Efficient Frontier Trading Tool Version 2.0
Buy and Download >
SAVE 60% OFF
Futures Truth has utilized its proprietary software to research and develop specific tools that you can apply to your overall strategy for trading. These tools are based on years of actual trading experience and market principals discovered by the founders of Futures Truth. The FT Trading Tools may be an entry or exit methodology, a trend indicator or a stop loss, but, many are based on an algorithm for trading that can be programmed and tested on actual data. FT Trading Tools may be used to enhance your success. And these tools are an excellent way to learn to become a better trader. Each one can be added to your trading tool belt.
Risk - the final frontier. This is the objective of the Efficient Frontier Gadget. Its mission to explore thousands of different portfolios, to seek out lower risk and higher return, to boldly go where only a few portfolios have gone before.
Version 2.0 allows portfolio optimization at the click of a single button. Multiple optimizations are now tracked which assists in finalizing portfolio weighting. Formulas are created which allow for the use of Excel's Solver to minimize/maximize portfolio standard deviation or portfolio mean. Large portfolios don't work well with Excel's Solver, so a random iteration of 10,000 or more different weights can assist in a final solution.
The Nobel Prize winning Harry Markowitz proposed Modern Portfolio Theory (MPT) in 1959, In today's trading environment Risk should sit center stage when trying to develop a winning portfolio for your algorithm. If you believe an algorithms returns can be modeled by a Gaussian or Normal distribution and you agree that Risk is ultimately important, then this gadget is for you. All you need to do is create monthly streams of returns from your algorithm and have the EF Gadget do all of the work. The Gadget will transform your data into correlation and covariance matrices and then use these matrices to simulate thousand of different scenarios. The simulations will randomly pick different weights for each market in your portfolio and Excel will plot each result in a scatter plot.
For those not familiar with the Efficient Frontier plot, risk is plotted on the X axis and return is plotted on the Y axis. All the portfolios that land on the left side of the plot curve are considered efficient - meaning that reward is maximized and risk is minimized. The Gadget picks the portfolio with the highest Sharpe ratio. If you are not sure how to allocate your current portfolio and want to have some direction that makes Risk the ultimate criteria, then this Gadget is for you.
The accompanying manual includes step-by-step instructions on how to get your monthly data from TradeStation™ into a format that is compatible with this gadget. However, please note that TradeStation™ is NOT required in order to run the application.
****This trading tool requires the user to have MS Excel 2010 or a later version.****
Free upgrades are available for the first 6 months.
Original Price: $150.00