CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 66 % 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.

VLR – Vipro

You won’t, and that is a good thing.
The balance is not relevant, the equity is the value in your account.
If I buy a share on the stock market and it drops 10%, the value is then 10% less, not what I paid for it. Darwins should be viewed in the same way, and trading accounts for that matter.
As in your example, the balance charts shows a nice smooth line, the equity shows the true volatility.
This is why myfxbook is very misleading, although they show both charts, the balance chart is the most prominent. The monthly gain bar chart they show is also based on balance and therefore can be very misleading, allowing returns to look much better than they really are.

This is not meant as anything personal against you, and please don’t view it that way, it is just a general observation of the industry.

I think your openness and communication is commendable and will watch your progress.

1 Like

@SATFX, I agree with you.

I wanted to show these two curves on one graph only to illustrate that in October there is a drawdown too, but it is less, than in September.

1 Like

In the illustration above we can see the strong variation in the replication ratio between strategy and Darwin correlated to changes in the VaR of the strategy.

You would wrong to minimize this problem of VaR. And it is a particular problem in Darwinex. Nothing to do with Zulutrade or AutoTrade.

If you let your VaR dive, the next big DD will be a massacre.

1 Like

@Medialux, may be there is some misunderstanding from my side… English is not my native language. Сan you correct me where it is necessary?

You said about “the strong variation in the replication ratio between strategy and Darwin”. As I understood, replication ratio (RR) calculated as 20% / VaR of Startegy (in common):

RR = 20 / VaR

If VaR is less than 20, then RR > 1
If VaR is much less than 20, then RR >> 1 and it is dangerous situation for investors.

At present for all history of ViproAlfaM VaR was from 5.3% to 14.3%, therefore RR was from 1.4 to 3.8.
Do you mean, that variartion of RR from 1.4 to 3.8 is the strong variation? 3.8 more than 1.4 in 2.7 times.

If RR is the constant, we can calculate it from monthly profit of Darwin and Strategy:

RR = Profit of Darwin / Profit of Startegy

But only if RR was constant in this month.

May be you look at profit for September (1.18% and 3.35%)? Sorry, if it is not. If calculate RR from profits for September, we get RR = 0.35, and 3.8 more than 0.35 already in 10.9 times - this is in fact more seriosly changes (strong variation).
But RR was not constant, and I think it is not correct to use RR = 0.35 for min value of RR.

I try to combine on one graph Profit curves for Darwin VLR and Strategy ViproAlfaM. I was changing the height of image with Darwins Profit for getting the best coincidence with Strategy Profit. It looks like that there is not so big size of variation interval of RR.

For example of other size of variation of RR we can look at ERQ, which already discussed in his topic and other topic. We can see the fast growing of Darwins Profit from Aug, 27 (against Strategy Profit), which is much more faster than before - this is one of point of strong change of RR value.

I consider a problem of VaR very significant and important and agree with this point of view:

RR <= 1 will be the best, but it violates the promise of the Darwinex to provide risk in 20% for all Darwins (even for Darwins, who have VaR < 20%).

What can I do in current conditions? I will try not to allow VaR to changing significantly.

3 Likes

Hi @Vipro,

Thank you for your comprehensive answer which proves that yes, you are particularly attentive to the problem of VaR, and fully aware of the potentially toxic side if VaR fall below a certain threshold.

Personally I set the danger threshold by 6%. It’s probably somewhat arbitrary, but it reflects my constant observation experience of a large number of Darwins.

I have no magic formula to maintain a very flat VaR curve, according to the strategy, especially when the number of trade and exposure varies is still a big challenge.

1 Like

@Medialux With a threshold of 6% you will exclude a lot of good darwins, the stability of the var is much more important than passing a certain threshold.
I suggest you to move that limit to 3%.
You won’t have problems from people trading a 3% var but from people trading at 0,3%.

2 Likes

This Darwin VLR migrated to Darwinex from existed live-account, which already was working as AutoTrade System on myfxbook.com.
After migration both accounts show similar results with small difference, because deposit size on these accounts are a bit diffrent.

