We would like to take a moment to wish a big Happy Canada Day to all our canuck investors and soon to be investors and readers! Also happy 4th of July (in advance) to all our American friends investors and soon to be’s as well. We are quite pleased to announce that June’s month of trading has been a very busy month for us, but it has also been a very profitable one! We were able to produce a healthy profit across the board on all of our systems combined. Despite a few challenges which presented themselves, we are very happy with the results. After a few months of constant “adjustments” to some of our systems we are finally getting to a point where we are almost satisfied with the current status of each system. We are not 100% there yet, and have a few more adjustments to make (all for the better) so please read this update in its entirety as there is some important information contained herein, but we believe that this month will be the last month for changes, and we will be able let our systems trade uninterrupted for quite some time. We would like to thank all of our investors for their understanding and patience as we tackled many of these challenges which ranged from small tweaks to our trading strategies all the way to setting up shop at new brokers.
Our returns for the month of June are as follows…
June 2010 Performance
Precision FX: +20.86%Guardian FX: +4.83%
Chrome FX: +10.56%
McLaren FX: +9.68%
June Average: +11.48%
* Account Discrepancies – Once again, please remember that if your returns for a given month do not match our posted returns take note that 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 and could vary significantly. In addition to this, if we have open trades at month end, we calculate our return on the current balance that day, NOT the floating equity. So open trades which have not realised their PnLs yet will be carried into the next month. For certain systems we have also noticed small discrepancies between larger investor’s accounts (100K+) and very smaller investor’s accounts. This often has to do with the broker’s min position sizes and how they are distributed with the allocation software in our MAM. All accounts are usually never out more than a percent or two max, and usually match within a fraction of this.
Our Performance Table has also been updated with the following statistics of interest (note, McLarenFX v2b’s historic performance will be compiled to the performance table during July. For now we have only included the month of June)…
MONTH | PRECISION | CHROME | GUARDIAN | MCLAREN | AVERAGE | |
Dec-08 | 32.30% | 72.73% | 52.52% | |||
Jan-09 | 18.70% | -4.19% | 7.26% | |||
Feb-09 | 27.50% | 160.30% | 93.90% | |||
Mar-09 | 29.50% | 21.97% | 25.74% | |||
Apr-09 | -34.40% | 61.33% | 13.47% | |||
May-09 | 53.30% | 33.35% | 3.52% | 30.06% | ||
Jun-09 | 23.60% | 25.77% | 4.69% | 18.02% | ||
Jul-09 | 10.10% | 20.69% | 4.13% | 11.64% | ||
Aug-09 | 26.92% | 10.77% | 4.86% | 14.18% | ||
Sep-09 | -0.32% | 5.44% | 5.79% | 3.64% | ||
Oct-09 | -4.26% | 20.36% | 6.55% | 7.55% | ||
Nov-09 | 10.76% | -20.98% | 30.98% | 6.92% | ||
Dec-09 | 9.37% | 15.94% | 10.39% | 11.90% | ||
Jan-10 | 33.63% | 27.91% | 16.02% | 25.85% | ||
Feb-10 | 15.31% | 14.93% | 22.63% | 17.62% | ||
Mar-10 | 15.43% | -5.08% | 3.23% | 4.53% | ||
Apr-10 | -8.11% | -9.43% | -0.05% | -5.86% | ||
May-10 | 0.70% | -7.66% | 27.30% | 6.78% | ||
Jun-10 | 20.86% | 10.56% | 4.83% | 9.68% | 11.48% | |
TOTAL COMP'D RETURN: | 932.22% | 2323.86% | 277.82% | 9.68% | 885.90% | |
MONTHLY AVERAGE: | 14.78% | 23.93% | 10.35% | 9.68% | 14.69% | |
MONTH-END TRADING RECAP & NEW DEVELOPMENTS
(important updates – please read)
1. Precision FX - Scalping conditions were rather good this month. We dodged a few bullets and also ate a few losses this month, but overall we witnessed great performance with this system. We traded with relatively low risk all month (more than half what we normally trade at) so it was nice to see that even with low risk we were able to make a healthy profit here. This turned out to be our top performing system this month. Also worthy of mentioning, is that PFX’s compounded return has nearly reached 1000%. Those who would have invested 100K with us 1.5 years ago, would have just surpassed the $1M mark this month. Congrats to our longer-term clients who were along for this ride. This is some really great bragging rights for you guys, especially in today’s economic climate. It goes to show the true power of compounding and clearly displays the robustness of this system over the long-term.
• NEW DEVELOPMENTS: As most of you know, Precision FX has been one of our longest running and most successful systems to date. Although it has been tweaked and fine tuned over the course of two years to where it is today, it has experienced the least amount of changes when compared to all of our other systems. We tend to abide by the well accepted rule of “if it’s not broken, then don’t fix it”. However if there is a way we can make it better, and with less chances of it ever breaking down we will certainly do so. We have been working closely with the developer to bring a new sub-strategy to the Precision FX system and we are finally ready for implementation. This will not interfere with the scalping component of PFX, but what it will do is diversify it a little further. As Precision FX stands now being a core scalping strategy, you will typically see it be profitable for a good period of time, then it may suffer a short lull period where performance will be poor for a month or more. This is typically when market conditions become abnormal and in general poor for scalping since it needs consistency in low volume hours and nice sideways ranges which stay within certain fractal envelopes. The sub-strategy is designed to bring more value to the system when scalping conditions are poor and performance is lagging. The new system is trend based, and does not rely on favourable scalping conditions to profit. It not only diversifies the strategy in PFX, but also diversifies the pairs being traded, which include AUD/CAD, AUD/NZD and EURCAD - some pairs with less volume, less noise, and less manipulation. Trades placed with the new sub-strategy will often be longer-term when compared to the scalping trades. Overall we think that this will add great value to the system and give it more tools in it’s tool box to allow it to profit over a wider range of market conditions. You can expect to see the new sub-strategy added in during July.
