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Q & A With Polpo Financial Ltd

Company Information:


mpany Name:



Windsor, Berkshire, UK

Contact Name:

Philip L. Jones (Director, FX)

Product Name:

Nexus Currency Program


$25 million

Total Assets Under Management:

$36 million

Firm Inception Date:

March 1998

Number of Employees:



Return Information

Annual Performance













Annualised Performance:


Annualised Standard Deviation:


Sharpe Ratio:


Parker FX Index Rank as of November 2000:

1 out of 41



1. How and when did your firm begin?

March 1998 when the principals left Linnco Europe Limited.

2. Who are the principals of your firm? Please provide a brief background on each.

Derek Adler (Managing Director) – involved in the futures markets since 1974 and has held a number of executive positions with major brokerage companies in the City of London. His experience includes the establishment of offshore funds and the review, analysis, selection and monitoring of trading advisors. He is a member of the Securities Institute and has served on the Conference Committee of AIMA.

Philip L Jones (Director, Foreign Exchange) – involved in the management of foreign exchange since 1975. After initial experience in audit/accountancy, he joined a major French motor company where he was responsible for worldwide foreign exchange.

In 1981 he joined an international bank where he was in the Capital Markets division responsible for corporate advisory and trading services, leaving in 1987 to assume marketing and trading responsibilities for a number of leading fund managers.

3. Please describe your best trade ever and when it occurred.

With the program focused on intra-day trading, the most profitable trades occur when there is a significant directional move over a 24/36 hour period. Moves of 100-200 pips occur with good regularity in individual currencies; however there have been trades where profits have exceeded 500 pips in a 24-hour period.

4. What was your most difficult period?

The most difficult periods are in low volatility/”sideways” markets; the most recent was the period from approximately 2-17 November 2000 that coincided with the run-up to the US Presidential election and its aftermath. These tend to result in a higher ratio of losing trades that may accumulate to 200/300 pips.

5. What is your outlook about the direction of the JPY, USD and Euro for the remainder of the year?

In terms of the investment management of our clients’ assets, the success is more dependent on intra-day volatility than on the duration of a particular move. My personal view is that the EUR is well placed for a further recovery, which may be partially fuelled by the USD’s susceptibility to the overall impact of slower growth. JPY remains beset by its own internal economy that suggests that the JPY is set for another period of weakness as the year progresses.

6. What is your view on emerging market currencies?

Emerging market currencies are unlikely to be conducive to our style of intra-day trading until there is improved liquidity, 24-hour coverage that they are allowed to float freely.

7. What types of instruments do you trade?

Spot Interbank foreign exchange. (EUR/JPY, EUR/USD, GBP/USD & USD/CHF only)

8. Is leverage used? If yes, maximum leverage amount? What is average leverage amount?

With full exposure in each currency, the maximum intra-day leverage is 4:1, with average intraday exposure around 3:1. This ensures that our primary objective of performance v. risk management is always at the forefront. Upon specific request from clients, maximum leverage can be raised to 10:1

9. What is the average length of time positions are held?

With trading focused on intraday, positions can be held for as little as 30/60 minutes or for 24/36 hours. The majority of losing positions are closed within a trading day, whilst it is profitable trades that may periodically be carried overnight.

10. Average number of positions during the month.

110/130 positions per month for the total program (220/260 trades per month).

Profit & Loss

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