Deposit and withdrawal
Deposit and withdrawal rules for an Portfolio are completely identical to the deposit and withdrawal rules for managed accounts.
| Deposit | Withdrawal |
|---|---|
| At any time | At any time |
- An application is executed only during the open market period (00:05 ET Monday – 23:50 EET Saturday).
Distribution of Profit and Loss
Investor's funds in an Portfolio are distributed proportionally among all the managed accounts in that Portfolio based on their shares. The rules for distribution of profits and losses in portfolio managed accounts are completely identical to the rules for distribution of profits and losses for any managed account.
The manager's performance fee is indicated in the offer of portfolio managed accounts. If a loss is made for a trading period, the manager who made the loss will receive no performance fee until his trading compensates the investor's loss
- Each Portfolio has multi copies similar to individual managed accounts;
- A multi-portfolio is made up of managed accounts with the same multiplier;
- The multiplier of an Portfolio and the multiplier of managed accounts belonging to that Portfolio are the same;
- Due to risk standardization, the parameters of an Portfolio grow in multiples of the multiplier;
- Rules governing multi-indices are similar to those for indices and managed accounts.
ICE FX selects managers for its portfolio products by considering each candidate on an individual basis.
Basic requirements for Portfolio candidates:
- Must have a successful long trading history, as well as verified monitoring system for the trading account (myfxbook);
- Must provide trading history and necessary explanations on trading logic;
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Must agree for ICE FX to apply automatic risk-limiting system with defined parameters, as well as agree for ICE FX risk managers to manually control his trading activity:
- Limiting the maximum loss for the week (normalized in accordance with the risk standardization system);
- Limiting the maximum leverage (limited based on the trading needs for a given risk level).
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Must agree with the investment transparency policy of ICE FX:
- The managed account must be constantly connected to a third-party monitoring system (for example, myfxbook) with an open trading history and maximum frequency of statistics update;
- Provision of an investor password: publicly for the first 6 months, and subsequently periodically for ICE FX privileged clients;
- Must have an open history of closed trades;
- Must agree to correct his trade at the request of the risk management department of ICE FX;
- Must agree with the risk management department of ICE FX on any changes in trading activity;
- Support of communication with the Administration.
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Adjustment of the parameters of the offer with the Administration of the Company, in particular:
- Remuneration from investors' income;
- Preferential offers for customers with a privileged status;
- Consent for the option "Indefinite compensation".
Selection of ICE FX Managers
ICE FX selects managers for its portfolio products by considering each candidate on an individual basis. We do not consider it appropriate to select managers based on a strictly prescribed set of statistical parameters, as is the case in many companies. In our opinion, creating clear boundaries for the whole variety of possible trading systems, risk management systems and money management systems is nothing but a Procrustean bed and makes no sense.
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Risk Standardization
All selected managers are standardized for maximum interval risk value (maximum loss for the week) at 5-10% level (depending on the type and indicators of the trading system). Risk standardization allows to accurately calculate the risks of a portfolio and simplifies the creation of balanced portfolios.
|
Maximum loss for the week, % |
Level of risk on account per trade, % |
|
|---|---|---|
| MA 1 | 5-10% | 1-3% |
| MA 2 | 5-10% | 1-3% |
| MA 3 | 5-10% | 1-3% |
| ... | ||
| MA n | 5-10% | 1-3% |
|
Maximum loss for the week, % |
Level of risk on account per trade, % |
|
|---|---|---|
| MA 1 | 5-10% | 1-3% |
| MA 2 | 50-80% | 10-15% |
| MA 3 | 20-30% | 4-6% |
| ... | ||
| MA n | 30-50% | 7-10% |
Building an Portfolio
- The risk/loss parameter is the most important calculation parameter since knowledge and loss limit are the most important for the investor (in comparison, for example, with possible profit limits, etc.).
