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

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(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.)

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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.

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

December 2012 Results & 2012 Year End Results for Forex Profit Monster

It's the start of a new year, that means it's time for my end of the year results post for Forex Profit Monster.  As you can see from the equity graph above it was another profitable year!  But before I break down the results for the year, I need to post the results for the month of December.  And before I do that, I'd like to take some time to reflect back on my trading in 2012.

This past year was the 6th year in a row that I've seen a profitable year trading with Forex Profit Monster.  The system that I designed and coded back in 2006-2007 has performed very well heading into its 7th year by showing me about 65,000 pips of profit overall. It's been grinding out nice profits during most months/years and also capitalized on the chaos that was 2008, netting me about a 300% profit for that year while most people were losing.  While I've enjoyed the success I've had with Forex Profit Monster, I've also continued to grow as a trader.  If you've followed this blog at all (or at least read some of the early posts) you've seen some of that growth... from the time frames I've traded to my metamorphosis to being a trend follower exclusively (I only trend follow now, I don't trade ranges or other mean reversion strategies anymore).

In the past few years I've watched my account grow in value to the point where it's almost time for me to take trading to the next level... by diversifying and trading more than just the Forex market.  The next logical step for me as a trend follower is to move into the Futures markets... trading commodities and other futures contracts.  To prepare for this I entered into a mentoring program in 2012 with one of the top commodity traders in the United States.  I won't mention his name as I haven't cleared doing so with him, but if you've been trading for any amount of time you would probably recognize him from his market related media appearances and his book written in 2011.  I've learned a lot from this trader, and continue to do so.  In fact, things have gone so well I will be working as an assistant to him in 2013 which will allow me to learn even more about trading futures as well as the trading business in general.  I have a lot to be grateful and thankful for as I look back at 2012, and am even more excited about 2013 and beyond!

On to results... here's what happened with my trading with Forex Profit Monster in December...

December was a great follow-up to November as I saw not only some nice winning trades during the month, but also some gains from trades that opened in November that closed out during December.  Once again the trends were nice and smooth on many pairs which kept the number of trades down and the profits up.  It was a rare month in that I had a 68% win rate... you don't see many months like that in a trend following system where the average win rate is usually more in the 30-35% range.  However the average risk/reward ratio was also lower... 1.74 to 1 instead of the 3 to 1  or 4 to 1 ratio where it usually is during winning months.  I had a profit of 657 pips in December, and here's how the rest of the monthly results played out:

19 trades total
13 wins:  892 pips
 6 losses: 235 pips

Total: +657 pips

68% win rate
Avg win:  68 pips
Avg loss:  39 pips
Avg risk/reward ratio:  1.74 to 1

Here are the results by currency pair:

EUR/USD  2W, 0L  +352
GBP/USD  3W, 1L  +166
USD/CHF  2W, 1L  +158
USD/CAD  2W, 1L   +38
AUD/USD  1W, 1L   +19
GBP/JPY    1W, 0L   +15
EUR/JPY    1W, 1L  (-41)
USD/JPY   1W, 1L  (-50)

Since it's the end of the year, that means it's the end of the 4th Quarter.  With October's 220 pip loss and the gain of 657 pips in both November and December, I showed a profit of 1,094 pips in the 4th quarter.  Here's the updated equity graph:

And here are the final results for 2012:


January: +891
February: +206
March: +1,667
April: (-293)
May:  +1,640
June:  +2,209
July:  (-343)
August: (-699)
September +1,103
October (-220)
November +657
December +657

That's a total of 7,475 pips, or an average of 622 pips per month.

There were 8 winning months in 2012 with 9,030 pips gained, and 4 losing months with 1,555 pips lost.  That gives me a monthly win rate of 66.6%, an average win of 1,128 pips, and an average loss of 388 pips, which calculates to an average risk/reward ratio of  2.9 to 1.

For more information regarding purchasing Forex Profit Monster (or my day trading system Forex Day Monster), please visit the website at www.forexprofitmonster.com or my eBay page at http://myworld.ebay.com/jimsgr8stuff4less where I list one or two items per week at a discount.

Best of luck in your trading...

Jim
www.forexprofitmonster.com

Forex Profit Monster Results - November 2012

November was one of those nice months where almost every pair ended up a winner, the trends were long enough that there weren't a lot of trades, and there were some trades that carried into December with nice open equity.  It's always nice to end a month with a good profit and head into the next month with a head start on more profits!

Looking back after the fact it was the Yen that carried the month.  With the changing leadership in Japan and the announcement about the government not being so concerned about keeping the Yen weak (which removes the threat of government intervention, at least for now) we've seen some nice moves to the upside as the Dollar gains strength, along with the other major currencies.  This is ironic as you'd think you would have seen the opposite happen since the Bank of Japan has spent more than the past two years trying to keep the Yen from getting any stronger by intervening in the market.  The government says it doesn't care about making the Yen weak and the Yen becomes weaker...  this is why you can't trade your opinion on fundamentals successfully, you have to have a trading plan and follow it systematically.  If you were trading a fundamental opinion you probably would have been expecting the Yen to gain more strength and would have missed the several hundred pips of profit available to you from the Yen pair moves in November.

Here are the November results on the 8 pair I trade on the 4 Hour chart:

27 trades total

11 wins:  1,293 pips

16 losses:  636 pips

Total: +657 pips

40.7% win rate

Avg win:  117

Avg loss:   39

Avg risk reward ratio:  3.0 to 1

Results by currency pair:

EUR/JPY  2W, 1L  +292

GBP/JPY  2W, 1L  +274

USD/JPY 1W, 2L  +132

USD/CAD 1W, 2L  +81

EUR/USD  1W, 2L  +64

GBP/USD  1W, 1L  +49

USD/CHF 1W, 2L  (-67)

AUD/USD 2W, 5L (-168)

The results for 2012 so far:

January: +891

February: +206

March: +1,667

April: (-293)

May:  +1,640

June:  +2,209

July:  (-343)

August: (-699)

September +1,103

October (-220)

November +657

That's a total of 6,818 pips, or an average of 619 pips per month.

For more information regarding purchasing Forex Profit Monster (or my day trading system Forex Day Monster), please visit the website at www.forexprofitmonster.com or my eBay page at http://myworld.ebay.com/jimsgr8stuff4less where I list one or two items per week at a discount.

Best of luck in your trading...

Jim

www.forexprofitmonster.com