At present on myfxbook.com we can see following public results:

And some results, that is visible only for owner of AutoTrade System (however on ZuluTrade, for example, this kind of information also is public):

For last two months unnamed live followers have got following results:

4 Likes

Thank you for sharing @Vipro,

You will have the ability to measure the discrepancy between your source account and performences of your followers?

The fact that it is very easy to hack your signal via AutoTrade does not bother you?

1 Like

My opportunities to precisely measure it are very limited. I don’t tested and used Myfxbook.com as a follower of some AutoTrade System. But I can tell about some reasons of discrepancy:

  • Not all trades executed at live accounts. I can see the list of closed trades but without links with concrete live account. At present there are 50 live followers, but number of follower’s trades corresponding to one my closed trade may be from 10 to 20. So, at least 30 followers from 50 don’t execute trade from AutoTrade System. I don’t know why it is, may be followers can set some conditions for opening trades.
  • Followers changing multiplier for replication trades. Some followers did it a few times.
  • Followers disconnected and connected again later. But in this case Generated Profit accumulate the value, that was earned in past periods. For example, look al last row with follower from ThinkForex with $37522.11 balance. Subscription date is today, but his $193.92 was earned early, not only today (if I remeber right).

When you say “to hack”, you possibly mean “pay to me as one follower and replicate trading to many other followers”, isn’t it? In this case it does not bother me for some reasons. I wouldn’t like to write about them here, but I exactly know that they exists and they really seriously influence to probability of implementation of the similar scenario. This probability rather low for to not bother me.
If you mean “implement trading strategy by information about my trades” then I think it is more difficult than the case described above.

The only way to be 100% protected from that “hacking” are not to use almost all existing services of trading signals (Zulu, Myfxbook, MQL and other which get to follwers access to MT4-terminal with copied positions). This way is unproductive for me now.

1 Like

People hacking your trades isn’t a real problem, you cannot hack discipline, patience and the confidence you put in a strategy.
Everyone can “hack” WB’s portfolio, but only he knows exactly what is doing and the informations behind his investments.

3 Likes

If I mention the ease of haking competitors, it is precisely because it’s a major argument of the superiority of Darwinex at this level :slight_smile:

Not even need to be really dishonest and resell your signal. But just subscribe to AutoTrade for example, with an account of $ 2,000 .-- on which I pay the markup on the spread or commission. Then copy the trades on an account of $ 200,000 .–. On account of $ 200,000 .-- you will have no commission, and you will never know anything.

Do you think there is people applying an autotrade signal to a 200k account?
:smiley: :smiley: :smiley: :smiley:

1 Like

The risk management attribute is too low. Martin should be the type! . . This transaction is difficult to guarantee that the model will not be exhausted pound black swan eradication! . .

@Medialux
I am monitoring autotrade since 3 years.
Do you know how many systems were there and are still alive?
RobinVol and Solitonfalcon…
The problem with mirrortrading/social investing is not dishonesty of investors, but fake and non-lasting systems.

Let’s just say that a trader would have a signal of such quality that it could attract real investors should not make it available on platforms where it can be easily replicated.

I also offer cheap signals. And my DARWIN account, this does not affect anything, the money we all earn together, the market is making money! The same signal as long as 20 dollars per month, the impact did not imagine so much!

1 Like

Note, that with this way big non-trading risks are coming to such follower and results of errors in working of copying software may be very sad, and I don’t believe that serious investors can choose such way.

But this is already the other question. I think that Darwinex has many advantages in comparison with other services of replication and if the investor wants to use them - he pays fee for these advantages under the terms of Darwin. But if these advantages aren’t so important for investor, then he has the ability to choose any other service.

As long as we play with 4 digits, signal services are good.
When we go to serious money we have to start speaking about reliability and lags.
Only an integrated solution can reach a good reliability.
Now people is playing with Darwinex with 1000-10.000, but Darwinex is ready for big money.
Only here we have things like divergence and execution quality.
Things that make sense only if you have TRUE traders and investors making money.

1 Like

@CavaliereVerde, I agree.

And… It’s Friday again!

In this week added only $100, total balance is $1580.

Welcome to two new investors at this week, thank you for trust.

2 Likes