Signal Provider Guide
Last updated on: 14-03-2012
1. ZuluTrade Signal Providers
A) Introduction to Signal Providers
A “Signal Provider” is a ZuluTrade User, who trades either on a Demo or Live account while ZuluTrade publishes his/her results and statistics publicly through the website. Each trading action performed in the Provider’s account is sent to all ZuluTrade Demo and Live accounts in the form of a broadcast signal.
Clients, who have chosen to follow the Signal Provider (“Followers”), have the trading action automatically executed in their account, residing in their brokerage firm. Since a simple Provider signal is executed by various different brokers that have different trading interfaces and configurations, trading problems can occur. A possible instance is an orphan trade. An orphan trade is a trade that although it is closed in the Signal Provider’s account, due to a variety of reasons, it may be left open on one or more of the Followers' Live accounts. This incident can lead to different results between the Provider and the Follower - e.g. although the Signal Provider gains, the Follower ends up losing as a result of the trade having closed long after it had been closed in the Signal Provider’s account. However, Signal Providers have the ability to both monitor and close their live Followers' positions that are detected as "orphans".
By using the tool for orphan trades, Providers can quickly and efficiently remedy this situation. Whenever a trade is closed in a Signal Provider account, if any orphan trades exist, they will appear under the POSITIONS tab within 5 minutes after having closed the trade. A table will appear displaying the provider ticket, the number of users under the same broker for whom the order is still open, currency pair, date opened, entry and current values, and a profit tab. To close an orphan trade, click on the "close" option; the trade will immediately close and a corresponding close message will appear.
Followers can fine-tune and override provider signals by configuring their settings in their ZuluTrade account portfolio, or even manually.
B) Creating a Signal Provider account
Anyone can sign up to become a Signal Provider. Simply register for your Signal Provider account here. You can open up to 10 Signal Provider accounts with the same email address. Competition however is fierce. Signal Providers’ performance is constantly ranked by ZuluTrade's ZuluRank algorithm and the ZuluTrade community, so that only the best Signal Providers appear on the top of our lists.
C) Trading platforms
Signal Providers can place trades through the following ways:
- ZuluTrade Platform
The Signal Provider account comes with a built-in web platform located at the ‘Trade’ tab; it is possible to open market trades, pending orders, and set Stop and Limit values by clicking on the relevant currency pair.
- ZuluTrading API
ZuluTrade offers its own REST API which enables providers to submit trading requests straight to their accounts from their own custom program. In other words, instead of logging in to the Signal Provider account to manually open, manage and close trades, providers can configure their own algorithm to do this for them. Although some basic programming skills are required, a comprehensive step-by-step guide is provided for setting up the ZuluTrading API.
- MetaTrader 4 (MT4) platform
It is possible to link an external live or demo MT4 platform to a Signal Provider account. In this case the Signal Provider account becomes read-only and any trading activity that takes place in the MT4 account is copied over to the ZuluTrade account. The list of brokers compatible with Signal Provider accounts can be found in the Settings tab of the Signal Provider account, or by contacting Support.
- ZuluTrade VPS
ZuluTrade offers Providers the chance to host their trading strategy for free via ZuluTrade’s own VPS service. ZuluTrade supports over 60 Brokers and there is no need to download any platform - the MT4 client of your choice will be pre-installed into your VPS account can access via any browser. The ZuluTrade VPS service is available only for Signal Providers trading via MT4 terminals; there is a limited number of available VPS, so Providers should keep an eye out for the 'Connect to my VPS' button at the Settings tab - it appears only when VPS slots are available. ZuluTrade VPS is a premium service and as such a fair use policy applies; if it is detected that the VPS service is misused in any way (malicious intentions, low or excessive usage, usage beyond ZuluTrade's environment, etc.) then usage of the VPS service may be revoked.
D) Performance, Stats and Indicators
As a Signal Provider trades, their performance and position in the ZuluTrade Performance page will gradually evolve; moving up and down in ranking. All data and information of the Signal Providers are taken into consideration in order to calculate their place in the ranking. Some decisive factors for the ZuluRank are (please note that this list is not exhaustive):
Maturity: How long the Signal Provider has been trading for, reflected in ‘Weeks’.
