Posts Tagged ‘forex’

Kurb Forex Intro Video

Tuesday, January 26th, 2016

– Hi this is Matt from Kurb and I’ve been trading currency for almost 18 months now and what I wanted to do was to post a video taking a perspective from the beginning of my personal journey into forex, foreign exchange trading, currency trading – because it’s where I hope to make significant investment returns for a long time to come, but I also want to be involved in the culture, mix with other traders, share analysis, pass on my insights and begin to explore where I could fit into the space providing media and education around currency trading.

– I got my start the day of the scottish independence vote. I saw a tip that as Scotland would stay within the United Kingdom buying pounds was the hot trade, and as another friend who also was in small business had encouraged me to set up my first trading account with CMC and I had put $20 in it, I thought I may as well buy some pounds and see what happens. Within a few hours I had turned my $20 into $100! An hour later it was gone. But I had seen what was possible and I was hooked!

– I had to learn a few things – currency is traded in “pairs” – I wanted to buy pounds to go up, but they had to be traded against another currency to go down, such as the US dollar, Euro, Yen, Canadian, New Zealand, or Australian Dollar – these are all major currencies which mean they are actively traded each day. you’ll pay two costs based on which currencies you choose to trade, the brokers cost, which can vary depending on the time of day and the availability of a certain currency. But you also pay a carry cost, and that’s the interest you pay on the money you’ve borrowed for each day you hold the trade if you are choosing to hold trades overnight.

– This is where I got intro to the basics of how retail currency trading – that is small guys like me and probably you – works, that is firstly leverage. For every $1 in my account I can borrow $500 to put down on a trade. That means with $200 in my trading account I can leverage $100k to put down on a trade, so if the currency goes up 1% In a significant move following some major news, I take a 1% profit on $100k that’s $1000! But if I’m wrong about how the currency takes a piece of news, I can just as easily lose money and if that money isn’t in my account, the broker will make a margin call on my trade and sell my position leaving me with my money gone.

– That’s why most traders work with stops. They set their positions to sell automatically as soon as it reaches a certain loss because there are so many different strategies based on complex mathematical formulas as to what might be expected in currency moves and there is a wealth of sources on that, but the fact remain that most strategies work on the idea that you never win every trade, it’s that you profit mre from the trades you win than you lose on the trades you lose money on. Once a trade loses a certain amount of money, you know it’s a loser. Better to cut your losses.

– What attracted me to currency trading over other forms of investment such as stocks, is that stocks crash in nightmare panic scearios and lose hue amounts of value. Currencies merely rise and fall in relation to one another, often swinging in value as it forms larger swinging trends and these patterns become predictable enough to not only make trades on, but have nowhere near the potential of stocks to completely lose their value – even in extreme events currencies usually only lose 1-2% of their value day on day. Although this can be dangerous if you’re highly leveraged, this makes it so much easier to commit to a long term strategy following relatively predictable ups and downs in the market.

– This is where we get to the nitty gritty of trading, there are hundreds of sources that will take you through the strategies involving complex maths or speculating over analsis of financial news – you can follow the news of financial announcements that often move the market such as monthly inflation or unmployment figures or regular announcements where reserve bankers announce changes to interest rates which also are felt keenly on the market. But the most important thing about trading and to the success of a trader is your psychology.

– Trading is not gambling, if you have a system and you follow it. The moment you stop following your system and begin to take hopeful chances ou have become a gambler and you are no longer assured success because you have abandoned the fundamentals of your system. I have a system and let me tell you what is clearly obviou to me now – if you knew the secret of making money in trading you would not give it away so do not be tempted by silly ads and schemes that promise you profits. My system works because its based on decisions I make that cannot be replicated by a formula.

– so this was just first video on forex for kurb, sharing a little of the knowledge I’ve built up, no one can know what the future could be for kurb forex, but I have a system. I am confident in it, I have tested it I have made money, lost money and made it back again. What I am doing takes months to work – in my case it will have taken years but I am well advanced in my journey and I am looking forward to providing more content for you helping you to understand currency trading, how it works, and how people like me and you can make our money.

Investment Contingency

Sunday, August 9th, 2015

Now that I’m safe again, my attention turns from worst case scenario contingencies back to how things could work to get me to the next stage, that is getting my equity higher so I can borrow more, so that should that borrowing quickly become unprofitable, I am not putting my equity in danger should it backfire.

