Cash & Carry | Page 2 | Forex Factory

Options

Go to
Permalinks
Print Thread

Similar Threads

Carry trade vs carry trader 3 replies

ECN && STP && Scalping && Hedging - Broker Review - Oct 2009 24 replies

Cash & Carry (Grid) Results 8 replies

I finally got FLAT in Cash & Carry (Standard) YEAH!!! 0 replies

Cash & Carry (Grid) took over 180 pips out of the market yesterday and under 1% DD 1 reply

Attachments: Cash & Carry
Exit Attachments

Cash & Carry

  • #21
  • Oct 4, 2005 1:54am Oct 4, 2005 1:54am
Day 15 - Test C&C
Added in USD/SAR to attain USD neutrality -this will be slightly negative interest wise. Also added AUD/JPY.
Attached Image
  • #22
  • Oct 4, 2005 1:56am Oct 4, 2005 1:56am
For some reason cannot get multiple images to display in a single post...
Anyway, basket now complete & USD-EUR neutral.
Attached Image
  • #23
  • Oct 4, 2005 2:02am Oct 4, 2005 2:02am
Will trade this as a single entity as Michael does.
Attached Image
  • #24
  • Oct 4, 2005 4:50am Oct 4, 2005 4:50am
Quoting electricsavant
No you are not getting it...

Prices change without any relationship to interest earned in Retail Spot Forex..You must take the interest earning direction to earn interest and not pay it. Each pair in the basket only is traded one direction...so what does that mean? Well nothing goes in the same direction forever... Right"? Thus the hedge...This basket does a pretty good job of controlling the swings while collecting interest...

the only way your position will change value is when you get paid the interest differential
yes yes i understand how the rollover (interest) works. i know it well.

i also understand that you want to earn (not pay) the rollover (i was calling this "putting your money in the highest yeilding currencies").

i also understand that you want to eliminate the directional risk (ie if the USD rallies, you dont want that to affect your position).

so what part am i missing here?

the way i am seeing it, the following statement wraps up the strategy:

put your money (leveraged) in the highest yeilding currencies, then hedge away the direcitonal exposure.

why is this not correct?
Relax and be happy.
  • #25
  • Oct 4, 2005 4:51am Oct 4, 2005 4:51am
another thing...

you said "the only way your position will change value is when you get paid the interest differential".

wont your position value change if you are not properly hedged? like if you have too much USD exposure that has not been offset?
Relax and be happy.
  • #26
  • Oct 4, 2005 11:29am Oct 4, 2005 11:29am
Electric,

I'm enjoying reading the forum about your method. So have you discussed with Merlin about making ForexFactory the 'home' for your blog? I hope theres no plans to start asking people for a "contribution" for your efforts, that would be a dissappointment. I appreciate your work on this and will look at opening a demo at Oanda soon to test it out. Sorry if I'm a little skeptical about your methods but most times if someone blasts in and starts touting something the 'catch' isn't far behind. Lets hope thats not the case here. I look forward to learning more from you.

Sam
  • #27
  • Oct 4, 2005 12:46pm Oct 4, 2005 12:46pm
Quoting electricsavant
What does this mean?

'home' for your blog?

In your FAQ it mentions something about a blog and daily emails so I was wondering if FF is your new home. If its out of scope, no worries.

Sam
  • #28
  • Oct 4, 2005 3:32pm Oct 4, 2005 3:32pm
Hi Michael,
do you know on what basis dgcfx originally constructed the weightings for the various pairs? I couldn't find any mention of it on the original thread. As there have been new pairs added since it would be handy to know.
  • #29
  • Oct 4, 2005 4:29pm Oct 4, 2005 4:29pm
Sorry if this is a stupid question but here it is. If I have 3k in Oanda, 50:1 lev, and 1k in used margin with this basket. What is the maximum drawdown I can sustain before receiving a margin call? I.E if it has a drawdown of 15% how close do I get?
  • #30
  • Oct 4, 2005 5:02pm Oct 4, 2005 5:02pm
Thank you for the quick response, I appreciate it!
  • #31
  • Oct 5, 2005 1:15am Oct 5, 2005 1:15am
Electric,

Thank you very much for starting this thread and sharing your system with us. The more I study it, the more excited I get!

I've got a ton of questions, some basic, some perhaps what you'd consider advanced.

Let me start with this. It makes sense to me that you should take profit, then immediately turn around and buy back in with a larger size. This in turn will give higher daily interest. In fact, if you did not TP, I don't see how you're going to get any compounding effect.

What I don't understand is adding to the system when it is ebbing. What difference does it make whether the system is ebbing or flowing? By adding to, I am assuming you are bringing in fresh, outside money into your account balance and adding to with that new money. Since adding money at any time will increase your position and thus increase your daily interest paycheck, why does adding to at the ebb make a difference?

Thanks

Dial
sxaxlxvxaxtxixoxnxbxyxgxrxaxcxexdxoxtxoxrxgx
  • #32
  • Oct 5, 2005 1:22am Oct 5, 2005 1:22am
Quoting electricsavant
Important point #1

As the system collects interest.... then the ratio of Unrealized P/L strengthens, placing time on your side.

This hedged basket slows the swings long enough for the interest to actually keep up and make a difference...

ElectricSavant
Ratio of UPL? I know what UPL is, but what is the other number you are comparing it to get the ratio? Also, which number is the numerator and which is the denominator in calculating the ratio? When the ratio "strengthens" how is that placing time on your side. How does time figure into this? Thanks ES!



Quoting electricsavant
Important point #2

Trading can be "not gambling" What side of the Bus do you sit on?

