Can a trader be a do gooder - best forex trading strategy videos

Can a trader be a do gooder ~ best forex trading strategy videos

It occurs to me that the only way in which a trader can become more than a completely selfish, self-enriching, narcissistic person is to trade well enough so that you can manage other peoples money and thus saving these investors from crooks and charlatans (provided you are convinced you are not a crook and charlatan yourself).

Other traders have advanced other arguments in favor of trading. But I am not convinced by them.

They say that we provide liquidity to other long-term investors who may need to liquidate their investments. But then, this applies only to mean-reversal strategies. Momentum strategies take away liquidity from the market, and in some cases exacerbating price bubbles. Certainly not something your grandma would approve.

Others argue that momentum strategies help disseminate information about companies through quick price movements. But cant we just watch Bloomberg or CNBC? Do we really need some devious insiders to convey that information to the rest of us through price movements?

No, I think that independent trading should serve only one purpose (besides short-term self-sustenance): as training and preparation to become a fund manager. Once you graduated from independent trading, you then enter into the grand contest among all fund managers to see who can best serve and protect investors assets, (and be rewarded according to your standing in this contest.)

I know, this is the idealistic way to look at things. Serving and protecting seem to be what policemen should be doing, not traders. But as in quantitative trading, I think it helps one becomes more successful in ones activities by having a simple guiding principle or model. And it doesnt hurt that in this case, the principle would also be conscience-nourishing!
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The risk a trader can take in a single trade - creating forex trading system

The risk a trader can take in a single trade ~ creating forex trading system

It is a depressing fact that their trading accounts are blown up by 90% of beginner Forex dealers in their very first month of trading. The astonishing thing is, this occurs regardless of whether they possess a Currency trading strategy that is money-making or not! Certainly, there is more than having a prosperous Currency trading strategy to making money in Forex trading. What most beginner Forex dealers do not understand is that when you are only getting started in Forex, having a Forex cash management strategy that is great is much more significant than having a system with enormous yields. By the conclusion of the short article, you will learn the best way to use the best Forex cash management techniques for yields that are consistent, safe out of your system.

The Very Best Forex Cash Management Strategy

You will not blow up your trading account if youve a great Forex money management strategy even for those who possess the worst Currency trading system on the planet. On the flip side, with no Forex cash management strategy that is great, you may possess the greatest Currency trading system on the planet plus it might not even matter. You should know how significant its to take care of your capital when you are trading Forex before we get to the nuts and bolts of cash management in Forex.

Believe it or not believe it, the greatest Forex cash management plan would be to dial your own risk per trade manner down to between 2-4% of your capital. Here is the most effective cutting edge Forex cash management strategy that hedge funds as well as all the large banks apply for each of their dealers, and that I strongly advise that you just use it too.

A Good Example Of Great Cash Management In Forex

Heres the way that it works. Go with 2% in the event you are extremely conservative, and go with 4% in the event you are extremely competitive. Lower or any higher and you are actually throwing away money. Meaning that for those who own a stop 20 pips away from your entrance, then you definitely are permitted to choose a maximum of 1 total contract.

Clearly, reinvesting your profits will let you leverage the power of compounding returns, while taking your gains WOnt. By reinvesting your profits, your profits can triple in annually! In case you choose to reinvest your profits, then youwill need to upgrade your place sizes at routine times as well as your threat per trade allotment. Id recommend upgrading your place sizes every 5-10 trades youre having the most effective compound increase of your trading account. It is vital that you keep in mind that you simply are still going to need a proven, Currency trading strategy that is profitable to create a Forex income that is consistent. The greatest Forex cash management strategy is not going to make a poor trading process rewarding, but with no great Forex cash management strategy it is not possible to create a long-term Forex income. Make sure you get both of both of these Currency trading components that are vital set up, and also you could be certain of your Currency trading success!
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A HFT primer - forex trading strategy testing

A HFT primer ~ forex trading strategy testing

As a follow-up of my previous discussions on high frequency trading, I have invited guest blogger Jennifer Groton to share with us a quick survey of various common HFT strategies used by equities and FX traders.

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High frequency trading strategies are under fire.  The recent trading spike in our national exchanges was duly noted as a short-circuit waiting to happen and drew immediate industry criticism of auto-trading robots. Before a witch-hunt ensues, perhaps a review of the common HFT strategies in stocks and Forex is in order. 

