OS.PA. Long Term ST Review ZuluTrade Trader July 2013
This review of OS.PA. Long Term ST (aka OSPA) was written on July 12th when this ZuluTrade signal provider was ranked 2279th and had just over $300,000 of money following their signals. OSPA had been trading for 31 weeks on ZuluTrade and based on OPSA’s ZuluTrade trade history, here’s our review of this Italian based provider:
OS.PA. Long Term ST Pros:
- send signals from a LIVE trading account
- fairly consistent returns so far
- low-ish historical drawdown
OS.PA. Long Term ST Cons:
- maximum stop level unclear (hence total risk unclear)
- pure automated system – no manual interventions
- system can get into trouble around major news releases
When we look at the profit graph for OPSA (see below) we notice an overall increase, though the increase is all but smooth. So far every month on ZuluTrade has been positive, though July has been poor so far. Average monthly returns are about 180 pips, which is not much, though this has been achieved against a relatively low account drawdown of 212 pips and open trade drawdown of 178 pips.
The strategy is described as a system based on price action with a maximum of 3 open trades. Maximum stop level is however unclear from OPSA’s description, though the strategy description mentions their system automatically applies stop levels. Looking at the actual trades in the ZuluTrade interface it’s clear stop levels are used and applied since many losing trades are closed out at their lowest level (i.e. stopped out). Levels seem to vary from 100 pips to 20 pips, though more often than not small stop levels are applied. The size actually seems to depend on the volatility of the market (EURUSD) at the time the trade was opened.
What’s clear though is that this is a pure automated system (EA) something which OSPA also mentions in their communications. The EA seems to look at the market every 15 minutes and make a decision whether to open a trade or not then, as those seem to be the time intervals trades have been opened in the past. Personally we’re never a massive fan of EAs unless the trader uses them as a guidance but still apply their own trading skills based on current market conditions or for example to intervene before, during or after major news events. From the communications and some recent individual trades we looked at it doesn’t look like OPSA intervenes with the EA, though they’ve suggested making some amendments to it as a result of a recent poor run.
OPSA also mentions they don’t intervene with the system during news events and expect the system will perform well over time independently of its behaviour during news releases. However, personally we feel that someone considering following this type of ZuluTrade provider (and someone with some basic trading skills) may outperform the automated system by looking at the position before major news releases (i.e. the ones where 50 or 100+ pip moves are expected). E.g. better results may be achieved in the long run by closing positions if a few points from profit target or by turning the system off for a few hours (if no positions are open) to let the markets settle so the system doesn’t react to the sudden spikes. As we mention in our ZuluTrade tips though, overall we prefer to follow traders where we don’t have to intervene since after all, that’s what social trading is about (and why you pay the small commissions to ZuluTrade and the traders you copy on each trade).
On a positive note OPSA do send the signals from a live account. Hence they risk their own money (very commendable) and so fully trust the system themselves. You’d therefore also expect them to track the performance on a daily basis. On the other hand, the number of followers and the amount of money people have made so far from the system is still very low.
In summary, while the results of OS.PA. Long Term ST so far have been fairly consistent for relatively small drawdown, it’s clear this is a pure automated trading robot. While it’s proved to be doing well in the market conditions of the past 6 months, an EA is only as good as the trader managing it. And while OPSA does trade the EA with their own live account, it doesn’t look like they intervene themselves (and hence may require close management by the follower).
Please note that any ZuluTrade trader reviews are included here for informational purposes only. A review doesn’t constitute investment advise and is neither an endorsement of the trader. Trading with ZuluTrade can be very risky. Always consult an independent financial advisor if not sure and never trade with money you cannot afford to lose.