ZuluTrade Review: “Signal Providers”
Every social trading network seems to be labelling the traders or people who’s trades you can follow and copy a little bit different, and in ZuluTrade’s case they’re called “signal providers”.
The ZuluTrade social trading network is totally open and therefore anyone can become a “signal provider”. They can sign-up with a demo account or live account from any partner broker. When they do sign up with a live account the history of their previous live trades will be imported into their ZuluTrade history as well. There’re only a few restrictions when using demo accounts, such as the maximum number of open trades is limited to 30 and only 1 trade can be opened every 15 seconds.
A “signal provider” is paid half a pip for each trade (Buy or Sell) generated in a live account following them. The monetary value of this will depend on the lot size and currency pair traded, but averages at about $0.4 for a mini lot traded. However, their commissions are only paid at the end of the month when they’re in profit for the month (including closed and open PnL). They lose all the month’s commissions during a losing month (this was introduced from November 2011, before this they were paid regardless of winning or losing). While it’s definitely a good practise to pay traders for being successful, this policy has introduced some end-of-month manipulations by the less professional providers on this social investment network, as they try to safeguard their commissions (e.g. not trade at the end of the month when they’re only just about positive to ensure they stay in the green for the month or closing all losing positions on the last day to be able to start the new month afresh).
When looking through the list of “signal providers” on the ZuluTrade network (click here to view) you’ll notice that almost all of them send signals from demo accounts. Some of these do however follow their own demo account as a live user, though this is no guarantee that they follow each trade, since they can close them manually in their live user account. With “signal providers” who use live accounts, you can actually see how much of their own money they trade, with demo account holders who follow themselves, you cannot (i.e. they can follow themselves with the absolute minimum, i.e. 1 micro lot per trade).
“Signal providers” can trade manually or automated using EAs (MetaTrader Expert Advisors), or a combination of both. ZuluTrade does display which ones are sending signals via EAs, though that does not mean all their trades are sent by the EA robot as they can do manual trades at the same time as well.
Because everyone can become a “signal provider” just with a demo account, it’s easy to understand that the choice of traders you can follow is massive. You’ll find almost every type of trading strategy and system across the various Forex currency pairs represented. It’s totally up to you (with the help of the ZuluTrade tools reviewed on the next pages) to find the best and most profitable signal providers to follow.