High-frequency firms employ a wide variety of  low-margin trading strategies that are implemented by professional market intermediaries who have invested heavily in technology. These firms claim that they make markets more efficient by enhancing liquidity and transparent price discovery to the benefit of investors.  The Forex market’s unique combination of high liquidity and low volatility make it an ideal environment for deploying HFT strategies, although many of the ideas and technology are from the equity markets.  The basic strategies fall into three categories: market-making, trending or predictive, and classic arbitrage.

Market-making strategies tend to focus on a single stock or currency pair.  Many firms in this area have been described as engaging in "rebate-capture trading", a reference to the credits that firms get for providing liquidity on most market centers.

The second group consists of mean-reversion and trending strategies. These utilize technical indicators for stocks or forex indicators for currencies, and seek to generate more return from individual trades.

The last group may involve a cross-section of trades from multiple markets.  The classic arbitrage strategy is a form of the “carry trade” that uses the prices of a domestic bond, a bond denominated in a foreign currency, the spot price of the currency, and the price of a forward contract on the currency.  If the market prices are sufficiently different from those implied in the model to cover transactions costs, then four transactions can be made to guarantee a risk-free profit.

High frequency trading is attributed with generating over 70% of the volume of trades on our equity markets.  Similar statistics are not available for forex markets, but speculating disguised as commercially necessary trades have been reported to be over two-thirds of the volume.  Liquidity and pricing transparency are the benefits offered by its advocates, but regulators and other market participants who disagree with this positive assessment are presently discounting these benefits.  Transaction taxes and time limits on orders have been proposed to mitigate the perceived risk created by HFT firms, but the wheels of Washington move slowly, even in crisis.  For the time being, there is no indication that their participation will be discontinued.   
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The Value Of A Forex Learning Course - g7 forex trading system 2.0 download

The Value Of A Forex Learning Course ~ g7 forex trading system 2.0 download

The recession has just passed, and it brought along lots of pay cuts and job layoffs. Those lucky enough to keep their jobs werent exactly spared either. They may have been kept on the payroll, but their responsibilities and tasks have definitely increased in both amount and difficulty. No matter how we slice it, the recession has affected all of us greatly and left us for dead. It may have kept us down, but that does not mean we are out of hope.

So, the recession has left us searching for ways to fit everything we need into a now-tight budget. It has even made us look for ways to increase our income. Fortunately, we have quite a few options on hand if we want to earn more money. Because of the way technology has advanced, we have been given oodles of options that can help us earn a higher living. Lets be honest, we really do want to make more right now. With that said, what are the things we can do to increase our incomes? That is what we shall focus on for now.

As previously presented, advanced technology has given us many chances through the increase of online jobs. A popular kind of job is the online writing job. For those that would like to make some extra cash in addition to their regular jobs, an online job is perfect. The best thing about it is that you can choose how much work you want to have. So, those with lots of free time might be inclined to take on more work while those busier with their regular jobs might choose a lighter workload. No matter what workload you prefer, the cash you stand to make from these jobs is definitely very good.

Another way is to play the market by engaging in forex trading. Forex trading is the manner of exchanging money based on the currencys value. It might seem intimidating at first, but there are actually forex trading courses available online. A forex trading course is a great way to get you acquainted with forex trading. This can really pay off really well if you can anticipate market value changes and can stand to make you extra cash. If you have the time, definitely look into taking a forex course.

So, youve seen how many options you have out there. Dont let the recession beat you down. Understand that you have options out there just waiting for you, and you will be fine.

By Bart Icles
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A platform a shareware site and some courses for quant traders - forex traders secret strategies

A platform a shareware site and some courses for quant traders ~ forex traders secret strategies

I mentioned in various places that Alphacet Discovery is an industrial strength integrated platform for backtesting and implementing quantitative trading strategies. But of course, it has many competitors, one of which is a relatively new company called Deltix. Deltix has the distinction of offering a full Matlab interface, which is convenient if you are already a Matlab programmer. (Full disclosure: I previously have a consulting relationship with Alphacet, but have none with Deltix.)

There is also a new website for sharing trading strategy software called Quantonomics. In the words of its founder Joshua, the goal is to "connect programmers and stock traders". Joshua also told me that he will create a custom application on his site for any of you readers as a gift!

A colleague of mine in Singapore, Dr. Li Haksun, who was previously a quant with UBS and BNP Paribas, is offering a course on quantitative trading strategy in July. It covers more theoretical concepts than my own courses: e.g. hidden markov model, stochastic control, and Kalman filters are included.

And of course, my own workshops on Backtesting and Statistical Arbitrage will be offered again in London next week.
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A new service for retail investors - forex trading system that works

A new service for retail investors ~ forex trading system that works

Here is a new low-cost service called Alerts4All that offers technical trading signals for retail investors. You can, for example, have an alert sent to you every time a "Double bottom" pattern occurs.

