Freedom Rocks Alternative Strategies

[FrankTheTank]

Please post any alternative Freedom Rocks strategies that you use or have heard of. Although I am not a member, I have seen people who always exit at a set profit or loss point. This scares me because you are no longer trading the FR system, rather, you are trading your own system. If you have months of live and backtests to support "your system" then I would agree it might be better to trade that way then to follow FR blindly.

Hi FrankTheTank,

I, too, am impressed with your unbiased approach to Freedom Rocks. I have been a member since Sept. '06. I have traded live since Oct. 18th. It seemed that almost immediately, my account experienced drawdown. However, this is expected. As my Profit/Loss remained negative, my balance was increasing daily due to two apsects of FR that generate profit. The first, as you know, is the interest that you earn. The second is every time a "sell limit" is hit, you lock in profit that goes directly to your balance.

At the time, I was trading the GBP/USD vs. USD/CHF (by the way, the approach is to go long both currency pairs), 400:1 and 10% of my account ($50k). At the worst drawdown time, my account balance was at around $57,800 with a Profit/Loss of -$18,000, so a net drawdown of around 20%. After 41 days of a drawdown, the account became positive and I closed out all positions (to move to a new broker paying a higher interest rate).

Since Oct. 18th, I have withdrawn just shy of $15,000. I have used this as income, although I think most people just let their account grow. In addition to that, my current account equity (which is the amount I would have if I closed all positions now), is $57,029.82. So, all in all, nearly a 50% return in 3 months.

I hope that helps. I would be happy to answer any other questions you have. Please email me.

[FrankTheTank]

Hi Paul,

Thanks for your post and Welcome! If you want to join our forum, you can add your FR link to your signature.

A few questions:

-Is that 20% drawdown still the largest drawdown you have experienced, or, was the recent drawdown period worse then that one?

-I am still confused how you can have a drawdown of 20% on your trading account if you setup FR to only use 10% of your margin. Are the two numbers correlated at all or am I confusing things. My thought was that if FR only controls 10% of your account, then the worst it could ever hurt you is 10% (but I guess that is not correct)

Thanks!

[EricGondek]

Originally Posted by FrankTheTank

Hi Paul,

Thanks for your post and Welcome! If you want to join our forum, you can add your FR link to your signature.

A few questions:

-Is that 20% drawdown still the largest drawdown you have experienced, or, was the recent drawdown period worse then that one?

-I am still confused how you can have a drawdown of 20% on your trading account if you setup FR to only use 10% of your margin. Are the two numbers correlated at all or am I confusing things. My thought was that if FR only controls 10% of your account, then the worst it could ever hurt you is 10% (but I guess that is not correct)

Thanks!

Frank-

Thank you for taking such an unbiased approach to FreedomRocks, Most people that don't understand it slam it. My best advice would be to try a demo so you can see how it works. You can do the 15 day free trial and see what happens. You can also use the trial to backtest (by hand, I'm working on that) the trading system. I haven't been able to find a time when it wasn't profitable.

Now as to your direct question. There's 2 different "margins" I will refer to them as follows
1- Leverage, 400:1, 200:1, 100:1, etc.
2- Margin - The amount of the trade your going to do represented in a percentage of your total account.
These are to determine the amount of risk that you wish to undertake...Here's a few examples of the extremes and worst case scenarios because I believe that's what you're getting at.

Scenario 1 (conservative)
$10,000 account
100:1 Leverage
10% margin
You would be using $1,000 to place options on $100,000 worth of currencies.(at least 2) The other $9,000 would be used in your account for drawdowns. You're only trading $100,000, so there's not a very big chance that you're going to use up your 9K in drawdowns.

Scenario 2 (wreckless)
$10,000 account
400:1 Leverage
30% margin
You would be using $3,000 to place options on $1,200,000 worth of currencies. The other $7,000 would be used for drawdowns. Now you're trading $1.2M so slight variations between the two pairs have a larger impact on your drawdowns.

The only way you can lose money trading FreedomRocks is by getting a margin call (a drawdown bigger than your account size) or if the Swiss Franc and the Euro start to not correlate, meaning that the movement between the EUR/CHF is bigger than the movement between the EUR/USD and USD/CHF, that's not going to happen any time soon, and it hasn't happened in the last 10+ years.



Eric Gondek

[FrankTheTank]

Thanks for your great posts Eric.

Let me think about your post for awhile and get back to you.

[Traderj]

I think it would be very interesting if the two gentlemen that posted in this thread with their results at the time with FR would now come back and update everyone on how things are going for them? I know the margin out rate is NOT as high as the 30 to 40% I've been told, but that is on a very small sample based on people I actually know using it or people that are within 3 degrees of seperation...

Looking forward to an update.

[toddanderson]

Does anyone know how these sites do their calculations?

ForexForSmarties
Welcome to FreedomRocks.com!!
ForexAssistantHome
true_north@email.com True north Excel calculator
Some use
EUR)/CHF
Euro pip value 10 CHF 8.13 10/8.13 = 1.23 x .86 correlation
100- 86= 14 1.23 x 114 = 140
Buy 1.40 lots CHF
Buy 1 lot Euro

HowTo -pip value of each pair, swap value of each pair ,daily range of each pair Calulate
All these to factor how many lots to buy,sell

Does anyone know these calculation are done ? can you share any Excel sheets you have