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Trend-following strategies in currency trading Abstract This project is based on a recent paper by J. James who described how profits could be made by using trend following strategies in currencies
trading. We utilized the method of simple moving averages in Technical Analysis to automate the buying or selling points. Then we optimised
the best days of moving averages, number of trades per year and hence the annual return. We reproduced the work of James and examined a range
of currency pairs and identified them as trend-following or range-trading. We also tested out various modifications such as levels of trading
cost, exponential moving averages, two moving averages and volatility adjustments to see the corresponding effects. During our study, we
found an interesting characteristic between the number of trades and days in moving averages, which resembles a universal exponential decay
function. We also constructed a random walk model from which we verified the random stochastic nature of the currency exchange market.
Data Input - 14 currency pairs
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