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07-22-2007, 08:57 PM
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Conservative LR/HR (low risk, high recovery factor) Forex trading concept
Conservative LR/HR (low risk, high recovery factor) Forex trading concept (Description Part I)
What are the basic characteristics for the system ? Its a highly conservative concept combining 4-6 diversified low risk strategies. Is composed of several modules combining concepts from quantitative stochastic analysis and probability based modelling and statistics with technical analysis. The quantitative stochastic analysis part is basically used for forecasting significant price cycles. It identifies low risk entries and follows them till the end of the forecasted cycle. The system is composed of several components. Some of them are automated and others are followed rather manually. The rather complex set of rules though allows no discretion. The only discretional part is referring to whether to re-enter a trade after an important news release. This requires experience for judging whether and to what extent the market reaction to a particular news release is going to destabilize the models used by this concept. A position is entered only when there is a high chance forecast for at least a 30 pip (or 30 eur/usd equivalent pip units) price movement. Trades can last from several minutes till some times many hours but usually less than 24 hours. Makes use of partial profit taking and money management for locking profits. Trades currently 8 pairs (those with the lowest spread) for keeping the costs as low as possible: aud/usd, eur/chf, eur/gbp, eur/jpy, eur/usd, gbp/usd, usd/chf, usd/jpy. Though the concepts apply very successfully to all possible currency pairs. The concept is behaving pretty stable during almost all market conditions (trending or ranging). Though during trending conditions the average profit per trade tends to be higher contributing to a higher profit factor. Positions are usually splitted in 4 parts (tp1, tp2, tp3, tp4). The system exits all open positions during important news releases as those can considerably destabilize the models used. On average there are about 3-4 trades per day to expect. Sometimes there will days with 6-7 signals and during other days maybe only 1 or even none. Risks are kept at the lowest possible level and the alternative to this concept would be just not to trade. System results do not necessarily depend on whether market is moving fast or slowly. Even slow market conditions can turn out to be at least moderate or sometimes very profitable. What are the basic principles or criteria used to design the system ? The system has been designed based on following principles and criteria:
What are the expected results and important ratios ? Is targeting 10-20 pips on average daily for each lot traded. Sometimes it will be significant more than that but on other days maybe less or even a small loss. Estimated monthly profit on average 200-250 eur/usd equivalent pip units per lot traded. Average profit/ average loss = 1.5-2 Average loss is about 5-8 pips Win ratio: there are market conditions (weeks) with % win ratio of up to 90% and others with up to 60-65%. But what is much more important than the win% is the very high turnover or recovery factor on average losses which tends to be up to 40 per month. Applying that to a system working with lets say a 25 pip average the monthly profit would be equivalent to 1000 pips. Profit factor: 2.5-4 Expectancy is 0.05 % (0.5%) per trade when using a 1:1 (10:1) leverage Worst drawdowns with a 95% confidence interval is 10% (5%) when using a 20:1 (10:1) leverage. Some examples:
Which are the trading hours ? Trading hours are basically from 6:00 to 22:00 GMT and sometimes extended into the asian session. How to follow the suggestions ? All trades in the room are supported from their entries till their final exiting. Though there are several other ways on how this service can be followed:
    
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07-22-2007, 09:19 PM
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Conservative LR/HR (low risk, high recovery factor) Forex trading concept (Part II)
General remarks
• For keeping spread costs low it’s suggested to either use low spread brokers (usually ECN brokers) or futures currency contracts (CME) for executing the trades. • It’s recommended to first try this approach on a demo account to get used to the concept and your platform. • Results will be reported both in pips and percentages. Most of you will be aware of the fact that pip accounting is in many cases wrong. Thus all results will be converted in “eur/usd” equiv. pip units. • The system will never add new contracts to an already opened position (no average down nor up). • this offer is for serious traders understanding and estimating the importance of consistency, low drawdowns and high “average loss” turnover or recovery factor and not for those believing providers promising totally unrealistic hundreds of pips by using several tricks like
• All trades have been reported (about 200 verifiable trades) with exact entry and exit prices (after spread/net of spread) and P/L results in pip or “eur/usd” equiv. pip units for all closed trades. • Sound alert is available when a signal is triggered. • All transcripts from previous trading days are online available. • The room is running by using the echat software (is free and can be downloaded under the following link http://www.ensignsoftware.com/ftpfiles/setupechat.exe, room #29). Echat is a very easy and technically stable software solution with some very interesting features like sound alerts or online transcripts from all previous trading days, etc. • You don’t need to be in front of PC all the time, as you can set your own sounds alerts for getting notified when a signal is triggered. How to apply for the service ? • For applying to the service you can just send an email to the following address (forumsplatform_chat@yahoo.com) by mentioning the nick name you got during the echat software installation. Are any plans to apply the concept to further financial instruments? Yes, the system has been manually tested and forward live traded on stock indices futures with even greater