HH Peter Henry Hugo Xavier
Source: Notion | Last edited: 2023-04-12 | ID: 1648ae49-185...
Hugo Xavier
Our latest factsheet: https://docsend.com/view/cnaz5k5idgve66us Our presentation: https://docsend.com/view/jy7i9aewehzqj3x6
https://www.navconsulting.net/
legally required minimal 100k USD
Hugo Xavier: (33:49) Hey, hello. Terry.
Terry Li: (33:50) Hi.
Hugo Xavier: (33:51) Hi, let me open the camera as well one second.
Terry Li: (33:54) Okay, no problem.
Hugo Xavier: (34:03) sorry, for the little delay, I was
Terry Li: (34:05) No problem.
Hugo Xavier: (34:05) finding
Terry Li: (34:05) I thought you were not. You have something else, no problem.
Hugo Xavier: (34:07) yeah, the Google
Terry Li: (34:09) No problem. Yeah, it was just about to send you
Hugo Xavier: (34:10) Link.
Terry Li: (34:11) mail.
Hugo Xavier: (34:12) Yeah. Yeah, he’s good.
Terry Li: (34:23) Yeah, I can see you.
Hugo Xavier: (34:25) Yeah, nice.
Terry Li: (34:27) Nice. Okay, so thanks for for coming to this meeting. And the reason I would like to talk to you more about this to talk about the The performance and expectation that you may have. Yeah. for now, let me get say Okay, let me check. Okay. So we were introduced by Peter Henry.
Hugo Xavier: (34:58) Yeah.
Terry Li: (34:59) Okay. So I got preliminary information about that you’re currently is having your own company running certain funds with around 600 kaum. And so, the reason I was interested to talk more about this because I also saw the Piano. There’s two screen captures with bml, which looks interesting, but unfortunately it’s just a screen capture. So, yeah.
Hugo Xavier: (35:31) Yeah, to be enough on the prop desk error, right? Not from the fund.
Terry Li: (35:36) Oh, I’m not sure. What? What’s, what’s that? Yeah, I’m not sure. So yeah, I guess better we sorted out through this meeting and try to find
Hugo Xavier: (35:45) Okay.
Terry Li: (35:46) out more about one another. So
Terry Li: (35:49) So so any question about the our company, first you want to know more about us first or and
Hugo Xavier: (35:55) Um, yet. Yeah, sure. So yeah. Um we’re going to introduce by Matthew there and he sent me a pitch deck actually yesterday about your company because before that, I would only have seen in your website leaking, etc. There isn’t much information, right? About you guys, before beside the pitch that. So when I first saw your saw your company in both website and only kidding, I thought you were more like a software provider providing software for people who want to automate this strategies. They can use your software and that’s it but after your story leaking, Oh sorry so your teacher deck. I saw that you actually guys runs a lot of strategy with your own
Hugo Xavier: (36:38) Matthew there and he sent me a pitch deck actually yesterday about your company because before that, I would only have seen in your website leaking, etc. There isn’t much information, right? About you guys, before beside the pitch that. So when I first saw your saw your company in both website and only kidding, I thought you were more like a software provider providing software for people who want to automate this strategies. They can use your software and that’s it but after your story leaking, Oh sorry. So your teacher that I saw that you actually guys runs a lot of strategy with your own capital as a proper desk. And yes, there is much more synergy than I thought because I thought were like, only selling your product. Like Okay, we have this platform and if you want automate your strategy, that’s it a bit like, maybe like matrix part, but then I saw that you guys have your own prop desk. You guys are you traded for yourself as well. I don’t know how your entities are is and so on and how you are set up. But yeah there’s a lot of more synergies and yeah if you want to can give a little bit of background about myself as well.
Terry Li: (37:18) Nice, thank you.
Hugo Xavier: (37:20) Okay, so yes, I I trade. I’m almost ready. I Tracy some 16 actually in the Have a have a background in finance as well. So I used to work for Deutsche Bank Btg and then on 2017 I starting doing the arbitrage here in the Brazilian market, same as Japan in Korea, Brazil had a premium on Bitcoin in 17 and I start correct. During the premium, I was the first one to be able to send wires to bitcoin brokers from Brazil regulated to the central bank that was in 17. So I was sending a wire. So cracking beats them. Basically, that was the only ones out there at that time, and then I start cracking a lot of spread. So I had a lot of Market share in Brazil when selling Bitcoin because I was basically one of the only ones who were able to, To provide those. And then I opened my own OTC desk into in 2019. I had a partnership with OSL. They are big OTC group in Asia. I like label their platform for the OTC and yeah, I use them ever since in the, but now the OTC, the spread is very tight. The street got crowded, I still do a bit of architragey and buying it. So in local brokers and the OTC loans by itself, this takes like 30 minutes of my day because it’s all automated rfq feel clients lawyer clients, so all good and then on 2020 late 2020, I was introduced to Mateos. He’s my partner that I too and he is what great. He was a quantity developer. Sorry he was a developer in the quantity training team and he was his life. He left sitting in 19 to trade his own money in crypto arbitrage, he was doing, he was doing, he were doing basically spot prepared to our market neutral on 2019 that was very good The funny rates was very high as you like there was a lot of spreads. know enjoying him late 2020. I brought with me. Andrea Andrea was former CEO of Dunamis. One, big hedge fund here in Brazil for crypto and alongside we bought for more for other depths we start training as a prop desk throughout all the way late 2022 out December 22. So two years, as a prop desk, and last year, I started to open the fun. I started to open like a march April got approved the license and so on bank accounts, everything on December. So yeah, the fun started on December basically prop money as a building avs and I started to to Talk to allocators only last month. So last month we got one external investor so our aim is already at one meal and now in April we are getting a uncle investor actually was putting bigger capital and committing to to put more if he likes the performance. So it’s a it’s a very good investor that we put in the fans of funds this year trade since May last year, and but we’re trading mostly spot perpeto arms and they already have some funds under the date. That great spot for petal. Now, these all December, he has Google, What what are you trading hours? Like I’m training, futures are so I’m trading mostly interactions in Hawaii, inter exchange. So inside minus inside hobby and trading this bread between those and then he approached me he didn’t have anybody doing the three days we are so we got approved. To be one of their friends under them which is very nice and that was about the same time last month. Sorry, that was early this month right there. You know, March that made you talk to me about you guys and see, if there’s any synergy for us to work together in something and yeah, but if I can hear more about your company, your labs or enigma, I don’t know if any, you might as a product of your labs or if it’s the same thing,
Terry Li: (41:51) Yeah, that’s our product. It’s our it’s what we use to train
Hugo Xavier: (41:53) Okay.