A much more advanced version of the service will be rolled out soon -- I saw a demo today where you can backtest your strategies online, combining different fundamental and/or technical variables as entry or exit signals. They also have some built-in models for you to adapt (e.g. a model based on The Little Book that Beats the Market by Joel Greenblatt.) More interestingly, you can look at other peoples trading models and their historical and/or real-time performance.

Matlab or Alphacet it is not, but I think it will be quite useful for many retail traders. It might even be useful to professional traders who want a quick-and-dirty way to test out ideas.
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A job opening for quants - forex trading strategies wiki

A job opening for quants ~ forex trading strategies wiki

Alphacet told me that they have a job opening for a quant who will be helping their clients backtest trading strategies, among other responsibilities. Given that Alphacets clients include several major investment banks and hedge funds, this position should provide pretty good close-up view of how the major quantitative players operate.
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A method for optimizing parameters - simple forex trading strategies that work

A method for optimizing parameters ~ simple forex trading strategies that work

Most trading systems have a number of parameters embedded, parameters such as the lookback period, the entry and exit thresholds, and so on. Readers of my blog (for e.g., here and here) and my book would know my opinion on parameter optimization: I am no big fan of it. This is because I believe financial time series is too non-stationary to allow one to say what was optimal in the backtest is necessarily optimal in the future. Most traders I know would rather trade a strategy that is insensitive to small changes in parameters, or alternatively, a "parameterless" strategy that is effectively an average of models with different parameters.

That being said, if you can only trade one model with one specific set of parameters, it is rational to ask how one can pick the best (optimal) set of parameters. Many trading models have a good number of parameters, and it is quite onerous to find the optimal values of all these parameters simultaneously. Recently, Ron Schoenberg published an article in the Futures Magazine that details a way to accomplish this with just a tiny amount of computer power.

The key technique that Ron uses is cubic polynomial fit of the P&L surface as a function of the parameters. Ron uses the VIX RSI strategy in Larry Connors book "Short Term Trading Strategies That Work" as an example. This strategy has 5 parameters to be optimized, but Ron only needs to compute the P&L for 62 different sets of parameters, and the whole procedure only takes 58 seconds.

Although Ron has confirmed that most of the parameters that Connors picked are close to optimal, he did find a few surprises: namely, that RSI of period 3 or 4 is significantly more profitable than the 2 that Connors used, at least in the backtest period.

Now, for a true test of this optimization, it would be helpful if Ron performed this optimization withholding some out-of-sample data, and see if these parameters are still optimal in that withheld data set. Since he didnt do that, we need to wait for another year to find out ourselves!

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74 PIPS FROM EURO CAD PROVIDES A 27 RETURN AND 567 PIPS FROM 9 TRADES - forex never lose trading system

74 PIPS FROM EURO CAD PROVIDES A 27 RETURN AND 567 PIPS FROM 9 TRADES ~ forex never lose trading system

EURO CAD provided us with a smaller-than-expected but positive result on Tuesday, due to the lower liquidity conditions of the Christmas Holidays. Our original target of 150 Pips could not be met under these circumstances, requiring us to exit for 74 Pips at the end of our specified Holding Period. Nevertheless, the strong gain had a significant influence on our overall Rate of Return, which now stands at 27.4% since July of this year. With over 500 Pips from only 9 trades, we are only 3 trades away from the 1000 Pip mark and a 50% Rate of Return. After meeting this short-term target, we would then need only 4 more trades for a remarkable return of 100%.

This pair began to decline following a False Breakout Reversal at the Resistance of the Range on the Daily Chart. As with all False Breakouts, a move to the end of the boundary was expected.


DAILY CHART

FXCM used for Entry Signal based on the New York Close Candle

The move was also taking place within a Downtrend that started with the break of the Trend Lines of the previous Uptrend.


DAILY CHART

The signal that we used to confirm that this trade should be taken was the 2nd bearish candle as it was deemed to be a Normal Candle- the Candle that we obey for our entries (Section 8 - “Consolidation Trading on the Forex Market - A Complete Trading System”). After determining that it met our criteria for trading within Consolidations, our Entry Setup was done on the 4 Hour Chart...



4 HOUR CHART

An Entry Order was used in this trade as a Market Order would have required a Stop Loss that exceeded our maximum of 90 Pips for entry based on the 4 Hour Chart. After pulling back to trigger our trade, the market then meandered sideways over the next few days. With trading activity and liquidity limited, we exited for the 74-Pip gain at the end of our Pre-Determined Holding period.