2. Guardian FX – We have finally started trading Guardian FX at our new brokerage which provided the necessary trading conditions needed in terms of margin and lot sizing which we could not achieve at our regular brokerage. The strategy has been executing very well here with the exception of a small bug which was addressed yesterday. We traded the system with low risk in June, and will be increasing the risk slightly in July. The results for June were based off of a partial month of trading as we had delays in getting the system setup completely for the first of the month. Please take note that we trade 2 PAMMs with this system (a USA client PAMM, and an International client PAMM). Results may vary from one PAMM to another; however they shouldn’t be too far off. We get a lot of inquires about this system by our current investors in it as to the strategy and what is occurring in their accounts. The reporting tool at this broker is a little tough to understand (they display equity as if it were balance). This system is very unique and it is currently our ONLY system which actually thrives in unusual and volatile market conditions. As long as the markets are “moving” we can continue to profit with this system. For those looking to understand more of what is happening in your account, we suggest you read the information page on this system found here: http://www.cayoflow.com/guardianfx.html (it has been recently updated with much more detailed information). Please take special note to the 10 steps to understanding what to expect from this system.
3. Chrome FX – We are very happy with ChromeFX’s performance in June on it’s sole single strategy. It also had some tough periods (mainly due to the quick announcement of Australia’s new PM) but it came out unscathed and locked in a nice 10% profit.
• NEW DEVELOPMENTS (Important): As most of you know Chrome FX has been the system “in the shop” for the longest stretch of time (nearly the past 3 months – in some form or other) and we are very pleased to announce that we are ALMOST done and satisfied with it. The core strategy on the account now, is a very “selfish” strategy in that it does not like to have other systems work with it. It is extremely complex and algorithmic in how it handles its money management calculations. It is always computing every penny going in and out of the account and takes into consideration all transactions from commissions to withdrawals to deposits, to margin changes, to MAM balance adjustments.
Last month we tried to implement Chrome’s final sub-strategies into the mix but found this difficult due to the money management occurring with the core strategy. After many attempts and many different ideas, we realised the only easy way to do this was to split the account into 2 “sub-accounts”. What we will have going into July is a Chrome A, and a Chrome B. When we produce Chrome’s return for the month end, it will be the average of the two sub-accounts (A and B). If there was a way to keep these all in one account we would. But as it stands now, we cannot do this and need to break the account into two sub-accounts. We will be working with our broker this month to setup all Chrome investors with a “Chrome B” account, and to split their funds between the two accordingly. This will be a small inconvenience for us all, but should be very much worth it for the safety net it adds to Chrome. As far as we are concerned the changes to this system will be final! Well… final for a while anyways (we are always tweaking and trying to make all our systems better). Ultimately this is a good thing and helps to further diversify the account as a way to incorporate its sub-strategies.
4. McLaren FX– Many of you were previously invested in our McLaren strategy in late 2009 / early in 2010 which we had closed to new investors. Last month we had resurrected an extremely aggressive version of this system for private entry by those seeking aggressive profit targets (by request). The system traded very aggressively and generated a quick 70% gain in the accounts in June. However this was shortly followed by a -39% loss which ate up the majority of the profit it had made. While the aggressive system has some serious profit potential, with such huge swings in the account it could get counter-productive. After much thought, we decided to discontinue the McLaren aggressive account. We do not want to be a company who offers “roller coaster” systems with huge ups and downs, despite the risk warnings. So this past Sunday (June 27th) we flicked the switch and put the original McLaren (v2b) on the account. Since then the system banked nearly 12%. So while this system is more conservative than the aggressive version, it still targets lofty returns. The original version banked 28% in June, which makes it far from a “low earner”. This system is a somewhat boring system to watch, but it is very powerful and a solid earner! It’s strategy is simply, yet very effective. The original version (v2b) is traded with a 3% max risk per trade risk profile, and should cater to a very large audience of investors. You can view this strategy’s live performance to date since October here: http://cayoflow.com/images/mclaren-moderate.jpg . This version is a merger of the original v1 strategy with some new enhancements. We are compiling the data on to the website for others to view and participate in shortly. It will be made available this month.
SUMMARY
We are exited to get back into the markets this month with all systems wrapping up their final modifications and trading at our new broker as well. We are targeting double digit gains across the board for July and believe we have the means and tools to do so. We would once again like to remind our clients that we are not going anywhere and are working harder than ever to ensure we keep an edge and remain profitable over the long haul. 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 or concerns you would like to discuss.
Thank you to all our current investors for your trust once again in trading with us. We are looking forward to making July another “full house” month of healthy profits across all of our systems combined.
Warm Regards,
The Cayo Flow Team
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