Welcome back to the wild (and often deceiving) world of Zulutrade!Looking at the Zulutrade performance page, its easy to click on the Users tab and sort the provider list based on the number of subscribed users. When you do that, provider Lowest DD comes right to the top. In fact he has almost 3 times the number of subscribed users as the next closest provider Pro-B5.
Presumably, this number includes both the number of live users and demo accounts following this provider. But can we trust this number?
When you think about it, this number can pretty easily be manipulated. All the provider has to do is request 5 new Zulutrade demo accounts per day (which I believe is the limit) and setup each demo account to follow themselves as a provider. Create 5 or 10 free e-mail accounts using Yahoo, and in an hour or two's work, a provider could easily add another 100 fictional followers. Repeat this every day for 10 days and bingo! 1000 new fictional followers!
What we really needs is a way to get under the covers and see how many real users are following the provider with real money accounts. The Zulutrade profile screen doesn't reveal anywhere how many live users are following a provider, so we need a way to peer under the covers and get at the live trading data.
Fortunately, the provider history (available for download via Excel) has a field called "Live Trade". This field presumably shows how many live users took that particular trading signal - although I can't find it documented anywhere. This is a much more accurate measure because people vote with their wallets. Also keep in mind that its not necessarily indicative of number of users, because a few very large users (with deep pockets) could be accounting for much of the trading volume.
Anyway, using my local database of Zulutrade provider history, I was able to reveal the real top users on Zulutrade according to actual trades executed. The table on the top shows the top-10 providers in the past week (DateClosed > 10/31/2009).
I haven't analyzed these results in any detail, but a few interesting things come out. First, my recent favorite Isunia occupies the # 10 slot. Isunia also occupies the #6 slot in terms of total user count and was the only provider to appear on both lists. If I was in law enforcement, I would call this corroborating evidence.
Anyway, here's a few other observations, that you can't see from the table above. There were 182 providers who actually had trades this past week and the total sum of live trades were 11765. I don't know all the specifics of pip rebates, but those of you who do might wish to leave a comment indicating an estimate of much Zulutrade as a system makes in a given week.
Here are a few other tidbits:
Bigwin is #12 with 200 live trades
Lowest DD is #23 with 146 live trades
Cheetah is #30 with 127 live trades
Sophistication is #31 with 122 live trades
Pro-B5 is #124 with 17 live trades
The Hunter is #158 with 5 live trades
So its clear that things are not always what they seem. Good luck and good trading!
Tcxmon
Tcxmon,
ReplyDeleteThe definition of "Live Trade?" is somowhat different from the number of live trades.
"Live Trade?" of my trade of EUR/USD closed at 15:06 on 11/6/2009 is 11. But when I closed more than 40 accounts were closed.
In a trade history page, on the very left column, you see "LIVE" or "-". "LIVE" means there was at least one live trade.
Even when there seems live trades, it sometimes shows "-".
Two months ago I asked ZuluTrade of the meaning of "LIVE" in that column and the answer is as follows:
"Live means that your trade has been executed at least at one Live Account."
No help to understand the definition.
coolie1997
Coolie-
ReplyDeleteThanks very much for your comments and for giving a perspective that can only come from a signal provider with live users.
Based on your comment, I dont think we can rely on live trade as an accurate measure of real activity on Zulutrade. Its possible that live trade was accurate at some point in the past but it now no longer accurate given the many brokers now accepted by Zulutrade.
Anyway, it gives another perspective that we can use to determine some proportion of real user activity independent of the Users column on the Zulu performance screen.
Thanks again for the comments,
Tcxmon
Some weeks ago I mentioned this Live Trade column in a post. I had asked support "what does it mean" and I believe the response was that it was the amount of live trades made for that signal. It sounds like that may be incorrect according to coolie. As he mentioned it showed 11 under live trade and, what was it?, 40 live accounts were actually closed. Your theory on more and more usable brokers on zulutrade could be a good point. As new brokers are added, it may be that those brokers don't update some data back to zulutrade as some of the other ones do. At any rate the data may useful in determining where people are putting their money. If big win is showing 200 live trades then we know that people like using him.
ReplyDeleteAs a comment to your estimate on what zulutrade system is banking a week based on your calculation of live trades. I would say about .5 pips per trade would seem reasonable. Which would equate to 5882 pips gained. However, based on coolie's comment, that number may be very inaccurate and may be much higher. At 11765 pips a week, you could support a team of 6 employees at zulutrade making 100K a year. I would consider this a low end estimate look.
Townjet-
ReplyDeleteThanks for the estimate. If the "Live Trade" figures are understated by 4x (per Coolie's experience) that's about 47060 pips per week. Assuming most users have mini accounts, one pip is $1 so that's about $47,000 per week or about @2.4 million per year.
Some of the live users would have micro 1K accounts, and some would have full sized 100K accounts. I suspect they are in the proportion of 10 to 1 (10 Micro accounts for every 1 full size account), so those would balance out.
That's not a bad little enterprise for the Zulutrade operators. Their data center and hosting charges could be as much as 20K a month (assuming they have a DR or COB site). And they seem have a handful of employees (probably as many technicians as customer service and sales people.
So overall, its probably at best a break-even operation. But it is growing and maybe I can run a query in my database to see what the trade volume growth looks like.
This doesn't account for all startup time and energy they put into it. I'm sure they ran it for weeks and months at a loss just to get it where is now.
So let's hope they are turning a profit and they keep growing.
Cheers,
Tcxmon