DAILY CHART - LIVE ACCOUNT RESULT

Dukascopy used for Live Trades

With this latest trade, our Rate of Return table is now closer to the mid-way point of our Medium Term goal of 100%.

RATE OF RETURN FROM METHODOLOGY

5% Risk Per Trade, 100-200 Pips Target per Trade; No Trading done in August

Summarizing these results, an average of 63 Pips have been made on each trade, supported by a fairly high rate of success.

SUMMARY OF RESULTS

These gains were due in large part to the last 8 trades, which steadily made up for the initial loss of 100 Pips that may have shocked my early Subscribers!!

SUMMARY OF RESULTS

The Demo Account which tracks the Live Account trades was not to be left out. The trade pushed the Return to 22% after only 5 trades.

DAILY CHART

DEMO ACCOUNT RESULT

Having started in October, the results on this Account are equally encouraging (verified at Myfxbook http://www.myfxbook.com/members/DRFXTRADING/duane/1079693)

RATE OF RETURN - FXCM DEMO ACCOUNT

SUMMARY OF RESULTS

The results from the Methodology at this stage bode well for what is possible within a few months time. By only targeting the highest paying opportunities that have a high probability of success each month, your chances of steady, long-term gains with limited draw-down are greatly enhanced. Nevertheless, given the inevitability of losses, we always need to remain confident in our strategy despite setbacks along the way. Once you have tested your strategy successfully on a Demo Account over a reasonable period of time (at least 6 Months), you can be more assured that the gains will outnumber losses by a reasonable margin. This will allow you to achieve strong Rates of Return over the Long-Term, with fewer losses. 

________________________________________

________________________________________

Duane Shepherd

(M.Sc. Economics, B.Sc. Management and Economics)

Currency Analyst/Trader

Contact: shepherdduane@gmail.com

Twitter: @WorldWide876

Facebook: DRFXTRADING
Website: www.drfxswingtrading.com

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A free Matlab to Interactive Brokers API - forex trading strategies wikipedia

A free Matlab to Interactive Brokers API ~ forex trading strategies wikipedia

For readers who do not want to pay for a commercial Matlab2IB API, Max Dama has put together a free alternative. Domenic has provided some additional sample Matlab codes for trading.

A user of the commercial product that I previously mentioned reports that "My problem with the matlab2ib product was that it did not have a function for all the Active X methods. ( for example the Market Scanners, Real time Bars and Fundamental Data methods are missing). I also had issues when I tried to steam in trades data(Im not sure if the matlab2ib product allows you to even do this?)." Apparently Maxs API has included these methods, though I have not personally tried them.
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Forex Autopilot Software A Time Saver And Minimizes Risk - fxsoni forex system trading indicators

Forex Autopilot Software A Time Saver And Minimizes Risk ~ fxsoni forex system trading indicators

If time is of the essence for you, then automated forex trading is the answer. The latest trend in the foreign exchange market is in forex robot software, an incredible device that takes the time commitment out of foreign investment.

This software operates based on pre-designed algorithms. These highly advanced algorithms allow for trading to be a completely automated process. This software is obviously available with a range of functions that are designed by experienced manufacturers and designers. You can find these online.

The forex robot software eliminates the guesswork out of trading and it is also designed to work for all level of traders with different account size.

Clearly the automated forex trading saves time and effort, two commodities people cannot afford to waste. As soon as a trader programs the forex robot software, it proceeds to invest on behalf of the investor without further input on a continual, 24-hour basis.

Sometimes crucial deals are overlooked during manual trading. This is the type of unfortunate situation that forex software prevents due to its continuous trading.

For those of you who experience trouble with trade management, forex robot software will prove especially appealing. It facilitates decision-making even to the point of closing a contract.

The forex robot software deals in several foreign currencies. Market data and financial reports are submitted with real time and this information is available whenever it is requested.

The forex trade is ultimately within the traders hands however, since he or she programs the software according to specifications then allows the system to conduct transactions. Although there will always be a risk factor in foreign investing, forex robot software minimizes risk and assists with overall maximization of profits.

By Richard U. Olson
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NZD JPY BULLISH SIGNAL NEEDED FOR LARGE GAINS - professional forex trading system

NZD JPY BULLISH SIGNAL NEEDED FOR LARGE GAINS ~ professional forex trading system

Consolidation, Consolidation and more Consolidation. When will they end? Only the policy makers at the major Central Banks and the key market players know the answer. Until then, our responsibility as traders of the Larger Time Frames is to accurately spot them, analyze them and trade them for large gains. We do this by using the trading rules established for trading these patterns in my Trading Manual and waiting patiently until our targets are hit.

