Tag Archives: Trade Leaders Investment Program

FINalternatives is the premier, independent source for news on the alternative investment industry. They wanted to learn a little more about Currensee so they called our CEO, Dave Lemont, for the inside scoop. Here are a few questions and answers from the interview. The entire transcript can be found here.

Can you tell me something about Currensee?Dave Lemont Currensee

We’re all about creating an alternative investment for the world’s currency markets, that’s the mission of the company. We’ve essentially created a completely new way to invest. We find emerging managers all over the world and then you…can build your own little fund of funds directly on the internet by selecting these Trade Leaders that we present to you—and by the way, we do a ton of due diligence on them...You pick them, you build your fund and in a single account, you can have multiple managers, and we replicate the trades from the managers’ accounts into your account.

The other cool thing is, because it’s foreign currency trading, it’s not correlated to the stock market. It’s very much of an alternative investment. And based upon how volatile the stock market has been this year, people need alternative investments. And the other beauty is, you don’t need to know anything about foreign currency trading—all you need to know is how to read a performance chart on risk and reward, the same as you’d read a performance chart when picking a mutual fund. It’s a very powerful alternative investing tool….And the returns have been very exciting. It’s really possible to build a very exciting portfolio for yourself or select a single Trade Leader, as we call them.

How do you choose your Trade Leaders? What criteria do you use?

We’re looking for emerging managers, and by emerging managers I would say these are professional people that have experience managing money —somewhere in the $1 million to $25 million range. Not that we would reject someone managing more, but we’ve also found that people managing tons of money no longer have the returns. And so we’re looking [for managers] at the right stage of their career, where they’re building their career and essentially, their challenge is gathering assets, but they’re fantastic traders…They do it all day long, it’s their only job, it’s the way they make an income. We give them the platform to gather the assets and they do what they do best. We take care of the rest.

As for the Trade Leaders, let’s face it, we’re picky. We’re looking for managers who have strong returns, meaning the returns should be anywhere from 1% to 10% per month, but their drawdowns are below 20%, hopefully below 10% in terms of the maximum drawdown that they would ever experience…And the most important thing, I would say, is people that manage their own money in a very disciplined manner, by that I mean, if they have a strategy that says, ‘I’m willing to risk 1% of my account on my trading day,’ that when they’re losing, they close. When they’re winning, they take their profits. Somebody that has a strategy and they exhibit to us that they are honoring that strategy to the ‘T.’

Now, the way we do due diligence is, we have a pretty strict process they have to follow: We interview them, we review their risk management practices, we run background checks, we invest with their system, with our own dollars, in a live account, and…we make sure that what they say they’re going to do is what they really do. And then we test the replication side of it, so we need to make sure that when we replicate their trades from one account to another that our correlation is strong.

Who is your target client?

One is [the] foreign currency traders…that aren’t very effective on their own…and they’re looking to diversify their trading by following someone who’s a great trader. Most Forex traders lose money and our program gives them a way to be in the market by putting Trade Leaders to work for them. But the bigger market that we’re after is what I would call the ‘active investor.’ The active investor is someone who, he may trade managed futures or ETFs, or he’s very active with his financial advisor, and he’s always wanted to take advantage of foreign currency markets but he doesn’t know how to trade. He wants to participate in alternative investments, and we’re perfect for him.

The other market [is] institutions. We continue to build partnerships with large hedge funds, family offices, funds of funds, and other asset gatherers. These folks are simply looking for great traders that offer alternative investments, and they love the fact that we allow the risk to be controlled…

What kind of risk control do you offer?

There are three risk controls: an overall drawdown control, that when you’ve lost a certain amount, the system will stop. An open drawdown control, so just the open positions tracking and then a leverage control that allows you to de-lever, so, if the Trade Leader trades like, 5 to 1, you could say, ‘I only want 50% of that,’ now it creates a 2 and ½ to one leverage. If the customer is a high-net-worth person who signs a special contract, they’re allowed to lever up. But only if they sign a contract that says they understand the risks. So they may say, ‘Well, this guy is pretty conservative, I might take a little more risk than he takes and double the size of his trades.’ And we’ll allow you to do that, but you must sign a special agreement for it.

In our software, if you were to follow Trade Leader 1 and Trade Leader 2 and Trader Leader 3 in your single account, we allow you to set drawdown controls on each one of these leaders, and even the amount of leverage they control. So, you can say, ‘I don’t ever want to lose more than 5% or 10% or 2%’ and then, if that were to happen, we shut the system off….Part of trading is not just winning but controlling when you lose and [trying to ensure] that the day you lose is not such a terrible day that you can’t recover from it.

