IMPORTANT: Conclusions about ZuluTrade.com's Ranking System

[Mike]

I've come to realize that there is a problem to say the least about the ranking system on ZuluTrade.com -- I am starting to really think Zulutrade.com is one of the greatest Forex websites ever.

First off, after analyzing MANY of the "top" signal providers on there, I've seen a lot of commonality between such varying systems in one regard... that is THE NEED TO BE RIGHT over the NEED TO PROTECT ONE'S CAPITAL. i.e., the signal provider's on Zulutrade.com are rewarded in the ranking system more for having a better winning percentage while not being penalized in the ranking system for having unacceptable drawdown levels.

Hopefully this makes sense automatically for most of you out there, but if it doesn't I'll show some examples.

http://forexforums.com/forums/attachment.php?attachmentid=344&stc=1&d=1258245679
These are the top three signal providers on ZuluTrade.com according to the official ranking system. As you can see, what holds more weight is clearly the winning percentage combined with the pips earned. However, experiencing a drawdown of 3000 or 1100 pips at any given moment is completely unacceptable. Personally, I haven't been down over 20 pips in a trade in over 4 years since I lost 300 pips REAL MONEY and altered my own method to cut losses. I am profitable on my own as a result, but my win percentage is less than 75%. If I were on ZuluTrade.com with my own method, I think I would find myself way down in the ranking, probably lower than 200 regardless of how profitable I am.

And it's a two way street, partly Zulu's fault for creating an atmosphere that forces Signal Provider's to naturally want to rank higher, but at the cost of wanting to hold on to losing trades much longer just to try and turn those losers into eventual winners, increasing their win percentage which has a much higher bearing on the signal provider's rank than their drawdown.

I could be wrong, because I am not privy to what makes the ranking system work, but they do have a disclaimer about the ranking system that addresses some of my concerns here.


Our proprietary ZuluRank system takes this into consideration, together with many other factors like maturity (how long a system has been running for), exposure (how many positions might be open at the same time) and drawdown (how many ups and downs the system has experienced) in order to provide you with an easy way of viewing the systems that are good performers and feasible trading strategies.

Despite what this disclaimer states, how could this ranking system give the amount of open positions and drawdown that much weight when a signal provider with a maximum drawdown of over 3000 pips is number 3 out of all signal providers on the site?

[Mike]

I'll stress I am not subverting Zulu's entire website, I'm really enjoying this website and service as something quite unique and useful.

I'm just wondering where all the systems with less of a winning percentage, but takes VERY small losses, 5 pips, 10 pips, 2 pips, etc. but much bigger wins in the ranking system. They're so far down in the list that we'll probably never see them come to the surface. Regardless, I'll be on the lookout for them for all of you potential Zulu Forex Warriors out there!

:yo:

[in2fx]

Your concerns about the Zulu Ranking system are duly noted, this can be a tricky way to follow a signal provider that may not be very profitable

[Matt]

It sucks cause one week a signal provider is #1 the next they are #300... no consistency.

[vladrus]

I havent read this post, good thing you bumped it :)
It seems they changed the part that they didnt calculate the open positions in their ranking, thats why the top 20 changed so much and providers like lowestDD got to #300.
But the max DD issue still remains and i dont know if it can be solved.
But does max DD always tell the "truth"?
If a new signal provider starts an account with low capital and while learning the platform, he losses half of his capital, but after that, he constantly wins, is it fair to judge this guy by his 50%+ max DD?

[mk3fx]

I agree with you VladRus. And there have been many more changes on Zulu the past few weeks. You can't rank signal providers on any other time frame than "ALL" which stinks in my opinion.

[Mike]

I havent read this post, good thing you bumped it :)
It seems they changed the part that they didnt calculate the open positions in their ranking, thats why the top 20 changed so much and providers like lowestDD got to #300.
But the max DD issue still remains and i dont know if it can be solved.
But does max DD always tell the "truth"?
If a new signal provider starts an account with low capital and while learning the platform, he losses half of his capital, but after that, he constantly wins, is it fair to judge this guy by his 50%+ max DD?

Yes, I noticed this too. Worse yet, the maximum drawdown figure is show in percentage rather than pips. Undoubtedly users were being discouraged by seeing 30000 pip drawdown, 300% seems less ridiculous. You can put a number to the drawdown in the graph to the right of the statistics, but its not the same really.

[tz1244]

i think the ranking has improved quite well after the last post here - it's results are much more reliable, as to say, though one should not forget they are computer generated after all and the real gut (and judgetment) if your account can support the specific trader should be used upon deciding who to follow.