“Everything Becomes FX” The Weekly Trade You Can’t Tell Anyone About Vol.006
This "Investment Navigator +" is a report delivered every Sunday by the "Everything becomes FX" team that considers money management.
It covers money matters not limited to FX markets, and I would like to share the weekly positions I actually hold with a limited audience.
――――――――――――――――――――――――――――
▼Table of Contents
―1. Recent Developments
―2. World's Finance
―3. Weekly Trades You Can't Tell Anyone About
―4. Q&A
―5. Positions for Next Week
――――――――――――――――――――――――――――
【PR】Turn FX losses into gains with money management
A trading technique that emphasizes money management, which is often neglected in FX.
Allows trades that are not swayed by win rates or methods.
▼1. Recent Developments
――――――――――――――――――――――――――――
The chief writer of "Everything becomes FX" travels between domestically and internationally about half of each month. I’d like to inform you which city I’m in, what I’m looking at, and who I’ve met and worked with domestically.
――――――――――――――――――――――――――――
This week I’m in Ho Chi Minh City.
In socialist Vietnam, even if you have an iPad Pro with Apple SIM installed (supporting 180+ countries), you cannot access the Internet by default.
The same goes for Cuba and North Korea (Laos is okay).
You insert a prepaid SIM into an iPad or similar device at the airport to connect to the Internet.
Step outside Tan Son Nhat International Airport in Ho Chi Minh City (formerly Saigon) and you’ll be bombarded by tour guides, taxis, and Uber drivers looking to hustle tourists.
Even if you say "I arranged an Uber, so you’re fine," some people will shamelessly pretend to be the Uber driver themselves.
When you ask to see the number, they frantically still say "It’s okay, it’s okay," trying to swindle you (my face tends to look soft, making me a likely target).
It’s sad to think these people may keep lying to earn a living, but poverty and crime are undeniably correlated.
While writing about this may create a bad image, once you step into Ho Chi Minh City proper you can enjoy a vibrant, eclectic, exotic streetscape (like how Narita Airport area feels rustic, but Shinjuku feels urban).
Sharing economy has grown far beyond Japan. Airbnb is as common as ever, and there are plenty of Uber drivers.
Given Vietnam’s abundant motorcycles, there is also an UberMOTO style (likely Uber’s bike version).
That, too, is an interesting aspect (I haven’t ridden it).
▼2. World Finance
――――――――――――――――――――――――――――
Many FX traders spend time researching fundamentals or technical analysis.
Ironically, about 90% of FX participants incur losses, and many of them exit the market.
In this column, we will distance ourselves from those topics and think about world finance.
――――――――――――――――――――――――――――
This week there was the U.S. employment report.
The unemployment rate fell and expectations for additional rate hikes rose, and USD/JPY reacted by moving higher, briefly reaching the 113 yen level.
However, when rumors spread that North Korea planned a missile test over the weekend, risk aversion intensified and it fell to the mid-112 yen range.
North Korea’s situation seems to overshadow the employment data… indeed.
Recently there hasn’t been a week without headlines about cryptocurrencies like Bitcoin.
There are a lot of claims like "it's a scam," "no, it's not a scam," "it's a bubble."
Viewing these as speculative assets is fine (though relying only on a "buy" stance may not be sustainable), but applying blockchain technology to Web services could be interesting.
In fact, Bitcoin is now most used on the so-called "dark web," where its anonymity is advantageous for high-risk transactions.
Not that I’m saying I’m doing that, but in Japan too some payments are increasingly recommended in Bitcoin… and it’s understandable that the government isn’t keen on it.
▼3. Weekly Trades You Can’t Tell Anyone About
――――――――――――――――――――――――――――
A “weekly trade” combining trend-following and counter-trend portfolios with full use of money management.
Since starting in 2012, there have been no annual losses and total gains exceeding +30,000 pips.
What is the secret to profitability with a win rate of 48%? Here we present this week’s trade results.
――――――――――――――――――――――――――――
・This week’s result: -531 pips
・All-time result: +29,799 pips
【Weekly Trade Results】
・Win rate: 48.6%
・Average gain: +839.6 pips
・Average loss: -580.1 pips
・Maximum gain: +13,491 pips
・Maximum loss: -2,932 pips
・PF: 1.37
・PR: 1.45
“Weekly trades you can’t tell anyone about” take positions with an edge from the 1-hour, daily, and weekly charts based on the trend. However, the essence lies more in money management than in the trades themselves.
The win rate for this method is 48%. It may feel like about 40% by "felt probability," so it may not be recommended for those who require a win rate above 80%. It targets those who can think long-term.
＞＞Overview of "Weekly Trades You Can’t Tell Anyone About"
▼4. Q&A
――――――――――――――――――――――――――――
We received questions about Investment Navigator Plus, so here are the answers.
Subscriber questions are accepted at any time, so please feel free to contact us.
――――――――――――――――――――――――――――
Q. Thank you for your time.
I have been following your blog for a while and subscribed to Investment Navigator Plus.
While reading, I noticed that you publish positions, which is good, but
I would like to know what grounds you use to select currency pairs and how you adjust position sizes.
If you don’t provide that, I’m not sure how useful it will be.
Or is it that this content touches on products related to money management, so you can’t write it?
Personally I’m interested in how money management can turn FX losses into gains, but for now
I subscribe to Investment Navigator Plus to see how things go, so I would be grateful for meaningful content.
A. The currency pairs and position sizes are chosen from those with proven edge based on testing. The pairs are used to form both trend-following and counter-trend portfolios. Position sizes consider volatility.
There’s nothing I can’t write about related to “money management.” However, in my case, trading is conducted with money management as a prerequisite, so the emphasis is more on “what kind of money management I employ” than on “what positions I hold.”
I think the market is very difficult. While there are things supported by a large number of people, the majority of the market still incurs losses. I personally don’t intend to loudly proclaim “I am right” (there’s no benefit in changing others’ minds); I hope to provide opportunities for people who share a similar view.
