ICE FX 2.0

Hello to all.

There won’t be any scam or reincarnation, so don’t be scared))

However, a number of major changes are expected in 2017 and the first half of 2018. These changes will be implemented at once and will touch on various aspects of the company’s activities. By the second half of 2018, ICE FX will be a quite different company after the changes have been introduced.
Apart from major changes on the website and functionality, a number of cooperation conditions will be changed. They are mostly on improving and creating new opportunities, especially with regards to the terms of investment – Pfee was recently lowered to 15% and commission to $10, but we’re not done yet.

Most of the changes described below will come into effect with the release of the new website (November-December). The rest will be introduced within the coming months after it.

 

Now let’s look at everything one after the other:

I. Legal and organizational aspects

1. Change of jurisdiction. Labuan.
As mentioned earlier, we are moving to a new jurisdiction – Labuan. The transition will be completed by around September 1.
Labuan offers a number of advantages over Vanuatu. It is considered a “white” offshore. A much larger number of trading and payment counterparties cooperate with companies from Labuan. This would lower trading costs for us and expand the range of deposit/withdrawal methods to/from the company’s account.

2. Audit
Depending on when the ICE FX has fully moved over to Labuan, the time for the first audit will be determined: either in the third quarter of 2017 or at the end of 2017. Although, given the fact that it takes several months to receive an audit report, I personally don’t see any reason to do it on a quarterly basis. But, once promised, we will try.

II. Deposit/withdrawal of funds

1. New deposit/withdrawal methods.
As mentioned above, Labuan gives us free hands when cooperating with a large number of payment counterparties. This would allow us to increase the number of deposit/withdrawal methods and cut transaction costs.
It is likely that clients will be able to withdraw funds (profits) to their credit/debit cards above the deposit limit, by PayPal (through an aggregator), and by some other ways.
Also, connecting a larger number of payment counterparties will enable us have reserve options for conducting transactions in the event that we encounter any problem with any processing company. Consequently, the number of problems in this direction will decrease.

2. Instant withdrawal.
In some payment directions, there will be instant withdrawal of limited (per day) amount of funds.
The limits will be higher for privileged categories of clients.

3. Deposit/withdrawal methods can be changed.
For some deposit/withdrawal methods, it will be possible to withdraw funds deposited using a different method and not necessarily sticking to a particular system (in case the system requires full identity verification). First of all, you will be able to withdraw funds through SWIFT and Epayments no matter how the funds were deposited.
These opportunities will be more for privileged categories of clients.

III. Privileged client statuses

Apart from the already existing VIP status, 3 more kinds of statuses will be introduced: Premium, Loyal, Loyal+.

The Premium status is an “improved” version of the VIP status, requiring a deposit of US $250,000 (or US $150,000 during promo)

The Loyal and Loyal+ statuses have a different logic: the client receives these statuses after being a client of the company for a certain period (regardless of the size of that client’s deposit).

The privilege line will expand a little. For example:
For a majority of the statuses, investments in most indexed managed accounts will be possible on a preferential offer (less performance fee);
Deposit/withdrawal methods will be interchangeable;
Clients will be able to request for demonstration of ICE FX funds at payment and trading counterparties (similar to a request for demonstration of confirmation of hedging positions) and some others.

IV. Migration

A separate marketing direction consists of creating conducive conditions for clients and partners to enable them migrate smoothly from other companies.
The existing Migration Cost Compensation Program will be expanded considerably. For example, the following will be introduced:

  • Immigrating clients will be given preferences when obtaining privileged statuses;
  • Obtaining a rebate bonus from the commission paid, including for investors;
  • Obtaining additional referral fee for partners who help their referrals to migrate from other companies.

V. Trading in ICE FX

1. Improvement in trading conditions.
As mentioned above, moving over to Labuan jurisdiction gives the company the opportunity to connect more trading partners. This would change the trading environment for the better.
Spreads will decrease by about 15-30% of current values.
Also, the company will be able to choose counterparties with the best other performance parameters (slippage, execution speed, etc.)

2. MA-ECN
Managers will be able to create ECN managed accounts.

3. Market depth for STP and ECN accounts
A “glass” functionality will be implemented for both types of accounts.

4. TradeBox
A functionality that allows you to see the average spreads for a selected period of time for all instruments and types of accounts.
Additional options: ability to exclude periods of news, market opening, etc.