The next major setup that could provide such an opportunity is on the NZD JPY. This has been moving sideways towards the major Inner Uptrend Line following the end of a very long 5 -year rally.

DAILY CHART

The sideways movement can be seen more clearly on the next chart where a Range setup appears to be taking shape.

DAILY CHART

This 390-Pip Range would be completed with a rally to the Resistance boundary. A few hundred pips would be ours for the taking if we see a strong Bullish signal above the Downtrend Line (DTL) and the Counter Trend Line (CTL).

DAILY CHART

Once this appears, we can enter immediately with the appropriate Stop Loss and Limit Orders, using the Daily and 4 Hour Charts. The exact size of these Risk and Reward parameters will depend on the patterns formed when the signal appears, so long as they are within our limits set out in our Excel Worksheet.

Take full advantage of the low market volatility by maximizing on these large Consolidation setups. Trade them on your own using the guidelines established in the Trading Manual or execute them directly from my Trade Setup emailed to you as a Subscriber.

RECENT EMAIL FROM CLIENT

____________________________________________________

SUBSCRIBE TODAY

____________________________________________________

US$120.00

Free 

 ___________________________________________

Duane Shepherd 

(M.Sc. Economics, B.Sc. Management and Economics)

Currency Analyst/Trader

Contact: shepherdduane@gmail.com

Twitter: @WorldWide876

Facebook: DRFXTRADING 

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EURO JPY 300 PIP RALLY IN A FEW DAYS - forex power trading system

EURO JPY 300 PIP RALLY IN A FEW DAYS ~ forex power trading system

The EURO JPY looks to be about to form the Support boundary of a very large Pennant on the Daily Chart. After ending a very long Uptrend and breaking the Inner Uptrend Line, it has been gradually moving sideways towards the Outer Uptrend Line. We also see what appears to be the start of a Double Bottom formation. If there is a bullish move that breaks the current Downtrend Line, then a rally to the Resistance of this Pennant could take place towards the end of this month.

The chart below shows the Inner and Uptrend Lines of the major Uptrend. The end of long trends usually leads to the break of the Inner Trend Line and a gradual drift towards the Outer Trend Line.


DAILY CHART

From here, the currency could continue to move sideways until it breaks the Outer Uptrend Line to start a Downtrend or rally to continue the main Uptrend. As it moves sideways to reflect the low trading activity across the Forex market, it could rally in the short-term to complete the formation of a large Pennant. The Resistance has already been formed and is now ´awaiting` the 2nd Support price point.

DAILY CHART

This rally could start with a break of the Downtrend Line that would also complete a pair of Double Bottoms. This would be enough of a signal to justify trading long towards Resistance, a little less than 300 Pips away.

If these Double Bottoms are formed with a strong Bull Candle to break the Downtrend Line, entry can take place either immediately or with a follow-up signal on the 4 Hour Chart. This, of course, will depend on the patterns we see on both time frames relative to the rules established for trading these setups.

RECENT EMAIL FROM CLIENT

____________________________________________________

SUBSCRIBE TODAY

____________________________________________________

US$120.00

Free 

 ___________________________________________

Duane Shepherd 

(M.Sc. Economics, B.Sc. Management and Economics)

Currency Analyst/Trader

Contact: shepherdduane@gmail.com

Twitter: @WorldWide876

Facebook: DRFXTRADING 

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Searching for a Genuine online Forex Trading System - forex powerful hba trading system-strategy

Searching for a Genuine online Forex Trading System ~ forex powerful hba trading system-strategy

With countless choice available online, finding a genuine online forex trading system can be a confusing task. However there are a few precautionary measures can be adopted when one is searching for a genuine online forex trading system. First of all make sure this site doesnt require you to download any software. Secondly, the site should also provides you with sufficient tools, has no hidden cost and do not charge commissions.

There are also other things to check out when searching for a genuine online Forex trading system. You need to also be aware of. It is wise to talk with an experienced trader to get his or her recommendations for a Forex account. Beware if you join a forum to find an online Forex trading system and someone tries to pressure you to sign up on a certain day. There is no reason to do so.

By searching out for a genuine Online forex trading system, you will have at your disposal the right tools and skills required for making informed decision when investing in the forex market.There are inherent risks in a speculative market, such as the forex market; therefore there are no guarantees such as a safe portfolio. You can only minimize the risks by educating yourself.

