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Is the ranking of strategies really consistent and fair

One thing that I’ll fully admit confused me is when you get Systems with massive DD, like 40%+, scoring really good scores.

Personally I would say anything above 20-30% DD should be penalised heavily for being too volatile. I keep my investor account far far away from anything with DD that high.

This goes into the D-Score? I think? That’s where I get confused with the terminology

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Thanks for your message!

I’d highly recommend watching our webinars on risk management: https://www.youtube.com/watch?v=Ci1gvsnge30

More webinars are available on our Youtube Channel

I hope this helps!

Thanks, I’ve watched through them before and I understand but I think something is fundamentally wrong when a system with 37.7% DD and only a 25.91% return in 2 years can be ranked as expert and currently be second in Darwina.

To me that encourages people to design systems to take on massive risk in the hope of sporadic gains rather than building solid, sustainable systems which give reasonable risk to reward ratios and build on consistent gains over time. Systems like that should be considered investment grade or expert, not the wheel of fortune gambling ones.

All of this is obviously only my opinion but I think that as long as systems like this are considered ‘expert’ and are ranking highly in darwina it’s a massive turn off for investors and makes the whole ranking system look like a casino, or worse, like binary options.

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Darwinia ranking system is far from being perfect, it is possible for fake systems to acheive a good rating.

Listing a system with sporadic gains is useless for the rewarding scheme used here, you can get a bit of glory but you collect fees only if your system is robust and keep growing after being invested.

Exactly my point. These systems turn up, rank highly in Darwina once or twice and take away capital from other systems which are genuinely good.

In my opinion the experience attribute is way too heavily weighted in the overall ranking and the risk management isn’t weighted heavily enough, or anyway near accurate.

I personally think if a strategy is showing less than 2:1 RR for the last 12 months it should be weighted heavily on its score. They certainly shouldn’t be considered ‘expert’ and be at the top of Darwina.

YZF is the one that’s caught my eye at the moment, currently sat in second for this months Darwina. Edit, it’s now in first…for real :disappointed:

It depends on the timeframe of your analysis.
IMO YZF is a very good system, look to the last semester! :wink:

For example the performance IA gives more weight to recent trackrecord and I agree with that, it is important to spot systems that are improving.

Really? Ok.

If your happy taking on that much risk for those returns fair enough. Yeah it’s had a good run recently but it’s so sporadic and inconsistent. Definitely not something I’d even slightly consider and investment. A roulette wheel is more fun and the same result.

Happyness is relative, I am quite happy about a ranking system which after 2 years is much better than older competitors.

As for YZF it is the secondary system of andromedahydra, the main system is DCD with more than 10k of equity, so if I want to invest I would go for the main system.

The main system actually looks pretty good.

I guess my point is that why is the main system not ranked higher than the secondary one when it looks like a much better system.

Good RR and reasonable DD. Not gambling with massive risk.

Obviously everyone’s investment choices have different things they want to achieve, I just think this is more about the way the ranking happens rather than the Systems themselves.

There are a lot of things I don’t like about ranking:

  • I don’t like that timing weighs more than scalability
  • I don’t like how consistency and timing work
  • I would give more weight to risk management.

Having said that I am quite happy overall, and we are waiting for the reloaded new system for the next weeks.

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I believe one of the changes from Darwinex Reloaded will be to get rid of the levels (Rookie, Talented etc)

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Darwinia Ranking depends a lot also from the % activity of systems :grin:

VolcanoFX

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Just following on from this, and also talking with @ignacio about some ideas and examples of this.

Currently KBP is ranked first in Darwina even though its a strategy with -35.5% DD and -2.01% total gain (all correct as I write this). There are a few reasons its been able to get the top position in Darwina, firstly 10 experience (I think overly weighs on scores but I’ve mentioned that before) and also it happens to be having a good month this month with a 23.82% gain.

My issue with this is a strategy that continually looses money but then has 1 good month doesn’t encourage consistent ‘investment grade’ trading but rather sporadic large gains, and therefore high risk.

One of the suggestions I had was that each months Darwina could use the previous 3-6 months performance, this way it encourages consistent growth with controlled losses and also brings consistent systems more into the view of investors. Maybe a system where it uses the previous 3-6 months but drops the worst month to allow for major events, eg brexit, Trump election, that cause mass volatility.

Just my thoughts and putting them here for everyone to see and give their opinion :smiley:

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You pay too much attention to return.
If KPB were gambler with a lucky month it wouldn’t have a Risk Management score of 8.

Investors invest on the future not on the past, maybe KPB was a loser one year a go but is profitable in the last semester.
This is what matters: if a system is worsening or improving.

Thats why I’m suggesting a 3-6 month analysis for Darwina, to rate them on good periods rather than looking at it too long or short.

Its had 2-3 good months, maybe 4 depending what you class as good, in a year and a half of trading.

Thats kind of the issue, why is a system that continually looses money getting a good risk management rating? It has small periods of gain followed by long periods of losses.

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I agree that one month can be just luck or “noise” in a robust system, but the goal of darwinia is scouting traders, rating quarters or semesters would slow down the scouting process.

Darwinia is a contest not a portfolio suggestion.
Hall of fame or top20aum are better suggestions for investment.

True, however with how it is currently laid out I think that the Darwina scoreboard is the first place a lot of people will see.

I also think people should be rewarded for making good systems, I don’t think an average of 3 months (which in reality would be 2 if there was a drop month) is unreasonable for scouting good traders. The facts currently are that unless you have 4 months experience that metric weighs so heavily on the rankings that you can’t score well in it anyway unless you get massive gains. Whereas systems like this that have been running for ages and therefore have a high experience, can rank highly on 1 fluke months of high gains.

Maybe I’m looking at the wrong area, maybe it should that that experience doesn’t go up in a linear like it does currently. Maybe it would be getter if you only rank up in experience if this months performance is better than your average? Or something like that?

That takes away any incentive to trade for the sake of trading which doesn’t develop a healthy trading strategy imo.

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I agree, probably Darwinia contest has too much visibility.

As a quant I can say that sample size (experience) is very important to rate a system.
As a provider I can say that even if you win the first prize it will be useless if you don’t grow the next semester, so an “optimization of luck” is useless to make money with Darwinia’s AUM.

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All true, and thats what annoys me because these casino systems take away capital from genuinely good traders who could use that capital to grown their account.

100% disagree with the experience weight though. It doesn’t take into account experience, just the age of that account. It has no idea how long a trader has been active, just how long this account has been used. It also has no idea if multiple EA’s have been used on one account just to get the experience score up. I’ve got an account with 3.3 experience but I’m currently finalising development on a new EA. I could just start using the EA on that account and instantly get a 3.3 experience score but I’m starting a new account because I think thats the sprit of the system. As a result even though I’ve been trading for 7 years now that account will get an experience rating or 0.5-1 when it lists and as a result it has no chance of being anyway good in Darwina for a number of months because it has low experience.

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I agree but the algos can analyze only what they find in the account.
They call it experience but it’s only the size of the sample of trades you have in a specific trading account.
If that sample is just a chaotic mix of systems you are penalyzed in consistency.