Personal Composite Instruments Technology & Portfolio Trading
It’s a real pleasure to see how young traders actively follow the innovations that take place in financial markets #PCI #GeWorkoMethod #Innovations #Forex #ForexNews Read this interesting article about PCI writen by Vahag Mirzoyan in linkedin
Method GeWorko is a new stage in the development of portfolio trading and analysis / PCI
IFC Markets offers traders the unique opportunity to realize their trading ideas by creating Personal Composite Instruments (PCI) on the basis of GeWorko Method and trading them. GeWorko Method represents an application of the currency exchange rate concept to a wide range of financial instruments. While the currency exchange rate expresses the value of the base currency in units of the quoted one, GeWorko Method replaces the base and the quoted currencies by US dollar denominated values of two assets or two portfolios. Thus a PCI is structured as a two-portfolio instrument and the PCI value or “price” is calculated as the ratio of base and quote portfolio values, expressing the value of the base portfolio in units of the quoted portfolio.
Buying a PCI involves buying the assets in the base portfolio while simultaneously selling short the assets in the quote portfolio. Trade operations are carried out in opposite directions when a PCI is sold — the base portfolio assets are sold and quote portfolio assets are bought. Profits can be earned from trading PCIs much the same way as from trading conventional financial assets. When the PCI price is expected to rise or, in other words, the value of the base portfolio compared to the value of the quote portfolio is expected to rise, profits can be made by buying the PCI and selling it later at a higher price. In this case profits get generated as proceeds from selling the base portfolio assets after they appreciate following the initial purchase of the PCI exceed the value of the quote portfolio that gets purchased to cover the initial short positions opened when the PCI was purchased. In case the value of the base portfolio compared to the value of the quotation portfolio is expected to fall, profits can be earned by selling the PCI and buying it later at a lower price.
Portfolio Trading on NetTradeX trading — analytical platform
IFC Markets provides NetTradeX advanced trading platform equipped with numerous analytical tools that make it possible to create, analyze and trade the PCIs by creating portfolio combinations from hundreds of conventional instruments — curecny pairs, CFDs on stocks, commodities and indices. The base and quote portfolios can be composed of a single asset each, or a combination of various assets. A complex PCI can theoretically include any number of assets in each of the portfolios compared. The trading platform allows to set the overall dollar value for base and quote portfolios and the individual weights for component assets in them. Assets from almost all segments of financial markets of various countries can be included in the PCI, and the platform automatically calculates the values of the assets and the overall portfolio values in US dollars. The trader then can analyze the behavior of the Personal Composite Instrument he composed by studying the historical chart of the PCI, which the trading platform can display in a separate window. The trader can use the wide range of analytical tools and indicators the platform is equipped with to analyze the PCI behavior and design and test appropriate trading strategies.
Full article in LinkedIn