More equity means I can borrow more to put on the table, which means I can earn more.

It seems by making strategic trades, this is the safest way to expand my exposure for greater risk reward, rather than simply heaving into the market. Choose positions that are going to be prudent.

The aussie was being hammered, which meant we knew it would spike up on the retracement, it just took weeks for that retracement to appear. It was less prudent to assume the trend would continue. When you have room to invest more, you can buy positions on the opposite side of a spike, ready for the retracement, however far the spike may be going – even weeks. Buying on the dip of course is the strategy for the otherside.

Trades that build the hedge are less risky than trades that unbalance the hedge.

I just wanted to talk about trading contingencies as I am still in a patch of doubt considering how all my trading work could come undone if I’m not careful. It has been a long few weeks but I am back in the safe zone

You always need a contingency – I was working out how much money I would need to cover my ass in a worst case scenario. How much room would we have to make?

EUR/AUD +1k
GBP/AUD:+3k
USD/AUD: +3k

This makes it obvious that my big problem is the collapse of the AUD, and my estimations are that I only need another $7k to cover my ass in a worst case scenario there.

My belief is they will run out of crises

What we are lucky for is that all the extreme movement is being accounted for now while I can still afford to cover my ass. If this was happening on a $500k account with only $40k equity I couldn’t rustle up $20k+ to insure we could stay alive for a couple more months. But $20k suddenly isn’t that much.

But honestly when you reach $500k will you be $400k in debt? This is what it seems.

But I am hoping in future the swings will settle into a smaller range it occupies for a number of months and spreading larger amounts over a smaller range will create more pronounced results as well as covering the same range and thus recycling positions rather than ever breaking a new range high that would see the bigger new positions stretched to ever higher lengths.

In fact the opposite is likely – when we finally have enough equity we can wind down hedges properly as we originally traded.

So in fact most new positions that are widening out are going be placed on top of reversals. This suggests new margin growth will be part of extending the hedge play, yet it will bring in better capital growth returns eventually, and equity is rising as it reverses over that territory.

We are working at a formula now of 6.66% of the full leverage becoming debt eventually. Which given that leverage is .2% does that suggest every dollar of margin creates $33 of debt?

Well the maths is $29 right now, but that could easily be $33 with a bad run. So when you add another $100 worth of margin you are signing up for a posssible $3000 more debt long term. 30 x you have to make that $1 back before it’s worth it. The thing is in various parts we are starting to get our 30 swings in.

so from that you could say that each $3000 of equity spare allows for another $100. But we know that could go wrong.

