Today we’ll take a closer look at ZuluTrade signal provider gbp–turn. At the time of writing this review, February 5th 2014, this trader was ranked 3rd in the ZuluRanking with just over $1,350,000 of real money following them. Based on gbp–turn’s 55 week ZuluTrade history and profile, here’s our review of this China based trader:
- profitable results over past full year
- decent average pips per trade profit
- does not trade with own money
- no stop levels used
- maximum number of open trades unclear
- historical drawdown fairly high
- fairly high risk reward ratio
The profit graph for gbp–turn (see below) shows an increase over time which, while not totally gradual, is also not too choppy. In just over 1 year, almost 14,000 pips profit have been made, averaging over 1,000 pips per month. These results were achieved against a maximum total drawdown of 2,498.2 pips (again we use our own Excel formula to calculate this). So while the returns have been healthy, the strategy has certainly endured a reasonably high level of drawdown as well (although it’s still less than 3 months average returns).
Since the actual strategy description from gbp–turn is pretty non-descriptive we again need to take a closer look at their actual ZuluTrade trade history to work out the trading style. While no information is given on the amount of open trades needed to follow gbp–turn, historically a maximum of 9 trades have been opened at the same time (at 4 occasions). With regards to stop levels used, gbp–turn mentions in one of their very limited updates that the maximum is 500 pips and they pretty much don’t use close stop levels because of the volatility of the market. However, even just looking at some recent trades on ZuluTrade, we can see that some trade cycles were closed at a loss. I.e. they don’t always let the trades go to -500 before closing them (which is at least a positive sign).
So far gbp–turn has been trading the EURUSD and GBPUSD pairs and when more positions have been opened, they’re normally not all in the same pair, but they’re usually in the same direction. Hence with up to 9 open trades and a stop level of 500 pips you’re easily risking 4,500 pips per trade cycle, which is quite a lot, considering the potential average gains.
It’s also clear that with the very wide stops and the strategy applied, this ZuluTrade signal provider does leave their trades open during important news events. I.e. with up to 9 open trades, some large daily movements can occur.
Average returns of 19 pips per trade are overall quite healthy. Though again, looking at the most recent trades, targets often seem to sit between 10 and 30 pips per trade, while the drawdown can be significantly more (> 200 pips). Hence risk reward ratio is certainly a concern. This fact is also supported by the observation that while gbp–turn have a large amount of live money investing in them, the amount of $ returns of the followers has still been relatively low. I.e. the risk taken by the followers seems low.
In summary, the returns and performance of gbp–turn over the past year have been pretty good. However these results were achieved against a relatively high drawdown. Without clear indication of total number of open trades required and without the use of stop levels, the risk taken is fairly open ended. All therefore depends on the trust one can put into the trader since the y ultimately control when to close the trades. Again with gbp–turn sending signals from a demo account, building that trust becomes more difficult than with ZuluTrade traders who send signals from a live account and hence risk their own money.
Please note that any ZuluTrade trader review we include on our Social Trading Guru website is included for educational purposes only. They are not investment advice. Trading Forex instruments can be highly risky. Hence never invest money you cannot afford to lose and always consult an independent financial advisor if you’re not sure whether this type of investing is right for you.