Who controls my money?
Short answer – “You”. Unlike traditional fund managers we do not have any access or control over your funds, and neither does the broker. The money sits in a client segregated account with one of the top four banks in Australia. The only person that can touch those funds is You. The Australian Banking System is highly regulated with stiff penalties for any transgressions. What we have from you is permission to trade on your behalf. We place a trade on our own account and instantly the same trade is mirrored in your account. It’s that simple
If you want to withdraw funds all we need is a few days to de-activate your account and close all open positions. After that the broker will release your funds.
Which Broker do you use?
We use IC Markets in Australia because we believe they have a very good track record when it comes to integrity and funds administration. See also: http://www.icmarkets.com/about-us/why-choose-ic-markets
How do you differ from traditional Fund Managers?
We are not licensed fund managers. We do not take control of your money like traditional fund managers. In Australia most of the fund managers are owned by banks behind the scenes. They spend most of their time and money producing fancy prospectus’ loaded with disclaimers. You can see here that the returns they produce are not that attractive
Fund Managers spend most of their budget on advertising and subsidiary financial advisory firms which are paid commissions and are all part of the “system”.
By contrast we are traders who are trading our own money based on our own systems. What we are doing is extending the benefits of our trading expertise to you. No fancy brochures, no flash offices – just profits.
We are hugely incentivised to make profits for our clients. We get paid at the end of each month and If we don’t make a profit at the end of the month we don’t get paid. Fund Managers charge management fees regardless of whether they perform or under perform.
What are your fees?
We charge 30% of your profits based on net liquidating value at the end of each month. You give the broker your authority to deduct this amount from your account and transfer it to us. As an example if we make 3.6% for the month 1.2% is paid to us. That leaves you with a net profit of 2.4% for the month. If your account has not made any profit at the end of the month, then we do not get paid for that month.
What are the chances of losing all my money?
Typically, when we buy or sell currencies we might use up to 3% of your account balance on any one transaction. Most of our positions use less - around 1.0 %. That means we would need to have between 67-100 losses in a row to wipe out your account. In most cases investors will close their accounts well before they get anywhere close to this point. The average person would get worried and start asking questions if their balance dropped by 25%. A drop of 30% would most likely trigger a withdrawal. Of course, none of this is likely to happen. The way we manage your investment we do not expect this type of draw down to occur, but it's quite conceivable that if we have a bad run your equity could drop temporarily by 20% before it recovers and returns to profit. You need to mentally prepare yourself for this possibility as unlikely as it may seem.
How will a cataclysmic event affect my investment?
This is a difficult question to answer because it all depends on what type of event we are talking about. We take precautions to stay out of the market at times of certain major news announcements that might cause unprecedented volatility and erratic price behavior. We sometimes reduce our exposure by using smaller position sizes, or participating for shorter periods. These are some of the tools at our disposal but at the end of the day we do not have the crystal ball and can’t control everything. Life is about taking calculated risks and if we want to be rich and successful we need to weigh up risk versus opportunity and venture out boldly.
What is the minimum amount required to open an account?
We cater mainly for clients that have 50k + to invest. We have a two tier program – one for clients with accounts in the $50 -300k range and one for those with more than $300k. The clients in the second tier have access to some of our more profitable strategies.
We appreciate that this style of investing may be unfamiliar to some, so if you feel you would like to test the waters you can start with as little as $10,000. This will give you the opportunity to see how your account performs and add to your balance as your confidence grows.