Terry Li: (41:55) our own funds, as well as clients funds.
Terry Li: (41:60) So yeah, it sounds to me that you guys are doing great. So what’s your personal goal or your team’s goal? I had. Of next few months or a year or so.
Hugo Xavier: (42:16) Okay. So, um, last year, for example, we were approached by a big desk in Chicago. They do market making for traditional funds, and they wanted to enter crypto. We almost did a joint venture. They didn’t because they don’t want to crypto just yet. As they’re finishing, some new strategy on their own. They’re pretty big. So, they takes time to make a movement and by doing, so, we would trade only prop money in my money, their money, and not have a fun at all. So as you see there in the presentation, everybody here is traders or developers. We have nobody in the commercial side. I don’t like doing cap raise, to be honest, I don’t have any broker doing. So everybody trades from home. Like we don’t have a flagship office and so on like this, we prefer, like we are straight our own money. That’s the first time we have fun. So Uh maybe to do a drive venture art to work with somebody who already that have that arm even by ozone capital or by external locators, and don’t have to worry about raising. Just have to worry about what we like to do. That is trading. Like we spend the whole day here actually, discord like from 9 am Brazil, to midnight. We are Always online like 12 13 hours every day yesterday. I don’t know but if you if you saw but was expire of some contracts. So the March contract expired yesterday was today morning in Brazil and the dads like they went through the night because the expired for a. So they didn’t sleep from yesterday to today because there was checking if was okay with the deliveries. So that’s like what we like to do. You know we don’t like picking out and reaching for investors just like to trade us all what we did. I’m I do the salesman part because I have to nobody else in the front It’s there only developers so they don’t do it but even so I I don’t like it I prefer just the trading part and so on. So was like What is this that Matthew approach me? Um, so I don’t know, maybe we have some synergy, my personal goal. Is to. So this is our, my only my only companies, my OTC run by itself. Basically, I have my five employees there doing everything takes me like that means every day and one hour on a Friday, to see if it’s okay on weekends on the, on the week. And that’s it. I dedicate most of my time now to to K2, but I still have Plenty of free time which I don’t like like I spend the whole day looking at the markets trade a bit of my own money, but yeah, I still have a free time. When I grow more k2, to a point that This will take my whole day and yeah, be super busy with it but it’s getting more and more traction. We just got them onboarded with hidden roads with Falcon X. Both now in March. So it’s going back and forth with them. So yeah, like a lot of stuff happening, taking more of my time.
Terry Li: (45:30) I guess hidden role was, I heard about this company, a lot was their strength when you
Hugo Xavier: (45:37) Yeah, they are prime brokerage just like any others. So they give you a direct market access with low fees just like any other, like LTP Falcon X and so on but the good for him they’re super institutional. So the onboard took eight weeks to be done by. Then they have you have you need approval from all sorts of teams they have for me their main point is that they have Of capital introduction. So, they have a lot of big funds there and they have Exchange default Risking source. So if that change goes down, you can buy insurance against it. So people who are trading through hidden roads on fdx, and had the insurance on, they got all paid on the next month. Not even the position of the aum that they have there, but unrealized Pnl. So, if you had five meal and one meal opening out, they paid out the six before for everybody and went. Oh, okay. So yeah, so they charge for this, of course, now even more But if for me still it’s still very worth the spreads how it is right now. I think it’s worth to pay insurance and capture those
Terry Li: (46:49) Okay. Nice. Have you got a chance to take a look at the profit sharing or how we would like to proceed with any partners or employees that we got to excel sheet up on the post? Have you got a chance? If not I can send you.
Hugo Xavier: (47:06) What is that? I didn’t receive that.
Terry Li: (47:07) Yeah I I can send you a link. I can send you a link. Hang on.
Hugo Xavier: (47:10) Okay.
Terry Li: (47:14) Yeah, it’s
Hugo Xavier: (47:19) Why did you why did you send that link?
Terry Li: (47:22) it’s the post. It’s a post that we
Hugo Xavier: (47:25) No. I mean why did you send the link to me? In.
Terry Li: (47:29) Yeah, no, no, no. I haven’t, I haven’t hang on. Let me, let me, let me, let me open
Hugo Xavier: (47:32) Okay, sorry.
Terry Li: (47:35) up.
Hugo Xavier: (47:35) Okay.
Terry Li: (47:36) And grab the link for you.
Hugo Xavier: (48:05) Alright. Amazing Vancouver.
Terry Li: (48:14) Yep.
Hugo Xavier: (48:20) So maybe I thought four hours behind me is I meet a midday for you noon.
Terry Li: (48:25) Yeah, yeah. No. No. Yes.
