Prime Direction Limited

INTRODUCTIONPrime Direction is a developer of low risk, medium to high yield trading systems designed to be applicable across multiple asset classes. Based on unique strategies, Prime Directions models deliver consistent returns through varying market conditions with minimal drawdown incidence.MISSIONTo develop effective trading strategies for the Forex market and other key asset classes, achieving scaled deployment into the market in collaboration with expert strategic partners over the long term.OBJECTIVESPrime Directions objective is to provide investment managers with trading systems that deliver low risk, low stress performance profiles over the long term, with the rigorous protection of equity at the center of the companys philosophy and system design. Through the application of effective strategies and modeling knowledge across a variety of financial instruments, Prime Direction seeks to combine its proprietary strategies with market scope and liquidity in order to position as a leading provider of investment grade trading solutions.DESIGN ETHOSA significant majority of all financial instrument trades in Europe and the USA are now executed byalgorithmic trading models or Black Boxes. While some models attempt to react to news and events in the financial world most models look at historic data to determine patterns that may be indicative of future market direction.These models make use of a suite of technical indicator formulae to examine price momentum, trend direction and a host of other extrapolated information with a view to placing a trade based on a set of rules.At Prime Direction we have moved beyond the more traditional techniques driven by the following flaws in these widely held views.1. Market prices do not follow statistically normal patterns. This is a key error in traditional technical analysis formulae. Instead there is much evidence of fat tails in the distribution curves of markets. This tells us that extreme moves can be expected to occur more often than would be the case with a normal probability distribution.2. The majority of technical analysis techniques suffer from failures relating to the tradeoff between lagging entry signals and too many false entry signals. By using traditional data smoothing techniques false entries can be reduced but this normally introduces a lag which means that some if not all of the trades potential profit can go unrealized. In the extreme cases the entry comes so late that the entered trade can be in entirely the wrong direction. This is particularly true in range bound cyclic market conditions.3. Markets are dynamic the constant changing currents in the financial markets cannot be adequately analyzed by a set of static rules. Performance may be on target in trending or range bound cyclic markets but then catastrophic failures may occur when market conditions change.Prime Direction has taken a multilevel view to addressing the above issues. Extreme market moves in recent years have highlighted that financial trading, while having the potential to be very profitable, carries with it the possibility of portfolio damaging losses even in the domain of relatively stable mainstream instruments. Prime Direction, while endeavoring to produce exceptional returns, starts by putting in place tight controls on downside risk. Downside exit points are clearly defined at the time of entry and overall market conditions are constantly analyzed in order to effectively navigate the effects of macro events. Leverage is employed within strict risk tolerance parameters. During certain market conditions and events Prime Directions systems do not trade at all.FX24 FOREX ENGINEFX24 is Prime Directions flagship trading strategy, developed for global foreign exchange markets but also adaptable across other asset classes.In addition to Prime Directions fundamental design principles, the FX24 system includes measures to help counter the nonnormal nature of price movement via the utilization of a number of dynamic rules to control trading when price action breaches the normal expected bounds of high or low volatility.To address the lag and false signal balance issue, FX24 uses complex but proven mathematical techniques to create filters which are highly responsive when markets move up or down, but only when those moves are backed by the momentum to make the trade worthwhile.And in realizing that as market dynamics change there is a reciprocal need for the algorithmic system to change; FX24 is a living algorithm applying a variety of rules on a trade by trade basis modified to take full advantage of the most recent price action for the instrument.Most technical algorithmic systems can be categorized as Trend Following or Momentum Driven. Dynamic markets move in and out of these phases and as such both of these trading system methodologies will encounter difficulty over the medium to long term. For example a system that looks at momentum using traditional indicators such as the Relative Strength Indicator or Bollinger Bands will favor selling as overbought levels are triggered. This will be a good decision only if the market is cyclic. However if the market is trending this model will give out many false