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currency ring system

  • #1
  • First Post: Mar 18, 2011 7:21pm Mar 18, 2011 7:21pm
hello fellow traders,i just want to share an idea with peoples on this forum,this is not mine but is available free at web,anyway please improve that together if have any potential,there is system like this that is belong to cash4u2 that i think
is very nice strategy because i tested it, so let"s start to develop and improve
this system by positive response.donut post if you dont like this strategy as well
Attached File(s)
File Type: pdf currencyring.pdf   54 KB | 3,593 downloads
  • #2
  • Mar 18, 2011 9:44pm Mar 18, 2011 9:44pm
I did something like this for awhile. What I did was long EUR/USD, long USD/CHF and short EUR/CHF all with equal lot size. But then I discovered that all I was doing was shorting USD/CHF but tripling the spread.

I wish the author of this PDF would have been more clear. Does he mean that we should go long or short the ring? Same unit size? Is there a stop loss? ,etc.

Quoting persia
hello fellow traders,i just want to share an idea with peoples on this forum,this is not mine but is available free at web,anyway please improve that together if have any potential,there is system like this that is belong to cash4u2 that i think
is very nice strategy because i tested it, so let"s start to develop and improve
this system by positive response.donut post if you dont like this strategy as well
  • #3
  • Mar 18, 2011 9:52pm Mar 18, 2011 9:52pm
Quoting Dreamliner
I did something like this for awhile. What I did was long EUR/USD, long USD/CHF and short EUR/CHF all with equal lot size. But then I discovered that all I was doing was shorting USD/CHF but tripling the spread.

I wish the author of this PDF would have been more clear. Does he mean that we should go long or short the ring? Same unit size? Is there a stop loss? ,etc.

if you long EUR/USD, USD/CHF and at the same time short EUR/CHF all with equal lot size, it's hedge EUR/CHF!
  • #4
  • Mar 19, 2011 6:21am Mar 19, 2011 6:21am
Quoting persia
hello fellow traders,i just want to share an idea with peoples on this forum,this is not mine but is available free at web,anyway please improve that together if have any potential,there is system like this that is belong to cash4u2 that i think
is very nice strategy because i tested it, so let"s start to develop and improve
this system by positive response.donut post if you dont like this strategy as well
Author says...

when we are buying the GBP/CHF and the GBP/JPY, we are infact also buying the cross pair CHF/JPY as well.. So, we have to actually also open a buy position on the CHF/JPY pair as
well to stabilise the account.
For example:
1. You buy 1 lot GBP/JPY
2. You buy 1 lot GBP/CHF
3. You also have to buy 0.8 lots of CHF/JPY in order to stabilise the accounts

How it can stabilize basket by buying 3 pairs?
  • #5
  • Mar 19, 2011 9:31am Mar 19, 2011 9:31am
probably the most advanced Ring trader you will find here is trader101. Although he may use other words he has some very good ring systems with 3,5,7 all the way to 14 pairs and he has a good system if you can follow him.

i am not talking about what others have done with his systems but if you actually follow his logic.
  • #6
  • Mar 19, 2011 9:41am Mar 19, 2011 9:41am
Quoting skinsomnia
if you long EUR/USD, USD/CHF and at the same time short EUR/CHF all with equal lot size, it's hedge EUR/CHF!
Ahh no,

Dreamliner is correct, its not a hedge. At current values it does create a usd/chf short trade. You can only create a perfect hedge is you change the lot sizes for each pair.
  • #7
  • Mar 19, 2011 1:29pm Mar 19, 2011 1:29pm
Right, this is very easy to see on Oanda's trading platform that shows "exposure." With the 3 pairs I mentioned above, we are simply short USD/CHF with 3 times the spread. Not a good way to trade. I suspect this ring method posted here is the same thing.

Quoting thorn
Ahh no,

Dreamliner is correct, its not a hedge. At current values it does create a usd/chf short trade. You can only create a perfect hedge is you change the lot sizes for each pair.
  • #8
  • Mar 19, 2011 3:05pm Mar 19, 2011 3:05pm
Quoting Dreamliner
I did something like this for awhile. What I did was long EUR/USD, long USD/CHF and short EUR/CHF all with equal lot size. But then I discovered that all I was doing was shorting USD/CHF but tripling the spread.