Hugo Xavier: (48:27) Okay.
Terry Li: (48:29) hang on, let me I’m going to share the link with you in the hat.
Hugo Xavier: (48:40) Okay.
Terry Li: (48:43) Can you see if you can open it?
Hugo Xavier: (48:55) Profit sharing. Yes, I see it.
Terry Li: (48:57) Yeah, earning simulation on Google sheets. Yeah, there’s a link underneath called earning simulation on Google sheets.
Hugo Xavier: (49:08) Okay. So, okay, I have it here. What am I looking here? Risk based on too mad?
Terry Li: (49:19) Yeah, that’s yeah.
Hugo Xavier: (49:21) We’re just by far.
Terry Li: (49:22) That’s basically how we trying to. Okay, I can I can try to like, show it to you.
Hugo Xavier: (49:32) Minutes of the countries. Start 1k a great, captain Jack, the ceiling. 100k.
Terry Li: (49:42) You can see it right? Okay.
Hugo Xavier: (49:44) Yeah.
Terry Li: (49:45) Okay, so What is essentially saying is that there’s there’s certain parameters or whatever is in the yellow that you can adjust.
Hugo Xavier: (49:57) Okay.
Terry Li: (49:58) Whatever is in the yellow that is adjustable from the leftmost. It’s the It’s the the 30, the 30 Here. It’s just a number that determines just a coefficients. that.
Hugo Xavier: (50:16) Okay.
Terry Li: (50:16) Yeah, you can just ignore it for now. The system minimum acceptable, access return. We call it the trailing minimum excess, acceptable, access return. It basically means in certain number
Hugo Xavier: (50:30) Okay.
Terry Li: (50:31) of periods of what the expected, minimum return, that you’ll get say,
Terry Li: (50:36) For example, it’s a per certain period never mind period, it’s just a number, like we preferably below 28 days, so it’s 5% under from four weeks, and then that’s the adsrp.
Hugo Xavier: (50:51) Set other four weeks.
Terry Li: (50:54) Every four weeks, every
Hugo Xavier: (50:55) Yeah, that’s a lot. No.
Terry Li: (50:59) That’s a lot. I’m I don’t think so because we we got we got 7,000 over 7,000% returns in 27 months.
Hugo Xavier: (51:11) okay, I saw that on your presentation, but for this, there is
Terry Li: (51:13) Yeah.
Hugo Xavier: (51:16) This is a market neutral though, right?
Terry Li: (51:19) Oh, we don’t think we can go with market neutral strategy because
Hugo Xavier: (51:23) Okay.
Terry Li: (51:24) The, the kind of capital. Allocation is just too much. For us to bear.
Terry Li: (51:33) Say for example we do have 20 million or so prop funds right now. But for individual, high performer, we can only allocate up to five million that’s it. And if we are allocating, just five
Hugo Xavier: (51:45) Okay.
Terry Li: (51:49) millions to you. And you’re just getting like one digit growth per month. It’s not even enough to cover your base salary. Well, it’s gonna be enough, but what’s left for us?
Hugo Xavier: (52:04) Okay.
Terry Li: (52:06) That’s the problem, right? So yeah.
Terry Li: (52:09) money, so market, neutral strategy is perhaps fine. But yeah, we’ve talked to quite a number of different teams concerning market neutral. Yes. The shop ratio is very high and it’s
Hugo Xavier: (52:23) Yeah.
Terry Li: (52:24) very stable and very good team but
Terry Li: (52:27) the problem is, hey, We are basically doing a charity.
Hugo Xavier: (52:33) Yes, in Europe.
Terry Li: (52:35) So that, that’s the problem that we
Hugo Xavier: (52:36) Yeah.
Terry Li: (52:38) are facing right now, and
Hugo Xavier: (52:39) Okay.
Terry Li: (52:40) And yeah. So yeah that’s it’s it’s just we can see a way out of it that that’s why.
Terry Li: (52:48) Yeah. Okay so just continue. So there’s excellent return and there’s Atsr fee. Atslv meaning like the profit share that you can get perhaps it very percent perhaps. It’s 25%. It’s well it’s negotiable.
Hugo Xavier: (53:06) Okay.
Terry Li: (53:08) The based on unsettled. What is this 90% number, is that Will keep. Certain amount. Of the fee, withhold certain amount of the fee. We won’t distribute it to you until certain period later. The reason for withholding say we pull 40% or we withhold, 50% is because we will hold that funds for in in case. Huge, you you cannot meet the you drop below the wrist level like,
Hugo Xavier: (53:44) Yeah.
Terry Li: (53:44) below the wrist, level like, Yeah. Then we’ll and then we’ll talk about like using it to cover it. And if you can continue to perform and your performance can exceed the previous threshold and will release the withholding, every certain period say, for example, every two period, every four period. It depends, it’s all negotiable. It’s all negotiable.
Hugo Xavier: (54:07) Okay.
Terry Li: (54:07) certain interval, then we’ll release the fun. So that’s it. And also this side is the startup capital, the the maximum. And well, the start perhaps, this one is too small, it’s for demonstration. Purpose only, it’s perhaps, at least, at least at least we have another guy who had this To start with and Five million is perhaps, Max. And these are all the injection rates and also the capital injection acceleration rate. So that’s basically covers everything. And also you can see that we have a fee for the headhunters as well for the recruiters. Yeah. So that basically covers everything so you can see how much you’ll be making according to this sheet.
Hugo Xavier: (55:10) And he’s here, they start of the etch to 60.
Terry Li: (55:15) What was your question? I’m sorry.
