Today, we are going to look at Innisoft. We learn something interesting today about this system. But first, let's review some key data about the system:
Max DD : -3,153
Profit in Pips : 1411
Start Date : 11/15/2007

This system provides us an equity curve that resembles a V-shape. Since its inception in Nov 2007, it immediately drew down a fairly steep amount of 3,159 pips. Then around the beginning of April, it began a 4,350 pip run.

Some items of note:
1) The previous systems we have reviewed of the EURUSD are trend following and have struggled when the EUR topped 6 months ago…Innisoft has held its own during that period.
2) Additionally, Innisoft has done quite well through the credit squeeze that became a highly visible crisis beginning in September.
3) Most importantly, this system recovered from a deep drawdown of 3,153 pips in 45 days.

This system shows us a quality that we have not seen thus far. It show us the ability to recover from its maximum drawdown in fairly quick order. Drawdowns are inevitable with every system. However, if the system continuosly recovers quickly, that tells me the system has an explosive nature that can grab quick profits.

Quick profits can also mean quick losses. You want to be certain to manage your downside risk and make sure you are well capitalized for the size of trades you are placing.

We will continue our review tomorrow of EURUSD systems.

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