The I Know First trading simulator uses the signal data in order to generate daily trades according to a simple set of rules. In this portfolio 3 different packages are used: stocks, currencies and interest rates.

• I Know First hedge fund simulation -> 39.42%
• I Know First stock simulation -> 47.54%
• I Know First interest rates simulation -> 32.27%
• I Know First G10 currencies simulation -> 11.00%

In order to prevent unnecessary volatility and high spread costs the currency universe is minimized to G10 currencies only. Also, while we trade four assets a day in each class, if not enough trades are available they are replaced with a “blank” asset, which simply means the funds were not allocated. The fund’s equity is divided 60% in stocks, 30% in interest rates, and 10% in currencies. Then the funds are sub-allocated into four assets within the class using a 50% signal allocation, which means 50% of the sub-allocated funds are allocated equally among the four assets, 50% are allocated according to the signal strength of these four assets on a daily basis (this is explained in the day trading analysis and table 2 below). Furthermore, while here the chart is conservative, one could leverage the currencies class by an at least 10-1 ratio (brings currency return to 280% and IKF total fund return to 55%).

Below is the chart showing the fund’s equity growth over the time period. Notice that the returns from stocks, currencies, and interest rates could have been made with the 1 package subscription.

Starting with an equity of $10,000 on July 1st 2014 the simulation trades until February 1st 2015 when equity hits $13,942 for a staggering 39.42% return in just 7 months.

Below is an example of using 50% signal allocation. As can be seen, in each class the absolute value of the four signal’s sum is taken. Each signal is then divided by the sum to generate the signal allocation. The even allocation is 25% to each asset. The 50% allocation takes 50% of the weight from the signal and even allocation.

Below is the change in equity for every asset class on a daily basis.