ZuluTrade Review – Detailed and Honest Opinion
ZuluTrade Review – Detailed and Honest Opinion
|Minimum 1st Deposit||Depends on the broker selected, starting at $300|
|Leverage||Depends on the asset. EU clients up to 1:50 and the rest of the world up to 1:500|
|Free Demo Account|
|Regulation||EU and JP|
|Number of Assets||Forex, CFDs, Crypto|
|US Traders Allowed|
ZuluTrade Review (Our opinion)
Please note that this is the ZuluTrade review summary page with our opinion. You’ll find more detailed reviews of the various ZuluTrade interface features, broker choice, costs and performance on the next pages.
So let’s start the review with some pertinent questions:
- Can you make money with ZuluTrade? Yes, you can.
- Is it easy to make money with ZuluTrade? No, some effort and Forex trading knowledge are required. When we started trading on the platform we managed a 15% profit on our portfolio in the first month and lost 30% in the next. But, by learning from our mistakes and applying some rigorous risk management we’ve been managing positive returns since then.
What is ZuluTrade?
ZuluTrade is a social trading network and platform that connects you with thousands of traders (also called ‘signal providers’) around the world. Instead of studying the market and trading yourself, you select the signal providers you’d like to follow instead. The Zulutrade platform will then convert their advice and trades directly into your own account (with one of their supported brokers or their own AAAfx broker).
At any time, you can close trades opened in your account by these traders manually yourself. In the ZuluTrade interface, you can also set limits on what trades you like to take at the account level (e.g. only EUR/USD trades) or at signal provider level (e.g. no more than 5 open trades at any time).
More than any other social trading network and auto-trading platform, ZuluTrade is “open” and accessible to everyone. For you (the investor) this is great. There’s a free fully functioning demo (click here to try ZuluTrade demo) and you can start investing with “real money” from as little as $300, £210, 250 Euro, 25,000 JPY or 300 AUD. The sign-up procedure is easy and straight-forward. However, the openness also means everyone can become a Signal Provider. Signal Providers do not necessarily trade with their own money (they can send signals from demo accounts) and their profiles are not formally vetted by Zulu Trade (i.e. if they say they traded professionally for 10 years, it’s their word and nothing more).
What instruments can you trade? Can you copy other traders?
While initially, ZuluTrade was pretty much a pure social forex trading network, since they added CFDs in 2015, more signal providers now also trade gold, silver, commodities, and indices in addition to forex currency pairs. And in addition to Forex/CFD traders, Zulutrade added binary options to their platform in 2015, but they discontinue them in 2017 before ESMA at 2018, ban distribution or sale of binary options to retail clients . . So now you can choose to trade yourself or copy other traders in either forex or binary options mode. Have you heard about cryptocurrencies? Guess what, Zulutrade decided to ride on that train too.
How to identify the best traders at ZuluTrade
The amount of “forex traders” to follow and copy is massive (> 10,000), though ZuluTrade does provide you with an advanced search engine that allows you to slice and dice through that list against your preferences; e.g. only show me traders with over 52 weeks history, who trade their own money and have a drawdown of less than 20%. They also have a performance table (see image on the right) in which they rank all “traders”. Until last year, they ranked using a proprietary algorithm, “ZuluRank”.
While this did improve over time, we saw more than one trader make an appearance in the top 5 in one month (and significantly increase its number of “live” followers) just to make a large loss and drop out the top ZuluTrade rankings the next month. Now the default ranking is by “Live Followers Profit” which seems fairer and more relevant (btw, you can rank on other performance indicators too).
Because the list of traders is very large and new ones are added every day, ZuluTrade introduced the concept of UserLists and more Recently ZuluTrade Traders Combos, to help you better manage them. You can create one or more UserLists of traders, which is useful if you want to monitor them for a while before you copy them. You can also share your lists with others and view lists created by other investors.