success as on forex. Monthly performance on futures contracts can get as high as 150% on initial overnight margin (interactivebrokers margins used) For how long has the system been tested ? • It has been developed towards the end of 2006 and has been forward traded during the last 6 months with excellent results. Unfortunately and because of it’s complexity it’s not possible to run any automated backtests as it’s composed of many different components making it impossible to automate all of them. Further difficulties for back testing are related to news releases. Manual backtests and forward live trading results have fulfilled all requirements for consistent and smooth performing with as low as possible drawdowns and high recovery ratios. There has been only one week with negative performance and that only because of a wrongly managed position What is the subscription price ? • The monthly nominal fee is 10'000 $ (reffering to institutional customers) . For keeping quality high and avoiding any other effects affecting the performance, it’s planned to keep the number of subscriptions not higher than about 5-10. • As the highest priority is to offer quality and subscribers being happy about the service, if for any reason the monthly performance becomes negative you can choose between getting a fee refund or the next month for free. Administrative • Subscriptions are not updated automatically. The deadline for updating the subscription for the next month is always the actual month’s last Friday 12:00 GMT. In case of still available spaces there will be an announcement here in the forum on same day at 16:00 GMT. If interested in subscribing please just send an email with your nickname (to get one first you have to setup the software). Thereafter and as long as spaces are available (new email applications will be considered according to their time stamp) you will receive instructions on how to proceed with payment (Paypal) for getting a password. • During the year I’ll be on vacations for about 4-5 weeks. All absences will be announced to subscribers in advance and there will be no charge for these weeks. During the months I’ll be on vacations, the fee will be reduced according to the time being absent (pro-rata). For example if I’m going to be out in august for two weeks, then the august fee will be only half of the nominal one, etc. If you are going to be in vacations but you prefer to keep a space occupied for you, it’s important to proceed with payment for the month you will be out but once coming back you will receive the upcoming month for free ( this can happen only once during a calendar year). Please understand that for avoiding very complicated administration processes, applications are available only for full monthly subscriptions. If for example you plan to be out for 2 weeks during a particular month, then it’s important to decide whether it’s better to apply for the monthly subscription or to skip that particular month • Please understand that these performance figures presented here are after considering the best available information. Though this should not be understood as a guarantee that it will be exactly the same every week and month. There will be times with results over performing the above numbers and others under performing them. • New email applications will be considered according to their time stamp Last edited by Forex LR/HR; 10-30-2007 at 04:03 PM.
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07-23-2007, 09:02 PM
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Conservative LR/HR (low risk, high recovery factor) Forex trading concept
Results for 23/7/2007
1 trade: -1 pip
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07-24-2007, 03:04 AM
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Another holy grail pay us $300 a month ($300 x 40 subscribers = $12,000 a month for him/her, not bad hey?). Why trade if you are getting that per month from subscribers
 Last edited by creztor; 07-24-2007 at 03:06 AM.
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07-24-2007, 05:47 AM
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Conservative LR/HR (low risk, high recovery factor) Forex trading concept
Full track records history with exact entry and exit prices and P/L in pips for all closed positions is online available (at ensignsoftware.com servers) by following these instructions:
when in the room then,
to get the full history.
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07-24-2007, 10:27 PM
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Conservative LR/HR (low risk, high recovery factor) Forex trading concept
Results for 24/7/2007
5 trades: + 15.5 "eur/usd" equiv. pip units per lot traded total profit for july sofar: + 180 "eur/usd" equiv. pip units monthly performance: 18% (36%) for 10:1 (20:1) leverage
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07-25-2007, 10:06 AM
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Quote:
__________________
Dont worry, bout a thing, cos every little thing, gonna be alright.  The future has not been written. There is not fate, but what we make for ourselves.
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07-25-2007, 04:43 PM
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Conservative LR/HR (low risk, high recovery factor) Forex trading concept
Shinigami
Swap costs is not an issue with this approach as almost all trades are intraday and when holding overnight, then in most cases z of already partial profit taking the exposures and any swap costs are minimal. Besides that, all usd/chf and usd/jpy pip results are reported without converting to "eur/usd" equiv.pip units. Their conversion factor is currently 1.13. Thus, results for these pairs are in real terms 13% higher than reported. All that does more than compensate the negligible swap costs.
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07-25-2007, 09:15 PM
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Conservative LR/HR (low risk, high recovery factor) Forex trading concept
Results for 25/7/2007
1 trade: + 5 "eur/usd" equiv. pip units per lot traded total profit for july sofar: + 185 "eur/usd" equiv. pip units monthly performance: 18.5% (37%) for 10:1 (20:1) leverage
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