Poisonfx Review ZuluTrade Trader June 2013
At the time of this review (June 3rd 2013), Poisonfx had been trading on ZuluTrade for over 100 weeks, making them pretty much a Zulu Veteran. They’re ranked 18th and had just over $320,000 of real money following their signals. Based on Poisonfx’s historical ZuluTrade trade history, here’s our review of this Pakistan based signal provider:
- follow their own signals with a live account
- profitable overall and on profitable run past 3 months
- long trading history
- high historical drawdown and high anticipated future drawdown
- strategy description doesn’t fully match trading style
- stop levels not identified (pretty much unlimited)
- max open positions unclear
- high risk/reward
If you look at Poisonfx’s overall profit graph (see below) you’ll notice an overall increase over the past 2 years, though most of the profits have been achieved in a number of bursts. However, a lot of the gains were achieved over the past 3 months, which is why it’s interesting to review this signal provider now. Because most of the pip gains pre December 2011 were achieved trading gold, and Poisonfx mentions they changed their strategy after 1st December 2011 we should kind-off ignore that initial period for our analysis.
Hence if we just look at the past year, Poisonfx has made a profit of just over 17,000 pips, for a maximum drawdown of almost 4,000 pips. Since during that period only 2 trades were in gold for small profits these results weren’t therefore impacted by the larger gold pip movements. While 17,000 pips is obviously a very good return, a drawdown of 23% is certainly on the high side as well, and hence a serious concern in terms of risk/reward.
Poisonfx describe their strategy as trading multiple pairs looking a 15 and 30 minute graphs. They mention a maximum of 2 positions per pair will be opened and a maximum of 5 in total, though looking at their trade history this is clearly not the case. Historically up to 29 concurrent positions have been opened and even over the past year a maximum of 24. While not all positions were in the same pair, they were in the same direction. Poisonfx’s winning percentage is also over 85% which means most trades are left open until they turn into profit. There’re no clear stop levels with some trades running over 500 pips into negative before rebounding, some being closed around the -500 pip level and some closed over -600 in loss. All this obviously means Poisonfx’s ZuluTrade strategy can lead to high drawdowns, which has clearly already occurred in the past
While just over 25% of trades were in the major EUR/USD and GBP/USD pairs, Poisonfx has traded about every single available pair in the past. Hence they clearly don’t specialise in trading short term on a specific pair and with positions open on average 1 day, it’s certainly a medium to longer term strategy which is applied. This trader does however seem to follow their own signal from a live ZuluTrade account, which is a positive factor.
In summary, while the overall profits and specifically the profits for the past 3 months have been good, with no clear stop levels and multiple open positions this is clearly a high risk and long term strategy. Poisonfx mentions that followers might want to try following them from a demo account first and that’s certainly sound advice as most ZuluTrade followers wouldn’t be confident carrying the large drawdown levels which are inevitable with this strategy.
Please note that our ZuluTrade trader reviews are included here for educational purposes only. The inclusion of a signal provider should not be considered as an endorsement of this provider. Trading on ZuluTrade and Forex can be high risk. Always consult an independent financial advisor if you’re not sure whether this type of investing is right for you. Never invest money you cannot afford to lose.