Investment returns from currency speculation offer a truly diversified, alternative approach to some of the more traditional asset classes. The returns are completely uncorrelated to the performance of equities or fixed income as Forex is an ‘absolute return’ market. Returns are not related to any long term directional bias, unlike equities which clearly favor ‘bull’ markets and participation in the growth of world GDP. What you invest in with Forex are the speculative returns in the continual movement of the most liquid market in the world. It is an alternative asset class betting on the fact that there will continue to be liquidity and volatility in the market, as well as relying on the trade management skills and proficiency of the chosen manager. It is also a commonly leveraged market employing the use of credited leverage on available trading funds to amplify possible returns. This is common because of the huge liquidity available in the market. Zooming into intraday Forex movements can witness more liquidity in minutes than many large cap stocks have in an entire day. As with any leverage it also affects the possible risk profile on the underlying investment, which is why a proper understanding of risk and trade management are so important in Forex. Understanding it’s characteristics is very important when deciding whether or not to invest in the Forex asset class. Please consult with your independent financial adviser when deciding if it’s right for you.
Forex has experienced incredible growth in the last fifteen years, growth which has fueled much enthusiasm about potential returns available in the market. Many mechanical based trade systems have been developed with measures of success. People have noticed that the market lends itself to patterns and repeating behavior, which encourages more trade system development. Of course, the risk of loss in the market has also been experienced by many, along with a growing awareness of the susceptibility of trade systems to failure and tweaking over time. This is because of the dynamic and changing nature of the world’s currency markets. It is comparable to a wild beast that can never be completely tamed, it must be respected and understood, given it’s due credit. It is impossible to box it in, control it and predict it’s movements accurately over longer periods of time. That is why we take a hybrid approach to trading the Forex markets, using many different currency pairs and time frames with a fundamental / technical, ‘news aware’ view of analyzing trade opportunities. But always with a healthy dose of respect for the power and dynamism of what the market itself is capable of. Our approach is not a mechanical system but involves manual trade analysis and management.
Like the early days of stock speculation, it became popular to believe that you could not consistently beat the market, that the market was too ‘efficient’. However, we have seen in modern times that many skilled managers have proven that they can beat the market consistently for decades. We believe that there is no reason why the Forex market cannot be proficiently managed in the same way with consistently profitable long term returns. We do not believe that a Forex investment is simply a ticking time bomb waiting to explode when a system fails or a large enough market movement occurs. Many titans of investing have survived multiple stock market crashes with staggering losses over the years while still managing risk and achieving incredible market beating returns. We believe that there is already a breed of responsible Forex managers now building a foundation that will prove the same principle, and the viability of the Forex asset class in the years to come. We aim to hold to this standard.
It should also be noted however that there is no reason why Forex should be for everyone. It is a very volatile market and no one should compel you to participate if you don’t feel comfortable. One thing we have learned is that it is very difficult for people to make money with something if they are always anxious or stressed about it. Making and losing money is of course an emotional thing. You must have a degree of understanding and comfort with Forex if you are to make money at it consistently over the long run.
Please see our Terms of Service.