Friday, April 19, 2013

ZuluTrade Strategy For Risk Free 300% Profit

Zulutrade is one of the largest social investment networks where you can follow (auto copy) trades of experienced and profitable forex traders (also called as signal providers). There are literally thousands of signal providers so it can be a hard work to choose only the best of the best. If you think that you simple check Zulu ranking and pick the top positioned trader you might get in trouble soon. History showed us that some signal providers are able to perform very well for some time so the climb to number one spot, but after some time they disapear as fast as they got there.

As you can see, there are tons of traders with ROI of 100% p.a. and more so following them can be very rewarding and profitable over some time. But on the other hand, high returns  often mean high risk. That´s why a task of choosing the right signal provider has to be taken very seriously. And even when you do it carefully, there is no guarantee that your money will be safe. Remember old saying regarding any investment that past performance doesn´t secure the same or similar results in future.
We think that the best strategy for choosing right signal providers in order to create a risk free but profitable Zulutrade portfolio is wide diversification. And we mean very wide. Other social investment network eToro allows you to copy 20 social gurus, but Zulutrade has no such a limit and you can follow and copy as many signal providers as you wish.  So we suggest you to choose many signal providers in order to minimize your risk.
To help you realize what your results could be, we have used an unique Zulutrade tool. Their simulator enables you to choose up to 40 signal providers and run a simulation of their performance. So we took current first 40 traders from Zulu ranking and simulated that portfolio results for past 12 months. Starting capital was $10.000 USD.


As you can see on the screenshot above, this portfolio would retun 300% profit after 12 months. Equity line is nice and smooth and drawdown is never more than 15%. So we can say that it is a risk free profitable strategy for Zulutrade.  Your lot size for each of traders would be only 1 micro lot, so even if one of them lost let´s say 2.000 pips, it would be only $200 and other signal providers would cover that easily. Here is the link for this simulation. Play with it a little so you can understand it better.

You can also create your own simulation portfolio if you go to Zulu Ranking, click on tab ” Simulate” and check tick boxes of your prefered signal providers. Remember, this tool allows up to 40 traders, but if you open a real trading account, there is no limit. Just make sure that your Margin o call meter in your Zulutrade account is below 100%. If you need to play with it little bit more, just try Zulutrade demo before you invest real money.