Hugo Xavier: (55:17) Right. I mean, first line nav at the start
Terry Li: (55:23) Okay. I’m sorry. I just closed it and you I can share this sheet with you. What do you have a Gmail?
Hugo Xavier: (55:31) I’m here. I’m with the sheet open.
Terry Li: (55:32) Oh yeah, yeah, nice man. Yeah, yeah.
Hugo Xavier: (55:33) Yeah.
Terry Li: (55:34) It’s a publicly viewable anyway. Yeah.
Hugo Xavier: (55:36) Yeah, so any via they start 260 in 60. You are with the screen with me, right?
Terry Li: (55:42) Yes, yes.
Hugo Xavier: (55:43) Okay, so here this is the start capital. This 360 there are captain but they start any V, right? So the That’s how I started to accruing.
Terry Li: (55:55) Can you can you modify the cell?
Hugo Xavier: (55:57) No, I can’t.
Terry Li: (55:58) Do you?
Hugo Xavier: (55:58) Only I myself F-17.
Terry Li: (55:60) Oh, Okay, I can share with you. The I can allow you to, I can add you as an editor so you can
Hugo Xavier: (56:11) Okay, you cannot see me. I’m moving the the
Terry Li: (56:14) No, no, I cannot see you. I cannot see you.
Hugo Xavier: (56:16) Up. Okay.
Terry Li: (56:18) Anyway, I’ll share a screen again. I’ll let me see you. Where, where you move? Okay, hang on. I’ll show the screen again.
Hugo Xavier: (56:30) Okay. So there
Terry Li: (56:31) Okay, show me where you are.
Hugo Xavier: (56:35) If 17 any v in the start.
Terry Li: (56:38) Oh still, I cannot see. Well, what about you share your screen with me. Thanks.
Hugo Xavier: (56:54) Okay. So can you see my screen?
Terry Li: (56:57) Yep. Yep, very clearly.
Hugo Xavier: (56:58) Okay, so here Nev at this start.
Terry Li: (57:04) I don’t see your cursor moving.
Hugo Xavier: (57:05) Once you.
Terry Li: (57:06) Oh okay, I see it now Okay. Yeah.
Hugo Xavier: (57:08) Yeah. So this is where you start. So yeah, you put to 60, right?
Terry Li: (57:12) Equal to 60?
Hugo Xavier: (57:13) Just
Terry Li: (57:13) Yes, yes yes.
Hugo Xavier: (57:14) So this is one most passing over.
Terry Li: (57:18) Say, for example, if it’s 1000, so everything changed, you see, okay?
Hugo Xavier: (57:21) Yeah. Yeah, perfect. So, let’s see. Okay, I cannot change. Okay. so, after 12 months, You’re gonna go from 1,236,000.
Terry Li: (57:40) if if it’s 5%, Because we’ll be keep injecting new money, right?
Hugo Xavier: (57:46) Okay, okay.
Terry Li: (57:47) You see we have injection rate, right?
Hugo Xavier: (57:49) Yeah.
Terry Li: (57:49) First round. And then
Hugo Xavier: (57:50) injection.
Terry Li: (57:53) Sorry, can you repeat? I’m sorry.
Hugo Xavier: (57:55) A dav should not change. This should be returned. I could return only snow Not additional capital. I think this is only accurate returns.
Terry Li: (58:07) Oh, additional kind of because we
Hugo Xavier: (58:07) See.
Terry Li: (58:08) won’t be taking out any of our profits.
Hugo Xavier: (58:11) No, I know, I know but for example, from 31 to 63, this is additional capital, right? No profit.
Terry Li: (58:21) Including the profit.
Hugo Xavier: (58:23) Yeah. Yeah, but you didn’t do twice as profit. This is probably more capital, that was 14 here, right? From month 9 to 10. That’s what I’m saying. Like it came from 31 to 63, not from profit but from deposit, both accurate profit and deposit, right?
Terry Li: (58:42) Yes. Yes, both yeah.
Hugo Xavier: (58:43) Yeah, but they, they nav. Should should not move with the. With the capital. I mean, I’m gonna see capital growth purely, like a purely return growth, maybe
Terry Li: (58:59) Well, that’s and the rightmost ad line. The ad line is nav after injection, right?
Hugo Xavier: (59:06) Ad. Yeah, I want to see before Egypt from like
Terry Li: (59:11) Oh, before injection.
Hugo Xavier: (59:11) yeah.
Terry Li: (59:12) Okay. Okay, and maybe after nav after
Hugo Xavier: (59:13) you know?
Terry Li: (59:16) excess return. L k J k l L That’s after access return.
Hugo Xavier: (59:28) Yeah.
Terry Li: (59:28) Without the injection.
Hugo Xavier: (59:29) But you know, disease are because as a calculating my fun, I go like this
Terry Li: (59:33) Okay. Okay.
Hugo Xavier: (59:35) Miami fee is a hundred. Now let’s say I do 10% returning them off, it’s 110 doesn’t matter if you put one more million or two meal is still 110. How much my shares worth right now?
Terry Li: (59:49) oh,
Hugo Xavier: (59:49) You know, that’s what I mean. So I can see the growth of 100
Terry Li: (59:53) I understand so you are using the
Hugo Xavier: (59:54) dollars.
Terry Li: (59:55) ministry basis, right?
Hugo Xavier: (59:57) Charbases. Yes.
Terry Li: (59:58) I see that’s more reasonable way to calculate it. I see.
Hugo Xavier: (60:01) Yeah, but again no problem. Again, this is all well, I think this is a very high return, but this is more for directional trades with some How to Say With some Edge, Right? So you you’re getting some edge to the directional tree here, right? But what is
Terry Li: (60:21) Oh we were we were assuming there were some edge. Yes and we were assuming there were so much but if you only have market neutral strategy we can still explore that but it’s we will have to come to the like the the tough question of how much they’re allocate and how much return you want? That’s the tough question.