Those dealing with genuine online forex trading system will have brokers with credentials obtained from regulatory bodies orlocal authorities.These brokers will be impartial, because they are not affiliated with any interbank movement.Furthermore,they were never guarantee you profits,but rather warn you of risks involved in a speculative market.

Using a genuine online forex trading system will assure you of professional and impartial advice.They well help you the making prudent investment decision, while trading in a volatile market such as the forex market.

Therefore invest in a little time and research to seek out a genuine online forex trading system. You will gain a peace of mind by knowing that you are dealing with a legitimate trading system. Furthermore there is the assurance that you are not been rip off.

Genuine online Forex trading systems are a boon to the Forex trading community. These are fully legitimate communities and will assure you of some safety when trading online.

Furthermore those who legitimacies will have the proper security protocol in place.Therefore they can rest assured that your identity, will not be stolen.

By Joel Gardner
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How a mean reversion strategy performed in August - forex trading system blog

How a mean reversion strategy performed in August ~ forex trading system blog

Prof. Andrew Lo and Mr. Amir Khandani at MIT recently wrote a paper on "What Happened To The Quants In August 2007?" (Hat tip to my reader Mr. J. Rigg for the article). Most of their conclusions confirm what many observers already suspected: that the loss is likely due to the simultaneous forced liquidation of portfolios holding similar positions by various quantitative funds. What is noteworthy, however, is that they constructed a mean-reversion strategy and observed what happened to it during August. This strategy is very simple: buy the stocks with the worst previous 1-day returns, and short the ones with the best previous 1-day returns. Despite its utter simplicity, this strategy has had great performance since 1995, ignoring transaction costs. The Sharpe ratio was an astounding 53.87 in 1995, gradually decreasing to 4.47 in 2006. However, the strategy also had a disastrous few days on August 7-9, suffering a cumulative (arithmetic) return of -6.85% in those 3 days. Then on August 10, it rebounded, like the rest of the quant funds, with a return of 5.92%, almost reversing all of its previous losses. For me, this experiment reveals three interesting points: 1) a simple price factor seems to capture most of the performance of the complex factor models run by the gigantic hedge funds; 2) even technical mean-reverting factors suffer losses, not just momentum (growth) factors based on fundamentals; and 3) if one wants to avoid disasters and enjoy spectacular returns, even a one-day holding period is too long. I havent done the experiment myself yet, but I bet that if we were to liquidate the portfolio at market close each day, not only would we avoid the loss of -6.85% in those 3 days, but would probably end up with a positive return of a similar magnitude!
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A reader comments on trading using Excel VBA and Factor Model - forex swing trading strategy youtube

A reader comments on trading using Excel VBA and Factor Model ~ forex swing trading strategy youtube

Thoughtful comments from a reader John S. from the UK on his experience with trading technology and models:

"I have been developing my own personal automatic trading systems using Excel VBA and based on rules I have developed over the years as an active private trader investor using both technical and fundamental data analysis.

One of the key merits in adopting an automatic trading system approach that has helped me is to avoid the temptation for manual interference and thereby improving profitability by maintaining consistency. I have found the challenge of developing a successful system very rewarding from a personal perspective as I recognise that there are many that have tried and failed. However one problem I have encountered is my ongoing desire to regularly modify and improve the system which I have found can become counter productive as there is a real danger that system development becomes an end in itself! I just cant seem to stop tinkering as soon as I come up with a new idea or feature!

One advantage of using Excel VBA that I have found is that it is inherently flexible as it facilitates the processing of data which can be important especially when using fundamental data as part of the system. In this respect I recognise that every trader is trying to build in an edge that will make the system more profitable. I have noticed that many traders seem to only focus on price by trying to seek an edge by looking at special indicators or combination of indicators etc. Combining price data analysis with a Factor Model approach is a challenge which is ideally suited Excel VBA as it can be easily used to process both fundamental and macroeconomic data into a form that can be integrated with price data analysis.

I recognise from your book that Matlab is more powerful than Excel VBA and may be just as flexible in integrating fundamental and macroeconomic data but I just wanted to draw your attention to benefits I have found using Excel VBA which may suit those who like myself are more comfortable in using Excel VBA and are reluctant to change. Other features that can be exploited that I have found helpful when back testing are automatically producing Price Charts that incorporate Entry and Exit points which provides visual reassurance that the system is working as intended as well as generating automatic Word reports recording key output for future reference.

I am sorry if I sound too much like an advert for Microsoft!"

