In the following sections we explain the individual copy modes with which you can subscribe to our strategies and how they can be used to minimize or increase risk, so that you can adapt the risk to your own needs.

 

For most traders it is recommended to use the copy mode proportional with a ratio of 1.0 and to activate rounding off. I do not advise beginners / novices to deviate from the settings as we pretend them. To keep the examples simple, I always assume that the trader has € 10,000 in his account.

 

Copy mode proportional

 

In contrast to the other modes, the proportional copy mode is not based on the volume but on the factor of the account balance from trader to investor when copying trades.

The formula is:

 

(Investor account balance / trader account balance) * trader lot * ratio = investor lot

 

 

With account balance is meant in English "equity" and means the account balance plus the profits and losses of all open trades.
Since the minimum lot size is 0.1 (in the DAX and DJI), the investor lot is rounded up or down. From x.x5 Lot it is rounded up, otherwise it is rounded down.
With the option "Round off the copied volume value" this behavior can be changed so that it is always rounded off.

 

The following table shows some examples of this:

 

TRADER EQUITYTRADER LOTSIZE INVESTOR EQUITY RATIO ROUND DOWN? INVESTOR LOTSIZE

1000 € 1.0790 € 1.0 No 0.8 (0.79)

1000 € 1.0 790 € 1.0 Yes 0.7 (0.79)

1000 € 1.0790 € 1.5 No 1.2 (1.185)

1000 € 1.0790 € 1.5 Yes 1.1 (1.185)

1000 € 1.02500 € 0.5 No 1.3 (1.25)

1000 € 1.02500 € 0.5 Yes 1.2 (1.25)

 

This option is suitable for the following cases:

 

• New investors

 

• The account balance of the trader or investor varies greatly due to frequent deposits or withdrawals

 

• The investor wants to let the capital grow in the account without further / frequent adjustments and benefit from the compound interest effect (⚠️Caution! Is not recommended by Capitalbrothers! )

 

• The investor only wants to set up an account that follows the trader and deposits more than € 1300 (otherwise the option “Flexible”, “Standard”, “Risky” would also work).

 

⚠️ ATTENTION: A ratio of over 1.0 means that copying errors can occur with too many open trades because the free margin is no longer sufficient. Always be aware of the risk of such a ratio before setting a ratio above 1.0.

 

 

WHY A RATIO OF 1.0?

 

The ratio indicates the lot size with which the trader's trade is to be copied to the investor's account. The trader thinks of choosing a certain lot size - he has a strategy - and tries to keep the risk in relation to the account size as low as possible.
The intervention in the risk / opportunity ratio by the investor destroys the trader's strategy.

 

WHY NOT A HIGHER RATIO?

 

A higher ratio means that not all trades of the trader can be copied as soon as the trader uses the margin completely. The investor's free margin is used up earlier and copying errors occur.
The trader will likely close all trades as soon as they are in positive territory. However, the investor was unable to copy the last trade and will still be in the red in the end.
In such a situation it is usually the most recently opened trades that are decisive in order to achieve a positive result.

 

WHY NOT A LOWER RATIO?

 

Anyone who thinks they can reduce their risk through a lower ratio because there is still enough free margin available at all times will not have any advantage.
The trades are always closed when the trader's trades are closed. With a lower ratio, the investor's trade is closed even if the trader stops out.

 

A CALCULATION EXAMPLE:

 

Trader account: 1000 €, investor account: 2000 € (ratio 0.5)
The investor copies the trade with the same lot size and has the same loss in euros. A trader stop-out at 40% would mean the investor would still have € 1400 in the account.
The 1000 € more in the account have no effect, on the contrary: the risk is increased because in the worst case the investor can lose the entire 2000 €. However, since there is no obligation to make additional contributions, the investor would lose a maximum of € 1000 with a capital of 1000 € and a ratio of 1.0.
In percentage terms, the profit is halved in the case of positive trading results and the risk increases due to the higher deposit.

 

WHY SHOULD I ENABLE ROUNDDOWN?

 

Rounding down is necessary so that the effect does not occur as with a ratio higher than 1.0:
By rounding up the volume, more margin is required in relation to the capital, which means that the margin is used up earlier than that of the trader and possibly not as many trades can be open at the same time as the trader.

STANDARD COPY MODE

The standard copy mode is based on the trader's volume per trade. The volume is defined by the lot size. The trades are copied 1: 1, regardless of the account balance of the trader or the investor. If the margin for the trade on the investor account is not sufficient to copy the trade, this can be seen from a copying error in the customer account with our partner broker

With an account balance of € 1000, this copy mode is identical to the proportional copy mode with the setting 1.0, but there is no compound interest effect on profits.
I recommend this copy mode from an account balance of € 1100 in order to have sufficient buffer downwards.
The risk decreases with profits and increases with losses.

 

FLEXIBLE COPY MODE

 

The flexible copy mode is based on the trader's volume per trade. The volume is defined by the lot size. The flexible trading volume can be set from 10% - 90% in 10% steps (100% would be the standard copy mode).
With flexible copying, the risk can be minimized by keeping the lot size always the same. Compound interest will not take effect without adjusting the copy mode.

 

 

SETTING MAX. LOT SIZE (SUM NOTE

Flexible 10% 0.1 Equals proportional 1.0 with an account balance of € 100.

Flexible 20% 0.2 Equals proportional 1.0 with an account balance of € 200.

Flexible 30% 0.3 Equals proportional 1.0 with an account balance of 300 €.

Flexible 40% 0.4 Equals proportional 1.0 with an account balance of € 400.

Flexible 50% 0.5 Equals proportional 1.0 with an account balance of € 500.

Flexible 60% 0.6 Equals proportional 1.0 with an account balance of € 600.

Flexible 70% 0.7 Equals proportional 1.0 with an account balance of 700 €.

Flexible 80% 0.8 Equals proportional 1.0 with an account balance of € 800.

Flexible 90% 0.9 Equals proportional 1.0 with an account balance of € 900.

 

The risk decreases with profits and increases with losses.

 

RISK COPY MODE

 

The behavior of the high-risk copy mode is identical to the standard copy mode, but increases the volume from 100% to 125%.
It must be taken into account that 125% cannot be precisely adhered to, since the smallest lot size is 0.1. It is rounded up from 0.05 lot:

 

TRADER INVESTOR

Trade 1Trade 2Trade 1Trade 2Total

1.0 Lot-1.3 Lot-1.3 Lot (130%)

0.9 Lot0.1 Lot1.1 Lot0.1 Lot1.2 Lot (120%)

0.8 Lot0.2 Lot1.0 Lot0.2 Lot1.2 Lot (120%)

0.7 Lot0.3 Lot0.9 Lot0.4 Lot1.3 Lot (130%)

0.6 Lot0.4 Lot0.8 Lot0.5 Lot1.3 Lot (130%)

0.5 Lot0.5 Lot0.6 Lot0.6 Lot1.2 Lot (120%)