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I am currently researching multicurrency diversification and correlated hedging as a zero risk/absolute return/market neutral strategy.

(Last Updated On: August 17, 2011)

currently researching multicurrency diversification and correlated hedging as a zero risk/absolute return/market neutral strategy.
Having seen some stunning results by others using this approach, I want to develop a purely TA intraday algo strategy, making simultaneous entries and exits from analysis either on a 1H,4H or D1 TF. If you have had some success trying this, kindly recommend links, materials and most especially good MT4 indicators that can at first glance, quickly show negative or positive correlation.
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zero risk can be achieved in the only case: zero returns. All “market neutral” strategies are either Metatrader BS with is phenomenal “hedging” capability, or use derivatives with fixed risk, like delta-neutral option strategies. But the latter worked best when LIBOR had substantial figures, I doubt if you could achieve anything substantial nowadays without risking volatility. However I am not too much into options, so there are others around to ask.
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I am not sure about zero returns. Anyway any portfolio is linked to the basic currency. So how about arbitrage strategies or even fixed rate returns from the stock/future strategies?
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, I seem to have missed the moment when arb has become zero-risk. And
with fixed-rate you’re about 3 years late. What we see now on yen for
example is the dramatic and fatal end of lovers of carry-trade started 5 to
9 years back.
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Ups, I meant not the cash and carry strategies;) but the thing more simple 😉 if the stock price is not equal to the future price at the same underlying that you can pick the fixed profit from this difference by the long position on the underlying and the short position on the future (if the future price is grater of the underlying one and vice versa in the another situation). In this case the conterparty risk insured directly by market.
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In this case you will need to spend at least $100K a year only on trading
infrastructure. Are you sure you will be able to cover at least these
expenses? Still risk-free?
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It depends on the size of the portfolio… If you invest saying $100mm… Anyway this is still the question is the glass a half full or a half empty;

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