If I become a trade leader, and connect collective2 to my algorithm running on another platform how does re-balancing my portfolio work with subscribers?
It’s probably easier if I give an example:
Lets say I rebalance my portfolio of ETF’s once a month, In November I held 100% spy, 100 shares and in december I rebalance to 80% SPY by putting in a signal to sell 20 shares. If someone becomes a subscriber in November do they have all my current positions in the right ratio for their account size? What happens to them when I submit a sell order for 20 SPY, do they have 80% holding of SPY? How does C2 make sure my orders match up with their current holdings?
When a new user subscribes to your system, he will be prompted whether to join your existing positions or not. So C2 leaves that decision to the subscriber. (Which makes sense)
In your example it would be.
- If he joins existing positions he would buy 100 SPY and the 20 sell when that signal arrives.
- If he doesn´t join existing positions he would just go short 20 when that signal arrives.
In my experience with auto trading if you join existing trades (positions) then yes you would buy 100 SPY and sell 20 when that signal arrives. You will always be in sync with the trader leader’s trades.
However, if you do not elect to join existing positions then a sync filter is placed inside the advanced sync manager on the auto trading dashboard which prevents any trades from occurring which are related to the original trade/position. It does not matter if they are buys or sells, they are simply ignored. That will not change until the trade leader goes flat on the trade at which time the sync filter is automatically removed.
Obviously, if you went net short 20 SPY you would not be in sync with the strategy.
Didn´t think about that Corey, a bit smarter behaviour.