These controls are extremely popular with the high-net-worth and the institutional market for us. When a pair that a Trade Leader trades—foreign currency traders trade the dollar/Swiss or the dollar/yen—feels too volatile, the investor or asset manager can say ‘I don’t want to see any trades from this pair in my account today,’…You are able to have that level of control.

Click here to read the full article previously posted on www.finalternatives.com

 

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Be sure to read the full risk disclosure before trading Forex. Please note that Forex trading involves significant risk of loss. It is not suitable for all investors and you should make sure you understand the risks involved before trading. Performance, strategies and charts shown are not necessarily predictive of any particular result. And, as always, past performance is no indication of future results. Investor returns may vary from Trade Leader returns based on slippage, fees, broker spreads, volatility or other market conditions.

Diversification, of course, is about taking positions in markets or securities which have low or negative correlations to reduce total portfolio risk. Basically, you're looking to have positions which aren't likely to all trade in the same direction.

Diversification has been a major talking point in recent years among money managers and academic researchers. This is because of the way the major financial markets have all been highly correlated during times of crisis – as witnessed by the so-called "risk-on" and "risk-off" trading patterns we've see in the markets.

This chart shows a rolling 12-week correlation of returns comparing the S&P 500 with four major markets (GLD = gold ETF, TLT = US long-term Treasury ETF, HQD = US high grade corporate bond ETF). A reading above zero is a positive correlation, meaning the markets move in the same direction. A reading below zero is a negative correlation, indicating markets that move in opposite directions. The more the reading moves toward 1 (-1), the more the return of the two markets match (are the inverse of) each other.

As you can see, the correlations do change over time – quite considerably and quite rapidly in some cases. Those quick changes, often coming all at the same time across markets, are often the function of extremes in market psychology, one way or another.

Is there a way to avoid these dangerous swings? I think there just might be, by taking diversification to the next level. That means going beyond just allocating funds among different markets. It's diversifying among trading strategies as one can do with the Trade Leaders program. That level of diversification, done properly, can make the market allocation just about irrelevant. My analysis shows that this can produce very low cross-market correlations. Watch this blog for fore information about how low it can go.

We had the opportunity to talk with the smart folks over at the The Fiscal Muse about Currensee and the Trade Leaders Investment Program. They asked our CEO, Dave Lemont, a bunch of questions – some of which we are asked pretty regularly. So, I thought…why not post them here to our blog so everyone can share in the answers. I present….all the things you wanted to know about Currensee and Trade Leaders but didn’t have the chance to ask. Enjoy!

Thank you John Trivett and David Gregory. Read the full article below or click here to view it on The Fiscal Muse.

Currensee is the alternative investment service that puts the power of world currency markets in the hands of every investor. With the Currensee Trade Leaders™ Investment Program, investors build their own automated trading portfolios of Trade Leaders, top foreign currency traders hand picked from the over 8,000 members of the Currensee social network, who trade over $50bn USD annually.

The Fiscal Muse managed to secure an exclusive interview with their CEO to discover what exactly Currensee has to offer the complex world of the foreign exchange markets.

Greetings …

Q1) Currensee sounds like an interesting undertaking. Can you tell our readers more about the whole project in general and what you hope to achieve with it?

I’d be delighted to. Currensee launched the first Forex trading social network in 2009 just as social media was beginning to change the entire trading and investing landscape. What made Currensee different and continues to set us apart is that our social network is comprised of “real” Forex traders, meaning traders who use real money to trade and who link a live trading account when they sign up with us. We all know that it’s one thing to trade in a demo account and quite another to put real money on the line when making trade decisions. We were the first to deliver this trust and transparency to the Forex market, which are two of the key cornerstones of our company. We aim to ensure that the fast growing Forex market is open to everyone, in a clear way. We have already seen encouraging growth and with the launch of our Trade Leaders program, we are confident that investing in Forex will become easier for investors.

Q2) What do you think are the main benefits of combining foreign exchange trading with social media?

The Currensee Forex trading social network was launched to bring Forex traders from around the world together to share trading ideas and strategies and to deliver trust and transparency to the Forex market. Our company created a new way for traders to collaborate and work together to make trading decisions using social media, and we take great pride in being first to the market.

As we launched our new Trade Leaders platform, we took the idea of a Forex social network one step further. We combine the power of social networking with social investing, creating the next generation of online investment services. The Trade Leaders program is the first social trade automation program that allows anyone – regardless of their knowledge of Forex – to take advantage of the Forex market. The program provides trust, transparency and control by allowing investors to follow and automatically execute the trades of the Trade Leaders, in their own trading account. Unlike other trade automation services that serve to increase trading volume and customer churn, Currensee delivers an auto trading product that strives to make our investors profitable, while giving them complete control and visibility to every trade.

