Frankfurt Strategy Data - March 15 - September 15, 2008
- EUR/USD
- GBP/USD
Mid-Range Trend Finder - March 15 - September 15, 2008
- 18 pairs
Results Summary
-Download full summary here
To learn more, JOIN US at our next weekly informational webinar
Thursday, August 7, 2008
Medium-High Risk System Backtest Performance
Frankfurt Strategy Data - March 15 - September 15, 2008
- EUR/USD
- GBP/USD
Mid-Range Trend Finder - March 15 - September 15, 2008
- 18 pairs
Results Summary
-Download full summary here
To learn more, JOIN US at our next weekly informational webinar
- EUR/USD
- GBP/USD
Mid-Range Trend Finder - March 15 - September 15, 2008
- 18 pairs
Results Summary
-Download full summary here
To learn more, JOIN US at our next weekly informational webinar
Medium Risk System Backtest Performance
Frankfurt Strategy Data - March 15 - September 15, 2008
- EUR/USD
- GBP/USD
Mid-Range Trend Finder - March 15 - September 15, 2008
- 18 pairs
Results Summary
-Download full summary here
To learn more, JOIN US at our next weekly informational webinar
- EUR/USD
- GBP/USD
Mid-Range Trend Finder - March 15 - September 15, 2008
- 18 pairs
Results Summary
-Download full summary here
To learn more, JOIN US at our next weekly informational webinar
Tuesday, August 5, 2008
How the Echo FX Managed Forex Account works
Forex (Foreign Exchange) is the name given to the "direct access" trading of foreign currencies. With an average daily volume of over $3 trillion, Forex far exceeds the $30 billion daily turnover on the New York Stock Exchange and is 46 times larger than all of the futures markets combined. For these reasons, Forex is the world’s largest and most liquid market. The main benefit of this alternative investment class is the ability to profit from rising and falling markets and the ability to diversify from traditional investments like equities, real estate or fixed income, which tend to be cyclical in nature.
It is often the case that a well managed Forex account will far exceed the quarterly returns gained from other asset classes. However, trading the Forex market is not an easy proposition. Many Forex investors do not have the time, experience or discipline to trade the Forex market themselves and most of those that try end up losing their initial investment. Understanding the complexities of why different currency pairs move, being able to follow market movement 24 hours a day, and having the self-discipline to stick to a trading strategy is essential to successful trading. The Echo FX Managed Forex Account Program has been created for investors with risk capital who do not necessarily have the know-how or time to trade the Forex market on their own but want the opportunity to participate in the Forex market.
1) The client opens a Forex account at an Echo FX approved, fully regulated and reputable Forex brokerage firm. This Forex brokerage account is owned and controlled 100% by the client. All client funds deposited into that account are held by the Forex brokerage where the account was established. Again, Echo FX has absolutely no access to withdraw from or deposit funds to the account.
2) The client authorizes Echo FX via a Limited Power of Attorney to execute trades on behalf of the client using the brokerage firms trading platform. The Forex broker approves the Limited Power of Attorney .This Limited Power of Attorney can be revoked at anytime and trading stopped immediately.
3) The client authorizes the Forex brokerage firm to pay a percentage (performance fee of 40%) of new profits on client's account to Echo FX at the end of each month. New profits are profits made above the previous high watermark of the account. Echo FX does not charge any other fee to the client other than the performance fee.
4) Client is given complete access to view and monitor trade activity on his/her account. This includes seeing every trade the system takes and viewing the account's current balance and equity.
5) It is the clients responsibilty to determine his/her own risk appetite and what he/she considers "max drawdown". If at anytime, drawdown on the account has exceeded the clients max threshold it is the clients right to cancel all trading on the account.
6) Client may withdraw profits at anytime. Echo FX does however recommend that the client give notice before withdrawing an amount in excess of 25% of the balance of the account to avoid the potential for there being insufficient margin available to the account.
To learn more, JOIN US at our next weekly informational webinar
Saturday, August 2, 2008
What is a "Trading System"?
Every once in a while you may check your trade log to see what trades were made on your account. You may ask yourself, why and how the decision to take that trade was made. Allow me to give you a little insight into the process behind every trade.
First, I would encourage you to read Investopedia's definition of a trading system.
