Elite E Services Newsletter September, 2006
Intelligence disclaimer: Reading and thinking on an intelligent level carries a high level of risk, and may not be suitable for all humans. A high degree of intelligence can work against you as well as for you. Before deciding to read this article you should carefully consider your objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial knowledge and therefore you should not invest time that you cannot afford to lose. You should be aware of all the risks associated with intelligence, and seek advice from an independent advisor if you have any doubts.
Forex Disclaimer: WARNING! Foreign exchange is risky! There is a very high probability that you could lose some or all of your investment. Therefore, forex should be taken with a grain of salt by only the elite, sophistocated investor. See Risk Disclosure
There are a number of reasons why people who are computer literate are more likely to invest in the forex market than others. Of course, that doesn't mean that fx financial products are not offered to a plethora of clients, and many who do not even have computers will invest in FX. However, the foreign exchange markets provide opportunities not available in other markets. For example:
Investment size is irrelevant - You can invest $500 or $500 million in currency trading. Of course, the size of your account may determine the psychology of your trading strategy, but there is no reason to treat small accounts different than large accounts.
Open Source Community - Forex is more open than other markets, utilizing the fix protocal for example, or the Meta Trader platform, traders can develop their strategy without spending any money, which can be saved for their trading account. There are many open source communities of other traders and systems developers that share code, ideas, tools, and much more, through online portals like Money Tec and Strategy Builder FX.
Automated Trading - Anyone in computers at least appreciates automation. So many tasks in today's world are automated we take them for granted. Your investment accounts should also be automated. Why rely on human traders that can be subject to hunger, fear, greed, excitement, fatigue, etc.
Online Business - The entire business process from account opening to trade and withdrawal, is totally online. Of course brokers and businesses have physical offices in major trading areas like New York and Chicago, but that is not a requirement. You have no real advantage being across the street from the CBOT or NYSE because there isn't any FX exchange. Also it would be quite silly to strategically place your offices near your counterparties, which are large banks - because they are spread out all over the world. And even considering that point, those banks probably don't even house their servers in their main offices they are probably remote. As the FX market itself is decentralized from a trading point of view, it is technically as well, allowing participants of any sort to be anywhere, that has a stable internet connection.
Develop your own automated system - You can start from scratch, making your own FX Strategy, and test it before using live money. Or, build on the ideas of others, tweaking settings and rules to suit your needs. It can be fun, too!
Custom tailored trading - There are very few limitations to how you can run your strategy. This makes it possible to create complex money management and trading strategies. Also, fx is traded in pairs, such as EUR/USD and EUR/CHF making calculations more dynamic (whereas most other instruments are traded against local dollars. For example if you purchase shares in Microsoft MSFT, you pay in USD.)
Ultimate software business - Think about this: Most software companies write software and then sell it. They are relying on marketing efforts more than the quality of their software, to bring in results to the bottom line. If you develop a forex trading strategy or standalone software, you are actually writing software that makes money! What better bang-for-the-buck can you have than writing a money making software?
The human element - Many people think that robotics and automation is somehow inhuman, whereas the reality is quite the opposite. Remember also, that it is humans who will be writing the software. Humans will be maintaining the servers, and many other tasks associated with automatic trading. It is not a printing press by any means, and does not absolve human traders from doing their work. More than anything, robotic trading takes out the tedious process of picking perfect entry and exit points, streamlines backtesting and analysis, and simplifies the process of portfolio building. It frees up traders time to work with clients, and don't forget it takes a lot of work to make a strategy that consistently profits.
Room for more - We saw the .com bombs of the late 90's, the day trading fad that fizzled out around 2001, and other tech start up failures. We have seen the success of Amazon and Yahoo, which really are not all that revolutionary. Although it is convenient to shop at Amazon, didn't we have mail order catalogs in the 80's? We have not seen much development in the investment and trading industry, which could be a very profitable business to be in. Of course, it's impossible to convince any industrialist of the potential for profit, but many programmers have taken up forex strategy development as a part time hobby and have made many strategies that are successful. There is room for more participants in the fx market, and they do not compete. If someone makes a strategy that is better than mine, I am a likely investor in that strategy. There isn't the kind of competiiton that exists in traditional I.T. business.
EES Podcast
http://ees.net.nz/ees-podcast.htm
EES Launches official markets Podcast. As part of our content creation and delivery development, we are using new technologies such as Podcasting to deliver streaming content. It will be free at first and eventually only available to eesfx.com customers. XML - See EES Podcast page
EESFX 2.0
Check out the all new eesfx.com - appropriately named eesfx2.0 - not only because it is a new version, and a full site overhaul, also because it employs so called 'web 2.0' technologies such as RSS, video streaming, podcasting, and other interactivity.
EES will give a free subscription to anyone who asks before October 15th, good for 1 year. We ask only in return that you contribute something to the community, whether it be comments, files, getting other members, or whatever you feel you can contribute.
About web 2.0
“Web 2.0 is a new class of affordable apps [that] are becoming do-able, delivering instantaneous value such as mash-ups and programmable web,” says Boloker. “Web 2.0 is comprised of everything from Ajax to social software, for example blogs and wikis; to a focus on simplicity, to microformats.”
http://www.readwriteweb.com/archives/coming_to_terms.php
Our addition to the web 2.0 is the concept of sitelets. We have registered 1 domain as an SEO domain or 'master host' and as we develop ideas and projects, purchase inexpensive domains per project and point them inside a directory of the master host. The master is forex-automatic-trading-systems.com (obviously something you are not happy to type in your address bar). But you shouldn't have to - it's linked to.