ElectricSavant
What "Bus"? Apparently this is a colloquialism I am not familiar with. Could you explain it to me please? And how does it relate to "not gambling"? Thanks ES!
sxaxlxvxaxtxixoxnxbxyxgxrxaxcxexdxoxtxoxrxgx
  • #33
  • Oct 5, 2005 1:27am Oct 5, 2005 1:27am
Hi Electric!,

In your BLOG, you said you recently moved the DD from 10% to 15%. What did you change to accomplish this? Assuming you kept the same 10 pairs, the only thing I can think of that you changed is the ratio relationship between them. Besides how you did it, would you please explain why? Does it have to do with interest rate returns? In other words, is there a relationship between DD and Interest earnings? Thanks ES!
sxaxlxvxaxtxixoxnxbxyxgxrxaxcxexdxoxtxoxrxgx
  • #34
  • Oct 5, 2005 1:33am Oct 5, 2005 1:33am
Hi Electric!

I can see the hedging effect achieved by combining the 10 pairs is similar to the algebraic addition of electrical waveforms. +10 volts would cancel -10 volts. Or to bring weighting into the picture, +10 volts would be cancelled by to other signals of -3 volts and -7 volts for example.

My question is, what was your methodology in choosing not only the pairs, but in choosing the relative weights between them? The reason I ask is that I want to understand your system well enough that I can attempt to fine tune it, like Beachie is apparently doing. Would you be willing to share your method of pair selection and weight determinations? Thanks ES!

Dial
sxaxlxvxaxtxixoxnxbxyxgxrxaxcxexdxoxtxoxrxgx
  • #35
  • Oct 5, 2005 1:38am Oct 5, 2005 1:38am
Hi Electric!,

You keep mentioning that you are pushing the system right now and are not comfortable with it and now it is time to start turning down the gambling meter.

What are you changing in order to "push" the system? Is it just the 50:1 leverage? Again, I ask because I am seeking a full understanding of your system so I can tweak it intelligently and with knowledge. Or conversly, know when NOT to tweak it!

Thanks Electric!

Dial
sxaxlxvxaxtxixoxnxbxyxgxrxaxcxexdxoxtxoxrxgx
  • #36
  • Oct 5, 2005 9:25am Oct 5, 2005 9:25am
Hi Mike,
The last couple of days you have given many of us a lot of homework of thinking and thinking.... I like your strategy a lot, because it seems it can be seriously used besides the other systems.

You have started to use less margin. However, one of my questions is ... would you have closed all your positions when you would have reached the minus 15% and take your loss and start again?

I started the CC system as you explained with 50:1 yesterday and today it has been a bad day for the unrealized profit: DD of 14% up to now in my case. Close to the minus 15%!

What would you have done? Take your loss and close all positions and start all over again?

Thanks!
KT
  • #37
  • Edited 10:01am Oct 5, 2005 9:58am | Edited 10:01am
yes, i did enter with wide spread... this made indeed a negative impact on the DD. So, your uncle point is -30%... OK, good to know...
Thanks again,
KT
  • #38
  • Oct 5, 2005 10:44am Oct 5, 2005 10:44am
Ok, in the process of opening my demo at Oanda, have some questions/concerns:

1. We 'add to' (meaning increase position sizing across entire basket with new money), during ebbs (-DD%?) and TP during +DD%?


2. If number 1 is true then aren't we making our Unreal P/L realized by liquidating? Does profit during +DD always exceed loss during liquidation at -DD? If not then aren't we continually watching our account balance decrease?

I guess I'm more confused then I thought, help!

Sam
  • #39
  • Edited 11:59am Oct 5, 2005 11:00am | Edited 11:59am
Quoting electricsavant
oh the agony..
do I enter now...or do I forfeit interest earned and wait..
even worse do I enter half of the matched basket and gamble that I can still get "better than now" entries later with better spreads?...(see beachies dilemma, that he solved, but how much did it cost him?)
Running a little experiment.....

Basket A - opened 19/09/05 Using a basket of 9 pairs posted on Oanda.
Base $1000 - Balance $1,170 - Margin Used $816 - UPL (-$124 )
This basket I closed the *profitable* legs yesterday & re-intiated the closed legs immediately.

Basket B - opened 4/10/05 Same composition as above but added in a small EUR/USD carry based on expecting EUR to go upside somewhat
Base $1000 - Balance $1000 - Margin Used $857 - UPL (-$66)

Basket C - opened 4/10/05 Recommended pairs & ratios as per Michael's S/S
Base $2000 - Balance $2000 - Margin Used $1220 - UPL (-$132)

Basket D - opened 5/10/05 *All* 33 pairs, long or short to be interest positive/neutral. Set @ 1000 units each pair
Base $2000 - Balance $2000 - Margin Used $1237 - UPL (-$39)

Basket E - opened 4/10/04 As above but adjusted to be EUR & USD Neutral
Base $2000 - Balance $2000 - Margin Used $1334 - UPL (-$95)

Now lets see how it goes over next month
**edited* got differing accounts mixed up - restarted Basket D
  • #40
  • Oct 5, 2005 11:33am Oct 5, 2005 11:33am
Quoting electricsavant
New money..no. I have dialed down the initial opening trade to leave margin. Use the spreadsheet. Is it working ok up there in the first field? Oh wait...I see, newcomers opening up the spreadsheet do not get the updates...shit

Thanks sam...

Can you just copy the last line in the spreadsheet and paste it up there and all the way down?

Here let me post a blank one for you guys...wait a minute ok?

Michael B.


Can you address my original questions please?


1. We 'add to' (meaning increase position sizing across entire basket with new money), during ebbs (-DD%?) and TP during +DD%?


2. If number 1 is true then aren't we making our Unreal P/L realized by liquidating? Does profit during +DD always exceed loss during liquidation at -DD? If not then aren't we continually watching our account balance decrease?



Thanks,

Sam
0 traders viewing now