Every trade our system signals has a reason for entry and a strategy to get out. Whether the trade made money or lost, whether the trade lasted 24 hours or 24 seconds, every trade is taken with a purpose in mind and is based off of precise entry signals. Every trade taken has a set stop-loss (absolute risk) and take-profit (profit goal). The trader's sole responsibility is to see that the system's rules are carried out precisely as called for in the plan. And thus, with confidence, we can "Plan the Trade and Trade the Plan" without emotion or fear. No system wins everyday. No system can guarantee consistent daily returns through all market conditions. The famous "Turtles' " system lost more often than it won but still managed to make over 80% per year.
Drawdown. The bad word in Forex. For those unfamiliar with typical Forex drawdown I would invite you to Google "Typical Forex Drawdown" to get a feel for what other Forex systems are experiencing. You will see anywhere from 5% - 65% all depending on the potential return. Obviously a system that only experiences drawdown of 5-10% will not make more than a couple percent per month while a system that risks 50+ percent will have the potential for equal monthly gains. In creating our system we looked to be somewhere in the middle between high Forex returns and high Forex risk. Keep in mind that compared to many investments any Forex risk is a high-risk.
WHY USE AN AUTOTRADER? We use an autotrader for the same reason every commercial plane these days uses auto pilot, because humans are prone to make errors in the heat of the moment. Trading is a highly stressful endeavor. Every trade involves complex formulas for determining when to enter, what position size to enter with, and how to exit the market. Without the computer we could not execute the system rules exactly according to plan. However, as with commercial flight, our pilot (the Echo FX Trading Team) is always at the wheeling monitoring the auto trader, watching the market, studying the fundamental news and making adjustments to the strategies as is necessary.
No Trade Days. You will see that often one or all of the Strategies' rules signal a no trade for that day. This is normal. We have calculated when a day is a much higher risk for loss. In some cases, we take half risk that day, in other cases we don't trade. For instance, we often avoid trading bank holidays or when the end of the month falls on a Monday or Friday. We tend to not trade (unless market conditions warrant it) around the time major news is coming out, and we never trade the non-farm payroll report (typically the first Friday of each month).
First, I would encourage you to read Investopedia's definition of a trading system.
Every trade our system signals has a reason for entry and a strategy to get out. Whether the trade made money or lost, whether the trade lasted 24 hours or 24 seconds, every trade is taken with a purpose in mind and is based off of precise entry signals. Every trade taken has a set stop-loss (absolute risk) and take-profit (profit goal). The trader's sole responsibility is to see that the system's rules are carried out precisely as called for in the plan. And thus, with confidence, we can "Plan the Trade and Trade the Plan" without emotion or fear. No system wins everyday. No system can guarantee consistent daily returns through all market conditions. The famous "Turtles' " system lost more often than it won but still managed to make over 80% per year.
Drawdown. The bad word in Forex. For those unfamiliar with typical Forex drawdown I would invite you to Google "Typical Forex Drawdown" to get a feel for what other Forex systems are experiencing. You will see anywhere from 5% - 65% all depending on the potential return. Obviously a system that only experiences drawdown of 5-10% will not make more than a couple percent per month while a system that risks 50+ percent will have the potential for equal monthly gains. In creating our system we looked to be somewhere in the middle between high Forex returns and high Forex risk. Keep in mind that compared to many investments any Forex risk is a high-risk.
WHY USE AN AUTOTRADER? We use an autotrader for the same reason every commercial plane these days uses auto pilot, because humans are prone to make errors in the heat of the moment. Trading is a highly stressful endeavor. Every trade involves complex formulas for determining when to enter, what position size to enter with, and how to exit the market. Without the computer we could not execute the system rules exactly according to plan. However, as with commercial flight, our pilot (the Echo FX Trading Team) is always at the wheeling monitoring the auto trader, watching the market, studying the fundamental news and making adjustments to the strategies as is necessary.
No Trade Days. You will see that often one or all of the Strategies' rules signal a no trade for that day. This is normal. We have calculated when a day is a much higher risk for loss. In some cases, we take half risk that day, in other cases we don't trade. For instance, we often avoid trading bank holidays or when the end of the month falls on a Monday or Friday. We tend to not trade (unless market conditions warrant it) around the time major news is coming out, and we never trade the non-farm payroll report (typically the first Friday of each month).
