This ZuluTrade signal provider review was written on January 29th 2013. On this date, “SELL GBP Wonderful” was ranked number 99 in the ZuluTrade ranking, though they were 13th in terms of the amount following them (just over $1 million). This Japan based trader has been a trader on ZuluTrade for 63 weeks and based SELL GBP Wonderful’s historical trade data (click here to view), here’s our review:
SELL GBP Wonderful Pros:
- profitable every single month to date (15 so far)
- clear strategy description which matches trading style
- does not seem to over-trade
- follows their own signals with real money account
SELL GBP Wonderful Cons:
- strategy adds to losing positions
- potentially high drawdown vs returns (i.e. risk/reward)
The performance graph (seel below) for SELL GBP Wonderful shows a fairly gradual gain in profit, but with 2 to 4 (depending on your tolerance) significant drawdown events. The largest of these drawdowns was 624 pips with 7 open trades at the time. While this amount itself isn’t high compared to lots of other ZuluTrade signal providers, at that time (July 2012) it was equal to 50% of the profits generated to date and equal to the past 6 month’s profits. Hence in our opinion it’s neither very high though it’s certainly also not very low in comparison with the performance.
The strategy description (click here to read) is very clear and SELL GBP Wonderful’s trading style also matches the actual description. They trade the GBPUSD pair and do so mainly during the Asian market hours when the markets are normally less volatile. The fact that they’re based in Japan may also be a driver for this because it looks like this trader opens and closes trades manually while watch the market (i.e. they don’t use a robot). Average trading time is 8 hours, so trades are not often left open during the more volatile European session. Target profit range is about 10 pips per positions. At times when the market moves against their original positions, up to 6 extra trades are opened. These are the times when obvious the larger drawdowns have happened in the past.
The performance per month over time has been great, with 15 winning months and no losers to date (even including any unrealised losses). This ZuluTrade signal provider also doesn’t seem to overtrade and didn’t increase their trades per month over time while they got more followers (i.e. no commission hunter). The slight downside of this is though that even though they’ve got a 63 week history on ZuluTrade, SELL GBP Wonderful has only done 173 trades so far. Some months they only made 4 trades. However, this trader doesn’t often open more than 1 trade so in total still more than 120 trade cycles have been executed and most of them ended up in profit.
Overall, the results of SELL GBP Wonderful have been good so far. Trading GBPUSD pair during the less volatile Asian market hours means this trader takes less risk and hence will normally have a lower drawdown on the day. The main caveat here is the strategy of adding to open losing positions which has led to the drawdowns in the past. So far, the worst a single trade was drawdown by -152 pips before reversing. However, there’s no guarantee the maximum drawdown in the future won’t be higher since no indication is given (either in the strategy description or from past results) as to how far the 7 positions will be left open before losses will be taken. The fact that this trader does follow their own signals with a real money ZuluTrade account might provide some hope that drawdown will be managed and not unlimited. Nevertheless, anyone considering following “SELL GBP Wonderful” should consider the risk reward ratio. I.e. are you willing to risk a drawdown of at least 600+ pips (and likely higher) for an average return of 120 pips per month? Obviously the answer to this is based on your own risk profile.
We also normally don’t advocate amending a trader’s strategy by limiting the open orders or adding close stop levels (since when you start doing this, you might as well trade yourself and there’re lots of other signal providers to chose from when you look for someone who matches your criteria). However in this case conservative investors who consider following this trader might run some simulations with a smaller number of open trades in order to protect their account from potentially large drawdowns (and look for better risk reward levels).
The ZuluTrade signal provider reviews are included on the Social Trading Guru website for information purposes only. These reviews do not constitute investment advice. Trading in Forex instruments is high risk and not for everyone. If you’re unsure whether this way of investing is for you, please consult an independent financial advisor. Never trade with money you cannot afford to lose.