First Eagle Review ZuluTrade Trader March 2014
For this review we’ll have a look at First Eagle, who’ve been trading on ZuluTrade for 49 weeks. At the time of writing (19th March 2014) they were ranked 2nd in the ZuluRanking with just over $1 million following them. Based on First Eagle’s ZuluTrade performance stats, here’s our review of this Russia based trader:
First Eagle Pros:
- overall profitable
- very consistent results for past 6 months (improved over time)
- low historical open trade drawdown
- drawdown risk contained due to day trading strategy
- decent average pips per trade profit
- almost 1 year trading history
- specialise on 1 currency pair
- clear limit of open trades (4)
First Eagle Cons:
- do not trade with own money
- potential slippage because trading during news events
- account drawdown to be considered
The historical performance graph of First Eagle is a tale of 2 stories. The first half is pretty much flat, while the second half shows a nice gradual increase. Meanwhile their monthly trade volume on ZuluTrade has been fairly consistent, so the difference in overall performance looks mainly due to an improvement in the performance of First Eagle’s trading system and strategy. On a monthly basis, 3 months resulted in losses, while the last 6 months were all profitable, most of them returning healthy pips profits.
In total about 5,600 pips were returned so far by First Eagle, which is an average of almost 500 pips per month (though looking at the past 6 months alone, the average returns are over 950 pips per month). These results were achieved against an open trade drawdown of 460 pips, which is pretty low and less than the average monthly returns. However, with a day-trading style like First Eagle’s we need to take into consideration the overall account drawdown as well, because losing streaks will sometimes occur. Using our own spreadsheet to calculate this, the overall historical drawdown works out as 1,629 pips. This obviously makes the returns look less good from a risk reward perspective, though it’s worth noting that this drawdown occurred more than 6 months ago and recent results on ZuluTrade have been more consistent.
With regards to their strategy, First Eagle mentions in their ZuluTrade profile that it’s a day trading strategy on the EURUSD pair using a maximum of 4 open trades. They mention the use of stop levels, though the actual level is not mentioned. The worst single trade has gone down to -216 pips though this was pretty much an exception and losing trades are normally closed at lower levels. In fact, because this is a day trading strategy it means trades are normally closed intra-day (or next day in the case of First Eagle) so the potential drawdown risk is kept under control. With a maximum of 4 open trades trading the EURUSD pair the daily swings are unlikely to be very large (> 500 pips).
So in terms of overall risk reward, First Eagle’s results for the past 6 months have been very good, with nice returns for limited risk. For the first 5 months the risk reward ratio was however not so good because of the overall ZuluTrade account drawdown. However, because this is a day trading strategy, the risk will be more contained than with strategies which keep positions open a long time or until they eventually turn profitable. The main risk when following a trader like First Eagle is a long and sustained losing streak.
First Eagle also has 4 other strategies running on ZuluTrade. Normally that’s not always a good sign since it often means the trader has tried a few other systems and accounts before stumbling on a (temporarily) winning one. However in this case, all these accounts are currently profitable. In addition it is very commendable that First Eagle continued trading with the same account even though the first 5 months were not that good. Many ZuluTrade traders who send their signals from demo accounts tend to quickly try new accounts to make their overall results look better.
And this leads us to mention that indeed, First Eagle, also doesn’t trade with their own money (or at least not on their ZuluTrade accounts). Another caveat is that they only recently started acquiring more followers. As always, some traders tend to amend their strategies (often overtrading) once they start making commissions on every trade or getting negative comments. So far there’s no sign of overtrading though obviously this is something to keep an eye on. A final point worth mentioning is that First Eagle sometimes trades during economic news releases. This will mainly impact the slippage you may see because during those periods broker spreads may increase (depending on your individual broker). Hence in case you follow this trader from a live account, do keep an eye on the slippage. With an average pips profits of 10, you have a little bit of leverage. However if you’d experience an average slippage of 3 pips it means your overall returns will be 30% less than those reported for First Eagle in their ZuluTrade profile.
In summary, First Eagle has performed very well over the past 6 months, with healthy returns for limited risk. The first 5 months were not that great, but it’s always better a trader’s performance improves over time than the other way around. Their day trading strategy means overall risk will be better contained than with many of the longer term signal providers on ZuluTrade, though occasional losses over time will be inevitable since losing trades will be closed same or next day. It’ll be interesting to see how First Eagle performs over the next few months now they started trading for quite a few followers, though only based on the results for the past 6 months, this is one of the best traders we’ve noticed on ZuluTrade lately.
Please note that any trader reviews are included here for educational purposes only. They are not investment advice. Investing on ZuluTrade can be highly risky. Never invest money you cannot afford to lose.The inclusion of a trader is not to be considered as an endorsement of that trader.