Emotion Free Trading/Investing
Emotion Free Forex Trading. Forex trading can be VERY stressful for both the trader and the investor. Our system is designed to take all of the emotion out of the trade. Every possible trade scenario has a rule attached that indicates to the trader what to do. My job as lead trader is 1) analyze the market prior to the open to determine if any fundamental factors require placing the system on hold that day and 2) to analyze the effectiveness of the system and strategies making changes when/where necessary. These changes however are NOT made on a daily basis since not every trade will win and no system will win every day. These changes are typically made monthly.
Emotion Free Forex Investing. Is there such a thing? I doubt it. But there are ways to reduce the daily stress of Forex investing. First, NEVER invest money you can't afford to lose. I can't even imagine the stress and emotion that would go along with that. Second, only check your account weekly. I know this sounds easier than it is, but you will find that Forex is a 6 steps forward 5 steps back process. If you are checking it daily you will be on such an emotional roller coaster that you won't be able to happily live your life. You will find that on winning days I am your favorite person and on losing ones your least favorite. But you shouldn't have to go through that kind of emotional daily ride. Third, knowledge is power. Learn everything you can about Forex. Understand the risk, the reward, and the fundamental reasons why currencies do what they do. If you get so good that you decide to pull your money and trade on your own, I welcome you to do it. If not, I am happy to continue to trade your funds. Just learn so that you know what your investment is (Here is a good place to start).
Emotion Free Forex Investing. Is there such a thing? I doubt it. But there are ways to reduce the daily stress of Forex investing. First, NEVER invest money you can't afford to lose. I can't even imagine the stress and emotion that would go along with that. Second, only check your account weekly. I know this sounds easier than it is, but you will find that Forex is a 6 steps forward 5 steps back process. If you are checking it daily you will be on such an emotional roller coaster that you won't be able to happily live your life. You will find that on winning days I am your favorite person and on losing ones your least favorite. But you shouldn't have to go through that kind of emotional daily ride. Third, knowledge is power. Learn everything you can about Forex. Understand the risk, the reward, and the fundamental reasons why currencies do what they do. If you get so good that you decide to pull your money and trade on your own, I welcome you to do it. If not, I am happy to continue to trade your funds. Just learn so that you know what your investment is (Here is a good place to start).
Friday, August 1, 2008
Three Unique Trading Options - Select Your Risk
When our group first began to trade Forex it was not initially with the intention of trading other individuals' funds. Our goal all along was to take a portion of our own portfolio and endeavor to make high returns on it through a high-risk investment (Forex). And with that goal in mind, in late 2006 we set to work on building a trading system that would meet that goal. The trading strategies we use have been designed and programmed by our group. They are tailored to OUR trading personality and risk comfort levels. However, from the beginning we have understood that our risk appetite, investment goals, and financial personalities are not necessarily the same as other investors and that quite frankly "no two investors" are the same. And so, with that in mind, we have taken our system and adjusted it to allow three distinct risk options for the Forex investor (Medium Risk, Medium-High Risk, and High Risk).
Echo FX Medium Risk System - Uses two unique trading strategies focused on limiting drawdown. Through disciplined and market sensitive guidelines the system strives to obtain consistent quarterly results. The system is a combination semi-auto trade strategy and a 100% manual execution strategy. Both strategies follow strict entry and exit rules and are monitored 24 hours a day by our trading team. Target Max Drawdown - 15%
Echo FX Medium-High Risk System - Uses the same two unique trading strategies as in the Medium Risk System but with higher risk/trade parameters. As with the Medium Risk System, this system is a combination semi-auto trade strategy and a 100% manual execution strategy. Both strategies follow strict entry and exit rules and are monitored 24 hours a day by our trading team. Target Max Drawdown - 25%
Echo FX High Risk System - Combines the two strategies in our Medium Risk System with a third, range based, strategy. This third strategy is extradinarily effective but requires much more account principal to not over-extend the account. The system takes thousands of small trades per month across multiple time frames and over 12-18 currency pairs. By doing this the system seeks to diversify it's positions and maximize it's profits. Target Max Drawdown - (40%).
