Ah, Strategy Rescaling - the conversation that never ends.
The point of rescaling is this: When a system has earned a lot of profits, it can be unmanageable for new subscribers to join it. So a system that used to trade 1 or 2 contracts two years ago might now be forced to trade 10 or 12 contracts because of the new nominal amount of capital in the C2 Model Account.
So we give strategy owners the opportunity to rescale their model account downward. Like a stock split, this adjusts historical results by some percentage. So, if you had $X dollars in your nominal account before the rescale, after the rescale you might have $X/2.
What this means is, you should read post-rescale hypothetical results in the following way: “Okay. If I had traded this system with $X/2 dollars way back in 2013, here’s how the results would have looked.”
Now, this doesn’t suggest you could have traded the strategy with $X/2 dollars back in 2013. And no, it doesn’t suggest you could have bought .50 of a futures contract. Of course, since you don’t have a time machine, and since you can’t actually go back to 2013, no one is suggesting that you should do so – i.e. no one is suggesting that you go back in time and start trading the system in 2013 with $X/2 dollars. You can’t. Because now it’s 2016.
But…
What you can do is trade the strategy with the current amount of capital in the Model Account, post-rescale. The implied suggestion is: “For every $X/2 dollars invested in the strategy back in 2013, here’s how the results would have looked back then. I know I cannot trade the strategy today with $X/2 dollars… indeed, I see that the Model Account is much bigger than that… in fact, now it’s $X dollars, not $X/2… so I probably need $X to trade this. But even so, I can still glean useful information about past hypothetical performance on a per-dollar-investment basis.”
That’s the idea, anyway.
No one is trying to “mislead” anyone. (We don’t accuse Apple of “misleading” the public after they do a stock split… after all, you couldn’t really buy AAPL back in 2012 for $100 per share… you really had to pay more like $300 for a share back then. But dividends and returns are still the same on a per-dollar invested basis. I know, I know, like all analogies, it’s not perfect, there are issues with contract granularity, subscription prices, etc. - but it conveys the general idea.)
So, look, as is the case so often in technology… and in business… and in life, there’s no perfect solution here. There are trade-offs every time one makes a decision. (And every time one chooses not to make a decision.) I can only present to you the reasoning behind this feature, and ask you to understand that - while you personally might not like it - other people have requested it, and it seems to me like a reasonable solution to a problem some people have.
Matthew