Assessing potential traders
For each “trader/signal provider” you can view a good range of performance indicators and graphs to help you evaluate them. What’s important here to mention is that ZuluTrade is totally transparent. In fact, they share every single trade a trader has done in the past and you can download all the historical trades in Excel as well, allowing you to do your own proprietary analysis (in comparison, some other social trading networks only give you access to the last 50 or 100 trades). While all the information is clearly there and presented in a variety of useful ways, looking for consistent and trusted “Traders” still requires some skill and regular fine-tuning. If you’re new to Forex trading it will take quite a few months before you assemble a portfolio of ZuluTrade “traders” you trust and who match your own investment profile and risk/reward strategy.
Why you should check out ZuluTrade’s ‘Social Charts’
The social aspect is delivered through an active forum and customer feedback and votes which can be directly left on the signal provider’s pages. In addition, you can link your ZuluTrade account to your Twitter or Facebook account, which will post a message every time a trade is closed in your account (winner or loser). They also introduced a unique feature called ‘Social Charts’. This allows you to share your comments directly on any instrument chart, and interact real-time with other ZuluTrade followers and traders as market events happen.
Unique features of ZuluTrade
Performance on slippage scenarios
Slippage is an important factor with forex autotrading platforms and a key driver of this is how quick the system executes the trades from the traders or trade signals you follow in your own trading account. While some slippage does occur and on very few occasions some trades were missed, we’ve found this to be more a factor which relates to the broker and signal provider choice (i.e. higher slippage with scalpers because these traders look for small quick profits in volatile market conditions), rather than of the execution speed or reliability of the ZuluTrade autotrading platform.
It used to be very easy to blow your ZuluTrade account by getting the settings wrong for one “trader” who may change their strategy from one day to another (and there are many stories on Forums of people who get this wrong). However, ZuluTrade did introduce some very useful additional risk management features in December 2012 which allow you to set a maximum loss you’d take in monetary terms for each “trader/signal provider” before your account automatically stops following them and closes any open trades they had in your account. This feature is now called ZuluGuard™ Capital protection, and it also takes into account your overall risk profile based on the short suitability questionnaire you complete when registering with ZuluTrade.
When you follow and copy multiple “traders”, a little bit of skill and Forex trading knowledge is required to work out how much of your capital and account you’re actually risking. To help you, ZuluTrade displays a “Margin Call -o- meter” meter to estimate the chance that your account will run out of money (i.e. you get a margin call). While this is useful, it is still merely an indicator and doesn’t replace the basic money management knowledge and discipline you should acquire to be successful yourself on ZuluTrade. Compared to the other social trading and trade copying platforms ZuluTrade already had the most advanced set of risk management features for the past few years. In March 2016, they introduced an additional tool called “The Automator”. This works like a personal assistant and it can notify you by email or automatically execute actions when things happen.
Checking your account performance
You can review your account performance online at any time and ZuluTrade also sends daily and weekly summary report e-mails which are useful to keep track of your trading results. They’ll also send you an e-mail when the behaviour of one of the “traders/signal providers” you follow changes. E.g. they change their usual stop levels or are opening many more trades than they usually do. It is however up to you to act on this information since ZuluTrade will not intervene in signal provider accounts. You can, however, use The Automator tool to automatically close or disable “traders” if certain behaviour patterns which you define are detected (e.g. send me an email when a trade from Trader XYZ goes below 100 pips).
What does it cost to copy traders on ZuluTrade?
Following the traders/signal providers and using the ZuluTrade platform from a live account is free. The costs and fees in ZuluTrade are included in the spread for each trade. E.g. if your broker spread is 2 pips, part of this will go to ZuluTrade as commission. The “signal providers” are paid directly by ZuluTrade, who share the pip commissions the “signal provider” has generated at the end of the month from their followers, but only if they made a profit in pips at the end of the month (i.e. they don’t get paid in losing months).
Additionally, in 2018, ZuluTrade has introduced Profit Sharing Account Type
Currently, this account type is Available only for AAAFx Broker account.
ZuluTrade presents a new innovative Traders compensation program, the “Profit-Sharing”, a breakthrough among Social Trading Networks around the web!
In addition to the current volume-based payment model, ZuluTrade introduces a new compensation scheme with a view to aligning Followers interests with Traders rewards and applying mutual fair copy-trading conditions.
With the Profit-Sharing Program, Followers auto-trade with discounted commissions and they only pay off Traders that generate profits in their accounts!
