FXALGO

Trading Strategy Memorandum

Executive Summary

This trading strategy is designed to deliver consistent, risk-adjusted returns through disciplined foreign exchange trading. By managing 8–10 currency pairs concurrently, it achieves diversification while maintaining strict risk parameters. Daily portfolio exposure is capped at 2%, with individual trades limited to 0.5% of account equity.

Capital growth is driven by a compounding model, allowing position sizing to scale as equity increases. The strategy is suitable for accounts with a minimum of USD 1,000 (mini lots) or USD 5,000 (standard lots), with a minimum leverage requirement of 30:1 to ensure margin efficiency.

The approach emphasizes capital preservation first, growth second — making it well-suited for investors seeking steady performance through structured risk management and disciplined execution.

1. Objective

The objective of this strategy is to generate consistent capital appreciation through disciplined foreign exchange trading. The approach emphasizes strict risk management and controlled exposure while employing compounding techniques to accelerate long-term account growth.

2. Strategy Overview

The strategy actively manages 8–10 currency pairs concurrently, ensuring diversification across correlated and non-correlated assets. Trade entries and exits are systematically governed by technical and risk parameters to minimize drawdowns and optimize returns.

3. Risk Management

Daily Risk Cap: Total portfolio exposure is limited to a maximum of 2% of account equity per trading day.

Per-Trade Risk: Individual position risk is restricted to 0.5% of equity, thereby reducing vulnerability to adverse market movements.

Compounding Mechanism: Position sizing dynamically scales with account equity, allowing for progressive capital growth while maintaining defined risk thresholds.

4. Capital Requirements

To ensure effective execution and risk adherence, the following minimum account sizes are recommended:

USD 1,000 for mini-lot execution

USD 5,000 for standard-lot execution

A minimum leverage ratio of 30:1 is required to maintain margin efficiency and to facilitate the simultaneous management of multiple currency pairs.

5. Execution Parameters

Trades are executed with precise risk-to-reward ratios, applying systematic stop-loss and take-profit placements to align with the overarching risk management framework. The strategy prioritizes capital preservation while seeking consistent, compounding returns over time.