entry signals. In this case a Trending System will give better results. However the same is true when utilizing a trending methodology in a cyclic market. As most trending systems rely on some form of moving average breakout for a trading trigger, by the time a signal is generated in a cyclic market the trade will almost certainly be in jeopardy. Prime Directions FX24 strategy is tuned to identify market dynamics as early as possible while at the same time avoiding the issuance of trade signals when there are conflicts with the perceived underlying market state. Fundamental to trade management are FX24s learning abilities that enable fast identification of changes in market conditions on both winning and losing trades, causing exit instructions to tighten, in this way mitigating equity erosion on bad trades and locking in profits on the upside.Markets are changing a few years ago the FX market, the biggest financial marketplace, traded on average about 2 Trillion USD per day now with the advent of High Frequency Trading algorithms and the greater adoption of the FX market by private and commercial investors alike over 5 Trillion USD is traded daily. This phenomenon highlights a very important aspect of market dynamics.To cope with this, it is essential to approach the market with an algorithmic engine that can produce results now but also be responsive and adaptive to market changes over time. This all needs to be wrapped in the tight management of downside risk to safeguard profits and minimize portfolio devaluation. At Prime Direction we believe our FX24 engine meets and exceeds these demands, establishing a new benchmark in this exciting field.FX24 SYSTEM RESILIENCEThe logic employed in the design of Prime Directions FX24 series ensures that the system behaves consistently day to day and is certain to be resilient over the long term. Unlike the majority of algorithmic models FX24 is not a strategy that can break down over time. This break down in system fidelity usually occurs due to excessive back testing and the resultant curve fitting that is the product of too much historic analysis and tweaking.FX24 on the other hand is based entirely on real time market conditions combined with applied AI capabilities that allow for the constant updating of signal strength and duration, and the recommended actions that result from this intelligence. FX24 operates on the basis that all future data is unknown and focuses on what is happening in the market at the present time when issuing trade instructions. Instead of the usual back test approach, testing throughout the development process was carried out in real time, live market conditions. In this way FX24 has developed the ability to make useful predictions of upcoming price action and is able to recommend a winning ratio of profitable trades. As with many automated systems FX24 is more effective in trending markets than in cyclic (range bound) conditions but nevertheless it can and does achieve positive absolute returns in both circumstances.FURTHER STRATEGIESPrime Direction operates an active development program engaged in the production of market beating strategies across a wide range of instruments. This program ensures regular additions to Prime Directions portfolio of trading systems, enabling an increase in opportunities for institutions and investors via a diversified stable of top performing strategies.In addition to FOREX, Prime Direction is currently developing strategies for use within trading engines operating across a variety of further asset classes including equities, indices, metals and energy.The company is also developing a strategy for the pensions market, CERTA, which has demonstrated market beating performance over the period 20032016. Average return for this period is in excess of 10% per annum after fees with only one losing year (2008, where performance was significantly better than nearest competitors). CERTA trades only high volume, low risk instruments.HIGHLIGHTSPRIMARY TRADING STRATEGY DEVELOPED FOR THE WORLDS LARGEST MARKETMEDIUM TO HIGH YIELD, LOW RISK, SCALABLE STRATEGIES SPECIALIZED IN GLOBAL FOREIGN EXCHANGE MARKETSFIRST DEPLOYMENTS OF FX24 SERIES WITH INITIAL CLIENTS UNDERWAYINITIAL CLIENTS TOGETHER CONTROL IN EXCESS OF $4 BILLION AUMPENSIONS SECTOR STRATEGY CERTA SHOWING MARKET LEADING RETURNS IN EXCESS OF 10% P.A.BOARD LEVEL DISCUSSIONS WITH LEADING PENSION FUND MANAGER WITH $90 BILLION AUMEARLY EQUITY INTEREST FROM LARGE NYC BASED INVESTMENT GROUPPROJECTED GROWTH TO $100M+ VALUATION BY END 2020 ENTIRE PROJECT PERSONALLY FUNDED BY FOUNDERS TO DATECHALLENGING HIGH RISK, HIGH COST INITIAL DEVELOPMENT STAGE COMPLETECOMPANY IS UNENCUMBERED AND DEBT FREEPRIMARY STRATEGY IS RECESSION PROOF, UNCORRELATED TO OVERALL ECONOMYSTRATEGIC ADVANTAGESAbove all Prime Direction operates a culture of risk mitigation at all levels of the design, infrastructure and trading implementation processes. This goes beyond the usual measures generally employed in existing algorithms, permeating the core design architecture and continuing through to advanced trade management mechanisms and catastrophic market event safeguards. The ability to combine the stringent control of risk with consistent returns