NSFG : Should I Stay or Should I Go?

Should I stay or should I go now?
If I go there would be trouble,
If I stay it will be double,
So come on let me know.

Sorry, couldn't resist the song by Clash. Judging from the latest email from Paul of NSFG (which incidentally I didn't receive on time as usual), they are allowing us to withdraw whatever is remaining of our money or stay with them while they try to recover.

Suffice to say, it honestly doesn't leave me very much room to manoeuvre. If I leave, I only take about 30% of my equity back and have to write the other 70% off as losses. This is unacceptable to me since the bulk of my deposits shouldn't even be losses in the first place. So my initial reaction is to let them trade the amount back.

The silverlining here is that Ken is actually the type of trader I would leave my money with. How soon the recovery process will be remains to be seen. I'm not holding my breath here, just crossing my fingers and hoping for the best.

Here's the email I didn't receive:

Good Morning everyone,

As you can no doubt imagine this last week has been a little hectic for me, I have enjoyed speaking with many of you personally over the phone and all the ideas that you guys have put forward.

Some of them are viable, some of them not so.

Some people have questioned the validity of our claim in respect to the seizure of the funds. To this end we are compiling the Case File along with the Bank Statements and Ken will be personally visiting one of the Forum Members, Cralle/cs65, who will independently verify the situation. I understand that they are going to be meeting this coming weekend and Cralle will no doubt post on the forums in respect to this meeting.

While a vast majority of you have given your support in what needs to be done over the coming months, one problem did occur over and over again, and that was in respect to the lock-in period we applied last week.

Taking these comments on board I have decided that choice is indeed important. No one likes to be told what to do, and especially told what they can not do! To this end then we are going to open up for withdrawals at the end of this month and give you guys the choice of what you want to do.

This will work in the following way. First of all we must establish what the liquidity % is at the end of the month so we know where we all are.

What I will then do is reflect this in your statements, the only way I have of doing this is by showing it as a trading loss. I want to emphasize at this point that we will return the fund to 100% liquidity and that this balance will purely show what your account is currently valued at should you choose to withdraw and close at this point.

If you do decide to take this amount now, it WILL close your account as there will be no more money in your account if you take it out now.

For example:

If your account currently stands at $100 and the liquidity % is determined to be 30%, your account statement will show a balance of $30.

You have the option now of withdrawing this money (or part thereof) or not.

If you choose to take all $30, it would close your account with the Northsea Pool.

I would like everyone to be 100% clear on this fact, by taking this action you now have the choice to do nothing and let your account grow back up to its correct level as per the end of September or withdraw now.

Interest will be added to your accounts each month to this lower balance as we resolve this issue. This means that the interest gains will allow us to build your accounts back up faster than we can by just adding our own money into the fund. The interest however will be added to the lower liquidity figure and NOT the end of September Balance. However you will retain the choice of being able to withdraw.

To summarize the above, the liquidity % will be determined at the end of the month. Your Month end statements will reflect this new figure and withdrawals will be opened as normal till the 15th of the month. Interest will be frozen on your account at the end of September account balance, but you will see your account balance grow each month as the interest and our own funds boost the pool back to its September Balance.

I would like to re-iterate here that the only reason we are showing you the balance that would be currently available is so you have the choice for yourselves to withdraw or not, and not be told that you can not by us.

We have complete and total confidence in getting back to the September Balances, it will cost Ken and I a great deal of our own money to do it, but we will get there!

Okay moving onto other news. We have been in the process these last few months of developing an auto-trading system that will work around the clock trading high-probability set-ups. We have worked out several set-ups which statistically have proven very effective. The problem with statistics is that you have to trade each and every set-up that comes along…fine when your awake and in front of the computer. However we needed something that would work for us while we are not there, and started development on such a project a while back.

We are now in the final testing phase of this system, and while there are still a few minor bugs it has performed very well for us. We will be using the next month or so to fine tune it and then go live with it. Data so far has been very encouraging and we are very excited by its prospects. It is unfortunate that this turn of events has happened right now as had this system been operational these last few months we would have returned some very good %’s and this problem would have resolved itself.

In my previous update I mentioned the fact that we would be separating the Pool Fund more directly from Northsea so that we can become FSA compliant. This will quite possibly be happening over the course of the next couple of months.

You will not actually notice a difference in anything in the first instance other than there being a website dedicated solely for the Pooled Fund or your statements coming from a different address. If it is logistically possible then the database may be placed online so you can view your account online as well as the monthly statements.

The other factor that you will notice is that the performance fee will be reduced. The exact level has yet to be determined, but until your balances are returned to their September level it is not something that you will be paying anyway.

That about wraps it up, as soon as know the exact liquidity % I will advise you all accordingly.

Yours,
Paul