Dear Darwinex Community,
First we want to thanks Darwinex for providing such a good platform for Alternative Investments.
Also we want to take the chance to introduce ourselves and our strategy OCD DARWIN and concept behind it in order investors can have a clear picture of what we do and how we do it.
Who we are
Onikami Capital was released in Jan 2018. Is a brand new algorithmic momentum/breakout based strategy with many advanced features which targets the G7 currency basket and commodities.
The chief strategist, Telmo Pinto, comes from a strong technical and mathematics academic background. This provides him with a vast amount of technical and market knowledge, as well as experience which has been responsible for the entire multi-system design and integration of some institutional systems.
The program itself is approximately 90% systematic (i.e., automated) in terms of management, however a discretionary overlay is used on trade execution and to oversee and fine tune the algorithms used in the strategy whenever necessary. Thus, the program is in a constant state of evolution and always trying to improve as it trades through various different market conditions and timeframes.
Trading tools and analysis are designed to detect market patterns on particular currency pairs; these patterns may be identified through a myriad of market indicators. Due to the relative stability of certain currency pairs over defined time periods, Onikami Capital methods identify when a pattern has been temporarily breached due to an increase in market volatility. Onikami Capital strategy initiates long or, short trades on a currency pair during a pattern disruption and realizes profits when the pattern has been restored. Onikami Capital time horizon on a particular trade may range up to 1 month.
In the simplest sense, the program focuses heavily on “momentum/breakout” movements in the markets. When a major sell off or heavily influenced move transpires in the market, Onikami Capital piggy backs alongside this move, gets in and banks its profits in the follow through, or it reduce the risk using lower timeframes entries if there is a retracement.
As stated, Onikami Capital underlying methodology involves trading without the use of linear modeling or technical indicators such as Moving Average, MacD, RSI etc… While using these tools certainly has merit and a long history of use, the fundamental problem is that indicators are static and don’t change.
As the market evolves, one day these indicators may provide traders with excellent profits, however the next day when certain economic conditions change the indicators are no longer accurate and are not able to interpret that the market has changed therefore they cannot effectively adapt to the new market conditions. This is where the Onikami Capital
algorithms hold an edge.
By basing the trading rationale solely around intra-day price action, the computer programs which make up the Onikami Capital algorithms simple try to identify the most likely movements in a particular currency pair by reading various data and attempting to interpret such data, by revealing patterns in it, and the relative importance of certain trigger points on the particular currency pair being traded. The result is a very unique price action based automated approach to trading the currency markets.
Risk / Money Management
Money management and risk management are strictly enforced into the basic “rules” and overall design of the trading program. The algorithms trade with auto-adaptive stop losses and have a very rigid money management formula. This allows it to accurately control the risk and contain draw downs when they inevitably occur. Error management and data management routines ensure the stability and ongoing success of these two key features.
Asset Class Traded
Spot Currency and Commodities Markets.
The strategy places most trades on the G7 currency basket and Gold.
Time Zones Traded
Trades can generally be executed at any time, and any trading session.
The strategy employs a combination of mixed strategy diversification, systematic (tools) and discretionary diversification, time frame diversification, and currency pair diversification.
Strategy Risk and Limitation Considerations
The key primary risk factor and limitation which can effect and significantly impact this strategy is multiple false breakouts or false sell-offs – whereby the market appears to move with huge momentum, but then suddenly stops with no “follow through”. This may trigger the system to place multiple orders multiple times in a short time frame and could cause significant smaller, but frequent equity draw downs.
Average Drawdowns (Equity): <=2%
Above Average Drawdowns (Equity): 2-5%
Worst Historic Peak-to-Valley Drawdown to date: 9.78%
Max Anticipated Drawdown (Equity): 15%
Global Equity Protection: 25%
Onikami Capital is considered to be a risk-adverse trading strategy with a lengthy history demonstrating good risk management. Average drawdowns above are encountered frequently and are considered “normal”. Above average drawdowns occur occasionally in a given year, are less frequent but are also considered “normal”. The worst historic Peak-to- Valley drawdown to date is the worst drawdown that the account has experienced to date, in equity decline, and is considered “rare” but it sets the benchmark in terms of worst historical drawdown the account has achieved to date, and hence can possibly happen again. Maximum Anticipated Drawdown is the maximum amount of drawdown anticipated in a given month, based on back-model data analysis.
If you have any other questions please visit our website or just write them in this forum and we will be happy to answer.
Onikami Capital Trading Desk