2014 Official Year End Performance for Forex Profit Monster/Effect of Swiss National Bank and the Swiss Franc "depegging" from the Euro

*********************************************************************************

(The portfolio of currency pairs being traded on the 4 Hour chart with Forex Profit Monster consist of:  EUR/USD, USD/CHF, USD/JPY, GBP/USD, USD/CAD, EUR/JPY, AUD/USD, GBP/CHF, AUD/CAD.

This portfolio will remain the same each quarter unless stated otherwise.

All results INCLUDE transaction costs... THIS IS REAL LIVE TRADING so all costs, spreads, slippage, interest rate swap, etc... are included in the results.)

*********************************************************************************
In the last post I mentioned that I was up about 54% for 2014.  The final results are in, and I finished the year up 55.05% with Forex Profit Monster.  While it was a spectacular year, I do see some changes in store for me in 2015.

The amount of money that I am currently trading is actually getting to be a respectable amount (for a retail trader anyway :-P).  I've come a long way from the guy who started out with less than a couple thousand dollars several years ago... so, as of this post I've changed my time frame from the 4 Hour chart to the Daily chart.

The reason I was trading the 4 Hour chart to begin with was to increase my opportunities and grow my account faster.  As far as I'm concerned I've accomplished this... and now I'm more interested in reducing some of the transaction costs and equity curve volatility by trading less.  The current trades I have open on many of the pairs (EUR/USD, USD/JPY, USD/CAD, GBP/USD and AUD/USD) seem like they are long term trends... and now would be a good time to continue them on the Daily time frame.

I am also considering making some changes to the portfolio that is currently being traded after doing some research on a new system.  I feel there are some pairs that have performed well over the past 25-30 years on both Forex Profit Monster and the new system... and will likely be adding them in the very near future.  The size of my account will also allow some additions to the portfolio... so again, the timing is right.

****************************************************************************
Now some comments about the Swiss revaluing their currency by "depegging" from the Euro.
****************************************************************************

I know it was tough for a lot of retail traders who lost their accounts because of the huge move... heck, it even put some brokers out of business (R.I.P. Alpari UK).  In fact my own broker, FXCM, almost went belly up as well (I was moved from IBFX to FXCM last summer when Monex Group decided to end its MT4 retail Forex arm of the business).  It was a close call, but FXCM has gotten a new influx of capital to continue operations... and there is even a rumor that they may try to "revive" Alpari UK to give themselves a foothold in the brokerage business in England.

With all that happened last week because of the Swiss "ambush", the news wasn't so bad for me personally.

One of the lessons I've learned (and tried to pass on to others for the past several years) is to TRADE RESPONSIBLY... USING THE PROPER SIZE FOR YOUR ACCOUNT AND NUMBER OF VEHICLES YOU'RE GOING TO TRADE.  Because I follow my own advice (which not all traders do) I only suffered about a 22% draw down from the "Black Swan" announcement from the Swiss.  Most of that was lost in a long USD/CHF position... and it was thousands of dollars in open equity profit... not really much in the way of cash after I was able to close out the position.

While I can't say that I "jumped for joy" over several thousand dollars in profit disappearing in the blink of an eye and an immediate draw down of 22%, compared to what happened to many others that day it certainly could have been much, much worse.  I've also recovered some of that draw down already through other open trades and am currently only down about 13%.  Even better news is that the draw down was from a higher equity high than I ended 2014 with, because I was up almost 15% on the year already for 2015 when the Swiss announcement was made.  What this adds up to is while I lost a lot of open equity profit over this mess... I'm really only down a couple of percentage points from where I finished 2014... and only a few hundred dollars in cash.  My new mantra for now is "... it could have been worse... it could have been worse... it could have been worse..."

While I do legitimately feel sorry for those who "lost it all" last week, I must say that I feel very good about my own trading.  I figure if I can weather an event like the CHF revaluation and keep earning double digit returns that I may just be in this game for the long run. For me this fiasco was a confidence builder... yes, even after all these years of trading it's nice to build your confidence through events like this!  This is a marathon for me, not a sprint... with the ultimate goal of not just trading for a living, but to be able to provide an even better lifestyle for my family and to use the skills I've developed into my retirement so I'm never forced to have to worry about where my next $ or "paycheck" is coming from... or worse, depending upon someone else to provide "investment returns" that I'll be living on.

