16 Jul From Trading Novice to Managed Forex Trader – Interview with Ashley Lim of T.Zenith Capital Management
How did you get into trading?
I needed to find something to diversity my investment portfolio and make my money work for me. That is the reason why I went into trading. I started trading stocks on my own in 2008 and eventually went into forex in 2011. The numerous advantages of forex attracted me to switch from stocks to forex. Ie. forex can be traded 24 hours daily from Mondays to Fridays, has good liquidity and incurs low transaction costs.
Why do you choose trading instead of other forms of investment?
Trading is the most readily available form of investment I guess. I prefer my assets to be easily liquidated.
How did you learn to trade?
Through trading forums, a local trading school and eventually met my mentor who guided me to become a consistent and profitable trader today.
What was most helpful to your learning?
Learning from my own mistakes. They are lessons which i have paid dearly for. It’s a waste to not learn from the mistakes that I have made. The other way is to learn from others’ mistakes. What strike them may one day strike me too. I should learn to handle it before it happens to me. I enjoy reading up on successful traders, and it’s not difficult to identify several traits that they share. I then develop those traits of successful traders.
What are some of your mistakes you wished you had learned without paying for them?
Greed, emotions and unrealistic expectations. I was taken in by those marketing hypes from the papers and forex workshop previews which promises a whooping 900% returns and even more. So my target was 450% after attending those workshops. Come to think of it I was really very naive back then. I guess if those workshops really gives 900% returns a year I guess many people would have became Millionaires or even Billionaires. One word of caution to the public – do your homework before attending these workshops.
How did emotions affect your trading in the past?
I was very focus on trying to hit my unrealistic target of 450% per year which amounts to 37.5% per month. So I will try to double up to hit that target. Well looking back how silly I was. Now I only take what the market is willing to give me and I do not expect unrealistic targets. Peace of mind in trading, capital preservation and consistency are my 3 key things now.
What are some of the successful traders you followed or learned from?
Successful trend traders like Ed Seykota, Bill Dunn, David Harding, Richard Donchian, and Richard Dennis. They all know that by having a strong will in trading is a must especially during periods of drawdown, and in most cases they have gone through 40% – 60% drawdown before the big trends come.
Any resources or books you would recommend to the other traders?
Michael Covel’s books.
How long did it take for you to become a profitable trader?
I would say it took me about a year to become a consistent profitable trader.
What do you think were the factors for your success?
Determination. I was determined to make trading a success. Therefore I did not give up despite going through the downs of the trading journey and eventually get to where I am today. I would like to quote Thomas Fuller, “an invincible determination can accomplish almost anything and in this lies the great distinction between great men and little men.”
Is determination the only factor? Can all determined traders become successful?
A good mentor that is willing to guide you can shorten your learning curve, which my mentor did. It explains why it only took me a year to turn profitable.
How would you describe your trading strategy?
Trend Following. Trend traders spot for profitable trend and ride on them. Bill Dunn and Ed Seykota are among the few successful trend following traders. Ed Seykota turned $5,000 into $15 million over 12 years.
What is the typical time-frame of a trade?
It depends, longest is less than 2 months.
What was your most memorable win?
Lately USD/JPY was trending very well and we caught the trend and gain about 300 over pips on 1 currency pair among the few other pairs I trade.
What was your most memorable loss?
During my crazy days of day trading, I lost 20% of my capital in a single trade. I was hoping to recoup my losses from the previous trade so I increased my lot size. I am thankful that I met my mentor who taught me the importance of trading psychology, understanding fear and overcoming greed.
What is managed forex?
A type of forex account in which money managers like me trades the account on a client’s behalf for a fee.
Why do you start a managed forex business?
I started this business because I hope to bring the opportunity for investors to diversify their portfolio and invest in the lucrative forex market without having to become a professional trader.
Our managed forex service is perfect for people who do not have the time to invest in mastering the forex market but would like the freedom and security of knowing that experienced and profitable traders are skillfully trading their money.
Forex trading is not a quick get rich option. Many people come into forex trading because of the crazily high returns promised by free online courses provided by brokerage companies and trading schools. Greed kills! Many got their account burnt and deem that forex trading is risky. Forex trading is risky because people over leverage and the high leverage offered in the forex market which can work for you or work against you. With proper money management and the correct trading psychology forex trading can be profitable.
How is managed forex service regulated? How are clients protected?
I am currently working with a few agencies to get my company regulated because it is quite a new thing in Asia. Our company do not collect any funds from investors to trade. Investors will need to open up an account with our recommended brokerage company then sign a Limited Power Of Attorney to authorise us to trade for them. The account will be under investor’s name and only the investor can deposit or withdraw funds from the account. Investors can login to their account 24/7 to view their account with an investor password. We operate with one of the most reputable brokers in the industry and carry out due diligence before suggesting it to our investors. The broker that we choose are well established in the industry and have a proven history of handling clients with respect and providing an equally competitive trading atmosphere for our clients’ funds. Investors do not pay us the performance fee directly. Based on the performance fee agreed between us and the client, the broker will charge the performance fee from investors account and credit it to us.
How big is your team?
I am currently have 3 people in my team including myself. We each play a different role. One will be focusing on R&D, one will be focusing on sales, and I will be focusing on trading. We are looking to expand our R&D team in the coming next few months.
What does your R&D do?
Our R&D is to experiment how to improve our Risk Reward Ratios and lower drawdowns, and also anticipate what kind of market conditions might happen. To manage the risks, we do not only enter trades based on 1 currency pair. Our portfolios are structured with numerous currency pairs. Currently, one portfolio consists of 13 pairs while the other diversifies into 7 pairs.
Do you have past performance available to potential clients?
Yes. Please see this link.
What is the reasonable returns a client can expect?
I would say an average of 15% – 25% per year.
What is the potential drawdown a client can expect?
My worst drawdown till date is 11%. So the potential drawdown a client can expect will be a range of 10%-20%.
What is the minimum capital requirement to open an account with you?
The minimum amount to start is US$15,000. Due to the limited accounts that my team and I handle, the bigger accounts will be considered first.
How can potential clients contact you?
Potential clients can drop us an email at [email protected]