I think we have a safe plan, advancing $100 margin with each $1000 equity, but that until we get to $20k equity and that is based on < $100k hedge spreads. Once we reach $30k equity we will be playing $4600 margin and $150k hedge spreads, I hope that would see us profit $2k-6k on most trades with an average of say $3k. So I could add the money in 3 months and simply jump there but I think we want to see more. Most of our pairs havent even reached $150k except for EURUSD And GBPUSD gave it a tickle. Breaking down the megahedges is what this is all about. Taking the pain, and then the ultimate windback. We can wait for the risks worth taking because that is when we will call on our back up, if that fails. That money is to build hedgfes, but only where it's likely they will pay out - not on the euro, though we can lift the paranoia on the euro soon. AUDGBP is a starter but not GBPEUR yet, we must wait. USDAUD also must be cautious as we must be sure this retracement has ended, whereas long term the GBPUSD is the least certain pair - though balanced, we can't weigh in yet. AUDGBP is the only candidate for adding to the margin in order to build the hedge and even then only as a secondary defence to a counter hedge! I think we must continue strategically as we have, feeling for swing highs, and putting in these road blocks like I've described so that we get a good squirt of profit and it all helps chip away - yes, the swing can lead us to turn around and carry $100+ debt but that's great considering these guys will knockout $10 $20 hits regularly in exchange, and the $1000 position on the far side of the game is already costing me $200+ and it hasn't ever profited me nothing. I can ride a $100 stone in my shoe for a week or more. The point is as we're laying on new margin we're saying the EURUSD is at 1.09, is it going back to 1.29, or even .89? No. no time soon in the next 12 months. is GBPAUD going back to 1.86 from 2.09 or even above $2.20? I very much doubt it. The big moves we've experienced may not happen to us on the edge again for some time. A diving action over week such as these may happen the opposite direction this time - a sinking GBP, a rising AUD releasing equity rather than chewing it up, and placing us deeper in the middle where we are so distant from the biggest danger 73 EUR/USD 160 vs 233 - delving into the parity dive, holding both levels as equally as we can going down. 55 AUD/EUR: 95 vs 40 - careful of the sheer drop here - I looking out for which pairs could in the future be ones to go off the deep end. 43 AUD/GBP: 109 vs 66 - hard times call for bigger hedges and that is where we have gone, recognising we are ready to go all the way out to 150, but we must keep the hedges in check and in line with the price movement. 43 GBP/USD: 94 vs 137 - Lower on both sides! Nice work. With EUR/AUD which is the fight for the bottom, this represents the fight for the top, and is therefore also uncertain, although USD strength 31 AUD/USD:105 vs 74 - We are hedged further in again. The big hedge is not just protection, it's standing opportune here for the australian to go as low as 71 before seeing a correction. The lucky thing about the AUD sides is we still have more room there to work with on the other side. But when the .735 level breaks we have to ramp right up to perhaps 80k so we need some $10k positions in there. 10 EUR/GBP: 101 vs 111 - this surge we actually played pretty well, we are tipping this can't run more than a few more cents but we have been wrong, wait for the reversal, still room on the other side. You can see the larger hedge positions and smaller hedge gaps indicate how unprepared I was with $75k gaps - not only was a caught short and put against the wall, but I also missed the opportunity to ride big hedges to a mighty result. Now I believe even $100k gaps can be too dangerous for now. I was thinking about my investments. WIth the turkish, I figured you could make $600 p/week off $100k, but with a normal investment, you'd need to have $500k+ to make $600 p/week. That's the base case, $1200, but what if you went riskier and went $200k into a turkish investment and then $400 setting me up for the basic figure of $1500 p/week. My trading covers my asset funding. What am I doing with that $800 extra, whether it exists or not, what is the aspiration? I can't see myself buying third and fourth properties within 2 years at the very soonest, and we would be hoping to be holding $400k in my trading investments by then. That should be enoughto be earning $3k-$7k.At this point it doesn't really matter how much I acquire, it's really what I can prove I earn. I'll get the money I need to buy what I like. You can buy a car, but after that it doesn't really matter, it costs money in lots of little ways to travel. After that, I don't really know. I have a regular safe income, and I have my work to a lesser extent, but both of these are removed when I sell my business and buy houses. What I see is that until you sell the business and buy houses, you are accumulating what you earn from the business and the returns on safe investments to back up the plans that may not be covered if the various personal investments and trading I do cannot provide a significant pool to dip from. When I buy 2 houses I will no longer get a regular payment from a secure investment, but I will no longer pay rent. In that case I will - given 18 months - have split my investment income into my regular trading and the more reliable and less risky turkish trades. The turkish replaces my secure investments. And I don't pay rent when I'm in the country. So I go from $1400 + work + trading - $800 = $1100 + trading $1000 + trading - $500 = $500 + trading $600 + trading - $300 = $300 + trading + capital gain ($500) + rental I will have enough money to support myself. When I don't have any safe investment returns because I bought a villa and an apartment, I can still take a payment of $600 from my turkish investments, paying for my food, gas and bills primarily off my broker issued credit card. I can still work obviously, and then of course there is my trading, for which there really is no specific

Auckland Pirates and Forex Video Productions

Saturday, March 14th, 2015

Well for a start the pirate auckland birthday party entertainer has really taken off!

Maybe there was a google shake up in the search engine rankings that suddenly made my kids stuff take off – I had 4 bookings made this week, it was great. It means while I’m working on my trading I’ll have friday nights in and saturdays doing the kid’s parties

I guess that is one part of my business I am happy to let grow because it is established as an earner, it’s not particularly challenging other than the physical demands, but also provides potential long term for me to jack the thing up.

Of course being a children’s entertainer is not just about making money. Right now for me it’s all about the aspects that balance out with my forex trading.

