Trading Program:

Objective

Although the risk of loss exists in futures trading, the objective of Global Financial Trading Group's trading programs are to achieve consistent and above average appreciation of its assets under management through speculative trading in the financial futures markets.  The Advisor seeks to accomplish this objective by generally trading the following four basic types of options on futures contracts. 

1. 1.       Bull call spreads
2. 2.       Bear put spreads
3. 3.       long Calls,
4. 4.       long Puts

The Advisor trades in the following complexes: Meat, Grain, Agricultural, Energy, Softs, Precious Metals, and Financials.  However, the Advisor may trade other commodities and futures contracts, in addition to options on futures, if the Advisor believes that opportunities exist.    

Global’s Trading Style

The Advisor’s trading methods are proprietary and confidential.  The Advisor uses technical, systems-based trading strategies with fundamental properties as well.     

The Advisor may purchase and/or lease software and/or charts to assist in trade analysis and selection.  Each trading model developed by the Advisor is rigorously tested.  Trading models are chosen based on parameters involving risk and above average performance capability.  The models adhere to the overall strategic philosophy of defining reversals of trend in the market.  This is also known as Contra-trend.

Global’s trading style is technical and systematic with certain fundamental input.  Entries and exits are based on continuous computer analysis of the markets and specific rules and parameters based on technical analysis and price activity.  The system is adaptive in nature as it is constantly assessing market data.

Technical analysis is based upon the theory that a study of the markets themselves will provide a means of anticipating the external factors that affect the supply and demand of a particular commodity in order to predict future prices.  Technical analysis postulates that the marketplace itself represents the collective judgment of a larger number of traders and analysis concerning the value of any particular commodity interest. By analyzing market characteristics (as opposed to underlying economic forces) that have not yet been directly reflected in price levels, it may be possible to predict future price moves.  Furthermore, technical analysis generally holds that, irrespective of basic economic forces, markets have dynamism of there own which is wholly outside the scope of fundamental analysis that should be reflected in any trading approach.  Accordingly, technical analysis generally focuses on a detailed study of such data as actual daily, weekly and monthly price fluctuations, trading volume variations and change in open interest, as the most effective means of attempting to predict price movements. Technical traders frequently utilize charts and computers for analysis of these items, including a series of mathematical measurements and calculations deigned to monitor market activity for the particular trading strategy. Trading recommendations are based on signals generated by charts, manual calculations or computers. Technical trading approaches may incorrectly analyze the effect of various market forces or price trends, particularly as technical analysis is typically based on historical market activity.  Such analysis may not in fact be applicable to the current markets (which many perceive as undergoing rapid and significant changes) and may be of little use when fundamental factors, particularly unexpected occurrences, such as certain governmental interventions, dominate the market.

Trade Selection and Methodology for the New Global Option Trading Program.

The New Global Option trading model is formulated based on extremely in-depth computer analysis, combined with fundamental review obtained throughout the day on each market we are researching at the time. The review of data will come from the cash/futures markets with technical data such as the Gama and Delta to create a matrix to determine trend change. We will use our proprietary and confidential trading system or "logic" as "counter trend" trades in most cases. Depending on the set up and how our computer indicators view the market we will take a "trend" trade looking for the follow through of the move.  We only look for these contraian set ups.  Some of the technical data utilized is information such as volume, momentum and market profile, and numerous other input that is of a proprietary nature. The trading logic is constantly monitoring market data and input from a number of technical and fundamental areas.

The trading strategies seek new breakout trends resulting in trades that can last from one to several days. The trades are positioned in the daily out cry session which generally generate signals.  Money management has been a key area. We strive to exit with a 50% maximum premium decay if the trade is not going in our favored direction. Of course, there is no guarantee that exiting at such point will occur in all instances.  We believe this to be beneficial for capital preservation.  This trading option methodology is generally referred to as "Swing" trading in the industry. Generally, the system trades approximately 9-15 completed options per month on average for every $10,000 in account equity.  All accounts require at least $10,000 in account equity.