Hugo Xavier: (60:42) Yeah.
Terry Li: (60:43) We have to like sort out. We can still start out with this
Terry Li: (60:46) sheet or with the unit base return. If you have sheets like that, we can like I can simulate your sheet. I can like I can try to look at your sheet and see how how we can do it.
Hugo Xavier: (60:56) Okay.
Terry Li: (60:57) but it’s good. We are in the Quan world. We can talk about, talk about numbers
Hugo Xavier: (61:03) Yeah, no problem.
Terry Li: (61:03) easy.
Terry Li: (61:04) So yeah.
Hugo Xavier: (61:06) example, I did let me open my my presentation here. Well, I can open up my presentation but I can be Even more precise, I can open my RBI. See that? so, this will be Real data from the front admin. like, We calculate this, but this always match the Different admin, just not neo.
Terry Li: (61:51) Nice.
Hugo Xavier: (61:53) Are capital is coming right now. On April, is not reflected yet. So yeah, there’s a little balance here, but we’ll be reflected.
Terry Li: (62:03) Mm-hmm.
Hugo Xavier: (62:04) And next week because we have to wait for the the period to open, okay? So like, for example, what I do here diseases are Our daily returns. Okay here, nav data. Never mind those because, yeah, not, those are real, but we increase. So it says here that we are 267 each, we are almost 500 now on the next month in April. That’s for the the front of fungi also.
Terry Li: (62:43) Okay.
Hugo Xavier: (62:44) if on the funds, we’re gonna trade on their own sub account and they’re gonna start with 2.5 meal, going all the way up to To 17 but between a new account. So this is this is our account and that’s how we we calculate so we are each based.
Terry Li: (63:01) Hmm. Oh Oh, I see not USD based.
Hugo Xavier: (63:03) So Is not the USB.
Hugo Xavier: (63:06) This is each base.
Terry Li: (63:07) I see.
Hugo Xavier: (63:07) The reason I chose to be each basis because well the market is is tough on on crypto. Right now, we have an investor. We only have actually one investor in the investment manager, he bought 4% of our investment manager. That’s the only outside capital we took, we took in and he’s a senior partner in OSL there. So he’s a very connected very well known guy and he’s a personal friend, not only business but Personal friend. Of ours. So and he said Hugo you should go. You should denominate, your fun in either eat or btc because throughout 2023, you’re gonna mostly talk with a crypto native people and they’re okay if CRYPTOS went down a lot. If if you do 20 30% early on the phone great but that’s on all our base. They want to grow their crypto portfolio so do it or bitcoin that would be better and we saw a lot of
Terry Li: (64:06) oh,
Hugo Xavier: (64:06) opportunities in the eat futures and on if you spot features so it’s okay, let’s do it but this can all be reflected to USD base. You just need to do a hedge. That’s it. So, the prime the, the fond of fun who are investing with us, they are USD base 100%. And I said, We have our inventory need because we train mostly future blah, like okay, no problem. We’re gonna Uh, send to our prime brokers, 100 me up, one meal us city, they’re gonna land us, 200 rumor in it, you’re gonna put there. So there are already hedges so they don’t care for it, so it’s fine. So yeah, so the way we do it here, it’s like it doesn’t matter how much money there is on the on the front, then if he will continue to be the same only based on the return. So that’s 13 off. December. And this is our like, daily returns 7 to 0.8 0.7. And you can see then if he’s growing here, January February was very good. So on two months we were on. 141 already on nav. And this is all Matched with the admin. Like both, January this January of disabled, January February, the benefit that we reported was the same as the admit, like, A perfect. so yeah, so those all you
Terry Li: (65:34) so I see your calculating, the excess return on a monthly basis and on
Hugo Xavier: (65:38) Yeah. Daily.
Terry Li: (65:41) every month,
Hugo Xavier: (65:43) Daily daily basis here.
Terry Li: (65:44) Oh, daily basis here. Okay. So the daily basis.
Hugo Xavier: (65:46) Yeah.
Terry Li: (65:46) Return is also doing very well. It’s like from Oh, that’s only March.
Terry Li: (65:51) Okay, that’s only
Hugo Xavier: (65:53) So Marshall we we started March was
Terry Li: (65:53) mark,
Hugo Xavier: (65:55) our lowest month because well, we didn’t see that much spreads the contract. Real trading. Most was expiring April. We were seeing a lot of good stuff. So, April is gonna be very good. So March, for example, we started with 147 got 49 nav, not eat because there was some additional here so it doesn’t matter. And we finish with one thief. So we did about three percent on March that was our worst month.
Terry Li: (66:26) Mmm.
Hugo Xavier: (66:27) but for example, January of December 13 to January 13, we did 17% Yeah, and so follow on on. January on February 13 were 41. So we did. Yeah. Like
Terry Li: (66:45) Well asked what kind of marketing neutral strategy? It is as market, making course
Hugo Xavier: (66:49) so yeah.
Terry Li: (66:50) exchange market making or
Hugo Xavier: (66:52) Both so no not market making. So we do inter exchange. Futures are so we trade going name versus usdm. On both bias and who are being exchange. We trade perpetual versus deliveries, we trade different delivers as well, the term structure and we take, we create inter exchange. So binance versus Gobi. Those same products. So poem versus kohim on the other sdm, Best ones, West, Demon, and another coin. Name on one usdm, on another, Whatever we see, it’s ready, where monitoring all those and whatever. We see that there are diversions, we enter, so we can trade, for example, the March 20m, that’s those September usdm on Binance one. And what we are the wicked, the perpet on minus versus the delivery of September all those, like we are really good. No, I’m not calculating the The. The term structure and see if it’s mispriced. So as you can see here throughout March, we had some loss, but this is not realized loss, this is basically carry laws. So yeah, we are the way we position ourselves in the term structure. What’s going against? So you can see it like minus 1.5 in 1.3. This is scary -33. So, this is like a caring and then months close yesterday.