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5 Steps to Managing Risk as a Microfinancier - forex atr trading system

5 Steps to Managing Risk as a Microfinancier ~ forex atr trading system

It might surprise some of you that lending money to middle-class American home owners to buy houses may be much riskier than lending money to Bangladeshi farmers to buy their first cellphones. (The beauty of diversification at work here?)

I have invited guest blogger Heather Johnson to explain microfinancing, and the quantitative risk management tools available if you want to do it yourself.

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5 Steps to Managing Risk as a Microfinancier

By Heather Johnson

Microfinancing is a growing trend among investors, as it offers low-risk money opportunities and a way to bring social change to poverty-stricken communities. "Low-risk" doesnt equal "no risk," of course, so many potential microlenders are keen to learn the ins and outs of credit risk management in this arena. After all, most microborrowers have poor credit or no credit at all. A villager who needs $200 for starting a third-world chicken farm isnt going to fare well in that department, as you can imagine.

The good news is, even in the event of a loan delinquency, you wont be losing a substantial amount of money. Most microloans range from a few hundred to a few thousand dollars. Any losses are unfortunate, though, so you will want to manage your microlending risks and keep loan delinquencies to a minimum.

Here are five steps to managing your risk as a microfinancier:

1. Research Your Borrower – If youre lending through a site, such as Prosper, then you will have access to your borrowers profile and credit reports. However, don’t be afraid to ask more questions if you have any doubts about this persons ability to repay the loan. If you are lending the money through other channels, definitely start with the credit reports and interview the borrower.
2. Lend With a Group – Though this wont make your borrower any more likely to repay a loan, lending with a group will help to spread out the cost and share responsibility. In other words, you will be risking less money and will have other people with the same interests to consult with.
3. Use Analytical Tools – Third-party applications can help you determine what is working best with your microlending. Both seasoned microlenders and newcomers are highly encouraged to use such tools. Microfinance sites that come with excellent built-in tools include Trickle Up, Opportunity International and Heifer International.
4. Provide Incentives – Consider an incentive program for those who pay on time. A small, inexpensive gift will be very appreciated by those living in third-world countries. Lenders have used food, such as rice or corn meal, as a bonus.
5. Be Proactive in Collecting – This doesnt mean you should harass your borrowers. However, you should research your delinquent accounts as soon as payments are late, rather than letting them go into default. There could be a simple breakdown in communication or an emergency on the borrowers end.

One of the biggest draws of microfinancing is the relatively low risk involved. However, that doesnt mean that you will have a 100% success rate. The best way to get your feet wet is to start with a small loan. Something as low as $100 will let you learn the process and allow you to become more comfortable with the system. Microfinancing isnt for everyone, but you may just find your niche with this kind of investment.

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Heather Johnson is a freelance finance and economics writer, as well as a regular contributor for CurrencyTrading.net, a site for currency trading and forex trading information. Heather welcomes comments and freelancing job inquiries at her email address heatherjohnson2323@gmail.com .

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Is there anyway you can make a lot of money online with currency trading - forex currency trading system

Is there anyway you can make a lot of money online with currency trading ~ forex currency trading system

Making money online is as simple or as complicated as you make it out to be.

Yet this doesnt mean you will make money online with Forex trading straight away.Let me ask you a question,Would you walk up to Bill Gates and ask him... "How do I make money"?

Of course you wouldnt! Thats ridiculous!.However, if you wanted to make money like Bill gates does then you need to educate yourself and learn the exact skills he developed to achieve this.

And with Forex trading its exactly the same.

You dont just walk up to a successful Forex trader and ask him "how do I make money", what you do, is you educate yourself and learn how to do exactly what that trader does.

You need to learn skills. Skills are what make you money in any business endeavor, including trading Forex.

So the correct question would be:

"Which skills do I need to learn for me to make money with Forex trading?"

And here is the answer to that question:

For you to make money trading Forex, you must learn the simple (yet commonly overlooked) skill of price reading, also known as price action trading.

So lets get cracking with some Forex trading lessons!

Lesson # 1: "How do Financial Markets Move?"

All financial markets move exactly the same. They move in waves, just like the ocean does.

Within these waves, markets trend up and down over and over again.

They trend up with higher swing highs and higher swing lows.

They trend down with lower swing highs and lower swing lows.

And within these trends two very specific movements occur over and over again:

Impulsive moves and corrective moves.

So in essence, markets move in waves, waves move in trends, trends do impulsive moves and corrective moves. And thats it! This is the most powerful skill you should master, interpreting price movements based on the above explanation.

Why? Read the next lesson to find out.

Lesson # 2: "How Are Trading Systems/Methods Developed?"

