Is there any way for my followers to scale their positions to match risk tolerances?
For example, say I’m trading from an account with $100,000 in funds, and a trade is placed at 1 standard lots. In order for a subscriber to maintain the same risk profile, if he has a $10,000 account, he should place a trade with 0.1 standard lots (or more or less depending on his input risk tolerance as a ratio of my reference risk). Does your broadcast system manage this automatically?
I’m looking for a simple yes or no answer… Anyone?..
Bueller?
Yes, Eddy -
This is the exact way AutoTrading on Collective2 works.
When subscribers AutoTrade your system, they can set a “scaling factor” which is a percentage (but it can also be greater than 100%).
This specifies what trade size to use.
So, for example, if your system issues these signals:
BUY 4 EURUSD
SELL 4 EURUSD
then a trader using 100% scaling will buy 40,000 Euros and then subsequently sell 40,000 (since the “unit” in C2’s forex trading is one minilot, which is 10,000 currency units).
A trader using 50% scaling will buy and sell 20,000.
Your Collective2 Model Account size is your implicit recommendation for the amount of capital which should be used to trade a system at 100% scaling factor. But subscribers who want to “lever up” and increase risk and leverage can trade at 200% scaling factor even while using the standard amount of capital you recommend. Etcetera.
By the way, I think it’s a super-duper practice to act like a subscriber and subscribe to your own system and AutoTrade it. For forex, this is quite easy to do, since C2 offers free demo accounts at several C2-compatible brokers, and there is no fee for AutoTrading in these simulated demo accounts. (Nor do you need to pay yourself subscription fees, unless you really want to! Just don’t subscribe to the system; but instead, only set up AutoTrading for it.)
AutoTrading your own system helps you understand what things look like from a subscriber’s point of view and will likely make you a better system vendor.
Matthew
Thanks a lot! That’s perfect! I think Collective 2 is leaps and bounds ahead of the competition. Can you trade fractional “C2 units”? what’s the smallest increment? e.g. I use a floor of 0.01 lots, with increments of 0.01.
By the way, that’s a very good point on subscribing to my own system. It’d be a great way to test it from the subscriber’s viewpoint, and see what kind of challenges I could address there.