VI. Investments in ICE FX

1. $8 commission for MA.
The commission will be reduced to $8 for all managed accounts. This would increase profits for both managers and investors. Together with a reduction in spreads, increase in profit should be considerable. In general, trading costs affect profit much more than it seems at first glance. For example, in 2016, iComposite*6 would have earned about 90% (against the 60% it earned) from managers’ trading activities with the costs that are predicted after reduction in spreads and reduction of commission to $8.

2. For a managed account, the trading period is a multiple of a month; for an indexed managed account, it is 3 months.
The difference in the (total) profit of the investor and account grows in time and depends on the performance fee and the frequency of paying the performance fee (length of the trading period). The lower the performance fee and longer the trading period, the smaller the difference, and consequently, the higher the investor’s profit.
Calculations show that when performance fee is paid out once every month and more often, and it is 30% or higher, the investment practically loses its meaning. This is so because if the trade enters into a drawdown close to the maximum, the investor will be at a loss (with a high probability), even if the account at that moment is trading at a profit.

Some time ago, we agreed with managers to reduce the performance fee to 15%, which is the maximum permissible.
Nevertheless, we believe that the difference in the returns of the investor and the managers is still considerable, and we are negotiating with indexed managers on increasing the trading period to 3 months.

All other managers will be able to set a trading period in months.

3. High-Water Mark+
The high-water mark – a classical method of calculating profit – ensures that the investor pays some performance fee to the manager only if a profit was made at the equity peak (high-water mark) during a rollover. If a loss was made at the equity peak during a rollover, the manager will not be paid any performance fee until the value of the equity account goes above the high-water mark during a rollover, or until the investor leaves the account.
If the investor leaves the account (even if he returns to the account immediately), the maximum value of the equity account becomes equal to the value of the equity at the time the investor re-enters the account, and the manager will not be obliged to compensate that investor for the previous loss.

Like many other things, this method was moved from long-term professional investment to PAMM forex investment, and, like many other things too, it was not adapted. In long-term investment, the investor does not work with a dynamic portfolio and Pfee I not paid out once a week/month.
Calculations show that, given the psychology of a majority of investors, the average investor loses a significant part of profit due to the fact that the trading falls into a drawdown and enters a peak, or is forced to make mistakes in the shares of accounts thanks to the opportunity to leave the account during an RO period for correct redistribution of portfolio.

ICE FX will deploy an improved form of the high-water mark method, which levels out investors’ loss by cancelling manager’s obligation to compensate the investor for any past loss in the event of a short-term investor exit from the managed account, for example, if the exit is aimed at redistributing portfolio or changing the aggressiveness of the managed account (change the multiplier of the managed account).

High-Water Mark +

We have improved the classic method of calculating profit by adjusting it to the features of short-term Forex investments.

Indefinite compensation.

Optionally, the manager can set the “indefinite compensation” option under which he is obliged to compensate a drawdown without receiving a performance fee, regardless of the time the investor returns to the account (if he leaves the account). Thus, the manager’s obligation to compensate the investor’s loss without receiving performance fee until the high-water mark level is reached is never cancelled.

This option will be enabled for a majority of A-rated managers.

4. Multi-level offer
The ability to specify different Pfee values for investors with different amounts of investment, or having privileged client status.
The manager will be able to assign 3 offer levels. Assigning more than this number would complicate implementation and graphical display in the accounts/rating statistics.

5. ICE-MAM
A separate article will be devoted to this tool.

At the moment, the MAM component of a managed account functions according to the classical MAM technology.
A classical MAM has a number of shortcomings, which can be quite effectively leveled, while preserving its positive aspects.
We are developing our own MAM module, which will bear the name: (most likely) ICE-MAM.

The main difference will be the order of distribution of position result after closure (in the classical MAM, trades are first distributed, then financial results, while in ICE-MAM, simply the financial results). It will be something like MAM-PAMM. The following are the advantages of this approach:

  • ICE-MAM will be able to open an account (slave) in the investor’s account of less than 0.01 lot and there will be no need to open a 0.01 lot trade;
  • The minimum required investment in an MAM account is reduced by 2 or more times. Thus, to compile an MAM portfolio, the amount will be several times smaller, and a significantly larger number of investors will be able to work with individual risk management (RM) and account entrance-exit parameters at any time;
  • The difference between investor’s result and the “benchmark” is minimized in the case of having an investment size that is not a multiple of the value required to open a 0.01 lot trade (for example, if the manager opens a 0.01 lot trade on 5k deposit, and the investor has 7k in the account – the investor will also open 0.01 lot and the result will be less by 1.4 times. On a large sequence of trades, the difference can reach huge values. This problem will be minimized through reduction in the number of opened trades);

6. OVER-indices
Indices that have a multiplier greater than those of the accounts in the indices.
A separate article will also be devoted to this tool.
Due to portfolio effect, the extremum (marginal yield) of the multiplication of an account portfolio is always higher than the extremum of individual accounts that make up that portfolio. Moreover, it is possible to have a portfolio of accounts that cannot exist separately from the portfolio at all (for example, accounts working with max(DD)=100%-120%).