Forex social networks are providing new opportunities for investing, as they’re opening new asset classes such as Forex to the “average investor.” Social networks allow members to share trades by real traders in real time. Using social networks, investors can leverage the expertise of advanced traders by following and automatically executing their trades. Members know that sharing real trades and positions can often lead to new insights and new ideas that can help make more informed trading decisions.

The major benefit of investing with Currensee is that we put the Forex market opportunity into the hands of every type of investor. Now, for the new Forex trader or perhaps a savvy trader who is ready to leverage the trading expertise of experienced and professional traders, we have the Currensee Trade Leaders™ Investment Program. For the investor who may know very little about the Forex market, but who is looking for a way to diversify and take advantage of foreign currency investing, the Trade Leaders program is a new way to access the market.

Q3) Would you say that Currensee is aimed more at Trade Leaders or at Traders themselves

Both. Without either, Currensee’s unique selling point wouldn’t exist! We encourage Trade Leaders to apply for the program as it allows successful Forex traders an innovative and easy way to leverage Currensee to boost their profile and their Forex trading business. We are very selective about who we approve to become Trade Leaders and spend a good deal of time assessing performance and risk management. We aim to provide our investors with the best Trade Leader choices possible. We also spend a significant amount of time talking to new investors and cultivating relationships with existing investors. We are excited to see existing investors continue to deposit and allocate new money into the program and we have had great traction building our investor accounts and assets under management. At the end of the day, we need both Trade Leaders and investors to help the site flourish.

Q4) Currensee currently has 7,000 active members. Is this predominantly traders or trade leaders? Can you give us a breakdown of how many members and participants you hope to attract in the coming year?

Actually, we have over 8,000 members of our social network and membership is growing every day.

Q5) According to internet sources Currensee recently raised $8m from investors. What do you hope to achieve with this? Will you be expanding into new markets, or updating infrastructure?

Our latest round of funding was $4M for a total of close to $17 M USD and will be used to develop new decision-making, collaboration and portfolio management tools for investors, and to make currency investing even simpler and more transparent. It will also be used to fortify the Currensee technology infrastructure including data center expansion and enhancements to the Currensee Intelligent Trade Replication Technology™, a sophisticated trade automation engine that precisely manages the timing and round-turn execution of trades. The funds will also drive further international development, including the expansion of the Currensee sales teams in the United Kingdom and Europe, as well as new global partnership deals in Asia and Europe.

Q6) Aside from foreign exchange trading can you see Currensee diversifying into other financial markets or products?

For the moment, we are primarily focused on the foreign exchange market. However we are looking carefully at adjacent asset classes that will continue to give our customers a true alternative investment to the stock market. We will continue to revolutionise the financial services industry and the social investing category. We aim to stand out in whichever marketplace we compete in rather than just fit in.

Q7) What do you think sets Currensee above its competitors?

There are some pretty significant differences between Currensee and our competition. First off, our Trade Leaders are all real traders with real Forex trading accounts. We do not allow any back testing or demo accounts. These are professionals-level traders who have been trading for many years and who have passed our rigorous review process and been tested as a Trade Leader before being added as a selection for investors. We review our Trade Leaders on a weekly basis and make changes as necessary to keep the top traders in the program and provide the best possible choices for our investors.

We are also different than our competition because the success of our investors is our top priority. We see investor profitability as our top goal and we work tirelessly to make it happen. We have a simple and transparent fee structure that focuses on investor success, rather than trade volume, which is how most of our competition charges fees. It ends up that the investor pays for many trades that don’t make them money and it becomes near impossible to make money in most of the other auto trading programs.

As our social network grew, we launched the Trade Leaderboard™, Forex’s first Leaderboard ranking top Forex traders based on historical performance along with a proprietary performance authority and risk index. The Leaderboard shows annual returns, historical and real-time performance along with risk scores for the top traders in the network. Traders are ranked against the Currensee Trader Authority Index™, a proprietary algorithm that combines performance, risk and experience into a single number. Any type of investor can participate in Forex by creating diversified portfolios that mirror the trades of our elite group of expert Forex traders. As the Leaderboard started to catch fire with traders, many members of our social network began asking us how they could “follow” the trades of some of the top traders on the list. We discovered that we had a unique value proposition for traders and investors looking to follow the trades of top traders because our traders had months of real performance, and we could easily report that performance through the Leaderboard feature. We began to hand-pick those top traders, our Trade Leaders, and vett and analyze their performance and risk management across a variety of strict criteria. For us, less is more. We’d rather provide our investors with fewer Trade Leaders, but who are of much higher quality. We also believe that fees should be very straightforward, which is why we have a simple model of a 2-percent service fee and a 20-percent success fee. We do not charge transaction fees and the Trade Leaders are compensated for success – not trading volume. We also deliver a variety of account controls to our investors, which provide the ability to modify or delete Trade Leaders from your portfolio at any time.

