A prudent trader will break the funds down into units and trade in smaller amounts, ever mindful of the changes in the price of a currency. If the currency goes down, he has lost. If it goes up, he has gained on the trade. What he would look for is a measurable return on each "turn" and a 1% return on $1,000 of which $100 is yours and $900 is the bank’s is $10. A 1% loss is $10. If on an average, the trader earns ½ of a percent on your $1,000 for 40 days of a 45 day period, then you will have had a gross gain of $200 or 20% for the quarter… that is an annualized return of 60%. Count the "IFs" to be sure you understand. The reverse can be true if the trader consistently loses. You would have lost 20% of your capital.  

That is the simple but realistic picture. The trader sits glued to his communication equipment day and night looking for the changes in the price of the currency your are holding in relation to the purchase price. He can have a number of units making a number of turns in which he acquired a currency at different prices. If he is smart, alert, attentive and opportunistic, he will make money for the account. It is not a matter of purchasing and holding. It is more a matter of moving at the right time… either to get out when the currency is moving consistently downward and realizing a gain when the opportunity presents itself.  

The trader has a vested interest in gaining because he makes money only out of earnings.  

The earnings will reflect the amount of risk. Under any circumstances, an investor should instruct the trader to take the risk he, the client, is comfortable with. The options are 20%, 30% and 50%. Some currencies are quite volatile in their movement. The traders we do business with are instructed to stay with the "hard" currencies… US Dollars, Swiss Francs, German Marks and Japanese Yen and British Pound Sterling… the return might be lower but the risk is much less, we feel.  

We have played around with a spread sheet and some totally arbitrary numbers. You can see some of them below. These are, as we said, simply exercises. We have a target in our own program of a realized net earnings of 200% on our capital a year, allowing the earnings to ride. The trader knows or objective and does not walk away from the possibility of that high mark… or even more. While the trader might be earning in that range now, no one should allow himself to think that the past is any more than a guide to what can happen in the future. Be realistic. Use funds you know you can do without under the worst of circumstances and be happy to earn what we know and you probably realize are totally possible.  

The facts remain, that at the close of every trading day, banks place their money on the table to be traded. Normally, they work in an arbitrage situation where they know the buyer exists before the make a purchase. We could do that too, if we had tens of millions of dollars to work with… which we do not. If you have tens of millions of dollars, you are reading this for recreational purposes, probably. You are already in the FOREX market and making money. You probably have an offshore company or trust with a major bank offshore and are enjoying the best of all possible worlds…. We are opening the world to you that is open to those with tens of millions of dollars enjoy.  

SOME PRO FORMA PROJECTIONS  
Hypothetical Return of 60% per Quarter, compounded monthly. This does not represent what does happen necessarily, but what could happen.