is the cornerstone of Prime Directions strategic advantage in the sector.Prime Directions focused and specialized team design only custom built solutions. In doing so, the team exercises total control over the architecture and behavior of its strategies and the way in which successful models integrate into the technical infrastructure.Prime Directions use of bespoke modeling techniques allows for complex trading strategies to be created, tested and implemented rapidly and efficiently. This combined with a compact and close knit team allows for an agility of approach that enables very efficient development of bespoke solutions for its clients.Prime Directions customization of trading strategies is not static; strategies are continuously and systematically evolved in order to instill ever greater learning capabilities, enabling the ongoing requirement of controlling risk while seeking return optimization.Prime Directions trading engines constantly learn and update, remaining current in the agile identification of differing market conditions, thus delivering consistent trading signal hit rates. This ability to consistently utilize input data in order to successfully evolve and perform through varying market conditions is a key differentiator.Prime Directions strategies employ logic that can be applied to a variety of asset classes and markets. This represents a key advantage over systems that are too heavily based on a specific instruments historic data.MARKET APPLICATIONSPrime Directions strategies are applicable to a variety of investment environments including Hedge Funds, Fund of Funds, Banks, Institutions, Pension Funds, Sovereign Funds, HNWIs and Family Offices. The company is considering a variety of deployment methods for its strategies contingent upon regulatory environment and appropriate commercial arrangements.TEAMPrime Direction currently consists of the two founders, David Curd (CEO) and David Over (CMO)The founders benefit from a broad based background in the Media, Marketing, Commodities, Energy and Financial Markets. They have been engaged within the financial trading sector for the last 10 years and specifically with the research and development of the companys current strategies over the past 3 years. This, along with the subsequent engagement with asset managers that bringing to market the companys strategies has entailed, has provided a deep understanding of the conceptual, design, infrastructure, administration and commercial aspects of the sector.David Curd is the driving force behind strategy design and development, establishing a trusted team of algorithmic modeling and programming specialists during the initial development phase. The key members of this team will be further engaged by the company to assist in the ongoing development and implementation of the companys strategies. David is also responsible for system infrastructure, risk management and redundancy provisions. He is a highly driven perfectionist and expert administrator.David Over is responsible for all aspects of marketing the companys strategies to the investment and asset management communities. He has to date been key in recruiting the companys initial clients and is working with a wide network of further potential partners to add to the companys roster moving forward. David also handles the interface with brokerage service providers and ensuring regulatory environment requirements and back office functions are correctly configured. He is people focused, a talented networker and critical relationship manager. Although the team required for this type of business is not particularly large the company has a wealth of proven talent available to it in order to ensure the fulfilment of its business objectives moving forward. SUMMARYEffective algorithmic trading systems represent a significant opportunity for market participants to gain advantage over their competitors. Truly robust systems are, however, few and far between and are often unavailable to many parts of the financial and investing community. Best of class systems can become buried within the larger framework of their creators operations with access restricted to just a few insider interests. Prime Direction is unusual in providing direct access for Investment Managers to strategies that combine a genuine and realistic potential for market beating returns with low downside risk.Prime Directions reevaluation of the algorithmic landscape has resulted in the creation of custom strategies that utilize entirely new methodology, creating the potential to over deliver on key performance metrics. Our focused, specialized team have proven that designing robust, risk averse algorithmic trading systems that are capable of significantly outperforming the market, is possible and can be achieved.Prime Direction is entering the sector with trading engines that possess true learning capabilities and incorporate the ability to evolve and identify changing market conditions swiftly and with a high degree of accuracy. This results in strategies that are managed efficiently and profitably and that, most importantly, protect investor equity throughout the process.Contact David Over CMO for more details +44 7951 [email protected]