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Be sure to read the full risk disclosure before trading Forex. Please note that Forex trading involves significant risk of loss. It is not suitable for all investors and you should make sure you understand the risks involved before trading. Performance, strategies and charts shown are not necessarily predictive of any particular result. And, as always, past performance is no indication of future results. Investor returns may vary from Trade Leader returns based on slippage, fees, broker spreads, volatility or other market conditions.

This week the financial headlines seemed to all center around a handful of categories: Ireland and all the things they do wrong, Germany and what they do right, the rest of the EU scrambling in the middle, Bernanke getting flack over QE (still), and China as the next big thing.

If this week’s news stories are any indication, we’re in for a game-changing 2011. Here’s some light reading for you before Thanksgiving.

The Eurozone Shuffle:

The Bernanke Burn:

China, China:

Or, if you’re pressed for time:

If you haven’t already, check out Yohay’s recent posts on Forex Crunch on his Forex portfolio. He writes about the Trade Leaders Investment Program, and you can watch a Forex investment portfolio as it develops in real time. Pretty exciting stuff!

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Be sure to read the full risk disclosure before trading Forex. Please note that Forex trading involves significant risk of loss. It is not suitable for all investors and you should make sure you understand the risks involved before trading. Performance, strategies and charts shown are not necessarily predictive of any particular result. And, as always, past performance is no indication of future results.

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Be sure to read the full risk disclosure before trading Forex. Please note that Forex trading involves significant risk of loss. It is not suitable for all investors and you should make sure you understand the risks involved before trading. Performance, strategies and charts shown are not necessarily predictive of any particular result. And, as always, past performance is no indication of future results. Investor returns may vary from Trade Leader returns based on slippage, fees, broker spreads, volatility or other market conditions.

2 Comments

I tweeted yesterday ...

“There is nothing quite like pre-launch madness. Complete stress & mayhem but I wouldn't have it any other way:-) #whyilovestartuplife”

I love start-up life and it’s mostly because of days like today.

Moments ago, we launched the Trade Leaders™ Investment Program, an important milestone in Currensee history. As the first social network for Forex traders, our mission is — and has always been — to bring trust to the foreign currency market. We’ve made great progress including growing our social network, partnering with top-tier brokers and expanding to the UK, but we’re not finished yet. The launch of the Trade Leaders Investment Program delivers a new way to invest in the currency market by enabling investors to follow and automatically execute the trades of some of the most successful traders from the Currensee Social Network.

What does that mean exactly? It means that investors in any asset class and on every continent can get involved in the Forex markets, even if they’ve never traded a currency pair themselves.

Here’s the 10-second overview: Trade Leaders are top Forex traders hand-picked from the Currensee social network. We relentlessly assess their performance, risk management, and returns and only the best make the cut. You can see it for yourself by clicking on any of the Trade Leaders on the Trade Leaderboard. Remember, Trade Leader performance is actual performance. Never fake or fluff. No backtesting or demo accounts. Real, honest to goodness performance in a live account.

Investors in the Trade Leaders Investment Program check out the Trade Leaders, select the Trade Leaders they want to invest in and create their very own Trade Leader portfolios. Once the investor allocates their funds, the Trade Leader’s trades are automatically executed in the investor’s account. Best of all, investors see all trades executed in real time and have full control over their account.

Watch The New Way to Invest, and learn about the program in just a few minutes.

Today, Forex is one of the hottest alternative asset classes being traded. While we can’t take credit for all the hype, we’d like to think of ourselves as being on the forefront of innovation in this market. It’s amazing to think what started as a simple idea between a software developer and a Forex trader has turned into an international foreign currency social network with thousands of traders meeting and collaborating in real time. And, now, that social network is a source of top traders for investors around the world to take advantage of this dynamic asset class. Pretty cool stuff.

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Be sure to read the full risk disclosure before trading Forex. Please note that Forex trading involves significant risk of loss. It is not suitable for all investors and you should make sure you understand the risks involved before trading. Performance, strategies and charts shown are not necessarily predictive of any particular result. And, as always, past performance is no indication of future results.

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Be sure to read the full risk disclosure before trading Forex. Please note that Forex trading involves significant risk of loss. It is not suitable for all investors and you should make sure you understand the risks involved before trading. Performance, strategies and charts shown are not necessarily predictive of any particular result. And, as always, past performance is no indication of future results. Investor returns may vary from Trade Leader returns based on slippage, fees, broker spreads, volatility or other market conditions.