There are a number of large trend-following CTAs that have been successfully running for 10+ years. Their main instrument is diversified futures. Why not ETFs (is it due to liquidity / scaling, costs, risk)?
Leverage: futures usually require much lower margin than their ETF counterparts. For example /ES (E-mini S&P 500 futures) requires about \$4K overnight maintenance margin per contract (may vary by brokerage) to control 50 times the S&P 500 index (currently valued at about \$108K). This is over 20:1 leverage. Furthermore you do NOT pay interest on your short positions.
Tax Benefits: in United States the futures contracts typically qualify for the so called Section 1256 Contracts and have special tax treatment. You may be able to significantly reduce your tax liability on realized short-term gains compared to ETF.
Commissions: in general commissions are lower with futures contracts.
I am going to speculate here. Scale. Say for equities the futures market is bigger than the actual spot market (presumably because you can have cash-settled rather than physically settled contracts); would appreciate if anyone could dig up some numbers. This means more capital can be employed making the strategies more scalable.
As far as leverage is concerned -- don't necessarilly have to see it that way. Instead of leverage you can see it as an intermediate settlement mechanism + stop loss bundled into one. To properly manage risk conceptually you could have the full nominal allocated to the position (10% for margin and say 90% put in some short-term fixed income vehicle for the life of position).
Another aspect could be access: futures are an almost 24/7 market, ETFs -- not yet.