Dear Investor,
We hope that this message finds you all well. We are pleased to announce that September’s month of trading has again been a profitable one across the board! By sticking to our core principals of capital maintenance over profit maximization, we were able to ride out some tough periods, lock in some profits, and start October off on a good foot (profitable already). We encourage both our current and prospective clients to read through our update in its entirety so that everyone is up-to-date on our latest developments.
Our returns for the month of September are as follows…
SEPTEMBER 2010 PERFORMANCE
Precision FX: +14.91%
Chrome FX: +6.13% (Average of Chrome A: 3.07% and Chrome B: 9.18%)
Mclaren FX: +1.37%
September Average: +7.47%
* Synergi FX: +21.66%
- this is a new strategy of ours (details below) which we will not include in our monthly average until we have it trading on a MAM, where it is auditable.
* 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 at midnight server time, NOT the floating equity. So open trades which have not realized 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 (<5K). This often has to do with the broker’s min position sizes and how smaller trades are distributed with the allocation software in our MAM/PAMM. 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:
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% | 9.43% | 24.90% | |
Jun-09 | 23.60% | 25.77% | 4.69% | 30.46% | 21.13% | |
Jul-09 | 10.10% | 20.69% | 4.13% | 28.02% | 15.74% | |
Aug-09 | 26.92% | 10.77% | 4.86% | 26.94% | 17.37% | |
Sep-09 | -0.32% | 5.44% | 5.79% | 7.83% | 4.69% | |
Oct-09 | -4.26% | 20.36% | 6.55% | 11.94% | 8.65% | |
Nov-09 | 10.76% | -20.98% | 30.98% | 29.39% | 12.54% | |
Dec-09 | 9.37% | 15.94% | 10.39% | 7.78% | 10.87% | |
Jan-10 | 33.63% | 27.91% | 16.02% | 4.30% | 20.46% | |
Feb-10 | 15.31% | 14.93% | 22.63% | 2.33% | 13.80% | |
Mar-10 | 15.43% | -5.08% | 3.23% | 6.75% | 5.08% | |
Apr-10 | -8.11% | -9.43% | -0.05% | 2.99% | -3.65% | |
May-10 | 0.70% | -7.66% | 27.30% | 21.07% | 10.35% | |
Jun-10 | 20.86% | 10.56% | 4.83% | 9.68% | 11.48% | |
Jul-10 | 10.80% | 14.57% | 6.60% | 0.15% | 8.03% | |
Aug-10 | 5.46% | 2.34% | 7.35% | 5.05% | ||
Sep-10 | 14.91% | 6.13% | 1.37% | 7.47% | ||
TOTAL COMP'D RETURN: | 1285.98% | 3438.97% | 302.76% | 563.18% | 1397.72% | |
MONTHLY AVERAGE: | 14.18% | 21.72% | 10.10% | 12.22% | 14.56% | |
MONTH-END TRADING RECAP
1. Precision FX - Scalping conditions were rather good again this month, which is important since the majority of PFX’s strategy is based on scalping strategies. This was our best performing system this month banking nearly 15% with a max drawdown of only -2.12%. This system has a monthly average of 14.18% over the past 2 years. In other news, we started trading this system at a second brokerage this month. It had a bit of a rocky start getting off of the ground, but it banked approximately 4.14% there in September. This was a partial month, and it took a little bit of getting used to and making some adjustments, but the system seems to be trading quite well there now. We will of course always notice some discrepancy between different brokerages.
2. Chrome FX – Our Chrome system (both A and B) performed nicely for us as well this month. The Chrome A system struggled a little more than B, and the A system actually ran into a few technical glitches as many of our other systems did this past month when our brokerage performed a server and bridge update. Performance could have likely been a little higher as a result of this, but we cannot complain with what the markets have given us if we are on the plus side. Especially given the current market conditions. There are often more technical challenges which come along with trading forex than many people know. There have been a few additional strategies added to the Chrome system for October which should give it a nice little performance boost!
