Hello C2. Your are establising a new Tradeable account size policy. Ok fine. But, C2 keeps raising the TradeDetector recommended capital requirement account size. We have not traded any larger positions than we have in the past. As a matter of fact, our recent positions have been smaller, yet the C2 capital requirement size has gone up during this same time period. The only thing that has changed is that TradeDetectors profit results continues to climb. How do we set a Tradeable account amount, under your parameters, if C2 contiunes to raise the required capital to trade our strategy? So, how are we supposed to determine TradeDetectors Tradeable account size? Is C2 going to continue to determine this amount? If so, why should we reset if you are going to determine that requirement? What are we missing here? Thank you, TradeDetector
One of the reasons for implementing the Tradable Model Account policy is that it will allow us to bring “Suggested Minimum Capital” metrics to be more closely aligned with nominal Model Account size.
For now, the “Minimum Capital” metric is a stop-gap measure designed for maximum caution. Once the Tradable Model Account policy becomes effective, we’ll be able to revise the Suggested Minimum Capital numbers to make them a bit more sensible. I ask for your patience as we work through this transition period.
This is certainly a hassle for leaders that use BrokerTransmit and typically always have at least one position open - preventing a scale down without preemptively closing positions. Simply selling everything to scale can cause taxable gains to be realized sooner than anticipated etc. Obviously, turning off TOS for a bit then closing everything is possible and could be communicated to subscribers ahead of time. I don’t love the hassle factor it can cause, but I am sure there are reasons for it that hopefully outweigh the hassle.
All that said is there going to be a way to have costs adjust as well to the scaling? For example, if you charge $100 a month on a $120,000 account then scale down to $60,000 doesn’t the $100 a month get applied retroactively to an account trading $60,000 from the start - doubling the cost drag for subscriptions and autotrade?
Hello Matthew,
Will you consider maybe make an exception to portfolios that trades TOS? As people who trade TOS ( most of them ) are not taking high risk trade as a paper account would. I think it also make the strategy manager life “easier”. Also as @InteractiveAssets mentioned there is a tax issue here for those who are in TOS.
Thank you,
One issue I have with this policy is that some subscribers with large accounts will be forced to subscribe to a more expensive auto trading plan (Standard to Portfolio or Portfolio Plus) to enable them to scale up the strategy to match their account size. This is a $100-200/month expense for them, so it is not immaterial. I originally chose a large portfolio size so that they would not have to pay this extra fee. Also, am I correct that I can continue with managing my current strategy without reducing the size but that it will be closed to new subscribers? Thanks.
I think 125k is very low , increasing the tradable account size to a more reasonable size will solve the issue for most systems .
Like to say for example 375k instead, this way many of the issues mentioned above will be avoided and lets face it trading developers wont need to keep rescaling every now and then like the case with the 125k account size .
Another point for all TOS strategy managers:
I think it is a different statement whether a trade manager trades his own strategy with $10,000 or $300,000. In order to comply with the 125k limit, every manager would probably go well below $100,000 so that there is enough room for the $125,000.
A scaling factor > 100% for TOS strategies would be nice. C2 Account $60,000 my Broker account $240,000 so a factor of 400%. But that wouldn’t work for me either, since I determine my trade size based on my broker account balance. Accordingly, with further profits, the trade size of the C2 system would always be too large.
Without Broker Transmit there would be fewer or different problems. However, a Trade Leader would then have to pay for a “Portfolio” or “Portfolio Plus” auto plan, which he does not need to do without Broker Transmit.
Unfortunately, I can’t think of a solution to solve the 125k limit with TOS strategies without new problems.
Similar for me. My C2 account size is currently what I trade in my broker account. 100% TOS. Now I would need to be able to go 400% TOS. Not sure if this is possible using broker transmit.
I think that, for now, I can temporarily remove BrokerTransmit strategies from the requirement. That will give us a chance to find a long-term solution.
Ok. So, do we hold off on rescaling our strategy?
Thanks
If you are using BrokerTransmit, then hold off rescaling for now. Give me a few days to investigate further. Thanks.
Futures trading strategies are going to have a very difficult time with this. Our strategy trades multiple futures markets at the same time. At times managing open positions (profitable positions & losing positions) against one another. That’s a big reason for the success of our strategy. Even if trading only one contract at a time in these multiple positions, it will be difficult to manage margin to stay under $125K. Futures traders should expect to have a larger account anyway. This policy change could actually force the manager to trade differently than the system was meant to be traded, Thus, causing the track record, up to now, to be a misrepresentation of the strategy to potential subscribers.
I still like the idea of ​​scaling > 100% for TOS broker transmit strategies.
If the strategy manager makes changes to his broker account capital, he must adjust his scaling factor accordingly. Also, no positions would have to be closed if the scaling factor is adjusted, since the new scaling factor is simply used the next time a trade is entered.
C2 has access to the trader account via the broker transmit and can therefore calculate the correct trade size from the C2 account when closing a trade after a scaling factor adjustment.
In the meantime, while you are working through this “transition period” are you suspending the Policy? My strategy has increased it’s return nicley over the past several days. And because the strategy has made money for my subscribers, the “tradeable model account size” has increaed to over $125K, telling me that we can’t take on new subscribers. So, because the strategy is being successful and growing returns for it subscibers, now I can’t accept new subscribers? So, I can’t make more subscriber revenue and C2 can’t make any more $ off of this strategy either because this strategy is too successful? How does that make any sense? We have postitions on that we don’t want to take off. I am stuck…what am I supposed to do? Thank you.
