We continue to actively look for traders to allocate capital to as part of the AxiSelect Incubation program. If you have a PsyQuation Score above 75 with a 6 month track record you will automatically qualify.
In our last letter we said we were working on some additions to the program. We will be updating our websites next week but those of you who have a 1 year track record and a score above 65 you will automatically qualify.
I am sure many of you are wondering how our program has performed you can follow (observe) live the program’s performance over here.
The program commenced on the 21st of November 2017. The performance of the AxiSelect program is not an optimized portfolio as the size of our allocations are dictated by the size of the master account of the program participant.
What is important to stress is that our incubation allocations follow a quantitative process. There are no courses to buy or desks to rent, no interviews to sit. The PsyQuation vision has always been and will continue to be a meritocracy. If you have the potential according to our proprietary PsyQuation Score we will back you.
If you are someone who believes in yourself and your ability then you want to know the rules of engagement and you want to be rewarded based on meeting the requirements as set out by the program. The last thing you want to do is go through an interview or due diligence where someone asks you why you trade with or without stops. What degree do you have, and what work experience you have or any such arbitrary question which probably have no correlation with future performance.
Let’s get to the retrospective……
Thankfully we are profitable after sweating through most of the year in drawdown. Take note traders, allocators stress as well.
There are currently 25 active traders in the program and there have been 11 dropouts, i.e. accounts who have had more than a 10% drawdown in 1 month or their score dropped below 70.
I have to say I am very satisfied with our first 11 months. We have made plenty of mistakes along the way. Onboarding is where most of the mistakes have been made. The way it works is we set up an AxiSelect slave account which copies the Axi Master account. Many of the traders who join the program don’t give enough thought to the copy multiplier. If the master account has a volatile track record then the trader needs to advise PsyQuation on an appropriate multiplier between master and slave otherwise we default based on the past and the 10% monthly drawdown threshold may come into play. Our advice is always to lower the risk (multiplier) in the beginning. You are not going to get rich on a $10k allocation so rather trade it conservatively and focus on risk adjusted returns and the long-term benefits the program has to offer.
We have designed PsyQuation’s Score with the law of big numbers in mind. What this means is that for the score to be effective we need to make lots of allocations. The magic comes through the diversification of many traders and allowing the power of our probabilities to come into their own.
The next important piece of the puzzle is providing our PsyQuation community the ability to invest in our trading talent. Stay tuned we are working on it.