Terry Li: (68:12) Oh I may ask you a question. This this particular sheet that you structured was it came standard with power bi or it’s oh you you made your
Hugo Xavier: (68:21) No. We made it all. RBI, we we are pushing these on our
Terry Li: (68:25) own
Hugo Xavier: (68:27) database I in power. BI is, is automated pulling these for us. So every every day a midnight UTC,
Terry Li: (68:34) Oh nice.
Hugo Xavier: (68:37) you just push data from our database and does the calculations as we as so access return, like we asked for all these. So we have we have even more here, fun report. So, yeah, so look, we can see here.
Terry Li: (68:53) Wonderful. Yeah, I can see that.
Hugo Xavier: (68:54) Yeah, this is mostly sharp. So we are on anymore shark as they always report. We are. Like 5.8 sharp. Mostly. So any video fun statistics like we do all this stuff that’s our histogram of our returns daily. A great performance. Those here. and then trade data where you can see all the trades here, like,
Terry Li: (69:28) Okay.
Hugo Xavier: (69:30) Yeah, so there is everything here. So yeah. so, and we also put a Dashboard for investor to come and look for any particular investor. They can look at here, they can go to the fun at me and they publish there. We use any consulting that’s found at me but they only probably once in a month. So this for there is mostly avs for us these We do daily in Avis, just for the
Terry Li: (70:05) Understand.
Hugo Xavier: (70:06) sake of be monitoring up pretty well. So, yeah, that’s us. I mean, I’m pretty sure there’s markets for everybody, for all sorts of trades and strategy. But I think that’s what’s difference. The most, like, we are pretty good in the future are. I also, there is a point. We use only maximum 4.8 libraries Ah, but that’s skating. So, in order for us to be allocated all the way to 4.8 this bread needs to be really tight. We spend most of the time with two to 2.5, leverage only. It’s pretty low leverage. I mean, if you guys are looking for more returns, we can for sure, increase that especially on the inter exchange jobs, we still have our prop desk doing some arms. We are doing some eye infection sharp with 20x leverage, that’s not in the fun. Okay, that’s enough that’s We are stressing it out and is doing a crazy good. We did that in 20 21 90 or 21 percent on March Inter Exchange 20X leverage so you’re basically doing 1% different on the, on the prices but your livering is 20x. So and this is the same exchange. There is no I wouldn’t say no rest of liquidation but it’s very low just need to to manage that well because it stays on the same exchange, right? You don’t need to transfer margins but even so you have to be careful about how the liquidation of each product works. So, yeah. So we have those high return strategies as well with higher leverage. But in general, we are like a market neutral fund. The other only struck, so we have. Spot prepared. What we have? Futures are both intra and interactions and the other strategies that we have. That realized it since the same as well, is the defy spot arm. So this is not on the phone as well. The fund is only the futures and the interaction sharp. Both high leverage and defy only prop money. So defies is doing very good. So we’re trading traders, Joe only swap versus buying sockets like with creating markets, Pony maker orders hating. Those when we saw straight on the defy, we have our own node. We have our own smart contract to be more safe. So this is also been very good We are liking these a lot. We’re gonna put this in the front later on but it’s doing very good. If I’m not wrong. I think we did 11% on this on March and this is Spot Arbitrar. So there is no carried, nothing just by there. So there that’s it. But of course then you cannot leverage But this has a lot of room to improve. We are putting our nodes in a lot of different servers, we’re creating the other notes in other networks as well. Like they’re being a lot in the defy side because our future is ours like this. Something we do for almost two years now. We are pretty comfortable how it is. It’s more like, when they’re whatever they’re spreads, we enter not much to you on the features arms as well but that’s our bread and butter and what we monitor the most, but
Terry Li: (73:29) How automated it is right now.
Hugo Xavier: (73:32) 100% not even is automated to a point that before. For example, there was a fed talk or some event, we would go there and put I’ll go on as low mode where if it misses a trade. It would wait x amount of seconds to enter again, but even this is automated now. So it’s being latency all the time. If the exchange latest is higher, it will go to slow mode one. If it’s too high and it’s just slow mode to if you still hire me. It’s a lot more tree. So that’s it. Since smaller orders to see if he’s hitting the same price as his receiving. So even this is automated already. So and if it goes all the way to the slow motion, still missing is always go to a close. Only pause mode and we will alertos on telegram and discord that is listening traits for some reason, maybe their WebSocket is down, the exchange is offline so it’s wrong. It will close automatically. Stop sending all those automatically transfer is all automated. We are right at least on both exchanges. So there’s we cannot stress anywhere else. I do right? At least you name. We also have if you want to send It fire blocks. outside to fully fully, Automated portfolio. Rebalancing latency automated everything. Like We are, of course we monitor because, well, see you outside money on it and it’s a fun but we don’t interfere manually Yeah, it does everything by itself.
Terry Li: (75:06) I see so, so I I guess this is the very main focus of your team right now. So what’s?
Hugo Xavier: (75:12) Yeah.
Terry Li: (75:14) wanting to delegate some of the, well, I guess. It seems to me that fundraising. Is your main next goal now, right.
Hugo Xavier: (75:26) Sorry.