Echo FX Medium Risk System - Uses two unique trading strategies focused on limiting drawdown. Through disciplined and market sensitive guidelines the system strives to obtain consistent quarterly results. The system is a combination semi-auto trade strategy and a 100% manual execution strategy. Both strategies follow strict entry and exit rules and are monitored 24 hours a day by our trading team. Target Max Drawdown - 15%
Echo FX Medium-High Risk System - Uses the same two unique trading strategies as in the Medium Risk System but with higher risk/trade parameters. As with the Medium Risk System, this system is a combination semi-auto trade strategy and a 100% manual execution strategy. Both strategies follow strict entry and exit rules and are monitored 24 hours a day by our trading team. Target Max Drawdown - 25%
Echo FX High Risk System - Combines the two strategies in our Medium Risk System with a third, range based, strategy. This third strategy is extradinarily effective but requires much more account principal to not over-extend the account. The system takes thousands of small trades per month across multiple time frames and over 12-18 currency pairs. By doing this the system seeks to diversify it's positions and maximize it's profits. Target Max Drawdown - (40%).
Past/Hypothetical Performance Notice
Please keep these two alerts in mind when considering the past performance, either hypothetical or real posted here.
PAST PERFORMANCE
Past performance is not indicative of future results, as returns may vary according to market conditions.
The trading systems herein described have been developed for sophisticated traders who fully understand the nature and the scope of the risks that are associated with forex trading. Should you decide to trade any or all of these systems' signals, it is your decision.
No representation is being made that following a system's suggested signals will necessarily lead to profit. Investors may incur into a series of consecutive losses and substantial equity-draw-downs that can deplete their assets before the occurrence of any meaningful profit accumulation.
Please take note that all the figures shown herein (unless otherwise noted) represent a computer back-test of trading systems-logic and NOT an actual trading record.
HYPOTHETICAL PERFORMANCE
Hypothetical performance results have many inherent limitations. No representation is being made that any account will or is likely to achieve profits or losses similar to those shown. In fact, there are frequently sharp differences between hypothetical performance results and the actual results subsequently achieved by any particularly trading program.
One of the limitations of hypothetical performance results is that they are generally prepared with the benefit of hindsight. In addition, hypothetical trading does not involve financial risk. Variables such as the ability to adhere to a particular trading program in spite of trading losses as well as maintaining adequate liquidity are material points which can adversely affect actual real trading results. For example, the ability to withstand losses or to adhere to a particular trading program in spite of trading losses are material points which can also adversely affect actual trading results. There are numerous other factors related to markets in general or to the implementation of any specific trading program that cannot be fully accounted for in the preparation of hypothetical performance results and all of which can adversely affect actual trading results.
PAST PERFORMANCE
Past performance is not indicative of future results, as returns may vary according to market conditions.
The trading systems herein described have been developed for sophisticated traders who fully understand the nature and the scope of the risks that are associated with forex trading. Should you decide to trade any or all of these systems' signals, it is your decision.
No representation is being made that following a system's suggested signals will necessarily lead to profit. Investors may incur into a series of consecutive losses and substantial equity-draw-downs that can deplete their assets before the occurrence of any meaningful profit accumulation.
Please take note that all the figures shown herein (unless otherwise noted) represent a computer back-test of trading systems-logic and NOT an actual trading record.
HYPOTHETICAL PERFORMANCE
Hypothetical performance results have many inherent limitations. No representation is being made that any account will or is likely to achieve profits or losses similar to those shown. In fact, there are frequently sharp differences between hypothetical performance results and the actual results subsequently achieved by any particularly trading program.
One of the limitations of hypothetical performance results is that they are generally prepared with the benefit of hindsight. In addition, hypothetical trading does not involve financial risk. Variables such as the ability to adhere to a particular trading program in spite of trading losses as well as maintaining adequate liquidity are material points which can adversely affect actual real trading results. For example, the ability to withstand losses or to adhere to a particular trading program in spite of trading losses are material points which can also adversely affect actual trading results. There are numerous other factors related to markets in general or to the implementation of any specific trading program that cannot be fully accounted for in the preparation of hypothetical performance results and all of which can adversely affect actual trading results.
Risk Disclosure
Let me first ask that you do not take this lightly. Many of the government required "disclosures" seem so boilerplate and unimportant. There is however in FOREX real risk. This is a high-leverage investment. Potential for huge returns as well as potential for large losses. We may lose 10 trades in a row before we get back to winning. You should fully understand the risk and the emotions that are involved.
