FEBRUARY 2009 PERFORMANCE
Precision FX: +15.26%Chrome FX: +14.90%
Guardian FX: +22.63%
Our Performance Table has also been updated with our new system as follows…
MONTH | PRECISION | CHROME | GUARDIAN | AVERAGE | |
Dec-08 | 32.30% | 72.73% | 52.52% | ||
Jan-09 | 18.70% | -4.48% | 7.11% | ||
Feb-09 | 27.50% | 160.13% | 93.82% | ||
Mar-09 | 29.50% | 21.17% | 25.34% | ||
Apr-09 | -34.40% | 49.91% | 7.76% | ||
May-09 | 53.30% | 18.65% | 3.52% | 25.16% | |
Jun-09 | 23.60% | 16.01% | 4.69% | 14.77% | |
Jul-09 | 10.10% | 3.76% | 4.13% | 6.00% | |
Aug-09 | 26.92% | 6.82% | 4.86% | 12.87% | |
Sep-09 | -0.32% | 32.73% | 5.79% | 12.73% | |
Oct-09 | -4.26% | 20.36% | 6.55% | 7.55% | |
Nov-09 | 10.76% | -20.91% | 30.98% | 6.94% | |
Dec-09 | 9.37% | 15.94% | 10.39% | 11.90% | |
Jan-10 | 33.91% | 28.06% | 16.02% | 26.00% | |
Feb-10 | 15.26% | 14.90% | 22.63% | 17.60% | |
TOTAL COMPOUNDED RETURN: | 700.93% | 2664.23% | 174.40% | 1179.85% | |
MONTHLY AVERAGE: | 16.82% | 29.05% | 10.96% | 21.87% | |
MONTH END RECAP
Trading this month was rather level on our two scalping based systems (PFX and CFX), with the exception of an unexpected high impact news announcement which caused both scalping systems to encounter a draw down on the 18th. Of course we had a few open positions on quite a few pairs during the announcement which had a compounding effect on the drawdown. Both systems seemed to recover quite well without the need to adjust their risk profile any. GBPUSD was a solid performer on the Precision system this month, and the EURCAD grid on Chrome performed quite well all month despite some large moves near the month end.
NEW DEVELOPMENTS
New Trading System – Guardian FX: Our biggest and most exciting news this month was the addition of our new trading system Guardian FX (http://cayoflow.com/guardianfx.html). This has been a much anticipated addition to our line-up of investments. The system is one of the more complex and powerful trading systems we have come across in a long while, and we are very proud to a part of this initiative. The system employs is a neural network strategy. For those of you who know anything about neural networks, you will know that their complexity often enables them to either a.) work extremely well, or b.) the exact opposite! Well… we have one that works very well. Please visit the system’s website above for more information on the details of the system including performance, but the bottom line is that we expect this to be a very nice addition to our arsenal of trading systems and we expect it to be a very consistent and long-term performer for our clients to diversify into. During February it has out-performed both our scalpers and with less risk exposure too! Those of you in our MAM will have only had 2 days of live trading on the account last month as we flicked the switch on the live MAM on the 24th. March will be the first full live month in the MAM accounts. These are now trading on the former McLaren MAM.
McLaren FX: The McLaren FX system is “in the shop” for the month of March. Due to January’s draw down and an early draw down in the accounts for February, for the safety of our client funds, we have since ceased trading the system on the live MAM with client funds as of the first week in February. The developers and trade team are making some essential adjustments to the core strategy, and many of the external influences which the system needs to constantly interact with in order to remain profitable. This past month of testing has looked good and it has nearly made up its loss already that it experienced early in the month. However, we feel that it would not be responsible to conduct our testing on live client monies in the managed account until the system has been completely finalised into a new build (McLaren V2). Our apologies for the inconvenience this may cause, but at the same time we hope you appreciate our discretion in protecting the safety of client’s funds. We do not wish to expose investor monies to any type of “testing environment” in the live MAMs. We anticipate the re-launch of McLaren V2 in April 2010, and we will use the month of March to refine and fine tune the strategy. Those wishing to participate upon the re-launch will still hold their previous high water marks.
