Applying Monte Carlo simulations to the Forex market is ground breaking technology.
Boston Ma (PRWEB) February 13, 2013
ITM Financial, a new forex startup, has finished an advanced series of monte carlo simulation on its latest software update and has shown that the software has a 92% chance of returning a profit to its members this year.
Monte Carlo simulations are a broad class of computational algorithms that rely on large sets of random sampling to obtain numerical results. They are often used in simulating projected results for financial models. The advantage that Monte Carlo simulations have over traditional back testing models is that back testing models go backwards a finite number of years to predict future results, whereas Monte Carlo simulation take random sampling of what could happen in the coming year and figure out the probability of those results.
After carrying out over one hundred thousand iterations of its current software predictions, ITM Financial results showed that having a positive ROI in any quarter was over 92%. Having a positive ROI in every quarter for the year 2013 stood at over 90%.
The forex signals generated by ITM Financial also showed that in over one hundred thousand test cases the chances the software had a single losing month stood at less than 30%. So the chances of ITM Financial having each month be positive in pips stood at over 70% probability.
"We are very pleased with our recent updates to take into account the market volatility and choppiness" added CEO, Curt Dalton. "The start of the new year saw currency traders getting whipsawed around as the markets were very volatile and jagged. Now, we see things like markets forming patterns and we see opportunity."
ITM Financial software runs on a set of worldwide neural networks that monitors fundamental trade conditions as well as Internet signals for when to enter and exit certain trades. "The algorithmic system is quite complex and the latest updates do a wonderful job of mitigating risk for investors. The up and down markets can create a ton of stress on traders as trends reverse quickly and then double back again." added CTO, Ali Khan. "The new volatility updates have really done a great job in limiting the investors' downside risk with low draw downs, yet keep the trade open for larger gains." added Khan.
The use of monte carlo predictions in the financial markets such as mutual funds and stock market portfolios is common, yet it is new technique for the currency markets, which tend to move much more quickly that traditional stock and fund markets. "We have the confidence to run Monte Carlo simulations on our software due the fact we monitor tens of millions of signal or data points for forex updates." added Dalton. "We are in a brave new world of big data being used for almost everything now, including trading and investing."