Echo FX High Risk System
The Echo FX High Risk Trading System uses the same two unique trading strategies as used in the medium and medium-high risk system but with higher risk per trade parameters. As with the other systems, this system is a combination semi-auto trade strategy and a 100% manual execution strategy. Both strategies have strict entry and exit rules and are monitored 24 hours a day by our trading team.
Target Quarterly Profit : 32%
Target Maximum (Floating) Drawdown: 40%
Account Sizes: $45,000 - $400,000
Performance Fee - 35%
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The Frankfurt Strategy
Trades GBP/USD and EUR/USD
Combination auto trading strategy with human signal confirmation
Executes about 10 trades per day
Averages 0.05% risk per trade
Does not get entry signals everyday
All trades closed before the end of each day
Target Quarterly Profit of 15.33%
Target Maximum Drawdown of 20%
Mid-Range Trend Finder
Trades 18 currency pairs using the EUR, USD, GBP, CHF, AUD, JPY, and CAD
No auto trading used but strategy is traded by trading team using strict entry and exit guidelines
Executes about 5-7 trades per week
Averages 2% risk per trade
Trades may be open anywhere from a few hours to a week
Target Quarterly Profit of 16.67%
Target Maximum Drawdown of 20%
To learn more, JOIN US at our next weekly informational webinar
Echo FX Medium-High Risk System
The Echo FX Medium-High Risk Trading System uses the same two unique trading strategies as used in our standard medium risk system but with higher risk per trade parameters. As with the medium risk system, this system is a combination semi-auto trade strategy and a 100% manual execution strategy. Both strategies have strict entry and exit rules and are monitored 24 hours a day by our trading team.
Target Quarterly Profit : 20%
Target Maximum Drawdown: 25%
Account Sizes: $35,000 - $400,000
Performance Fee - 40%
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The Frankfurt Strategy
Trades GBP/USD and EUR/USD
Combination auto trading strategy with human signal confirmation
Executes about 10 trades per day
Averages 0.033% risk per trade
Does not get entry signals everyday
All trades closed before the end of each day
Target Quarterly Profit of 10%
Target Maximum Drawdown of 13%
Mid-Range Trend Finder
Trades 18 currency pairs using the EUR, USD, GBP, CHF, AUD, JPY, and CAD
No auto trading used but strategy is traded by trading team using strict entry and exit guidelines
Executes about 5-7 trades per week
Averages 1.25% risk per trade
Trades may be open anywhere from a few hours to a week
Target Quarterly Profit of 10%
Target Maximum Drawdown of 12%
To learn more, JOIN US at our next weekly informational webinar
Echo FX Medium Risk System
The Echo FX Medium Risk Trading System uses two unique trading strategies focused on limiting drawdown. Through disciplined and market sensitive trading guidelines the system strives to obtain consistent quarterly results. The system is a combination semi-auto trade strategy and a 100% manual execution strategy. Both strategies have strict entry and exit rules and are monitored 24 hours a day by our trading team.
Target Quarterly Profit : 12%
Target Maximum Drawdown: 15%
Account Sizes: $25,000 - $400,000
Performance Fee - 50%
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The Frankfurt Strategy
Trades GBP/USD and EUR/USD
Combination auto trading strategy with human signal confirmation
Executes about 10 trades per day
Averages 0.02% risk per trade
Does not get entry signals everyday
All trades closed before the end of each day
Target Quarterly Profit of 6%
Target Maximum Drawdown of 7.5%
Mid-Range Trend Finder
Trades 18 currency pairs using the EUR, USD, GBP, CHF, AUD, JPY, and CAD
No auto trading used but strategy is traded by trading team using strict entry and exit guidelines
Executes about 5-7 trades per week
Averages 0.75% risk per trade
Trades may be open anywhere from a few hours to a week
Target Quarterly Profit of 6%
Target Maximum Drawdown of 7.5%
To learn more, JOIN US at our next weekly informational webinar
Welcome the Echo Fx Blog
Let me be the first to welcome you to the Echo FX Blog. This is an effort to educate our clients and potential clients on our trading strategies, share the fundamental and technical data we are working off of, give added insight into the why behind our trades, and to provide a forum where we can log each and every trade we make. So welcome and enjoy.
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