Investment Minimums Increasing: For the bulk of 2009 we have kept our minimum investment at $2000 USD per system. The purpose of keeping this minimum so low was to allow investors the opportunity to “test” out the managed accounts with a small capital placement due to our relatively short trading history at the time. Now that we have a year under out belts and anywhere from 6 – 15 months of live trade data on our systems we have currently increased the minimum investment up to $5000.00 USD per system. We will be incrementally increasing this investment minimum up during the course of 2010 until we reach $50K USD as the new minimum planned for the start of 2011. We will stay at $5000.00 USD for the next month or two before increasing to the next interval of $10,000 USD. Our apologies for the lack of notice on this increase and we will try our best to give prior notice before the next increase. We feel that $5000 USD is still a modest investment minimum for prospective clients wishing to participate with us. While we welcome all legally eligible and quality clients, we want to ensure we are ultimately attracting the proper investor base. Our target clientele is the mature investor who properly understands, and can afford the risks associated with alternative investments. We would urge any potential investors wishing to participate before the minimums increase to $10K per system to sign up during the month of March.
Segregated Accounts: For clients with $1M+ USD our current broker has been very busy working on an opportunity for segregated accounts. They have forged partnerships with 3 leading Swiss, French, and US banks, all with a very large global reach. These segregated accounts would allow the client to keep their funds in his or her own personal bank account in their own name. An API script via FIX connection would allow the funds to be accessed and traded in the interbank forex market without having to move to the broker. Everything would be the same, only all PnL settlements would be made on a daily or weekly basis dependant on the bank. Please note that this is not available to general clients of the brokerage. It is a special arrangement we have in place, and can be implemented for high net worth clients (1 Million USD or higher) who may have difficulty moving their funds for whatever reason or who are not comfortable in doing so. The implantation should be complete for April 1st, 2010. Interested parties are urged to contact us for details.
Account Discrepancies: Many of you have inquired with us wondering why your monthly returns are either more or less than ours posted on our website. Our numbers are from the 1st of each calendar month, to the last trading day of the calendar month. If you have invested in the middle of the month, your numbers may not match ours. Our returns are gross of performance fees which are deducted at the end of each month.
Account Audits: Some of our prospective investors have inquired with us about having our accounts audited by a 3rd party as a means of verifying our performance. While the question of our performance has never been an issue for us in the past (since 90% of our business comes from referral) we have had a growing number of investors contacting us without an introduction through our website. Most of our current investors referring clients share their account performance with their referrals. For those contacting us without referral, we are happy to announce that we are working with a USA based CPA firm who has agreed to conduct quarterly audits on our accounts. We are working out the finer details, but ultimately we like this idea and are very open to implementing it for our prospective clients coming across us via our website.
USA Investors: Just a final note on jurisdiction as we still get constant requests to accommodate to USA investors. Unfortunately at this time, we cannot make exceptions with this. This is a limitation imposed by our broker to purposely not partake in any of the new proposed FX changes being released by the NFA and CFTC. They want no affiliation with this. Our broker does not like the direction that FX is headed in the USA, and we must admit that we are on the same page as them. We know many quality clients in the USA and have many friends and trading associates there. We really dislike having this restriction in place, but at this time, unfortunately we must adhere to it.
For those of you looking to participate through a foreign corporate entity, we have an international law firm ready and willing to assist clients getting established with non-USA based entities to trade through sush as an IBC (international business company), trusts or foundations. This will allow USA citizens the ability to indirectly participate with us. Costs vary anywhere from $900 - $1600 on average for a company established in a low tax jurisdiction with all the bells and whistles. While we realise that this may not be for everyone, we have found that many of our USA clients are enjoying a few other advantages that such an offshore structure can provide. There are too many reasons to list and it really depends on the client, but for most people the obvious benefits are; financial privacy, asset and currency diversification, protection from inflation, asset protection, access to foreign investments, legal income, capital gain, estate and gift tax reduction, immunity to domestic law, higher returns on investment, estate planning, tax reduction, and in general more favourable foreign laws than most high tax jurisdictions. Please ensure you are fully aware of the proper management of your company if deciding to incorporate offshore.
Please visit our website and blog for frequent updates and newsletters, and do not hesitate to contact us at any time should you have any inquires, concerns, or partnership arrangements you would like to converse about.
Thank you to all our current investors for trust in trading with us, and we look forward to making March another month of healthy profits for all!
Warm Regards,
The Cayo Flow team
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