Terry Li: (75:26) Right. So fundraising fundraising to put more funds into it, like, it’s
Hugo Xavier: (75:30) Yeah, fundraising for fundraising is
Terry Li: (75:31) probably
Hugo Xavier: (75:33) large. Maybe a joint into it with some props desk and don’t raise any more but yeah, fundraising would be increasing. Are you and would be our our go right now and
Terry Li: (75:49) What, what do you see in the market impact of it? Like how much then you
Hugo Xavier: (75:54) Capacity.
Terry Li: (75:55) Yeah, capacity. Yes.
Hugo Xavier: (75:56) Well, I think it’s well, we are trading the The most liquid spreads, there is a Features on ethereum bitcoin. That’s it. Like, we don’t trade those small outcomes futures. So there’s a lot of capacity, still here. It also depends on the leverage, right? So if you want to do low average, there’s a lot of capacity. I mean, I think we can easily go to 50k, 50 mil. No problem without having a liquidity issues here. Again, retraining the most liquid exchange and the most liquid instrument. So it’s fine.
Terry Li: (76:42) Mood. So, what’s your What? So what do you have existing like investor industrian workflow that the gets in get investor in? Or is it like a legally compliance right now? Like, how what’s the stage you’re in like, in terms of getting new investor in?
Hugo Xavier: (77:02) Oh yeah, so everything needs to go through the Need to go through the fun that mean so we are completely regulated and entity we have Any consulting as a fun add me we have video as our auditor we do making customers make Dms bank. So yeah everything that we everybody on board needs to go through the fun that but it’s pretty fast. Is that came and entity SPCA. Entities are pretty fast like they would on board. And one two days is pretty far.
Terry Li: (77:39) Mm-hmm. And what’s the do you have a? Do you have a like a do you have a presentation for your? for this now, or you have,
Hugo Xavier: (77:51) I can sure, let me sure.
Terry Li: (77:53) Thanks.
Hugo Xavier: (78:13) Yes, if I sent here.
Terry Li: (78:25) Hmm. Okay.
Hugo Xavier: (78:55) The fact sheet in April will come on the new format as well. So there is, you can see there’s a Much stronger. Blue and that. Yeah. So we’re gonna have the new template for the fact, sheet of March now. So now in April, we’re gonna Have all in the same format, you can see there’s a little template discrepancy that I yeah.
Terry Li: (79:22) it’s Okay, let me take a quick look at hang on.
Hugo Xavier: (79:28) Friends. Okay.
Terry Li: (80:28) What’s your technology fee? What’s your like Yeah?
Hugo Xavier: (80:31) Are you AWS cost and also and so on?
Terry Li: (80:33) Performance. Sorry.
Hugo Xavier: (80:37) You mean AWS? And so on infrastructure cost,
Terry Li: (80:42) Meaning, you’re helping investors invest, right? What your performance fee that you
Hugo Xavier: (80:46) A pharmacy.
Terry Li: (80:47) are performance,
Hugo Xavier: (80:47) Sorry, I thought you mean. My infrastructure fees.
Terry Li: (80:53) Oh no. Sorry.
Hugo Xavier: (80:54) Okay, it’s a 20% over returns and 30% if we do more than four percent in a month, so there’s like a little bonus if we do more than 4% and the administration fees are 2% yearly. So yeah, training performance. If we do more than 4% 30% over the excess,
Terry Li: (81:23) Oh, is it sat in the presentation or No. No, it’s not set in the presentation, right?
Hugo Xavier: (81:28) I don’t think so. I don’t think so. Good question. I don’t think it is.
Terry Li: (81:36) Oh yeah. I don’t see it in the presentation.
Hugo Xavier: (81:50) yeah, so it’s 20 with 2%.
Terry Li: (81:53) Okay, let’s try it with two superset.
Hugo Xavier: (81:56) Yeah.
Terry Li: (81:56) OH, based on how high watermark.
Hugo Xavier: (81:58) Yes, please on high watermark.
Terry Li: (82:01) And monthly settled.
Hugo Xavier: (82:04) Yeah. Monthly liquidity muffins are oh yes.
Terry Li: (82:06) Okay. And administration fee has to be paid up front.
Hugo Xavier: (82:14) No, no, that’s a good movie as well.
Terry Li: (82:17) Accruled, like on the monthly.
Hugo Xavier: (82:19) Yeah, yes.
Terry Li: (82:19) Okay. 2% per year, right?
Hugo Xavier: (82:23) Per year, yes.
Terry Li: (82:30) okay, well, What’s the administrator that you were talking about the administrator that helping the TO, to help investors to go into the workflow?
Hugo Xavier: (82:43) AD consulting, this one.
Terry Li: (82:46) And nav consult.
Hugo Xavier: (82:48) Oh sure. These guys.
Terry Li: (82:54) Oh, thank you for the link. Me. Okay. Yeah. oh by, what’s the minimum minimum investment per
Hugo Xavier: (83:23) 100k that.
Terry Li: (83:23) Week.
Hugo Xavier: (83:24) Yeah, that’s the legal minimum from Cayman
Terry Li: (83:36) Okay. Let me talk to my team about it. I’m not sure how we can proceed it with, not sure how we can proceed, but I guess you guys are doing great. And I’ve seen firms like yourself way back a couple of years ago and they’re all well, they are, they’re over if not mistaken 40 million so you am right now. So yeah, it’s successful.
Hugo Xavier: (84:04) Okay, that’s nice.
Terry Li: (84:06) Yeah, they’ve been around over six
Hugo Xavier: (84:07) Okay.
Terry Li: (84:09) years. Yeah. so,
Terry Li: (84:17) So let me let me think about it, I’m not sure. Well let me know.