3. McLaren FX – McLaren FX was the turtle this month just barely breaking positive ground. It started the month out with a bang, and sort of dwindled down during the last week and a half of the month. We get many inquiries about this account by our current and prospective clients. Again, we must stress that this is not an “action packed” account. We do not always see a pile of trades in this account like many of our other systems, as it is very selective when it trades. We have seen up to 10 trades in one day, and no trades for over 1 week. So it can really vary. But, it’s the winning trades that count, and it’s the month end numbers that matter. This is a very strong and stable performing account. We always stress to our clients that this is a long-term system, and should be treated as such in terms of performance. This is an account which runs in cyclic periods as well. We will sometimes see some stagnant periods of slow and steady performance, followed by a few high 20% or even low 30% months. We never know when these will happen, but they certainly do. The best approach with this account, is depositing funds for long-term gain, and letting them work for a lengthy period of time. This holds true for all of our systems really, and not just this one. But those who leave their funds in this system for the year should be rewarded with some very nice long-term steady growth.
INFORMATION AND NEW DEVELOPMENTS
1. New Strategy: Synergi FX – For the past few months we have been working with some of our programmers to construct a new synergistic trade strategy which we have finally put to live real money testing back in the last few weeks of August. Our return for September was 21.66%, trading on somewhat aggressive settings. During October we will experiment with a slightly lower risk profile, and we will move the system over to a private MAM environment where we can run it on multiple accounts at once - mainly ours and the developers and a few others for now. The MAM will be ready early next week. Assuming this continues to trade well this month, we will open this up to a few interested parties next month. From this point on, assuming performance and the risk profile hold up as well as we think it will we will allow clients to come on board whenever they choose (basically whenever they see enough live trade history). Our audit for this system will start on the MAM as soon as it is ready. We will be offering this at our current brokerage only for the time being.
2. Purchasing our Systems – We have been approached by multiple groups this past month asking for a price to purchase our experts (automated systems). While this may be an option some day down the road, currently at this time the systems are not for sale. They are for sole use on our managed account products. Even if they were for sale, they are not as simple as selling as one single product. Most of our systems require constant supervision, testing, tweaking, monitoring, and intervention from time to time. Furthermore, many of our systems are very well diversified now. They use a mix of multiple experts, some custom and proprietary, and some even commercial. This combination of systems/strategies along with a discretionary approach is what these are made up of to form the final product. Some of the systems use proprietary and/or commercial indicators. Most of the systems also have a dedicated team constantly adjusting the risk profile for the systems. So to answer this question before we get asked again - unfortunately the systems are not for sale, and furthermore, even if they were it is not as simple as selling one single expert per system and plugging it in, and achieving the same results as we do. There has been a tremendous amount of R&D which has went into these, and continues to go into them on a regular basis.
3. Incremental Minimum Investment Increases – Just a friendly reminder to all that starting November 1st, we will be implementing a small increase in our initial minimum investment amount for new investors. We will be increasing this from $5,000 USD which is our current minimum, up to $10,000 USD as the new minimum. Our next increment will be increasing to $25,000 USD, which right now is slated for January 1st, 2011.
4. New Broker(s) – As many of you are aware, we have started to migrate some of our systems over to a new brokerage. We ask our clients to bare with us while we embark on building a relationship at the new house. We have been trading at our current brokerage for nearly 3 years and it has taken us some time to get things setup the way they are now running like a well oiled machine. We cannot expect this to be the same at the new house instantly, and may take some time as we learn more about one another. So far things look great, but of course there will be issues which we may not have uncovered yet. We would like to ask our clients to bare with us as we build up our business here and work through any growing pains which may arise. It is also very important that our client’s understand that it is extremely difficult to get consistent performance from one brokerage to another, especially when trading with automated systems. There are many many factors at play which have an influence on this. We get many requests from people asking to trade for them at specific brokerages. This is not as easy as it sounds. We need to put our systems through an extensive testing phase, and assuming things look well there, we need to make sure results will not vary too significantly. Unfortunately many of our systems are extremely high maintenance in the requirements they need to be profitable on a consistent basis and trading at a good brokerage has a major major impact on the success of the system – it’s a very important piece of the puzzle.
SUMMARY
We are happy to report a positive and profitable update once again this month to our cleints. We are also looking forward to heading into a profitable October which is already the case across the board. As always we will do our best to communicate with our investor base whether in the form of monthly updates, or on a “per needed” basis as we go through the month on any issues which may present themselves. Please visit our website and blog for frequent updates and newsletters (note: we are always adding new content to our website) and do not hesitate to contact us at any time should you have any inquires or concerns you would like to discuss with us.
Thank you to all our current investors for your trust once again in trading with us. We are looking forward to more above average profits each month herein to wrap up the final quarter of 2010 making it a year to remember.
Warm Regards,
The CayoFlow Team
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