It was more of a question really than a statement …;)…dang I’ll have to find that webpage again and reread it!
No, technically it would NOT go down. There has to be a change in vaule of the USD relative to the CHF for the pair to move.
Ok, what I read was:
For example, if the more volatile (or leading) pair breaks out, chances are the other positively correlated pair is likely to breach similar resistance or support levels. Correlation is about exploiting time lag to make predictions about the other pairs.
But that’s not what your method is?..
Sorry SweetPip, i got 2 hours of sleep last night and my brain is rather fried. Would you mind posting the context, or link the post?
Does anyone else remember the story of the British guy (a physists IIRC) who developed a correlation based method for trading currencies ?
He eventually sold the method (possibly to citibank) for some obscene amount of money, plus an ongoing royalty based on profits. The guy and his girlfriend where interviewed for some crappy TV program about the lifestyles of billionaires, from what I remember he eventually bought an island and became a recluse.
lol that’s awesome
It’s part of a comment I picked up on…it’s down the page a bit at the end of a paragraph just above the first chart image you come to…
rofl sweetpip, you are quite literally on the ONLY other site i have researched and found that trades similarly to my strategy. keep lookin around on that site. that’s hilarious that you went there xD
Not sure, it was something I saw on TV a few years ago
I could be wrong, but it sure looks like Brickman has snaked into this forum to be a 2nd in charge after tradingliberation to support his thread in its aim to solicit gullable traders into submitting…
-
private messages.
-
then personal email address.
-
then a full introduction to the scheme which requires a team to work it.
-
then the fee to join is charged - off Babypips so that the Admin here cannot complain.
[B]In short, the Babypips forum is again being used as a soliciting ground for customers for a scam.[/B] 
This kind of access is called “privilaged access” in legal terms.
Abusing it carries legal penalties.
Exactly correct!! 
No you are completely wrong, we have already established (and agreed) that the position is dollar neutral, but there’s an exposure to EURCHF.
In response to your repeated ignorance and abusive comments, I have the following to make absolutely CLEAR to you:
- I have NEVER solicited anybody into submitting private messages…if they wish to message me, that is out of their own free will. I have made myself extremely available via aim, skype, and msn if anybody has any questions that they CHOOSE to ask of ME.
- Same as above
- This “scheme” doesn’t require a team by ANY stretch of the imagination…you have obviously not read the first post or any of my subsequent posts on the matter. I suggest you go back and read them.
- There is absolutely NO fee related to ANY of this information I have provided to the babypips community–freely and out of my own generosity I might add.
In short, babypips is being used for exactly what it was designed to do in the first place; that is, provide information free of charge. I suggest you take advantage of this information as you might learn something–humility to start.
This kind of “behavior” I might add is called “harassment”. If you continue this behavior, I shall engage in a discussion with the admins, and request you be locked from this thread.
Kindly reconsider your position, as I have a feeling, that if you come back with an open mind, you may learn a thing or two.
I agree entirely, and its rather sad. The old saying “those who can, do, those who cant, teach” is still very true.
Not sure if this is important to the method, but I’m going back to your post that says you place 2 orders:
- buy (or sell) both pairs with negative correlations,
- buy 1 & sell 1 pairs that have positive correlations.
That is correct…correct?
The pairs that have been mostly used as example here have been EURUSD and USDCHF which have negative correlations, so therefore when you buy one and buy the other… that is like a hedge…right?
So I was looking at GBPUSD & AUDUSD, and they are also negatively correlated, so if I buy both pairs, then it’s not hedging…right? My IBFX demo doesn’t have a GBPAUD (or AUDGBP) on the list.
Does it matter what side of the pair the currencies are on when picking pairs?
yes, with this trading method you ALWAYS hedge…if you don’t, you open yourself up to the unnecessary risk I was talking about earlier. You are absolutely correct. I’m not sure wha tyou mean by:
“Does it matter what side of the pair the currencies are on when picking pairs?”
could you explain that please? early in the morning sorry, MOAR COFEE
I mean in the first set the USD is both the base & quote price, whereas in the 2nd set, the USD is the quote price of both pairs.
So it does matter as we’d want the common currency (if there is one) to be opposites…right…lol
“Does it matter what side of the pair the currencies are on when picking pairs?”
I am not clear on the strat being discussed here but in any strat involving correlation I know of the answer to your question would be a yes.
if i understand your point correctly…typically if you have USD as both base and quote then they will be negatively correlated, if the pairs are correlated at all…and positively correlated if the usd is the quote price of both pairs. hope that answers your questin
I don’t know what is typical, but I was just noticing that both these set of pairs are negatively correlated, but the USD is both on the left and right, in the first set, and only on the right in the 2nd set:
EUR/[U]USD[/U]
[U]USD[/U]/CHF - Negative correlation
GBP/[U]USD[/U]
AUD/[U]USD[/U] - Negative correlation