I-System and COMEX Copper trading

Copper market is an important indicator of the overall economic activity. Given the pervasive uncertainty over the last 12 months, the price of Copper has staged two major trend reversals – never a good environment for trend followers. Nonetheless, with the last two months’ rally, I-System strategies have again proven their worth.

Three of the strategies had negative performance over the last 12 months, but the remaining nine have done superbly well, bringing the average performance for the year to $0.31/lb. – equivalent to $7,750 per contract.

Trading performance: high quality strategy + steadfast discipline

The above chart once more shows that trading performance requires perseverance and steadfast discipline: after the January’s sharp trend reversal, the strategies were $0.35/lb. ($8,750/contract) in the red. This underscores what I consider to be the single most important lesson I learned in my 20-years of trading and asset management: that in order to generate high investment returns, you must be able to tolerate periodic losses.

Even the very best trading strategies will experience periods of draw-downs. Staying the course and keeping your discipline is essential. There are two key aspects to this discipline: (1) managing your risk and (2) staying the course with the strategy you implemented.

Managing your risk entails making a realistic estimation of how much loss you can absorb if markets go against you. When – not if – when this happens, you must avoid gambling with more risk to try and recover your losses quicker. To stay the course, you need to have confidence in your strategy.

This is where I-System provides an important reassurance: after nearly 20 years of use with different hedge fund vehicles, I-System has proven its worth by enabling us to consistently outperform our relevant benchmarks. I-System’s capability to formulate, implement and track literally thousands of autonomous strategies in over 200 security markets, with no loss of consistency or focus, is why I believe that I-System is the best model of its kind ever built.

This is why I expect that I-System strategies will continue generating strong positive performance in spite of the coming turbulence and all the uncertainty we will likely encounter in the markets over the coming years.