Definition submitted to netlingo.com
the concept of mini-sites or 'microsite' for projects and specific purposes inside a larger framework. For example instead of having 1 website, you have 1 master site and 10 'subsites' each with it's own domain. The visitor to the sitelet may not be aware it is part of the larger network. An example would be instead of going to a company site and clicking 'employees' and seeing the bios of the staff, each staff would have his own website www.bobjones.com and it would use the same hosting and technology as the master site.
Webjargon: http://support.internetconnection.net/DEFINITIONS/
Websites Update
Registered 3 new fx related domains:
http://eliteib.com/ For Introducing Brokers
http://forexcoding.com/ Describe your programming strategy and submit for custom forex coding.
http://fxextensions.com/ FX Extensions - extending the world of fx.
Our first extension: firefox plugin called forex fox. Get forex for firefox!
EES updates
Elite E Services is now a member of FIX
http://www.fixprotocol.org/members/
Compliance and legal
We have applied for copyrights on all of our websites.
Information Curve
Since the collapse of Refco, more than anything we have been collecting information. The intelligence of FX business, it seems, can be more valuable than the product. Knowing where to invest, who is making money and who is lying, what software is the best to use, is the key factor making or breaking players in the fx market from business and trading perspective.
Key product development
Elite Signal Trader is complete, and we are testing. elite Signal Trader
We are also working on a arbitrage system that is currently confidential, but upon success with live money we may offer it to clients.
Auto Trading
We are now live with Trade Robot. Check out the perfomance here:
v1 FX
Forex, Version 1 - The EES auto-managed accounts program
We are launching a mini-managed accounts program which will have no minimums imposed by us, only broker minimums (i.e. $500 minimum to open an account). The problem we have had in the past years, managing mini accounts, is due to the fact that there is no PAMM mini. People we talk to alot are probably tired of hearing the word PAMM. It's a simple concept - you click once, and it distributes to your client accounts on a percentage basis. PAMM - Percent Allocation Management Module. This has been available for only 100k accounts - and with reason. The types of people who open mini's are subject to more problems than 100k accounts, unfortunately. Many of these people just shouldn't be trading fx. On the other hand, we have had many pleasurable clients who don't have much to invest and we are happy to give it a go with small amounts. The idea being 1,000 isn't worth the hassle - but if you can get 100x the clients that 1k becomes 100k. Regardless, we are going to be working with a small pool of mini's.
For now, we will be using Forex.com / Gain capital and Advanz AutoX. Soon, we will use Velocity 4x and their Meta Trader PAMM module, when it is available.
click here to view outline and risk disclosure
ees-v1fx2.pdf
IB
We are now IB's of North Finance. Northfinance Ltd. for offshore clients only.
IT update: Computers
EES has participated in the Microsoft Office 2007 Beta Program.
parallels 
- Use windows on your mac
Parallels Workstation is a powerful, easy to use, cost effective desktop virtualization
solution that empowers PC users with the ability to create completely
networked, fully portable, entirely independent virtual machines on a
single physical machine.
yourwaresolutions Our philosophy is simple: At YourWare Solutions, we design quality, free software solutions. To see it at work, download one of our products! Home of FreeRAM XP Pro
New Trend: Social Atlas
Flagr "Bookmark the real world"
platial Platial enables anyone to find, create and use meaningful maps of Places that matter to them. We hope it can connect people, neighborhoods, cities and countries through a citizen-driven common context that goes beyond geopolitical boundaries. We are building it, because we adore Places.
EES Development
Working on our arbitrage system using the fix protocal and Currenex API. If this program is successful, we may begin converting other EA programs into fix / currenex platform.
QuickFIX is a full-featured open source FIX engine, currently compatible with the FIX 4.0-4.4 spec. It runs on Windows, Linux, Solaris, FreeBSD and Mac OS X. API's are available for C++, Java, .NET, Python and Ruby.
TA-Lib provides common functions for the technical analysis of stock/future/commodity market data.
Widely used by trading software developers working with Excel, .NET, Java, Perl, Python or C/C++.
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than 125 technical analysis indicators such as ADX, MACD, RSI, Stochastic, Bollinger Bands etc... |
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candlestick pattern recognition. |
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abstract API allowing your code to adapt automatically when new functions are added! |
Reference Articles:
http://business.timesonline.co.uk/article/0,,8210-2332487,00.html
http://www.businessweek.com/the_thread/hotproperty/archives/2005/07/is_the_fed_prop.html
EES Newsletter Info
This newsletter can be accessed in its entirety from this link:
http://ees.net.nz/info/ees-newsletter/09-2006-newsletter.htm
Newsletter Folder:
http://ees.net.nz/info/ees-newsletter/
© 2006 Elite E Services Inc. Elite E Services is an electronic boutique brokerage offering managed accounts, trading systems, and I.T. consulting for the financial industry. eliteeservices.net ees.net.nz
Risk Disclosure
Trading foreign exchange on margin carries a high level of risk, and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to invest in foreign exchange you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading, and seek advice from an independent financial advisor if you have any doubts.
We have contacted you because you have at some point corresponded with Elite E Services or signed up for our newsletter. This message is an informational newsletter, not a commercial advertisement. It is compliant with all federal and state laws regarding e-mail messages including the California Business and Professionals Code, . We have provided (mailto:info@ees.net.nz?subject=REMOVE) e-mail contact so you can be deleted from our mailing list. Elite E Services USA mailing address is Po Box 1436 Swansea, SC and our website address is www.eliteeservices.net eliteeservices.net