Here's hoping you survived "Hurricane Swissy"... and if not, consider it a life lesson. Get up, dust yourself off, find a little more risk capital and start trading with more confidence that with the knowledge gained you can probably withstand a "Black Swan" like that next time.

If you have any questions just send me an email through the website and I'll be happy to lend an ear... as much as I legally can :-)

Jim
www.forexprofitmonster.com

Forex Profit Monster Results - April 2011

It's been almost a year since I've had a "windfall" month like April. It always feels good to reap the rewards of being a patient trend follower... and when the pips come flowing in like they did last month, you can't help but feel good! After all was said and done, I finished April with a profit of +2,168 pips across the 8 currency pairs I trade on the 4 Hour chart. I'm at a new account balance high, a new equity high, and I have a few trades still open that have carried over into May with a current total of about 1,500 pips of profit!

I'll get into the exact details of the month's performance in a little bit, but first the time seems right to address a question I got about 2 weeks ago from a fellow trader. I'll keep this person's name anonymous because I didn't ask to publish his question, but I think it's important to answer it and discuss the subject matter he brings up in an open forum so that others who may have the same mindset can learn.

The question posed was regarding my year end results with Forex Profit Monster over the past few years and the "sub-par" performance of the first two months of 2011:

"With regards to decreasing ROI year after year (2008: 300%, 2009: 60%, 2010: 30%, 2011: ?% do you consider FPM to be slowly losing its edge?"

I don't mean to be rude, but if this seems like a good question then you have a LOT to learn, young Jedi. :-)

The fact that the ROI has decreased each year for the past 3 years is not because the trading system is becoming less effective... it's actually quite the opposite! This system is very robust, and it adapts to the current market conditions. The reason that I experienced a 300% return in 2008 was because of the global "market meltdown" toward the end of that year. FPM helped me to achieve the incredible results in 2008 (not only a 300% return for the year, but more than a 100% profit in the month of October alone) while many other traders and investors were losing 40-50% of their account values (or more... there were a lot of account "KABOOMS" heard toward the end of 2008!). It was the "black swan" event that drove the profits for 2008... those profits were extraordinary and they can't be expected EVERY year. However sooner or later they will happen again (with things the way they are more likely sooner than later), and if you're trading a sound trend following system like FPM you'll be in the same position I was in 2008 when they do.

As far as 2009 and 2010 are concerned, all veteran traders know that after a huge event like we had in 2008 it will always take some time for markets to "settle down" again while volume and volatility move from one extreme to the other... and because of this profits during these times can be squelched. I don't know if that's what you can call a 60% and 30% return, but I guess you can if you're comparing it to 300%. However, any way you look at it even 30% is a great year. Even suggesting that a 30% return on the year is "poor" performance (as the person who asked the question seems to think) shows someone who is far removed from reality!

Here's some "homework" for you if you think a 30% return on the year is poor performance... go to your local bank and ask them how much of a return they're willing to give you on a savings account; or better yet, tell an investment adviser that you think a 60% or 30% ROI on the year is poor performance and tell them you'd like to invest with them... I'd almost guarantee they won't take you on as a customer... in fact they may call security and have you escorted from the building LOL!

If you are a new trader (or even an experienced trader) who thinks the question asked was valid, then you need to adjust your view of the market(s). Trading systems can only deliver what the market allows them to under the current market conditions. If you think you have any control other than to follow your trading plan and accept the returns available then you should probably give up trading because you're going to lose all of your money in the long run. Find someone who is a good trader/money manager, give them your money to trade and let them make you some money... or just donate the money you were going to use in your account to a worthy charity... at least then it will do some good since you're probably going to lose it all anyway! As an added bonus of doing this you can claim the tax write-off!

And here's some more advice for those of you who might feel better selecting a professional to manage your money... invest it in a trend following fund... and do the opposite of human nature and buy in during a drawdown (when the fund is actually temporarily losing money) so that you can maximize your returns when the new trends kick in! If you buy in during the "good times" (like after a 300% ROI year), you may start out in a drawdown or during a long stagnant period while the market consolidates. If you're going to be successful even placing your money with someone else, this is the way you need to learn to think!