I wish the author of this PDF would have been more clear. Does he mean that we should go long or short the ring? Same unit size? Is there a stop loss? ,etc.
hello dear,he/she says go long on each pair and as the example he has he went long for first and second pair with 1 lot and then for third pair he has 0.8 lot,so
is different lot size and most important is he/she is suggesting to use ADR to
find the daily rang of each pair,this can be more important that we can discuss
that and develop the system if it worth .
  • #9
  • Mar 19, 2011 5:07pm Mar 19, 2011 5:07pm
Yes, I understood that, so the point is simply to go long on all currencies in the ring, if they have not moved more than 25% of the Daily Range, with no stop losses and take profit "whenever"? How does he determine lot sizes? I saw where he said 1 lot for two currencies and .8 for the other. How is that determined for each ring?

I do believe these are all directional trades though, and if that is true then why would you pay 3 times the spread just to take a directional trade on 1 pair?

Quoting persia
hello dear,he/she says go long on each pair and as the example he has he went long for first and second pair with 1 lot and then for third pair he has 0.8 lot,so
is different lot size and most important is he/she is suggesting to use ADR to
find the daily rang of each pair,this can be more important that we can discuss
that and develop the system if it worth .
  • #10
  • Mar 19, 2011 5:21pm Mar 19, 2011 5:21pm
do you mean to basket trade or trade inefficiency thru arbirtage?
  • #11
  • Mar 20, 2011 1:43am Mar 20, 2011 1:43am
Who are you asking this to? You did not quote anyone, so we have no idea who you are asking this to.

Quoting sidhujag
do you mean to basket trade or trade inefficiency thru arbirtage?
  • #12
  • Mar 20, 2011 2:56am Mar 20, 2011 2:56am
to anyone trading this strategy im on my iphone hard to quote a message and append to it but the original strategy says to wait until profit but doesnt talk about how to calculate risk. like you said you are adding to spread if you trade like lotsizes so then we are left with arbritrage?
  • #13
  • Mar 20, 2011 10:56am Mar 20, 2011 10:56am
Right, the PDF file is not a complete trading system. It is a suggested method, I assume. I don't understand why anyone would trade this way when you can accomplish the same thing by going long or short, with one third of the spread.

Quoting sidhujag
to anyone trading this strategy im on my iphone hard to quote a message and append to it but the original strategy says to wait until profit but doesnt talk about how to calculate risk. like you said you are adding to spread if you trade like lotsizes so then we are left with arbritrage?
  • #14
  • Mar 21, 2011 12:24pm Mar 21, 2011 12:24pm
Quoting Dreamliner
Right, the PDF file is not a complete trading system. It is a suggested method, I assume. I don't understand why anyone would trade this way when you can accomplish the same thing by going long or short, with one third of the spread.
Yup I agree... but when people start talking about changing lot sizes to create a perfect hedge then it becomes arbritrage... and there are already big banks doing this so you will need some high startup capital to do this in the long run.


Jag
  • #15
  • Mar 21, 2011 1:19pm Mar 21, 2011 1:19pm
so does anybody know how we can determine the lot sizes?
  • #16
  • Mar 21, 2011 7:45pm Mar 21, 2011 7:45pm
Quoting persia
so does anybody know how we can determine the lot sizes?
Yes, the website you got this strategy off of has a way to determine this. Check it out here: All the way to the bottom there is a calculator.

By the way, in order to get the EA to this method, all they are asking is a mere $2500.00 plus $299.00 a month. Sheesh, some people are sure greedy!
  • #17
  • Mar 22, 2011 8:10am Mar 22, 2011 8:10am
thank you so much for your help,it would be very helpful
  • #18
  • Last Post: Jul 3, 2012 10:34am Jul 3, 2012 10:34am
what happen with this thread? is this system working? thanks for your information
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