The objective of the $TICK trading program is to achieve capital appreciation through the trading of futures and options on futures contracts. The program seeks to trade stock index futures on any or all of the stock indices available for futures trading. We seek to enter into trades that can capitalize on short-term, intraday trends, both on the long and short sides, with a focus on market internals such as the $TICK indicator. The $TICK program engages in day-trading and overnight positions. At times, depending upon market or other conditions, the Advisor may abstain from making trades until trade opportunities arise.
The following criteria play a major role in market selection and allocation for trading intra-day trends, which often last from a few minutes to a few hours: 1) Early identification of institutional accumulation or distribution in the stock index futures via key market internals; 2) Proprietary research on short and intermediate term overall market direction; 3) Utilization of a core set of indicators that establishes the conviction of the current move, up or down, and when and if to prepare for its failure; 4) Positions in futures contracts established, both long and short, based on the above; and 5) As the level of market uncertainty increases, the level invested in that particular market is decreased.
In addition, the manager may use the following criteria to identify short-term trading opportunities: 1) Gap openings, trading with the order flow; 2) Fading extreme tick readings; 3) Price acceleration; 4) Reversals; 5) Range-bound markets; 6) Contrarian indicators; 7) Less active trading periods; 8) Market participant psychology; and 9) All actions guided by a strict set of risk management rules.
The program's portfolio is monitored on a real-time, daily basis. It will also incorporate swing trading strategies across various markets, including currencies, metals, energies, grains and other markets. Such strategies may be implemented using futures contracts or long futures options, amongst other strategies. As a general matter, such strategies will focus on trend following techniques utilizing retracements to support and resistance, breakouts through key resitance and support, as well as volatility plays. In addition, this program sells premium in futures options using credit spreads in order to smooth out the overall equity curve.