Exposure: How many positions might be open at the same time, reflected in ‘Max Open Trades’, the 'NME' required, etc.
Drawdown: How many ups and downs the Signal Provider’s historical performance has experienced, reflected in ‘MaxDD%’.
Performance: Overall pips earned, average pips per trade and other performance metrics.
The Performance page is updated several times per day, as trades and Signal Provider statistics develop.
Performance page also contains visual indicators, helping followers to identify certain Signal Provider attributes. Most common of which are:
Signal Provider is using a Live Account.
Signal Provider is using a Demo Account and has a Live Account linked to his Signal Provider.
Signal Provider is using MT4 Expert Advisor
This trader has an average user rating of at least 4 stars!
This provider is trading correlated currency pairs, by using a natural hedging strategy that potentially lead to limited drawdown
This Signal Provider is frequently trading economic calendar releases!
Zulu Veteran - a Signal Provider that has been trading with ZuluTrade for more than 2 years with a consistently high ranking
In order to appear in the Performance page, a Signal Provider must first close 1 trade.
Signal Providers earn 0.5 pips per lot, for each closed trade executed in a live follower account. Pip cost varies according to the currency pair traded, the type of account of the account follower etc. For US Followers, ZuluTrade compensates Signal Providers by a variable monthly membership fee. Signal Providers compensation is calculated on a monthly calendar basis.
ZuluTrade compensates US Signal Providers by a variable monthly membership fee. Monthly compensations for Signal Providers can vary depending on account size and signals generated per month. Please note that ZuluTrade Signal Providers, who are NFA registered as IBs, receive half pip per lot for every trade generated in a live account.
The monthly membership fee is calculated using the following formula:
((Aggregate customer capital following the Trader / Initial balance) / 100) × Subscription fee
Initial Balance represents the Necessary Minimum Capital required to cover the Trader's maximum recorded historical drawdown. Aggregate customer capital following the Trader, corresponds to the average amount over the monthly period.
Subscription fee is determined by the number of signals generated by the Trader during the month. Below is the schedule used to determine the subscription fee.
- 5 - 20 Signals = $50 Subscription fee
- 21 - 30 = $100
- 31 - 60 = $200
- 61 - unlimited = $350
Payment requests can include accrued commissions for only the previous month(s), up to the end of the calendar month prior to the request. The current methods of payment for all Signal Providers are via bank wire transfer, PayPal and the ZuluTrade Mastercard. Payment Commissions are as follows:
$20 for PayPal requests up to $500 and a 3,9% fee (applied on the requested amount) for PayPal requests greater than $500.
$30 for each Wire Transfer within the United States.
$45 for each Wire Transfer outside the United States.
$20 for each payment to the ZuluTrade Mastercard.
Also please take under consideration the following:
- Before issuing payments ZuluTrade needs to be provided with sufficient evidence of the Signal Provider credentials – typically we require a valid photo ID (passport, government identification card or government issued voter’s card) and a recent formal bill indicating your name and full current residential address.
Before issuing payments, all trades need to be checked against our Trading Compliance rules and relevant commissions need to be collected from our collaborating Brokers; the estimated time frame required to process a payment after a request has been made via our website is 30-45 calendar days.
An active account balance with a minimum of $100 is required before proceeding to request a payment.
Please ensure that your bank account details, PayPal account or ZuluTrade Mastercard are set up properly to avoid any complications with payment.
If for any reason your account has been terminated and you have the minimum of $100, you can request payment via email to firstname.lastname@example.org.
ZuluTrade values the safety of its followers’ capital as an utmost priority. For this reason, Signal Providers who apply abusive trading behavior, introducing high risks to their followers, will be examined carefully and if deemed malicious, they will be refused compensation.
For each specific calendar month that a Signal Provider presents a negative Total Monthly PnL performance in pips, the Signal Provider will not be compensated. Total Monthly PnL includes unrealized PnL deriving from the end of month valuation of the Signal Provider’s open positions.
Please note that payment must be requested within 30 days of receipt of the termination notification. Payment requests received after this period will be rejected.