- The degree of influence on the result of a portfolio (Portfolio) of each managed account belonging in the portfolio should be the same. That is, there should be no situation where one account drags the entire portfolio into profit or loss.
Risk standardization simplifies the process of building a portfolio according to the above rules. Thanks to risk standardization, it is not required to calculate the share of each managed account individually, since the risks and volatility of all accounts that are on the same level of multiplication (base accounts, accounts*2, accounts*3, etc.) are brought to approximately one level. To build a balanced portfolio, you just need to include in it accounts of the same multiplication level in equal shares.
| Maximum loss for the week, % | Average volatility of weekly results, % | Account share in the Portfolio, % | |
|---|---|---|---|
| MA 1 | 5-10% | 5% | 25% |
| MA 2 | 5-10% | 5% | 25% |
| MA 3 | 5-10% | 5% | 25% |
| MA 4 | 5-10% | 5% | 25% |
| Maximum loss for the week, % | Average volatility of weekly results, % | Account share in the Portfolio, % | |
|---|---|---|---|
| MA 1 | 5-10% | 5% | 15% |
| MA 2 | 5-10% | 5% | 15% |
| MA 3 | 5-10% | 5% | 15% |
| MA 4 | 5-10% | 5% | 15% |
Currently, there are 3 different Portfolios in the company, which have different formation logic.
It is the most conservative of all Portfolios in ICE FX. iPro trading strategies are based on potentially long-lasting ideas, namely: classic trend systems, SWING trading, trend-following strategies, and trading based on inertial price dynamics after the release of important macroeconomic news. All trading strategies are weakly correlated with each other.
Completely excluded are such techniques as:
- Averaging;
- Martingale;
- Increase in Stop Loss level;
- Overstaying in loss-making trades;
- Other high-risk techniques.
All trading strategies must include setting the Stop Loss and Take Profit levels for each trade.
This Portfolio is suitable for low-risk long-term investments, as well as for investors whose main goal is to minimize possible losses.
Advantages
- Potentially long-lasting trading strategies;
- Possible risk of loss is minimized;
- Complete absence of toxic trading methods (martingale, averaging, etc.).
Disadvantages
- Relatively low potential returns;
- High probability of flat periods.
It is a hybrid of the iPro and iMain Portfolio. This Portfolio includes all iPro and iMain managers with a certain proportion of shares, which dynamically change based on the composition of both Portfolio.
As a consequence, iComposite combines aspects and features of both components and has the widest diversification in terms of trading strategies and instruments. Due to its widest diversification, this Portfolio is potentially the most stable and has the best risk/reward ratio.
This Portfolio can be used as a full-fledged investment portfolio with a moderately conservative risk level, suitable for both medium-term and long-term investments.
For those who do not have enough experience or time to independently analyze trading strategies, ICE FX strongly recommends that they first of all consider investing in this Portfolio.
Advantages
- Potentially long-lasting trading strategies;
- The risk/reward ratio is balanced;
- Maximum diversification in terms of trading strategies and instruments.
Disadvantages
- Insignificant presence of high-risk techniques (pyramiding, etc.);
- High probability of flat periods.
It is more aggressive than iPro. Selection of iMain managers does not differ radically from selection of iPro managers, except that iMain involves higher money management aggressiveness. All the trading strategies are weakly correlated with each other.
Completely excluded are such techniques as:
- Averaging without loss limit;
- Martingale.
There may be insignificant high-risk techniques, such as:
- Increasing the size of trades when the price moves towards the Take Profit level (pyramiding);
- Increasing the size of trades when the price moves towards the Stop Loss level with a loss limit on aggregate trading position.
This Portfolio is suitable for risk-taking investors or for the moderately aggressive part of an investment portfolio.
Advantages
- Potentially long-lasting trading strategies;
- The risk/reward ratio is balanced;
- No toxic trading methods (martingale, averaging, etc.).
Disadvantages
- Insignificant presence of high-risk techniques (pyramiding, etc.).