Scientific Trading Solutions scientific.altavra.com

Although there can be no guarantee that trading will be successful and that clients will not experience losses, Scientific Trading Solutions strives to provide superior returns and to minimize drawdowns.  Past results are not necessarily indicative of future results.  The risk of loss in trading futures, options and off-exchange forex can be substantial.

Description of the Investment Program
The following is a description of the Scientific Trading Solutions, Inc. Trendchannel Capitalflow Portfolio program. The exact nature of the Trendchannel Capitalflow Program is proprietary and confidential.

Scientific Trading Solutions’s Program employs a systematic trend following methodology, applying both intermediate and long term trend following systems.

Scientific Trading Solution’s trading program is primarily based upon technical analysis. Technical analysis is based upon the theory that a study of the markets themselves will provide a means of anticipating the external factors that affect the supply and demand of a particular commodity in order to predict future prices. Technical analysis postulates that the marketplace itself represents the collective judgment of a larger number of traders and analysis concerning the value of any particular commodity interest. By analyzing market characteristics (as opposed to underlying economic forces) that have not yet been directly reflected in price levels, it may be possible to predict future price moves. Furthermore, technical analysis generally holds that, irrespective of basic economic forces, markets have dynamism of their own which is wholly outside the scope of fundamental analysis that should be reflected in any trading approach. Accordingly, technical analysis generally focuses on a detailed study of such data as actual daily, weekly and monthly price fluctuations, trading volume variations and change in open interest, as the most effective means of attempting to predict price movements. Technical traders frequently utilize charts and computers for analysis of these items, including a series of mathematical measurements and calculations deigned to monitor market activity for the particular trading strategy. Trading recommendations are based on signals generated by charts, manual calculations or computers. Technical trading approaches may incorrectly analyze the effect of various market forces or price trends, particularly as technical analysis is typically based on historical market activity. Such analysis may not in fact be applicable to the current markets (which many perceive as undergoing rapid and significant changes) and may be of little use when fundamental factors, particularly unexpected occurrences, such as certain governmental interventions, dominate the market.

Markets and Instruments Traded

Scientific Trading Solutions trades both futures and options on futures on United States Exchanges. Scientific Trading Solutions generally trades Stock Indexes (e.g. Nasdaq 100, Russell 2000, Nikkei225 and S&P 500), Interest Rates (e.g. 10 Year Treasury Notes, 2 Year Treasury Notes, Federal Funds, and Eurodollars), Currencies (e.g. Euro, dollar index, yen, Australian dollar, and Japanese Yen), Agriculturals (e.g. Corn, Sugar, Wheat and Soybeans), Energies (e.g. Crude Oil and Natural Gas), and Precious Metals (e.g. Gold and Copper). Scientific Trading Solutions may trade other commodities or futures contracts in the aforementioned complexes. The percentage of the portfolio devoted to each complex varies and is based upon the then current market conditions and potential opportunity.

Margin to Equity

Generally, up to 10% of a client’s nominal account size will be committed to margining positions. However, at times, based upon market conditions, margin to equity may be closer to 20%. Should the client wish to employ the trading strategy at a 2.5 to 1 leverage then generally 25% of the nominal account size will be committed to margining positions, and at times, may be closer to 50%. These percentages are only estimates, and can vary significantly depending on market conditions. Excess funds that are not being used to purchase or margin futures contracts may be invested in short-term U.S. Government securities (e.g. Treasury Bills).

Money Management and Risk Parameters

Scientific Trading Solution’s program applies multiple money management systems to determine position size (number of contracts) and equity at risk. Variable position size is based on measurements of volatility risk for each new position, for each open position, and for the total of all open positions. Scientific Trading Solutions will cease trading a client’s account if the account level falls by 20% from the initial nominal trading level. For example, if a client funds his account with $200,000 in actual funds but agrees to have the account traded at a nominal trading level of $500,000, then a decrease of $100,000 would result in the temporary cessation of trading. There is no guarantee that any potential loss would be limited to 20% of the initial nominal trading level as market movements could cause actual losses to exceed 20% of the initial nominal trading level. In the event such a 20% decrease occurs, Scientific Trading Solutions would need both verbal and written confirmation from the client to continue trading the account.

John Tolan was born on July 14, 1954. Mr. Tolan is an owner, President, and sole trading principal of Scientific Trading Solutions, Inc. (the “Advisor"). Mr. Tolan became registered with the CFTC as an associated person and became listed as a principal of the Advisor on October 17, 2008 and February 24, 1999, respectively. John Tolan’s responsibilities entail market research and analysis, trade selection and execution, and communicating with clients, regulators, and vendors.

For the five years preceding the date of the disclosure document, John Tolan has been employed by Scientific Trading Solutions. Mr. Tolan was responsible for marketing and selling the Trendchannel Trading System. Mr. Tolan continuously monitors and enhances the Trendchannel Trading System as necessary.

John Tolan graduated from the University of Illinois, located in Champaign, IL with a bachelor of science degree in Agricultural Economics.

John Tolan currently trades futures for his own account. Clients will be permitted to inspect the trading records of such accounts along with any written policies related to such trading, at Scientific Trading Solutions office, upon reasonable request and during normal business hours, from the time the client opens a discretionary account with Scientific Trading Solutions.

As of the date of the disclosure document, John Tolan was not directing any client accounts pursuant to power of attorney.
 

Daniel Conrath has been a principal of the Advisor since January 13, 2011. Daniel Conrath does not exercise any control over the day-to-day management of Scientific Trading Solutions or exercise any trading authority on behalf of Scientific Trading Solutions. Daniel Conrath has been an associated person of Risk Management Incorporated ("Risk Management") since January 16, 1995, and has been a principal of Risk Management since October 17, 2001. Risk Management is a CFTC registered independent introducing broker and NFA Member, since May 30, 1992 and June 14, 1988, respectively, involved in the introduction of energy customers to future commission merchants. Daniel Conrath's primary responsibilities at Risk Management include the solicitation of clients, supervision over the firm's operation, and assisting energy users with hedging and trading strategies. Mr. Conrath was also an associated person of MF Global Inc. ("MF Global") from April 1, 2002 to October 3, 2007. MF Global is a CFTC registered futures commission merchant and commodity pool operator. Daniel Conrath's responsibilities at MF Global involved providing consulting and energy related services to commercial and institutional customers of MF Global.
 

John Snell has been a principal of the Advisor since January 13, 2011. John Snell does not exercise any control over the day-to-day management of Scientific Trading Solutions or exercise any trading authority on behalf of Scientific Trading Solutions. Mr. Snell has been an associated person of Risk Management since February 27, 1990, and has been a principal of Risk Management since June 14, 1988. Risk Management is a CFTC registered independent introducing broker and NFA Member, since May 30, 1992 and June 14, 1988, respectively, involved in the introduction of energy customers to future commission merchants. John Snell's primary responsibilities at Risk Management include the solicitation of clients, supervision over the firm's operation, and assisting energy users with hedging and trading strategies. John Snell was also an associated person of MF Global from April 1, 2002 to October 3, 2007. John Snell's responsibilities at MF Global involved providing consulting and energy related services to commercial and institutional customers of MF Global.

The descriptions above are from the manager's disclosure document.

THE RISK OF LOSS IN TRADING FUTURES, OPTIONS AND OFF-EXCHANGE FOREX CAN BE SUBSTANTIAL.  PAST RESULTS ARE NOT NECESSARILY INDICATIVE OF FUTURE RESULTS.  PLEASE READ THE CTA'S RISK DISCLOSURE DOCUMENT CAREFULLY BEFORE INVESTING MONEY.