Accounts with considerable deposits can be characterized from the Broker as Institutional due to the low spread offered. Compensation for such accounts is 0.1 pips per lot executed in a live follower account.
3. Trading Compliance Rules
When trading from a Demo account, please make sure your trading strategy complies with the following restrictions:
There is an upper limit of 30 market and 30 pending orders, as well as a limit of 1000 update signals, permitted to be broadcasted to followers within a 24-hour interval.
Signals to create market/pending orders should have a minimum time interval of 15 seconds from the last one accepted in order to be broadcasted to followers.
Maximum overall number allowed of open - market and pending - orders is limited to 30; any further signals will not be broadcasted to followers.
Please note that none of the above restrictions applies to Signal Providers trading from a Live Account.
Trading from MT4 Terminals
In addition to the above rules for Signal Providers trading via MT4 terminals and outside of the ZuluTrade web interface, compliance with the following rules is also expected:
Strategies that perform continuous updates on entry/stop/limit prices such as "trailing stops", are not supported.
Closing partial lots is not supported.
Deleting Stop/Limit via EA (updating Stop/Limit from non-zero values to zero via EA) is not supported and related signals will not be broadcasted to followers.
Trading in products other than Forex, Gold and Silver (such as Futures, CFDs etc.) is not supported yet.
Altering of mt4 trading records and statistics in any way is strictly prohibited.
Inappropriate Trading Behaviors
ZuluTrade values the safety of its followers’ capital as an utmost priority. For this reason, Signal Providers who apply abusive trading behavior, introducing high risks to their followers, will be examined carefully and if deemed malicious, they will be refused compensation and may be banned from the ZuluTrade services.
In order to avoid extremes, Signal Providers are required to comply with a minimum set of guidelines that aim to reduce risks, such as:
A Signal Provider's maximum total draw-down should not exceed their profit in pips (Max DD % should not be greater than 100%). This applies once there is an adequate record of provider's performance, e.g. once overall PnL exceeds 1000 pips.
No positions should be allowed to reach losses of 700 pips or more. The use of stop loss at reasonable values is mandatory to ensure followers' safety. A careful and short use of Stop-Loss will also assist and promote you in our Ranking algorithm. Large stop-losses or no stop-losses is not appropriate trading.
ZuluTrade is not endorsing a winning trades ratio close to 100%. It is a potentially risky strategy as it may indicate exposure to unusually large draw downs.
Note that the above thresholds in pips are indicative for basic FX pairs. Please assume equivalent amounts for exotic pairs including XAU, XAG or CFDs.
No trading should be performed outside of ZuluΤrade's Market Hours. Market Opens Sunday 22:00 UTC and closes Friday 22:00 UTC. When Eastern time is in daylight saving, market opens Sunday 21:00 UTC and closes Friday 21:00 UTC.
4. Recommendations for Effective Strategies
Scalping is not Recommended.
Due to the combination of different trading policies, configuration and rate feeds of various brokers to whom your followers may subscribe, scalping is not a recommended manner of sending signals to your followers. The practice frequently leads to very inconsistent results for different broker accounts.
Trading During News
Many brokerage firms will often reject trading signals during News announcements that affect the market, resulting in possible discrepancies between the execution in your account and your live followers.
Trading with Unrealistic Amounts of Virtual Funds
Apart from producing unrealistic trading results, no trader will ever be able to relate with your strategy if your starting balance is extremely high, or you trade huge amounts of lots.
Suspension of a Signal Provider’s account may occur in two ways: temporarily as a warning, or permanently, leading to prohibition from using the service. Liability for any consequences from a Signal Provider account getting suspended burdens the account holder.
Providers linked with MT4 terminals that violate the Compliance Policy Rules, will be automatically disconnected from their MT4 accounts.
They can try to re-connect after they have reconfigured their strategy according to the suspension reason.
Inactive Accounts. A Signal Provider account is considered inactive if there is no trading activity for a certain period of time.
- All Provider accounts that have been inactive for more than 3 months will be permanently suspended.
- Especially for Provider accounts linked with MT4 terminals, the permitted inactivity period is limited to 1 month.
Provider accounts that repeatedly get temporarily suspended.