes. The terms "portable alpha" and "return stacking" are used descriptively and do not imply guaranteed positive returns. NovoDyn generally earns incentive compensation only when account performance exceeds the applicable benchmark and high-water mark provisions, applicable to Qualified Client accounts. For investors not represented by a financial advisor, a 1% annual management fee also applies. For investors who do not qualify as Qualified Clients, an annual flat fee of 1.75% of assets under management applies in lieu of a performance fee, resulting in a total annual fee of 2.75% of AUM (1% management fee plus 1.75% flat fee). Fee structures may vary by program and investor type. Prospective investors should review the applicable Disclosure Document for complete fee terms before investing.
General Disclosure and Registration. This website is for informational purposes only and does not constitute an offer to sell or solicitation to buy any commodity interest or security, and should not be relied upon as investment advice. Any offer will be made only through official offering documents, which should be carefully reviewed before investing. This website is intended solely for residents of the United States and does not constitute a solicitation or offer to any person in any jurisdiction outside the United States, including the European Economic Area. NovoDyn Advisors, LLC is registered with the CFTC as a Commodity Trading Advisor, is a Member of the National Futures Association (NFA ID #0435960), and is registered as an Investment Adviser (CRD #156451). Registration does not imply a certain level of skill or training. Trading futures and derivatives involves substantial risk of loss, is not suitable for all investors, and past performance is not necessarily indicative of future results.