Smeck Capital Management Services
FX trading allows you to speculate on the changes in currency strengths over time, trading currencies and buying or selling one against the other. Forex traders seek to profit from fluctuations in the exchange rates between currencies, speculating on whether one currency's value, like the pound sterling, will go up or down in relation to another, such as the US dollar.
With over 5 trillion dollars’ worth of currencies traded globally every day, the foreign exchange market is the most traded in the world, making it a highly liquid and dynamic market. This high market liquidity means that prices can change rapidly in response to news and short-term events, creating multiple trading opportunities for retail FX traders.
Forex is always quoted in pairs, in terms of one currency versus another. Take for example GBP/USD (sterling vs US dollar) - the fluctuations in the exchange rate between these two is where a trader looks to make their profit. The first currency, also known as the base is the one that you think will go up or down against the second currency, which is known as the quote.
When trading currencies, you can speculate on the future direction of the market, taking either a long (buy) or short (sell) position depending on whether you think the currency’s value will go up or down. Forex price movements are triggered by currencies either appreciating in value (strengthening) or depreciating in value (weakening).
This Forex market size and depth makes it the perfect trading market and this liquidity makes it easy for traders to sell and buy currencies. This is why traders from all different asset classes are turning to the Foreign Exchange market.
FXHL1032 Exchange Trading Fund
This fund has the additional benefit of not being associated or dependent upon traditional asset classes such as equities or bonds.
Employs an actively managed, benchmark unconstrained investment approach.
Evaluates currencies by assessing fundamental long-term valuations, while also taking into account short-term dynamics.
Aims to capitalize on currency opportunities through long and short positions in developed and developing markets.
Diversification Benefits. Currencies have the potential to provide diversification to an overall portfolio given their historically low to moderate correlations to traditional asset classes, such as stocks and bonds.
Active Currency Management. Offering flexibility to actively manage both long and short currency positions enabling the fund to pursue opportunities in various market environments regardless of the direction of the currency markets.
Forex Trading Methodology & Risk Management
STRINGENT AND SELF-ADJUSTING RISK CONTROL.
Each currency is automatically "micro-managed" using dynamic self-adjusting risk control measures that generate their unique stop placement, trailing stops and profit targets based on their individual volatility characteristics.
Once in a trade, the system will exit a position in one of the three (3) ways:
Initial protective stop-loss — control market exposure risk.
Trailing stop — to reduce trade exposure and lock in profits.
Profit target — to capture explosive moves that might not otherwise be realized because at certain times markets will quickly return to previous levels.
HOW RISK CONTROL AND PROFIT OBJECTIVES WORK.
At the time an entry signal is issued, the Foreign Exchange Management Algorithm will issue an initial protective stop. Stop-loss orders are continually adjusted to create break-even or a minimum profit on any given trade or series of trades. If a trade moves in the anticipated direction, then a trailing stop will take over from the initial protective stop to reduce individual trade exposure and then to lock in market profits. If the market continues to move in a favourable direction, and/or if the market makes and a quick explosive move in the correct direction, the position will reach the profit target for a sizable gain. Conversely, if a market does not move in the anticipated direction, the program will stop out the position will with an acceptable loss.
A stop loss is a type of order which will automatically close a trade at a set level in order to prevent further losses. If a buy order has been placed, then the stop level is set at a price that is lower than the buying price. A trailing stop loss of either 5% or 10% is normally attached to all retail accounts. This means that if the value of any account suffers losses of 5% from its all-time high then the account is automatically suspended until we have received written instructions from our client to either terminate or reactivate the account. The beauty of the trailing stop loss is that as the value of the Premier Managed Account increases the profits are locked in and are protected against potential future losses.
If you would like to have any additional information or further assistance, then please do not hesitate to contact us.