Forex trading is pure speculative capitalism, there’s no craft or human aspect to it – outside of understanding the market flows and having a tight psychological game.

The only two ideas that I am serious about right now outside of my core business and trading is pirates and video production, and in regards to video prodction I am really using that as a lens to develop 3 areas I’m committed to: pirates, forex and my artist promotions.

It’s about limiting my exposure to projects so I don’t get stretched out and end up achieving nothing. The overlap means that I can be working ideas that complement each other and have overlap areas where I can make progress over two fronts.

Here I have a little forex video which is helping me get inspiration for how to produce forex videos. I just grabbed this clip because i’m looking at ideas of doing my own forex show.

But I am barely keeping up on here with new thinking and new development.

My forex trading has definitely gone next level now.

What happened was I was forced to implement my new theories before I really had a chance to think them through properly, because that’s how insane the situation has become, it has far overshot what would have been my realistic appraisal fora worst case scenario.

Obviously I was not paying attention to the news but I have learnt from that mistake and have been studying trends. What I didn’t recognise was how deep the trends could reach, but there is enough to suggest I couldn’t have predicted things would get this bad, but because I have been modest, and I do have deep resources I can survive something no one else could have.

So I need to be smart and start coming up with the answers.

I can see how different techniques work in different scenarios. Switching technique depending on what the action and trends are like, or using one technique for one pair and a different one for another depending on the type of movement taking place.

It’s all about experience of how the markets move.

I need to stay on top of my forex thinking, and I need to start talking about new worst case scenarios and what my contingencies will be.

So first let’s go back.

***

I have had my first major wipe out in trading and I am sorely chastised.

But it happens to everyone.

Part of the cleansing process of my new resolutions is to see a way forward, and in business and in art, we know using other people is the key.

We know we need forex funding to push forward other priorities. But humans and markets are unpredictable and hard to control. But the aspect I can control is limiting the amount of jobs I am taking on. It’s not just freeing up time, it’s freeing up headspace from worrying about issues that are not of priority.

But I think we also have to accept we have too many ideas. Stress caused in the business is an example of an obligation I am maintaining without receiving a significant enough benefit from the stress and energy required.

Much like the pirates also, I am seeing that I am doing too much, and the things that are hard are the ones to go first.

Gigs, CD’s for musicians, Pirates. OThese use energy and focus.

The main issue is paying my bills when I am trying not too work so I can clear my head for more macro organisation of my life. In terms of aristotle, where are the goblins coming to cause me pain? Well if you didn’t have to worry about CD/DVD so much, you might be surprised.

I feel it is a good idea just to mitigate the flow of jobs while I am in a vital transition phase. It is vital that I am available and committed to my property and trading issues, but also I see opportunities to focus on removing stress.

What I am hoping is that by doing less work, I get other things done, which make me more positive. Finishing up video projects will get me more grounded and focused on how I want to move forward.

Having more time allows more maintenance opportunities to get everything prepared how it should be.

I should mention it was secondary account that wiped out, now my primary account, there would be no way of shrugging it off if I blew up my main account.

I am staying with this account even though it was the turkish situation that did me in in the end because I like the way there system is set up for the turkish interest payments. What I am thinking is that I am aiming in a year or two to have 50k in there, and $200k worth of turkish positions making $1800 a month. That’s a $21k return a year on 50 maybe $60k. So you could have $200k in there, and hold $600k in positions and make $5500 a month out of that.

Yes, it would tie up your capital but $66k return on $200k is just too good. What it means is that you have a true passive income – well you might check it every day I guess just to be prudent.

I did a little research it is as it seems. Yes it’s a great investment, but not when the ass drops out of the turkish currency as it just has, and well, I lost grands.

But that was because of inconsistencies in the platform which showed me and taught me a lesson about how an oversight can destroy your whole game. We have been guilty of oversights.

I’m just reading over what I wrote in my last entry because after a very dry and very modest last couple of months coping with the eurozone problems, a transition back into decent earnings became a very sudden and violent switch.

I thought as there was little data this week, it would be quiet, but it’s been the opposite, there’s no reason for traders to hold their breath and they just went in. Now I see why events are even more significant because they quieten markets in anticipation.

The catalysts were there a week ago when the process began with jobs friday, the USD establishing a huge gain on it’s already strong position on much better than expected employment data.

