Fri, Feb 12, 2016
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Opalesque Futures Intelligence

Manager profile: Jan de Wever of WholeCapital describes his distinctive trend-following approach.

Thursday, January 07, 2010


Trend Following with an Eye on Psychology

We feature a trend-follower with a distinctive method. WholeCapital founder Jan de Wever is a discretionary trader who looks for a behavioral edge while using a systematic model for risk control.

Mr. de Wever hails from Belgium but is currently based in San Francisco. He says he bought his first mutual fund at age nine and his first stock at twelve. He started trading futures at age seventeen. Prior to starting WholeCapital in 2009, he worked as a trader for Fortis bank (now BNP Paribas) in Brussels and arbitrage firm Flowtraders in Amsterdam.

He’s been trading for his own clients for only a few months, but sounds happy about his hybrid approach. We asked him to explain how he differs from other trend followers.


WholeCapital’s Global Opportunities Program is designed to profit from short- and
medium-term trends. But we’re not a typical commodity trading advisor. Our trading strategy is positioned between a CTA and a global macro approach.

The trading system is hybrid in nature; it combines (40%) systematic and (60%) discretionary elements. We feel this provides the flexibility to adapt to the infinitely complex and ever-changing marketplace while conserving the repetitive process of a systematic trading model

The trading program incorporates technical analysis as well as ideas from behavioral finance. In essence the trading model aims to profit from recurrent human behavioral tendencies through pattern recognition, volatility and inter-market trend analysis.

Risk management is entirely systematic, with risk limits on each trade and an overlay on the entire portfolio to make sure we don’t risk more than 5% on strongly correlated positions.

The other systematic component is in identifying entry signals. But there is discretionary choice from systematically generated signals: when there are three or four entry signals, we will the choose the one that I perceive as having the best risk/reward profile.

In addition, I apply a additional psychological screening where we seek trades that look and feel the most uncomfortable. That’s because I believe that in the market there is a trade-off between being comfortable and making profits. Does that make us a contrarian? “Yes” in the sense that we will look for less crowded trades, but “no” in the sense that we don’t tend to go against price action but look for underlying relative strength and weakness.

We focus only on the most liquid markets. Positions are clustered around five to ten liquid global markets that are predominantly driven by speculative flows. Mainly Gold, Crude Oil, T-notes, T-bonds, S&P, EUR/USD, JPY/USD, GBP/USD, AUD/USD & CAD/USD. The target for the program is to achieve +20% annual returns with a worst peak-to-valley drawdown of 15%.

WholeCapital is a company with a higher purpose. We aim to build wealth for our clients and also make them feel good about the company they are aligning themselves with. 10% of our own profits will be donated to targeted charitable projects.



 
This article was published in Opalesque Futures Intelligence.
Opalesque Futures Intelligence
Opalesque Futures Intelligence
Opalesque Futures Intelligence
Today's Exclusives Today's Other Voices More Exclusives
Previous Opalesque Exclusives                                  
More Other Voices
Previous Other Voices                                               
Access Alternative Market Briefing


  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. Credit Suisse cherry picks hedge fund ideas[more]

    From FT.com: Credit Suisse Asset Management plans to cherry pick profitable concepts from hedge funds with the launch in Europe of a “best ideas” strategy. The investment arm of the Swiss bank said the strategy will separate it from other funds blighted by “overcrowding problems”. It comes at a time

  2. Investing - Hedge funds bet on risks in U.S. blue-chip debt, Hedge funds bets against bank credit risk paying off, Tiger Global still likes Internet names, gets pointers from Jeter[more]

    Hedge funds bet on risks in U.S. blue-chip debt From WSJ.com: Hedge funds are betting the next bond sector to crack will be the $4.5 trillion market for the safest U.S. corporate debt. New York’s Perry Capital has placed a $1 billion wager against investment-grade bonds issued by 10 comp

  3. Short Selling - Hedge fund manager Kyle Bass is shorting real estate—again, Top US hedge fund has €80m short position in Paddy Power Betfair[more]

    Hedge fund manager Kyle Bass is shorting real estate—again From Fortune.com: He also predicted the mortgage crisis in 2008. Hedge fund manager Kyle Bass, who runs Dallas-based Hayman Capital, tanked the stock of a little-known real estate financier Friday by revealing that he is shorting

  4. Investing - Real estate secondaries sole 'bright spot' in 2015, As hedge funds stumble, one firm prepares to buy illiquid stakes[more]

    Real estate secondaries sole 'bright spot' in 2015 From IPE.com: The secondary market for property was the sole “bright spot” over the course of 2015, as hedge fund secondaries saw deals fall by two-thirds, according to a wide-ranging survey of the market. Setter Capital said 2015 saw th

  5. Asia - Hedge fund manager Kyle Bass estimates China's foreign reserves below critical level[more]

    From Nasdaq.com: Investor Kyle Bass stepped up his attack on China's currency, arguing in an investor letter distributed Wednesday that the second-largest economy's foreign reserves are "already below a critical level." The comments mark the latest effort by hedge funds and other investors to raise