All highly consistent profitable trading methods are based on the above concept.

You see, if you want to trade like a pro you need to trade with the pros. It is that simple.

So, what do pros do? They trade trends! Be it intraday or intraweek trends.

However, lets take it one step further:

Pros only trade ONE movement within a trend, and that is the impulsive move.

And guess what! All methods are based around this simple concept:

Trade the impulsive moves within a trend. Go with the institutional order flow!

And if you learn to trade like this you will automatically be able to trade any method you like, be it 123 patterns, be it Elliot waves, pullback trading, Fibonacci trading... you name it you can do it!

Lesson # 3: "So How Do I Go Trade Forex?"

1. - Learn market movement analysis to identify impulsive and corrective moves within a trend.

2. - Learn proper trade and risk management principles, irrelevant of how you trade Forex.

3. - Learn good entry and exit techniques.

Just remember, you want to learn how to get into the impulsive moves at the right time.
But you never know when a correction has been completed.

So how do you get into a low risk high probability trade when the impulsive moves start?

Well, that is where further education comes in. Just remember to ask yourself the following:

"When will the corrective move be completed and *how* do I identify this?"

If you seriously want to make money online trading Forex, and eventually with experience and determination become wealthy, then you must learn the above skills which over time will give you a hugely successful money making home based business.

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Top 7 Things A Trader Must Know - forex trading guided profit system

Top 7 Things A Trader Must Know ~ forex trading guided profit system

Forex traders have to know these 7 things before they can start trading:

1) Dont use indicators - They are just blocking your view of whats important. Learn price action and youll be miles ahead of the competition.

2) Learn the concept of money management - It doesnt matter what kind of trading system you are using. If you dont know how to manage your money, you will never make it in this business. Too many people are just overleveraging their account, until it eventually crashes and you are left with no money.

3) Dont rely on demo trading for too long - The normal tendency is to trade on demos on until you feel comfortable trading. The problem is that people just abuse the demos. They trade for so long without any kind of risk that they just cant handle when they trade with real money.

4) Maintain your poise - One of the hardest things traders have to deal with is what happens when trades go against them. Certain traders just cant handle this. Expect to lose once in a while, and you wont be so disappointed.

5) Start off small. Do some mini trading - Once you got the demo trading out of your system, start off trading on a mini account. Chances are you arent quite ready to play full lots (both financially and emotionally).

6) A Margin Ratio of 200:1 - I thinks that gives you enough room to trade comfortably without having to worry about getting a margin call.

7) Understand how news moves the market - Its a forex trading certainty. The economy will always have news coming out, and you best be prepared for it, if you want to succeed. Too many people disregard this aspect of trading.

By George Kramer
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Statistical model predicts a McCain victory - ea forex trading arbitrage system

Statistical model predicts a McCain victory ~ ea forex trading arbitrage system

There has been a lot of buzz lately about a simple statistical model proposed by astrophysicists Prof. Gott and Dr. Colley that uses the median polls of each state to predict the November electoral vote. (For our un-American readers, the electoral vote is what determines the outcome of a general election, not the popular vote, in case the nightmarish 2000 election has not already drilled this fact into the worlds collective consciousness.)

Dr. Colley has set up a website to track daily such polls to gauge the mood of the states. The authors have tested this method on the 2004 election, as well as numerous sporting events outcomes, and found it to be highly predictive.

Right now, they are betting on a McCain victory.

But there is one caveat that many bloggers have pointed out, and it is the same caveat that I have previously applied to the predictive accuracy of political futures market such as intrade.com. The caveat is this: polls (and futures market) change with time. And at different times, they predict different election outcomes. So for example, at this point (June 2008), the polls predict a McCain victory, while the futures market at intrade.com predicts an Obama victory. Who is right?

The answer is: neither. As Dr. Colley has explained to me, no backtest as far back as the June of an election year has been conducted. (Their research was based on polls from September onwards.) So we do not know if the June polling prediction has any accuracy. Similarly, as I pointed out before, the futures market can swing violently even on Election Day, even in the last hours of an election.

One advantage of the Gott and Colley method though, is that the predictions resulting from median poll statistics are remarkably stable over time. In 2004, there was very little movement in the electoral tally from September through election day. Extrapolating this result, we can be somewhat more confident of their prediction vs. Intrade.coms, even at this early date.

And in any case, I have observed that the political futures markets are highly mean-reverting, implying that the current large 20 points spread between the Obama and McCain futures is destined to decrease in the coming months.

As an arbitrage trader, I have therefore proceeded to short the Obama future.
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