Informed Trades

David Waring, Managing Partner

2.       What is your professional background?

Former Employee of Forex Capital Markets where I spent 7 years and held a variety of positions, the most relevant of which was as Managing Director, a position where I oversaw a team of individuals responsible for developing FXCM's Managed Funds Program.

I left FXCM on good terms in November 2007 to launch InformedTrades.com, an online trading education site and social network for traders.  In January of 2009 I launched InformedFunds.com a fund management company which, due to a pending regulatory change, is now the entity responsible for the former FXCM Managed Funds Program.

3.      Why do you think investors will be attracted to your fund at such
a difficult time for the economy?

The most dramatic drop in US Equities during the current crisis was from August to November of 08, where in 4 months the S&P 500 lost over 30% of its value.  During that same time, our primary fund gained a little over 9%, and has continued to perform well in December and January.

While past performance is not necessarily indicative of future results, our live trading record shows that our funds exhibit a very low correlation to US Equity returns.

4.       Is the main focus of your business online or offline?

The primary focus of our business is online.  The goal of Informed Funds is to open the professionally managed funds business, which has traditionally been shutoff to all but the wealthiest of clients, to the average individual.  We do this by leveraging the power of the internet and electronic platforms to keep costs low, and are therefore able to offer fund minimums as low as $5000.


5.       What kind of investor would benefit most from your fund?

Any investor that is concerned about the potential future performance of US and international equities, and/or that is looking for portfolio diversification.

6.       What advice do you have for someone who is just starting to trade
the forex market?

• Visit the free course section of InformedTrades.com.  I am obviously biased, however I truly believe that we offer the best free trading education available, and there is a knowledgeable community of traders there to help you get started in the right direction.
• Focus on not losing money first.  New traders focus the majority of their attention on how to make profits and pick the right entry point for a trade.  Professional traders focus the majority of their attention on how to control losses and how they are going to manage a trade once they are in it.
• Start small and only trade with money that you can afford to lose.  One of the biggest advantages of the forex market, is the fact that transaction costs fluctuate with trade sizes.  This means that you can trade a very small position size, and not have to worry about being eaten up by large transaction costs.

The market has come a very long way for the individual trader in the last
2 years.  The biggest change has been the fact that many of the larger forex brokers now allow individuals to trade directly with banks, via what is referred to as "no dealing desk execution".  This has brought spreads down and removed the conflict of interest that can exist when a broker is acting as a market maker.

Like most other markets, volatility in the forex market has seen record levels during the financial crisis, offering traders greater opportunity for profit, but also greater risk.

8. What do you think about Forex scam problem in the on-line Forex brokers market?

If an individual is trading their own account at a regulated broker in the US or the UK, then the chances of that individual being scammed are very low.  The reason for this is that their is oversight from two of the worlds top regulators, the CFTC here in the US or the FSA in the UK.

Where traders run into problems, is when they trade with firms outside of these two countries, where the regulatory oversight may not be as strong, or my not exist at all.

A second problem is with traders opening managed accounts or purchasing "trade robots" from firms who promise consistent triple digit returns, only to have their money quickly lost in the markets.  The problem here is generally something which is known as "hypothetical returns" which are returns that are generated based on historical data, rather than live trading.  Hindsight is of course 20/20, so firms advertising "hypothetical" or "backtested" returns can generate pretty much whatever returns they would like.

At InformedFunds.com we only advertise returns which were generated on live money, meaning that our performance is real, and not based on hypothetical or back tested market conditions.


9.      Where do you see EUR/USD 2 years from now?

I am expecting more problems to arise from the Euro Zone, and the market to begin to focus more on whether or not the Euro can remain a viable currency as a result of the financial crisis, than it has been up to this point.  Because of this I would expect the Euro to continue to weaken against the US Dollar and other currencies such as the Japanese Yen over the next two years, and perhaps significantly so.

As I talk about in some of my presentations however, I think it is very important to trade what the market is saying (meaning what is happening with price) rather than what one thinks is going to happen.  With this in mind any trades I take relating to this view will be based on what actually happens with price, and not what I think is going to happen with price.