FAAR vs SDMF

FAARDFirst Trust Alternative Absolute Return Strategy ETF

SDMFBSimplify DBi CTA Managed Futures Index ETF

In short

FAAR Most commodity funds only bet one way: up. FAAR is actively managed and can run short positions alongside long ones across the futures complex, aiming at absolute return rather than tracking a commodity index.

SDMF Managed futures without the hedge fund bill. SDMF tracks an index built to replicate what CTA trend funds are actually doing, using a short list of liquid futures markets, for 0.35% a year.

Stated mandate

FAAR The Fund seeks long-term total return through active management of long and short exchange-traded commodity futures positions, accessed through a wholly owned Cayman Islands subsidiary.

SDMF The Fund seeks long-term capital appreciation.

Why people hold it

• FAAR Goes both ways. The managers can hold long and short exchange-traded commodity futures, so the fund is not structurally locked into commodity prices rising.ftportfolios.com
• Active by design. A few dozen futures positions sized by the manager, not by a fixed index weighting, in a cohort where most rivals simply track a broad commodity benchmark.
• Runs as a registered 1940 Act fund, with the futures book held in a wholly owned Cayman subsidiary. Distributions are paid quarterly.
• Trading since 2016, giving the long/short approach a live record across very different commodity markets rather than a backtest.

• SDMF Charges 0.35%, roughly half the typical fee among futures-strategy funds in its group. Cheap shelf space for a strategy that usually arrives with hedge fund pricing.
• Rules over hunches: it follows the DBi CTA Managed Futures Index and its advertised 10-factor replication approach, not a trader's discretion.simplify.us
• Its cohort is mostly long-only commodity baskets (BCI, CMDY). This one is a managed futures strategy, which can lean either direction across futures markets.
• Ordinary 1940 Act ETF plumbing: daily pricing, intraday trading, no lockup or subscription paperwork.

Worth knowing

• FAAR Active costs money: 0.98% a year against a cohort median near 0.68%, and several times what index-based peers like BCI (0.26%) or CMDY (0.29%) charge.
• No index to hug. Short positions can offset a broad commodity rally, so results track the manager's calls rather than the commodity complex itself.
• Mid-sized and moderately traded, so spreads can run wider than the largest commodity futures ETFs.

• SDMF Launched in 2026, so there is no long record here and the risk picture rests on limited history.
• A small fund that has traded lightly since launch, so spreads can run wider than the big commodity index names in its category.
• The stated goal is long-term capital appreciation, and payouts come once or twice a year at most. Not built as an income stream.

Full FAAR profile⁠

Full SDMF profile⁠