While we normally don’t like writing a review on a trader with less than half a year history (and ideally more) we’re making an exception here in the case of youron. This is mainly because youron is somewhat of a unique type of trader on ZuluTrade in the sense that they actually send their signals from a LIVE real money trading account. In addition they’ve also moved up rapidly and at the time of this review (March 7th 2013) this Ukraine based trader is 9th in the ZuluRank and 8th in terms of amount invested in them. Based on youron’s 18 week historical trade data here’s our review:
- send trade signals from LIVE real money account
- profitable every month to date
- relative low historical drawdown
- manages stops effectively and based on market conditions
- excellent communicator
- sound risk management approach
- still limited history on ZuluTrade to properly evaluate trader/strategy
The first thing to highlight again in this review is the fact that youron sends their trade signals from a real money account. While there’re very few signal providers on ZuluTrade using their own money, most of the ones which do so only follow their own signals with a live ZuluTrade account (and hence there’s no guarantee they’ll follow all of their own trades). With youron, at least you know that when they have a bad period, they’re losing money as well.
While we’d obviously have liked a bit more trade data to work with, the fact that they use a real money account also gives us much more confidence to include youron’s first few months of trade data in our analysis. Anyone investing on ZuluTrade for a while will know that there’re quite a few signal providers who arrive with exceptional 2 to 3 month histories from demo accounts which cannot be sustained (you’ll never know how many demo accounts they tried before they eventually got a profitable one). When you use a live account, you obviously don’t have that luxury.
Looking at the historical profit graph (see below) we notice a fairly gradual increase with the period from mid December to end of January being the exception where the growth temporarily halted. Looking at the pips profit per month, every month has been profitable so far though some much more than others. The maximum drawdown on open trades so far was 432 pips and the maximum account drawdown (highest difference between peak and valley on the profit chart) was 596 pips. While these numbers are not necessarily small, they have to be seen in the context of the returns to date. So far youron has returned 3,486 pips, or roughly almost 800 pips per month. In light of those returns, the historical drawdowns have actually been fairly low, since 1 month returns would cover them. There’s obviously no guarantee drawdowns won’t be higher in the future as this is only based on limited data.
Youron describes their strategy, which trades the EURUSD and GBPUSD pairs, as using both technical and fundamental analysis, while monitoring the news. They’ll open a maximum of 10 trades though no fixed stop levels are given. However in one of their updates youron mentioned they consider around 50 pips to be their comfort level for stops, while levels of 70-100 pips are considered excessive, though they sometimes use them. In fact the highest drawdown of a single to date was 111 pips. This is actually some very useful insight. We’re normally not a fan of traders who use arbitrarily stop levels of the same amount of pips (e.g. fixed at 100 pips). It’s a well known fact that top traders manage their stop levels depending on the market conditions and will amend their stops accordingly (often driven by support/resistance levels or news). Looking at the individual trades in youron’s ZuluTrade history it’s clear that they use the approach they mention since trades got stopped out at various levels.
Only on 3 occasions did they open up the 10 trades so far and while the first time these were all in the same pair, this was always in the same direction (i.e. this is what can cause potentially a larger drawdown). However even with 10 open trades the maximum drawdown so far was only 432 pips (i.e. they weren’t left to run to excessive stop levels).
One caveat from looking at youron’s trade history is that it seems they sometimes trade different lot sizes themselves in their own account. For us as followers every trade is just one signal and hence whether youron risks more (0.2 lots) or less (0.1 lots) themselves , in their ZuluTrade follower accounts it’ll be the same risk per trade. Nevertheless though, looking at the actual trades, we didn’t really find any correlation suggesting that when they trade more lots these trades are any more or less successful (and hence our overall results will still closely match their results). Hence you can probably ignore this comment, though we thought we’d mention it for completion.
You’ll also notice that youron does very regular status updates. Yes, they are in Ukrainian (or Russian) but you can use the translate function which works well. Their status updates cover feedback on their own trades and perceived market conditions as well as responses to questions by their followers. Youron is probably one of the most active update providers we’ve seen on ZuluTrade and their updates enable us to get a better inside in them as a trader. A lot of updates cover their approach to risk and money management (risk max 5% of account) with various suggestions to help their followers with sizing their investment appropriately. These updates do seem to give us good confidence that this signal provider actively follows the market and news while also understanding money management best practises.
The feedback scores of youron from other ZuluTrade followers are a bit disappointing so far (<70%). This is slightly surprising since it’s difficult to see how anyone who’d have followed youron for more than 1 month could have lost any money. But then, we all know that there’re plenty of ZuluTrade followers who expect 100% profitable trades, so we shouldn’t put too much value in that at the moment. It’s also still less than 50 people who rated this signal provider so far.
In summary, I know we sound like a broken record when we keep mentioning this, but 18 weeks is unfortunately still a very limited time period to properly evaluate a trader or trading strategy. Youron also hasn’t had to react to a losing period yet or deal with being in the top of the rankings (two pitfalls which often seem to change traders behaviours on ZuluTrade). However, from what we’ve seen so far from youron on ZuluTrade, there’re quite a few positive things to take away. The main one that they trade with real money and they seem to understand risk management principles. We also like the fact that they’re not afraid to close trades in loss (and avoid further losses) instead of keeping adding to losing positions in the hope the market eventually turns. Yes, this does mean that not all days (or in the future all months) will be profitable, though this should “hopefully” mean that in the long run the strategy is successful and capital is protected from excessive losses. As always … only time will tell.
Please not that this ZuluTrade signal provider review is included here for informational purposes only and does not constitute advice. Historical trade results are not necessarily indicative of future performance. Trading on leveraged fx instrument with ZuluTrade involves a high level of risk. Always consult an independent financial advisor if you’re not sure this type of investing is right for you.