For example, we plan to introduce the following:

  • iComposite *8-*10
  • iPro *8-*10
  • iMain *8

7. MAM-indices
At present, indices work exclusively by a PAMM model, which carries a number of negative aspects.
There will also be an opportunity to work with MAM indices. This would allow investors to:

  • Enter and leave at any time;
  • Configure risk management parameters;

The minimum investment amounts, of course, will be quite large: please keep in mind that the minimum deposit in index is calculated not as the sum of the minimum deposit included in the portfolio, but as the product of the maximum minimum deposit of managed accounts included the portfolio, multiplied by the number of accounts in that portfolio. That is, having 9 accounts with a minimum deposit of 1k and 1 account with a minimum deposit of 10k, the MAM-Index will require 100k of investment.

With the introduction of ICE-MAM, the required minimum amount will decrease several times, similar to a managed account.

8. New indices
Their appearance is not guaranteed, and will depend on expediency. For example, iComposite+ (iComposite+iMinor) and ATS (Composite without “manual” traders) are expected to be introduced.

____________________

In summary, the return on investment for A-rated managers will increase thanks to:

  • Trading period = 3 months;
  • Reduction in commission to $8;
  • Reduction in average spreads due to increase in the number of counterparties;
  • Reduced Pfee for privileged clients;
  • HWM+;
  • «Indefinite compensation».

V. For partners

1. Migration of referrals
As described above (paragraph IV. Migration), for attracting referrals from other companies, agents will receive additional referral fee for a certain period of time.

2. Agency certificates
This is similar to what obtained with the infamous Pantheon company. An agent can generate a certificate code in his Personal Area for a fee, and give it to any person. When this certificate is activated, the person who activated it is tied as a referral to the agent that generated the code and receives a non-withdrawable deposit that can be invested in certain accounts (probably A-rated accounts) for a certain period of time.
The logic of this tool is that it enables a potential client to “try out” investments, without contributing his own funds, and if the client is satisfied with the investment result, to link him as a referral. At the same time, the partner spends a small amount of money, while the client will be able to test investments without contributing any funds at.

3. New partner functionality
A range of functional innovations for partners, such as:

  • Partners will be able to generate several agency links (for example, to track direction of flow of clients);
  • Partners will be able to associate their referral link with the company’s website without the need to insert links in texts wherever possible);
  • Improved statistics in the personal area;
  • etc.

4. Consulting Group
The functionality, products and the activities of ICE FX are quite complex for understanding, especially if the person is just starting to engage in partnership activities.
To this end, we are creating consulting groups in which more experienced agents and employees of ICE FX will be able to answer the questions of rookie agents.
Anyone can join the group and it’s free of charge.

VI. Personal Area

There is an absolutely new Personal Area, which provides detailed statistics and monitoring for both investments and partnership activities. There is no need describing everything in details here – you’ll see everything yourself.

VII. New functionality for MA rating and MA/index page

  • The number of parameters of MA/Index statistics has been increased;
  • The client can customize the statistics (of all parameters) display period;
  • The client can customize the display of parameters for specific offer levels;
  • The client can configure the set of parameters displayed in rating;
  • The client can save the configuration of rating parameters and reproduce it in the future;
    and much more.

VIII. Genesis and Genesis Prime

Traders’ competitions will start in the nearest fall-winter.
The terms and conditions of participation will be published later.

IХ. Unification of terms and notations. Glossary.

All statistical terms, their definitions, abbreviations, etc. will be unified on/in the site, wiki, my articles/publications and other materials published by ICE FX and its employees. A fairly large “Glossary/dictionary” of terms, abbreviations, formulas, and so on will be collected.
This idea was prompted by the complete absence of single categories/terminologies in the Forex investment industry, and the resulting manipulation of terms by companies and individuals. The absence of a single “language” also makes it extremely difficult for any communication in specialized circles. For example, you can very often see some referring “maximum drawdown” as “floating drawdown”, or “return on account” as “investor yield”, etc.

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