Now with that out of the way, here are the results for April:

19 trades

11 wins: +2,876
8 losses: (-708)

Total: +2,168 pips

Win rate: 57%
Avg win: 261 pips
Avg loss: 88 pips
Avg Risk/Reward ratio: 2.96 to 1

Here are the results by currency pair:

USD/JPY 2W, 0L +472
EUR/JPY 1W, 3L +444
AUD/USD 1W, 0L +421
GBP/JPY 2W, 1L +344
EUR/USD 1W, 1L +213
USD/CHF 2W, 0L +203
USD/CAD 1W, 1L +90
GBP/USD 1W, 2L (-19)

And the up to date yearly results so far for 2011:

January (-35)
February (-334)
March +869
April +2,168

That's +2,668 pips total so far for 2011, or an average of +667 pips per month.

I hope your April was as profitable as mine, here's to a successful May!

If you'd like more information about Forex Profit Monster (and my daytrading system Forex Day Monster), visit my website at www.forexprofitmonster.com. You can purchase both systems there on the "Purchase" page.

You can also buy each system individually on my eBay page at http://myworld.ebay.com/jimsgr8stuff4less/ where I list one or two trading systems per week at a discount.

Jim
www.forexprofitmonster.com
http://myworld.ebay.com/jimsgr8stuff4less/

Forex Profit Monster Results - May 2010

As you can see from the sharp rise in the equity graph above, May provided an excellent increase to my account! After what's been a relatively "sleepy" year so far, one of the dramatic price movements that I've been expecting to happen this year happened during May. It's important to understand that when trading this system (or any trend following system) you will go through periods where you have small wins, small losses and break even times. It may test your discipline to stick to trading during these times, but if you can do it you can reap the rewards in months like May.

If you are familiar with the concept of black swans (if not, you should read a copy of Nicolas Taleb's book "The Black Swan - The Impact of the Highly Improbable") then you're already familiar with how FPM generates profits. It basically provides small returns until an unexpected major market move (black swan) occurs. Most traders and investors are caught off guard during black swan events and end up losing a lot of money. FPM is designed to capitalize on these events, and May 2010 was one of those months.

I don't usually make predictions about the market (well, OK, I sometimes do, I just don't allow those predictions to influence my trading) but my personal feeling is that May isn't the only month like this we're going to see in 2010. With all of the economic problems in Europe continuing to grow, and the economic problems we continue to see here in the U.S., I'm reasonably sure there will be more "black swans" not too far away.

The other nice thing about FPM is that it doesn't rely solely on "black swans" for profits... when the day comes that we do see a real recovery and a new "bull" market, I'll be in a position to profit from those sustained trends as well!

OK, let's get to the details of the May 2010 results (from the 8 pairs I trade on the 4 Hour chart):

17 total trades

8 wins: 5,485 pips
9 losses: 888 pips

Total: +4,597 pips

47% win rate

Avg win: 685 pips
Avg loss: 98 pips
Avg R/R: 6.98 to 1

Results by pair:

GBP/JPY - 1 W, 1 L +1001
EUR/JPY - 1 W, 2 L +754
AUD/USD - 1 W, 1 L +695
GBP/USD - 1 W, 1 L +676
USD/CHF - 1 W, 0 L +635
EUR/USD - 1 W, 2 L +390
USD/CAD - 1 W, 1 L +229
USD/JPY - 1 W, 1 L +217

Here are the results for the year 2010 so far:

January: +823
February: +669
March: +434
April: (-446)
May: +4,597

Total: 6,077 pips
Avg: 1,215 pips per month


For more information about Forex Profit Monster (and the day trading system Forex Day Monster), visit www.forexprofitmonster.com.

To purchase FPM or FDM visit my eBay page at http://myworld.ebay.com/jimsgr8stuff4less/

That's it for May... hope your month was as profitable as mine and here's to more pips in 2010!

Jim
www.forexprofitmonster.com
http://myworld.ebay.com/jimsgr8stuff4less/