TYL Trading tyl.altavra.com

Most traders rely on one or a combination of two different methodologies for their basis of trading: fundamental and technical analysis. Fundamental analysis is based on the study of external factors that affect the supply and demand of a particular commodity in order to predict future prices. Such factors may include economic and trade policies of various governments, interest rate fluctuations or weather and crop conditions of the major agricultural commodities. Fundamental analysis theorizes that by monitoring the relevant supply and demand factors of a particular commodity, a potential disequilibrium of the market may be identified, causing price levels to shift.

Technical analysis, on the other hand, is based on the theory that the study of commodity prices themselves, their interrelationships and correlations provide the data necessary to determine a market’s trend. Technical analysis theorizes that commodity prices reflect all known factors affecting supply and demand at any given time. By studying the detailed analysis of daily, weekly and monthly price fluctuations, the underlying trend changes of commodity prices may be determined.

The Blend Program utilizes a multi strategy systematic approach which incorporates techniques for trending and non-trending markets. The method employs systematic trading rules, money management principles and volatility adjusted features for individual trades as well as the overall portfolio. Mr. Geoffroy tested numerous futures markets over a historical period in the trading of his own accounts and through extensive computer testing in developing the proprietary trading model known as the Blend system.

The Blend system incorporates computer market analysis to identify and capture market price moves rather than predict market actions. TYL Trading’s philosophy is that market prices cannot be accurately predicted; therefore, the objective is to allow the markets to determine their own direction and follow the emerging trend by the application of disciplined money management guidelines. The goal is to participate in a substantial portion of a market’s movement while managing the downside risk.

In TYL Trading’s opinion, commodity futures trading offers an excellent opportunity for investors to diversify their portfolios, since futures tend to have an inverse relationship with equity and fixed income investments. Due to the leverage employed by the Blend system, only a certain percentage of an investor’s total investments should be employed in the program. Accordingly, TYL Trading recommends no more than 10% to 25% of a person’s investment capital should be exposed to futures trading.

TYL Trading's Blend Diversified Program will normally analyze over 40 markets in an effort to identify those markets that meet the parameters of the Blend system. The principal objective is to maximize profits in trending markets while maintaining account equity during periods of non-trending or choppy market activity.

Ideally, the Blend Diversified Program aims at maintaining a diversified portfolio of physical commodities and financial futures.

TYL Trading will primarily buy and sell commodity futures contracts, but may also trade put and call options on such contracts. The following are examples of some of the commodities, which TYL Trading monitors, and the categories or sectors into which they are grouped:

Currencies

British Pound, Euro-Currency, Japanese Yen, Swiss Franc, Australian Dollar, Canadian Dollar and Mexican Peso

Financial Instruments

Eurodollar, Treasury Bills, Treasury Bonds, and Treasury Notes

Stock Index

S&P 500 Index, E-Mini S&P, NASDAQ 100, E-Mini NASDAQ and Dow Jones futures

Metals

Copper, Gold, Silver, Platinum, Palladium, Aluminum, Tin and Zinc

Energy

Crude Oil, Gasoline, Heating Oil and Natural Gas

Grains and Fiber

Corn, Wheat, Soybeans, Soybean Meal, Soybean Oil, Cotton and Rice

Livestock and Meats

Cattle and Hogs

Food

Sugar, Coffee, Cocoa and Orange Juice

TYL Trading may add new markets or delete currently traded markets in its Diversified Portfolio at its discretion.

The Blend Diversified Program requires a minimum initial deposit of $1,000,000. This allows sufficient diversification among most major futures market sectors.

Before taking a position in a market an exit point is identified in an attempt to manage risk and limit possible loss in a given position generally to a reasonably small percentage of total account equity. The risk of a position is monitored on a constant basis while concurrently monitoring total portfolio risk. Profitable trades will have the potential to produce profits that could be many times the projected risk. Therefore, a trading system that would produce losing trades over 50% of the time could still be very profitable because of the potential risk/reward ratio. Of significant importance is that this trading method has the ability to profit in rising and declining markets.

It is not always possible to exit a trade at a desired price due to market illiquidity or exchange imposed price limits. This may cause a loss in a particular position or group of contracts greater than the intended objective. On the other hand, it could also cause a profitable position to become much more profitable. By using the money management principles discussed above and by trading a diversified portfolio of commodities, TYL Trading believes these risks can be reasonably managed resulting in above average returns.

At times when markets become volatile and are in strong trending modes, it may be difficult to place new accounts or additional funds contributed by existing accounts into such positively trending markets. Therefore, the returns for clients whose accounts and positions were established prior to an increase in volatility may vary substantially from those of clients who opened accounts and entered the market after the onset of volatility even though all such accounts are being traded pursuant to the same system.

Differences in account equity, commission rates, portfolio composition and the timing of orders are also factors that may cause variances in rates of return among TYL Trading’s clients.

The duration of time trades are held vary from several days to several weeks for unprofitable trades while profitable trades can last several weeks to several months. It is possible that there will be occasions when TYL Trading’s managed accounts may not have any open market positions at all, as when excessive volatility or quiet, trendless market activity prevails.

It is essential to give the trading account ample time before making a decision about the merits of the program. A client withdrawing his or her equity immediately after a drawdown may be exiting at a premature or inopportune time, or a client initiating his or her account activity after a period of larger gains, may be entering the market just before a drawdown period. If the client should choose to make a withdrawal that would bring the account equity below stated minimums, TYL Trading reserves the right to close the account and direct the return of all funds.

Conway P. Geoffroy is TYL Trading, LLC's principal, president and series 3 licensed senior portfolio manager. Conway Geoffroy became interested in futures trading in 1987, opened an individual futures account and began actively trading his personal account in August of that year. Throughout this period he has developed numerous computer programs that tested an endless number of market characteristics and trading techniques. Conway Geoffroy also worked and consulted with successful futures traders and programmers. The result of this continuous testing is what produces our current trading strategies. Conway Geoffroy is a graduate of the University of Texas Health Science Center at Dallas with a BS in Health Science and is also a graduate of their Physical Therapy Program. Following graduation in August 1975, he has successfully owned and managed his Physical Therapy Clinic.

Brad Geoffroy is vice president of business development and member of the portfolio management team. He has been instrumental in the formation of TYL Trading and involved in the ongoing analysis and research which produces current trading strategies. Brad Geoffroy began his career in the financial industry in 1999 with Legg Mason and continued with Fidelity Investments until he joined TYL Trading in 2001. He graduated from the University of Louisiana at Lafayette with a BS in Business Administration with a concentration in Finance and a Masters in Business Administration. Brad Geoffroy is also Series 3 licensed.

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.