To The Moon

Recently, movements in the U.S. dollar, interest rates, and commodities have drawn considerable attention from investors. In response to investor requests, Tiger organized an in-person discussion this month with traders who had shared strong historical returns, and invited me to take part. On September 19, I gave users in Hong Kong an in-person presentation on trading techniques titled “From Macro Cycles to Trading Strategies: A Discussion of a 102.5% Historical Cumulative Return.” It was a substantive session. The presentation focused on methods and case studies, not specific investment advice.

In this in-person session, I shared some of the ways I observe markets and use trading tools, centered on the theme “Finding Trends Through Macro Analysis, Managing Risk Through Trade-Level Decisions.”

First, a brief introduction about myself.

Macro analysis helps me identify directions worth watching. When it comes to actual trades, I place greater emphasis on choosing the right instruments, sizing positions, and managing risk. Here is a recap of the session’s main points.

Using the U.S. Dollar Index to Understand Macro Cycles

For the macro discussion, I used the U.S. Dollar Index as a starting point to examine its relationship with U.S. interest-rate policy, market liquidity, and the broader economic environment. I reviewed how the dollar had moved at different stages and, against the backdrop of rate cuts, changes in inflation, and rate hikes, explained why short-term moves in the index alone are not enough to determine the market’s direction.

I also introduced my own framework for understanding the recurring shifts between periods of dollar strength and weakness. This framework is mainly a way to organize historical experience and watch for possible macroeconomic changes; it is not a fixed forecast of future movements. Market conditions continually change, and even periods that resemble one another historically may not unfold at the same pace.

Understanding the Capital Efficiency and Risks of Futures

In the section on trading instruments, I introduced some features of CME futures and derivatives, including their extended trading hours, margin-based trading, and ways to express a market view through different contracts or spreads. I compared gold futures, Micro Gold futures, and gold ETFs to make the differences in contract size, capital requirements, and trading hours more tangible.$黄金主连 2612(GCmain)$ $黄金ETF-SPDR(GLD)$ $微黄金主连 2612(MGCmain)$ $1盎司黄金主连 2612(1OZmain)$

The prices, margin requirements, and capital commitments shown in the presentation were based on specific assumptions. They were intended to illustrate differences between instruments, not to represent live trading conditions. Futures may require less capital up front, but that does not mean they carry less risk. When trading on margin, I believe it is especially important to distinguish between the money actually committed and the exposure represented by the contract, and to plan ahead for price swings and potential margin calls.

Trade-Level Strategies: Choosing Instruments for the Situation

Building on the idea of “managing risk through trade-level decisions,” I discussed three types of strategy: using futures to participate in short-term market moves, selling options on futures to collect premiums, and looking for spread opportunities between different futures contracts or underlying markets. The presentation’s examples involving gold futures price movements, crude oil futures spreads, and Nasdaq futures options illustrated different applications of these approaches.

I did not share these examples as trading plans that could simply be copied. Before trading a trend, for example, you need to establish your entry and exit conditions. When assessing a spread opportunity, you need to understand the relationship between the relevant contracts and how it may change. Selling options can generate premium income, but it also requires an assessment of moves in the underlying market, changes in margin requirements, and potential losses. To me, whether a strategy suits the current market environment matters more than discussing its expected return in isolation.

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Historical Results and Takeaways From the Session

At the end of the session, I showed several examples of historical returns from the presentation:

My purpose in showing these figures was to review how the strategies performed at different stages, not to suggest that the same returns can be achieved in the future. The results cover periods and use measurement methods that are not entirely consistent, so they cannot simply be added together.

Looking back on the session, I hope participants took away a sequence for thinking through trades: first, assess the market environment from a macro perspective; next, understand the characteristics of the available instruments; and finally, evaluate the strategy and its risks in light of the specific situation. Macro analysis provides a direction to watch, while trade-level planning helps us remain prudent in actual trading.

This article is solely a recap of the session and does not constitute investment advice. Investing involves risk, and past performance is not indicative of future returns.