CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 64 % of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

Darwins / signal copy reality

So i thought I would test Darwins - i have been running a portfolio of what i consider the best (I will not be drilling into that here - suffice to say its solid in my view of building systems) for 6 months. It has returned 3%, thats jumped up from 1% for the 5 months, this month.

What this is saying to me or more to the point, confirming is, that signal copying sites (Etoro/collective2/myfxbook/tradency/zulutrade/mql5 etc) are probably running martingales or are fake results one way or another (you can fake accounts on MT4 very easily).

I noted in the lastest podcast Darwinex seem to think they are not an etoro etc which I find odd, the differentiator will be running their own brokerage and you trading through them to gain some level of validation (except migrated).

Now, some will think 1% in 6 months is decent. I don’t. It’s risk for little return - you have no idea who is behind what and I have gone through this branch of the forum to check if it was just me getting this low level of return and it isn’t. My results are on par with what other ‘investors’ are getting too.

What I have also seen is the one Darwin that is top of the roost - the trader is manual.

Signal copying appeals because I am lazy and an appalling manual trader - so if it worked, I would put my own funds in and I know plenty of people that want to generate more alpha than the paltry 0% they earn with a bank.

I am sure this will gain attention from those wizards who are or have made great returns but the reality is, still at this stage I cannot see myself putting any real money into any Darwins

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I agree, the point is that what you find on social trading sites is a product of selection, luck and hindsight.
Among thousands of accounts or darwins there will always be a few that show impressive return.

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I think your results are better than the average.
https://www.darwinex.com/investors/darwins-performance
On this page you can find a backtest,
This portfolio was generated on 1/7/2019 .
Since that day the result is ~ -10%.

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They should replace in that link QUA and maybe others which are not active anymore

Yes QUA should be replaced but that is not the point, the point is the portfolio/backtest.

It shows that also Darwinex is fooled by lucky trackrecords. :slight_smile:
Dead heroes are very educational.

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thanks for the responses. I will just have to pull my finger out of my bottom and trade properly then.

here is the portfolio - it only jumped up 23 & 25th.

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@pecuniafactorem Thanks for a thoughtful contribution to this thread.

Since this is a recurring topic, here’s my take on why we’re objectively different and don’t like the association with social trading / copy-trading (we’re neither):

  • We’re an FCA regulated asset manager - investors sign a discretionary management agreement with us
  • Investors don’t copy signals - they replicate them. This may not make a lot of difference if you’re an investor, but it is of a heck of a difference if you’re the strategy provider (see below)
  • We manage risk at arm’s length from the signal provider. I encourage you to learn about our risk management framework - it explains why grids / martingales have no traction here
  • All trades run on our broker - we vouch for track record integrity. You may or may not trust us, but you don’t need to trust the trader.

Whether or not that’s enough to put us in a different category is open to debate, but the fact is (to the best of my knowledge) is that neither EToro, Collective2, MyFXbook, Tradency, ZuluTrade/MQL5 etc. meet any of the above.

Having said that, that’s not the reason we think we’re different. The key is we protect manager IP, and provide a legal framework to charge for success. Trade signals remain private (investors can’t trade them without paying for success), and we carry the regulatory licenses to charge for AuM success, thus providing managers with a sustainable model - provided they deliver Alpha.

Wrt to the last point - performance not being good enough for you. We’ve never promised anyone good results, just like the NYSE or NASDAQ don’t. We’re an Exchange listing what we think is an asset worth listing (liquid Alpha), and offer independent managers a turnkey solution to legally tap investor AuM.

Granted - there’s a large chicken & egg problem: no managers worth their AuM without investor AuM, no AuM without managers worth their salt. We’ve been going at it for 7 years, and we’re getting closer and closer every year. For one, the top managers are now pulling in decent pay-outs: https://www.darwinex.com/darwin/HFD.4.17 (again, unlike others, we make these public).

We’re in this for the long haul. Our door will always remain open for when you’re ready to take the plunge (unlike numer.ai, or Quantopian), but I hope this explains our take on this. Eager to hear your thoughts on the above,

Greetings from the Company’s Founder & CEO :slight_smile:

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Thanks for the response Juan.

HFD is one of the strategies already in the portfolio (I have blanked out the others).

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Thanks for everything @pecuniafactorem Love to be in this with you guys :slight_smile:

Are there any plans to do like etoro has, that you can invest in a portfolio manager?
i.e. not just traders but people who actively trade the darwins and index those?

Here is my portfolio so far… still above water just. Not quite a Vanguard yet.

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aaaaaaaaaand the bulk all died… Wonder what the main strategies are using underneath as they all died at the same time… (this week)…

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update - wheels coming off.
It really is striking how similar two darwins are - especially what HFD is going through atm - I wonder what they are trading underneath? BTFD in US indices? (you can see indices have stalled…)

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Konstantin is (HFD) as recommended by Juan above https://www.darwinex.com/darwin/HFD.4.17

Konstantin says this is down to EURUSD/GOLD - (I would have said BTFD on indices coming to an end…) but he says he is FX/Gold etc. using futures & options analysis.

he says its a “semi automated systems known within certain circles” - anyone know what that is?

Its interesting this drawdown right now - it is remarkably similar to other EAs that are going through the same drawdown and being marketed online as signals/investment ops - is it a common EA? I don’t keep up to date on EA’s as they are mostly garbage… but there seems to me commonalities around.

Signal providers with incredible results are probably not that good; Reality is more moderate and especially long-term. Good accounts don’t attract attention.

On the other hand, immature retail investors are also not prepared for the truth, they panic to a drawdown and complain when profitability is not astronomical.

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What Konstantin has written to date doesn’t explain this, the current threads full of people posting on his behalf don’t explain it either.

There are 2 discussions active on it atm - my thread was timely.


the first circled DD on the left of chart is 7% Drawdown and the 2nd last circled DD in sept 19 was 8.9% drawdown.

you are reading the chart incorrectly

I am not.

thanks.

- Circle 1,2,3,4,5,6 show rapid rebounds - that is not normal, this is every dip. That is martingale-esque.
- Last square is the drawdown - in the context of what Konstantin has told us “how” he trades - this is very wrong - there is something else going on here.

It look very similar to an EA that other companies / people are using to sell investment/services.

Any type DD recovery pattern where the DD quickly “snaps back” again and again combined with a D-leverage increase at every trough could mean adding more and more to positions, holding losses longer and longer and or trading more and more frequently during DD periods. All of which are forms of an increase to risk to subsidize a speedier recovery out of DD. (BTW, employing such a recovery technique increases long-term risk over-all vs. any given over-all expected long-term reward/return. Not to mention is EXTRA likely to have much larger intra-day DD spikes than the Darwinex stats are showing because DD data at Darwinex is currently recorded as infrequently as once per day to once every six hours.)

To be fair though, any excellent trader who is masterfully scaling in only when trades move against her original position would have have a similar pattern. I think properly scaling in would have some leverage spikes at troughs and the ones that she got stopped out on then might have a flat period while she patiently waited for another high probability trade then she would start small again with small leverage (even though she may be deep in DD.)

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loving the steady queue of people trying to educated others on this forum - it’s cute.