Cash & Carry

Discussion in 'Journals' started by ElectricSavant, Jul 8, 2005.

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  1. Rules for Cash & Carry (Retail Traders):
    1) Start out with any amount of capital.

    2) After funding, ask for a Sub-account, name it cash.

    3) Segregate 5.85 * amt of funds into the Cash sub-account. For example, if you start with 5k then put $4,270.00 into Cash and trade with $730.00. To transfer between accounts just use the transfer choice in the platform. Your cash earns around 2.3% APR, assuming you have a USD account. Set the
    Leverage at 50:1 and restart your puter'.

    4) Open up three Charts, AUD/JPY, GBP/CHF and EUR/HUF
    and save your settings. (tools/save current settings)

    It's been easy so far, now lets continue:
    5) Now, this part, might trouble you. You must scale in over a few days or longer if you want to begin correctly. It will make your "carry" easier to manage over the months to come. There is not a clear rule for this and it is discretionary. You can also just get in fast to begin your interest earning account at max from day one. Simply Enter in 1k units at a time and try to get one PIP improvment on each entry. Split up the opening trades with your trading dollars in each pair. Use this spreadsheet for your base proportions and scale in, beginning with AUD/JPY. Start by entering in with 1k units of AUD/JPY and the spreadsheet
    will tell you what to enter in with on the other pairs.

    6) After step #5 is complete, transfer some cash over to your primary trading account, to cover the possibility of the "Average Down" limit orders that are going to be placed in the next step.

    7) Use the spreadsheet here, and enter in a limit order with the next Average Down entry at the increment indicated with the Base Proportion & Inrement Finder. You can exercise discretion here if you wish, and glance at your charts and at will. Try not to space your orders too close together.

    Almost done, just some finishing touches:
    8) Look under the trade tab and sort the P/L in descending order, by clicking the header, and if you notice a profitable group of trade(s) that can cancel a loss at the bottom of the list …Trade it, but wait to be net profitable with that exchange, preferably at a higher rate than the 25% APR. You can also take
    profits only by using the Positions tab and with two clicks to close out a position that is profitable.

    9) If you do #8 above, then you must re-enter some trades immediately to get back up to the 25% APR earnings capacity. Reference to the Base Proportion and Increment Finder in this spreadsheet.

    10) As your balances grow and your unrealized changes, transfer on a daily basis the monies accumulating, to reach the 5.85:1 ratio discussed. As time progesses you will find opportunities to compound the daily injections of interest into your primary trading account after you FIRST meet your 5.85:1 requirement. Distribute those excess amounts into average down trades.

    11) Lastly, you can draw horizontal lines on your three charts to give you a visual where your average trade price is compared to the current price. You can find your average trade price under the positions tab in the platform.

    rev. 06/27/05
  2. Interest Rankings
  3. ScreenShot (trades)
  4. ScreenShot (orders)
  5. ScreenShot (positions)
  6. For those of you curious. Electric has replaced his personal trade log with the blog. So he will be writing his personal thoughts there in the blog.

    Some folks do not appreciate these ramblings to be in a Trade Journal on ET. So Electric will write some personal things for himself in that Blog.

    This Journal is strictly Business. I know that many do not understand how this System works. So I will try to answer any questions pertaining to how to trade Cash & Carry.

  7. The thought was:

    If 1k is trading at 50:1 leverage,

    Then $1,000.00 * 5.85 = $5,850.00 in a USD cash sub account earning between 2.3% and 2.8% APR (This sub-account enables an ability for an online transfer with a few clicks). You will see the daily adjustments in the spreadsheet that Electric or I make and post here daily at around 17:00 est. There is a graph of the "Gambling Meter" to show its progress.

    The trading account gets paid the interest on the leveraged amount, where the cash account simply is like a Money Market Account paying interest on its cash value. See the Interest cow Spreadsheet for the corresponding Ranked interest rates, margins and APR yields.

    Winter, There is a large amount of cash in this system. It is used up as the cycle of carry progresses, and occasionally when all the pair come into profitable synch at the same time the system can go flat and re-balance itself with the desired ratio of 5.85:1 Cash to Trading, and then it starts again. first with the initial entry, then its "Chasing" of the current price around with the 'Average Trade Price".

    Hope this Helps


  8. Good idea with the new blog.
    #10     Jul 8, 2005
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