Greetings and welcome back to wild world of Zulutrade!When evaluating Zulutrade providers, it helps to pick providers with a high profit-to-drawdown ratio. This ratio measures the amount of profit you experience for a given amount of drawdown.
For example, a provider that takes a 40-pip profit after a 40-pip drawdown should be considered above a provider that takes a 40-pip profit after a 300-pip drawdown. This measure helps to distinguish between providers that have good entry points versus those who just enter, then wait as long as it takes for a position to come back to show a profit.
To do this calculation, I analysed the top 400 Zulutrade providers using a system I developed earlier this year that surfs over to the Zulutrade site, downloads data for a whole load of providers, and builds a local database of provider trade histories. The system uses a combination of "web scraping" via VB-Script and XML parsing inside of MS-Access to populate the database.
To calculate the drawdown ratio, I summed up all the pips earned and divided by the sum of the maximum drawdown for those same positions. The higher the number the better, it means the more profit generated for a given amount of drawdown.
The results are shown on the left. I filtered out providers that didn't trade in the month of October or had less than 50 trades total.This screen doesn't mean that all these providers are good, it just means that they produce more than one pip of profit for each pip of drawdown on average. I will analyse this list of providers and pick a new set for demo accounts in a future post.
I should also point out that some providers might have profit-to-drawdown ratios less than 1 and still be perfectly good providers.
While i'm on the topic, here a few other popular providers and their profit-to-drawdown ratios:
GasCan69 - 0.72
Coolie 1997 - 0.46
LowestDD - 0.46
Hehehe - 0.34
Pro-B5 - 0.29
TrendCatcher - 0.22
AkhterFx - 0.20
Davincy - 0.16
Again, the higher the number the better. More to come in a future post.
Open a free Zulutrade account at http://www.zulutrade.com/ but please be careful before you commit real funds!
Good analysis.can you study and inform with which signal provider your capital is the safest
ReplyDeleteSK-
ReplyDeleteThanks for the comments. Will come back in a day or 2 with an analysis of the above providers and some recommendations. Cheers,
Tcxmon
Tcxmon, you must be an Engineer. Software Engineer perhaps? Excellent calculation, though for some reason I can't see the images. I remember doing some similar calculations with the .xls you can download for each signal provider, (didn't get into all the coding in VB, XML, etc.) I have to say that is one thing Zulutrade did right, was allow us access to that important trade data either via your Web crawling, or .xls
ReplyDeleteJT
JT-
ReplyDeleteRight you are, I am a software developer and that's what I do for a living - when i'm not trying to make a living off Zulutrade - ba ha ha.
Sorry you can't see the images. Here's the raw data for the image on the bottom, comma-delimited since spacing gets removed when I post the comment:
Name, Profit/DD, Last Trade
NewForexAge, 5.90, 10/21/2009
Isunia, 3.59, 10/23/2009
cp-novafx, 3.52, 10/23/2009
Romeda, 3.15, 10/15/2009
Student, 2.79, 10/23/2009
Sophistication, 2.62, 10/23/2009
Fairtrade, 2.40, 10/23/2009
ok798, 2.30, 10/22/2009
OranjFx, 1.61, 10/23/2009
JLOFX, 1.23, 10/23/2009
wqq899, 1.11, 10/23/2009
zulu888, 1.07, 10/21/2009
Yasu, 1.01, 10/19/2009
Anyway, now that I have this thing running, I can do some deep dives into the provider history and pull out some interesting stats.
Also, it i'm going to try and catch some up and coming providers before they get too popular because it seems like as soon as they get really popular and I start blogging about them, they blow up in no time.
Stay tuned for updates and thanks for commenting,
Tcxmon
Sk-
ReplyDeleteLet me know if you have any thoughts as to how to define safety. Size of the drawdown, percent of winning trades?
I've found that no provider is really 'safe', they all blow-up at some point. That's why I think its key to have a provider with some type of sell (or hedging) discipline so that whey things go wrong, they have some type of exit plan and don't go into major drawdown.
Let us know your thoughts,
Tcxmon