Managed Forex Accounts

DEV ended the month on a low note: at the end of the trading day,it had about 5% open trade draw down. Finally we are seeing some volatility in the account, the trader is human after all. My account is left with a gain of 3% since Oct 9 start. However, after the Asian session re-opened later in the day, the position jumped back immediately. I expect that the trader took advantage of it. We will see tomorrow when the results are updated in the broker's system.

The Sentiment Aggressive Fund is on a roll, gained 1% more today, account is up 3.8% since Oct 23. Very happy about that.

AKM slided more, end the month up 14.4%. The account is in negative territory YTD.

My Sentiment Aggressive Fund account continues to do well, as of now, it is up 2.8% after trading started Oct 23. Got an email from a client today:"...I applied a couple of days before your website was updated and therefore I used the FXCM LPOA form which was set at 2%pa Management Fee. I then forwarded your LPOA form and they have changed it to 1%pa. " FXCM's service and promptness always impresses me. They have a great system processing paperwork.

DEV had some gains today, account is up 8.2% overall, close to 1% on the day. The open position is cut in half now.

AKM had some losses today in open position, still up 18% for the month.

DEV had a small loss today, and an open position. So he did not call it a month as I was expecting. Account equity is still up 7.2%.

SEN had a good day, up 1.5% since the account was opened last week. I have not seen much fluctuation at all.

AKM's open position had some gain today. Up 25.5% month to date.

Getting ready to launch a new managed account soon. The trader averaged 25% a month since Feb 2007 in his own account, with no negative month. We will be opening our own live accounts this week to be the first accounts traded by him.

I observed some pattern of DEV. He has an internal performance target, which is around 5% net return for the leverage level I chose. Once that is reached, he would either trade very little or trading might stop completely until the new month. My account has 8.3% gain since open, about 1% gain for the week. It still has a tiny open position right now. I don't think we will see much activity till the end of the month.

AKM first went up more and then dropped back further when USD continued to weaken. One step forward and two steps backward. The account is still up 20.8% for October.

We have a new listing on our site: SEN. This is the FXCM Sentiment Aggressive Fund. Accounts opened through us receive a lower 1% management fee, instead of regular 2% fee. This is our way of saying thank you to our clients. The Sentiment Aggressive Fund was started in July. FXCM also offers a more conservative Sentiment Fund, at about half the leverage. The Sentiment Fund has a 12 month live account track record. This managed account uses a contrarian strategy developed by FXCM in house, similar to the COT (Commitment of Traders) trading strategy. When most small speculators are taking one position, it takes the opposite position because most of them will lose. As one of the largest forex brokers out there, FXCM is in a unique position to gauge retail traders' sentiment. It also employs another strategy for range bound markets, taking advantage of over bought and over sold conditions. The fund is relatively conservative, with the largest open draw down less than 5% for Sentiment Fund in its one year history. The $1000 minimum makes it easily accessible to many small investors who otherwise do not have a choice of good performing managed forex accounts. My own account has been traded for a week, up 0.66% so far. Normally we would have waited much longer after we start our own live account before introducing a managed account to our clients. But in this case, we do trust the track record supplied directly by FXCM.

I created this blog to give updates on the progress of the Managed Forex Accounts listed on our site. I might also talk about some other managed forex accounts that we are monitoring but are not yet listed on the site.

In this first post, I would like to give a brief overview of the two managed accounts that we currently have on the site: AKM and DEV.

I first became aware of DEV managed account when I tried to close an idle account at a Swiss broker and the broker offered me this managed account and provided some track record. It was in November 2006 and the trader only started to manage retail accounts September 2006. I was told the trader was trading the firm's proprietary funds before that. The records looked pretty good, but I decided to wait a little because I had bad experience with many managed accounts before. Initially they all show you good track records, but once your accounts start, it is a completely different story. Not so in this case. I requested regular updates from the broker and the trader continued to perform consistently month after month. So I finally funded my live account in March 2007 and the account performed exactly as I expected based on prior records in the next few months. Then the broker had regulatory issues in July and unfortunately my account was stuck there, and still awaiting further court action on the broker client funds.

In September, we got information that DEV was trading at a major US futures/forex broker, so I opened a second account at the new broker without hesitation. It started trading Oct 9 and is up 7.3% as of Oct 20. One thing I like about the new broker setup is the more flexibility of leverage use. By default, the leverage used is approximately half of what the trader uses as "normal" leverage with the previous broker. The investor can request additional leverage by specifying 2x, 3x ect of the default leverage. I am using 2x leverage in my current account, which is similar to the leverage used in my first account. The trader seemed to be getting even better in that his trading at the current broker is more conservative with less account volatility, yet he still produces those good returns. I am seeing him taking small losses less than 1 percent of account equity, which he did not used to do. I might increase my leverage to 3x or maybe even 4x in the future.

I opened my first account with AKM in August 2006 and the account started trading in September 2006. I started at a good time and it quickly gained almost 30% in a month. After a rough November 2006 when EURO broke out to the high side and the account experienced a 35% or so open trade draw down, my account ended the year with over 40% profit, not too bad. AKM has over 200% net profit for all of 2006, which I confirmed with a few other investors who started with the trader before I did. AKM started 2007 with a bang when the USD rebounded strongly and the account shot up to new high. I opened a second account with the trader at another broker in Jan 2007. The accounts have seen two more significant draw downs this year. The latest draw down started in the second half of June and the acounts have not fully recovered yet. At one point, the peak to valley open trade draw down reached 50%, which is pretty scary and quite a few clients closed accounts understandably. There has been some good recovery in October so far but still a long way to go to reach new high. This account is definitely not for the conservative investor and should only be used as a small position for diversification of a portfolio.

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