Why would Live Followers select the new model?
- Reduced trading cost
– Followers who will select to operate on a Profit-Sharing account will benefit from discounted Broker commissions on their trading.
- A win-win situation
– Traders and Followers share the same interests, the more profits generated on a Follower’s account, the higher the compensation will be for the Trader. Simple and clear!
- Profitable Traders get rewarded – losing Traders get penalized
– Followers will be sharing a portion of their monthly earnings only with their lucrative Traders, while losing Traders will get penalized. Fair and transparent!
- Enhanced Direct Communication
– This new model promotes a deeper bond between Follower-Trader, fostering powerful collaboration towards a common goal.
ZuluTrade Pros and Cons
- Free fully functioning demo account (can easily try without committing money)
- Wide choice of traders (‘signal providers’) to follow and copy
- Good choice of brokers in different countries
- Data is fully transparent (all historical traders are shared)
- Customer comments directly on signal provider profile pages
- Low ongoing cost (spread only)
- No entry cost and low minimum deposit requirements (trade from $200)
- Advanced risk and money management features
- Good mobile apps
- Offers Cryptos in addition to Forex, and Stock Trading (CFDs) also are coming in 2019
- For every successful consistent trader (‘signal provider’) there are also some poor and inconsistent ones.
- ‘Signal providers’ are not required to trade using their own money (though more and more do)
- Money management can be complex for non-Forex traders or beginners (but has improved significantly)
- Requires regular monitoring until the right mix of ‘Traders’ is selected
It’s worth noting here that on December 12th 2014 ZuluTrade made some significant changes in accordance with EU legislation and with the aim to increase investor protection and reduce systemic risk. From this date EU residents can only view and follow the top 1,000 traders who all need to comply with the following 3 criteria:
- maximum drawdown less than 30%,
- average pips per trade profit more than 3 pips,
- trader has been sending signals for at least 12 weeks.
The knock on effect of this ZuluTrade policy though has meant that all traders now clearly aim to meet those criteria because they all want to be visible to EU customers. Hence the average quality of the traders to follow has increased for all customers.
The list of Crypto traders to copy is currently still a lot smaller and they have much less trading history, obviously because ZuluTrade only introduced this service last year.
ZuluTrade Platform: which brokers are available?
The choice of brokers you can use with ZuluTrade is very good. As a built-in option, they have their own broker: AAAFx (based in Greece) ) for EU Investors and AAAFx International (New Zeland Based) for Non EU Investors. This broker allows you to manage your account in EUR, USD, JPY, GBP, AUD, RUB, and CHF. In addition, though, there’re over 50 other supported brokers, including US, UK, Europe, Russia, New Zealand and Australia based and regulated ones, which allow you to keep your account in these and other base currencies. These other brokers do charge a small commission on each trade from a ZuluTrade signal, while AAAfx doesn’t.
The performance for each broker will be slightly different (mainly because the spreads and ZuluTrade commission they charge differs), though ZuluTrade does review and report the average slippage (i.e. difference between the price the signal provider traded at and what your broker account traded at) for each broker on each “signal provider” page. From our experience with accounts at multiple brokers, these slippage reports are pretty accurate.
Want to know which are the best brokers and what do they offer? Please check the list below for further information:
How To Sign-Up For A ZuluTrade Demo Account
You can sign-up for a free Zulu Trade demo account (click here) which allows you to select any signal provider in the same way as you would with a live account and monitor the performance of your portfolio. Once you decide you want to use “real” money you need to sign-up with one of their supported brokers. AAAfx is their “best” broker because they’re part of the same holding company as ZuluTrade. However, they’ve got a list of over 40 other brokers globally which you can sign-up with as well.
Conclusion: Is ZuluTrade a good place to start trading?
Overall, ZuluTrade is an easy to use social trading platform and network with no entry costs and low ongoing costs. The fact that anyone can become a signal provider may take the open social concept to its heart but makes it more difficult to find the few ‘professional’ providers on the trading network who deliver consistent results over time. Basic money management knowledge is a requirement if you want ZuluTrade to become a long-term investment platform for you instead of a short-term casino game.