Hugo Xavier: (84:21) well, we don’t talk to a team, not about investing at all, but maybe
Terry Li: (84:23) Yeah.
Hugo Xavier: (84:25) some kind of partnership you can do together. I’m pretty sure you have more reach
Terry Li: (84:28) Sure.
Hugo Xavier: (84:30) than us when it comes to investors and so on.
Hugo Xavier: (84:33) So maybe people are looking for market neutral fonts and that yeah Delta neutral strategy all the good side we are even base. So for native People who are native in crypto, not want to leave the crypto risk. Well, they cannot even subscribing ethereum here. They don’t need to subscribe the dollar. So yeah. Maybe we can partnership in some way together.
Terry Li: (85:01) Okay, thank you for the information. By the way, you have a standard contract contract for investor.
Hugo Xavier: (85:07) Yeah. Yeah, I have it all.
Terry Li: (85:09) Okay, do you mind?
Hugo Xavier: (85:11) Yeah, I can share with by email one.
Terry Li: (85:11) I take a look.
Hugo Xavier: (85:14) Second.
Terry Li: (85:14) Oh, thanks.
Hugo Xavier: (85:16) That.
Terry Li: (85:16) I can send you my email or you have my email? Let me okay.
Hugo Xavier: (85:20) No, I don’t. I’m sure right now. Yeah, so maybe a partnership in in that sense would be nice since we have Some sharing the subscription document and the PPM does the. That’s the documents from the Yeah, so it’s all set. Yeah, so those are the different documents. That we share with clients. So yeah, maybe we can cooperate on that sense.
Terry Li: (86:16) Oh, what about the funds? Are they in segregated fund or they have to be in your own account
Hugo Xavier: (86:25) Yeah. So the rate is right now, they are on our own account with index changes. We are moving those to prime brokers, so we’re gonna probably move the trace to hidden roads. They’re gonna be sitting there with hidden road structure, and they’re gonna be like this, they can only transfer between The same. Hidden roadster. So like buying this and hobby within there and to transfer out will be to our fire blocks wallet. But this would need to be manually confirmed so nobody will have access to to just with throughout the funds to another wallet it won’t. But yeah, like we cannot trade on other accounts like on your own sub account because then we would compete with ourselves like There’s a not ultra low as it was on spot perpeto, but very low frequency. So if you have latency there, like putting other on your account, in my account, in other account, then that won’t work. We need to be fast because the spreads go out like this. So yeah.
Terry Li: (87:26) Okay, so aggregated in one single
Hugo Xavier: (87:28) Yeah.
Terry Li: (87:28) account the trend. Okay, okay, so what about well where well how what’s the assurance to the investors? Like why does the investor feel comfortable knowing that they find the safe with you? You’re not taking the friends.
Hugo Xavier: (87:45) yeah, so the way it is right now, I showed them how structure we are on terms of wallet, white listing on the redundancy that we have. So we need in order to wait to release a wallet, we need to to send an emails and voice confirmation and so on and so on. So that’s why we don’t have any wallets white liset that not to exchanges. But again, we’re gonna move this out to prime brokers. So this, you can put in contact with hidden roads and see that we are gonna be all in their structure. So there is no possibility to nobody just withdraw their fonts.
Terry Li: (88:25) Okay.
Hugo Xavier: (88:25) You and when we do, when we withdraw funds, that’s to pay performance fee administration fees, and to bear expenses, we’re gonna have to talk with you the roles, like, as for a withdrawal sent to our Fire Blocks account and then send to OTC and then sell the funds, but that will be only the performance. And so what and subscription and so on. We’re also be managed throughout the Administrator. So You do the subscription with the fun admin. After you, you make the the subscription they will go out to hit the roads. On platform and that’s it. And not only insurance. So not only this kind of security that they will have knowing that the funds are safe within the prime brokers, there is no way for any of us to access those. There’s also the exchange default risk. So if one of the exchange rate trading goes down, we are going up. We’re gonna pay for this service on those right now, we’re gonna do for both for both binders and hobby, and on the future if we think, okay, not not worth the cost and so on, we take it out but we’re gonna start by using that. So yeah.
Terry Li: (89:38) Okay. Thanks for the explanation and I guess, Yeah, I’ll try to talk more about that to him. Oh, you share the share the shared agreement with you with me already right on Google Doc, right?
Hugo Xavier: (89:51) yeah, you
Terry Li: (89:52) Okay, thanks. Okay. Any more questions for us?
Hugo Xavier: (89:56) Know.
Terry Li: (89:58) Okay.
Hugo Xavier: (89:58) I don’t think so. I think you guys have a great product and great team. As I saw there your returns and so on.
Terry Li: (90:05) Thanks.
Hugo Xavier: (90:05) Yeah. If there’s any way we can work together that would be nice if you
Terry Li: (90:08) Okay.
Hugo Xavier: (90:09) can add this with your team. And yeah, we like I mean, there’s market for everybody has his own specialty. I think that’s what’s really good at. That’s the future, are the defy Abs, Alberto, but we like those market neutral strategies as a more safe and
Terry Li: (90:24) Nice. your time again.
Hugo Xavier: (90:25) different way.
Hugo Xavier: (90:27) Yeah. Okay.
Terry Li: (90:30) Thanks a lot and thanks for your time again and I’ll talk to you later. Thanks.
Hugo Xavier: (90:32) Yeah, perfect.
Terry Li: (90:32) Bye.
Hugo Xavier: (90:33) Thank you Terry. Let’s be in touch.
Terry Li: (90:35) Okay, bye.
Hugo Xavier: (90:36) Cheers