I can see here it was almost a discussion focusing on why I have continually renewed my commitment to trading given that there is so many lifestyle advantages – that once I could get to the point of establishing steady income without stress I am not tied to my business in auckland with all the stress of the clients, I can focus on trading at particular times and events to lessen the time I spend trading, and I can afford to pay other people to do all my other work.

3 Reasons why I felt focusing on trading has been my mission.

I am starting to think the only solution is to go even deeper to a new unprecedented level. Accept I need to put up another $10k to bring my account to $65k because the level at which I can establish myself earning around $2k a week

Yes breaking my term deposits costs me hundreds. Yes depositing $10k will cost me $250 just in fees.

But this is about changing my whole lifestyle from working 20 serious hours and 20 relaxed hours for little more than a grand, with lots of stress dealing with customer service vs. working about 6 serious hours and 20 relaxed hours, for $1500-$2k a week, with decreasing stress as my equity builds.

To have enough money not to really work except on easy jobs because it breaks up trading and avoid stress; To have enough equity that blowing my account is simply not likely; to have enough money on the table that I don’t have to work it constantly to hit my targets and instead focus on wed-fri night

Give up on the days altogether, especially earlier in the week unless theres an australian event, and try to learn to only check it once an hour at most over that time. That does mean being up at 10 on monday to sell on any weekend reactions.

What I am saying is that if this any other opportunity, playing for those stakes are definitely worthwhile.

The other thing about trading that makes it not gambling is skills for life.

I am learning the game. I am learning about these risk events. I am learning about the persistence of trends.

I realised this morning that even if I fried my main account, I am in this for life. Through dedicated persistence over 6 months, I have learned to

But lets move onto the next problem. It’s into july. Say Ive got $100k account with -$80k unprofitable positions. How do I get my money back?

Cool it down. By focusing on lowering your margin – that is, selling more than buying, eventually over time, your equity will rise. Of course by lowering your margin, you lower your profits. But if you’re already kicking $3k a week, you can probably handle a hair cut in the interests of prudence.

I can’t prioritise prudence because I’m still hungry for that $2k baseline level. When I get there, then I can look at doing housework, picking off individual positions. I know when I get to the other side I will be able to look at writing off my past sins.

The market has been very hard for my style in this period because I rely on up and down movement, whereas this year its just be one trend mainly.

That I guess is the point I reached when I decided I needed to change my style.

The euro was flying down terrifyingly so I just worked crazy hedges. I had already started to thrash out some ideas about hedges on my business blog which is becoming increasingly less about promotions and more about trading, and after the crazy dive began, I realised I was going to have to put my new found ideas to the test.

The highs were pounded, I laid down bigger and bigger positions knowing I had the trend behind me, but always selling off when the reversals came so I was left holding less positions as the price withdrew, and throwing down bids recklessly as the price drove higher. It was so epic.

I had really got to the stage of having this real game like interaction with trading as if I’m trying to clock the level, and has been like that this week.

Trading just taking over everything and yet I can’t hep but think this is a turning point a huge battle has been fought.

This just flies in the face of the technique I was using last year of trailing off when a currency reached it’s peak. Now I just keep loading on more positions until it starts falling, then I rapidly pull out of as many of those positions as possible, knowing that any slip or retracement will be brief – the trend is quite clear. The euro will be hammered all the way to parity. Every chance it rallies is another chance to buy shorts, and ride them down again, so that your hedge is rising faster than your original positions are falling. The trick is to pull out before the reversal and take your profit, and let the reversal ease out your profit back to you knowing that the reversal also offers you the opportunity to hit the trend once again.

So firstly there’s a new technique for making money when the trend is smashing new highs.

There is also this aspect of hedging and when you’ve got deep hedges it means you can take risk. Yes you carry a perpetual debt maybe running $50k deep, but eventually you outpace it, much like a mortgage.

And finally, the new possibilities that open up once you can grab this profit and use it to liquidate specific rotten positions strategically to tidy your account up and prevent issues down the road with momentous shifts.

But when you’re hedging, why lose money on a ratty position, when you can hedge against it?

Because our people want to see our equity come home.

But there’s so much to say here with everything I am experiencing and learning . . . I will continue soon . . . because it’s time to to take the hedge to the edge.