Choice

A participant can choose the risk factor with which he or she wants to participate in our fund. In principle, we offer two variants.

Class A

The risk for the participant in class A is smaller than that in class B. This is because the transactions are smaller. The expected results are therefore also lower. The aim is to achieve an average return of 5% net on an annual basis for the investor.

Class B

Is the variant in which larger transaction positions are taken in order to increase returns. The aim is to achieve an average return for the investor of more than 10% net on an annual basis. Such a return also involves a somewhat higher risk.

Our approach

Based on years of experience in international financial markets, we have developed an innovative method to achieve returns in a consistent manner. The starting point is to profit from rising and falling waves in liquid financial markets.

When developing trading models, trading experience, software knowledge and research are combined. The research is aimed at finding the right buying and selling moments. We have looked at patterns and trends that are statistically significant. We have tested our approach extensively, initially with a theoretical back test and later with a live test. The result is an automated model that detects opportunities and generates transactions in a disciplined way.

”Cut your losses short and let your profits run”

The transactions that we conduct based on our model are accompanied by strict risk management. We have a limited risk budget per transaction so that we do not lose too much in the event of a loss transaction. If the transaction does go in the right direction, we want to optimise profits.

Strategy

The average investment portfolio and strategy is highly dependent on a rising market. We use a different starting point. We want to benefit from both rising and falling movements. Our approach is based on recognising trends and patterns where statistical reliability (edge) is essential. We apply a consistent policy based on decision rules and algorithms. Our trading strategy is largely automated. The advantage of an automated approach is, among other things, the consistency and the ability to perform a pure test. It leads to reliable and stable results over a long period of back testing.

Psychology

Following a strategy is not difficult when things are going well. Nonetheless, every approach, including ours, has its downsides. The trick then is not to lose too much and to stick to the approach. But where do you get the confidence that the approach is good? How do you stay disciplined? Discipline has everything to do with trust and conviction that an approach is successful. In order to become convinced, an approach must first be tested. We have done this extensively. The psychology of the trader has been replaced by the consistency of the computer.

Backtest System

We initially tested our approach by means of a theoretical back test. By testing back in time you can see what the return and risk of a certain approach would have been (simulation). The approach consists of decision rules (algorithm) that become part of a strategy to buy and sell. We have translated the set of decision rules into an automated model.
Each decision rule (algorithm) must have an added value to be part of the strategy and the model. Only the best strategies are selected and then further tested for validation. Various statistical techniques are used to test the robustness of a model. A robust model provides the best guarantee of positive future performance.

Live result

Following a strategy is not difficult when things are going well. Nonetheless, every approach, including ours, has its downsides. The trick then is not to lose too much and to stick to the approach. But where do you get the confidence that the approach is good? How do you stay disciplined? Discipline has everything to do with trust and conviction that an approach is successful. In order to become convinced, an approach must first be tested. We have done this extensively. The psychology of the trader has been replaced by the consistency of the computer.

Result

The graph shows three lines. We want to compare the potential of our approach to a benchmark – the CTA index – and make a comparison with an investment in equities over the period 2008 -2020.

The grey line shows the development of the MSCI world index for equities from 2008 onwards. The development is positive and an average return of 8% is achieved.

The drawdown (falling from the highest point to the lowest point) is a measure of the risk of an investment. The drawdown percentage over this period was no less than -48%.

The red line shows the development of an investment in the CTA index. This includes the sector of large international investment funds that adopt a similar approach to that of the Brouwers Fund.

The green line shows the performance of our automated trading model. In the period from 2008 to 2017, there is a simulation based on the theoretical back test. Since 2018, the model has been tested in a live environment and the results achieved on the trading account have been verified by an accountant.

Important here is the fact that the stable image of the theoretical back test can also be found in the live test results. The test period covers more than 20,000 transactions. This gives us the confidence that the model has sufficient statistical evidence. We are convinced that the model has proven its added value.

The Brouwers Fund wants to use this model as a basis for its investment policy. We continuously evaluate the results and develop new strategies that we add to our approach after extensive testing.

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You can request the information package via our website. The information package contains:

  • Brochure
  • Information memorandum

You can request the information package via our website. The information package contains:

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