Sponsored content from Dukascopy
Dukascopy Bank has opted to expand its client capabilities and profits via a new FX and contracts-for-difference (CFDs) liquidity offering. By now offering liquidity through 25 banks, clients will gain access to some of the broadest measures to date by the group.
The initiative was designed to become a more universal mobile bank that is useful to all matters of clients, particularly in the wealth management space. In the long term, these banks providing liquidity will earn half of the market spread.
Dukascopy creating new opportunities for investors
As such, starting from a $1,000 minimum investment and upon receiving a management mandate, Dukascopy will automatically start trading for its clients. On the basis of its own technology, the group will also match sell trades of investors with buy trades of other clients, at the same Ask price.
As such, Dukascopy will also match their buy trades with sell transactions of other clients, at the same Bid price - this is the traditional role of all liquidity providers. Victor Ekimetskiy, Head of Development in Dukascopy Bank SA, commented exclusively to ForexLive: "Dukascopy LP PAMM wealth management is indeed a special offering on the market. It combines the flexibility of a margin trading account, the relatively high expected return that normally comes with riskier investment types and high diversification of the trading portfolio that contains 5 asset classes, including FX, precious metals, commodities, indices and stocks."
No fees
Moreover, the average expected return of this service is 11.15% with a standard deviation of 9.99% which gives a sharpe ratio of 1.11. This service is free of management or performance fees.
"Unlike conventional managed accounts, Dukascopy wealth management solution does not apply any management and performance fees. The only type of fee payable is the volume commission on the executed trades. Yet, even these fees will be returned by Dukascopy should the yearly performance of the investment appear negative and provided that the client kept it for at least for one year without fund withdrawals," explained Mr. Ekimetskiy.
Dukascopy has also taken extensive lengths in the risk management space by providing investors with unique systems and tools that limit possible losses on their investment. Dukascopy also commits to returning trading commissions in case managed clients would get an annual negative performance after keeping their investment for one year, without withdrawing any funds.
Dukascopy believes that this offer has no equivalent on the market presently and should satisfy a large and growing clientele. A simple comparison of a sharpe ratio of 1.11 of proposed investment (LP PAMM) with a sharpe ratio of another class of investments shows that Dukascopy proposes investments of a very high quality. The sharpe ratio calculation time-frame was the same.
According to Mr. Ekimetskiy, "Dukascopy has full confidence in the long-term solidity of this technology. However, as with any investment, clients should keep in mind the possibility of drawdowns and remember that the performance is most correct to be evaluated over a long horizon. Based on historical modulations, we believe that a holding period of one year and an equity stop loss level set 15% under your initial investment should be sufficient to withstand possible fluctuations and reach the estimated annual return."
Like all other accounts offered by Dukascopy Bank, LP PAMM wealth management accounts are subject to the deposit insurance, which in Switzerland is up to 100,000 CHF per person.
This is a press release provided by Dukascopy.
