Why I Stopped The ‘Verified Performance’ Account

By | October 29, 2016

Since early December last year until this week I’ve had a ‘Verified Performance’ widget tracking the performance of a live 10k account at Darwinex. This post is to explain why it got started, why I shut it down and the way forward.

Close followers of my site know that I’ve been an enthusiastic cheerleader of Darwinex, believing it will disrupt the asset management/mutual fund industry. So of course that as soon as they offered corporate accounts (you don’t go for a potential income of millions of $$ with a personal account, now do you? :) ) in November last year, I joined. As they say, what a difference a year makes. Long story short, I very much doubt now that the DARWIN as a product and Darwinex as a company, in their current format, will make significant progress in attracting investors and AUM. I won’t get into more details here, if you’re curious you can read the posts I made on their forum or contact me privately.

While the above was perhaps 90% of the reason why I started that account, 10% had to do with making my site even more different and unique compared to the rest of the other 1M  trading related sites. So after 90% of my original motivation when I  opened the account disappeared, I had the following dilemma: should I continue to run it at Darwinex, move it to a different broker or close it? After debating with myself for a few days, I decided for the latter. Main reason being, I didn’t see the utility in it anymore. To those critics who would be quick to point out: ”yeah, then you’re now just like the guys you’re bashing and calling scammers” I will answer that it’s not the case. I haven’t so far and never will imply more or less overtly that trading is easy, you can do it on your smartphone while sunbathing, you can effortlessly take 1k to 10k in a year, all you need to become a professional trader is a $300 course and all other sorts of  BS so ubiquitous on trading sites. Always keep in mind what Carl Sagan said: extraordinary claims require extraordinary evidence.

The way forward as I see it, unless some very strong reasons will come up, I won’t start another account to show verified performance.

24 thoughts on “Why I Stopped The ‘Verified Performance’ Account

  1. BD

    The main problem of Darwin and similar attempts (eToro is another example) that traders are under pressure to produce quick gains. A failure to do that does not cost too much. A success brings retail in and royalties with it. Darwin makes money no matter what. The whole thing turns into one month best forex trader competition with an obvious result. The goal to find capable money managers who consistently beat the market fails because in reality no one is looking for 6% annual gain with 0.5% draw down and instead searches for absolute double or triple digits ROI.

    In my humble opinion here is no true alpha in equity trading. There is nothing left. Options still have some limited potential. May be mean reversion and trend following strategies in forex if you have an adequate capital. A platform which does not allow futures (low cost hedging) and options just does not make sense in the current market environment.

    Reply
    1. JLTrader Post author

      For those looking for triple digit returns (normally followed by a blowup) there’s Zulu and a myriad of individuals selling EAs and signals.
      It’s generally accepted that the financial industry still has to be disrupted by new technologies (see the buzz around robo advisors) but what’s on the market so far claiming to challenge hedgefunds & mutual funds isn’t convincing at all.

      Reply
    2. Vitor

      “… traders are under pressure to produce quick gains…” – In the example I quoted below, the trader (moderate, as per his history ) had a real loss of a mere 2%. The catastrophic 48% loss in October was inflicted by his… Darwin. Here, as a matter of fact, the Darwin has acted as a risk factor.

      Reply
    3. Brian

      “A platform which does not allow futures (low cost hedging) and options just does not make sense in the current market environment.”

      Covestor has offered the full gambit of securities since its inception, as they were only one of these sites to support InteractiveBrokers. Unsurprisingly, IB bought them up. I see there are only 44 portfolios being tracked on the site currently, thus it doesn’t seem to have taken off significantly in popularity unfortunately. Retail is probably too awestruck by the leveraged blow-up artists on Zulu, MyFXbook, Tradency, eToro etc

      BattleFin is another entrant in the institutional-lite space. They don’t seem to publicly publish the results of traders on their platform, but hopefully they’re getting traction. This industry could use more serious players/platforms like Covestor and BattleFIn and less of the retail/leveraged variety.

      JL – I would check out both if you haven’t already, especially BattleFin. From their marketing, they seem to be what you had hoped Darwinex was going to be (a platform which allows for actual institutional funding, not margin nonsense posing as funding).

      Reply
      1. JLTrader Post author

        Thanks for the suggestions – both sound familiar, must’ve looked at them in the past and was left unconvinced. I’ll look at them again, see what has changed.

        Reply
  2. Vitor

    Yes Vlad, unny film! In the blog you mentioned we see dozens of arguments trying to explain how the Darwins work, references pertaining the VaR calculation, the 95% percentile, etc etc.

    I could imagine how fun it would be a lecture on the predicates to invest in Darwins before an audience of investors with real money, when they saw a chart like this one > Darwin named OPK, 48% loss in a single month (October 2016).

    (with all respect for the trader, I’m not criticizing him)

    Reply
  3. BD

    If anyone has an idea about a business model which can work (Covestor/BattleFIn replica?) I will gladly take a part in the venture. I am a software developer with 25+ years professional experience.

    Reply
  4. BD

    See, for example, how collective2.com front page looks like. This is look&feel which sells.

    Reply
  5. BD

    Re covestor.com – the top portfolio manager has Sharpe is 1.9 with 20% return in 12 month.
    They had 20% drawdown since inception – in Aug 2015. In the last 365 days they had 5% drawdown.
    Sortino is 2.0

    It is nice to know that I am not worse than the best covestor guys – “Elite Wealth Management:Dynamic Option Strategy” – with Sharpe 1.5, Sortino 2.2, max drawdown 2.2%, return 14%.

    Reply
  6. Lie Detector

    I suggest you to have the screenshots of you performance, at least for those who want to sign up for your mentorship program. It helps them know what a great mentor you are. I have the screenshot if you don’t. Here it is:
    https://i.imgsafe.org/a48823107a.jpg

    You think people are stupid? You removed the performance from your site because of Darwinex, or you did it because you made a mess on your account and so nobody signed up for your mentorship anymore? Wasn’t Darwinex your recommended broker and weren’t you used to refer traders to it to open a live account? Here is what you also removed from your site a while ago:
    https://i.imgsafe.org/a4ca24bf36.jpg
    https://i.imgsafe.org/a4cc84a0e0.jpg

    You are nothing but another piece of shit like the other forex scams. The difference is you are the most stupid and miserable one.

    Are you man enough to publish this comment on your site???

    Let’s see :)

    Reply
    1. JLTrader Post author

      Wow, a real ‘fan’ here!
      You can print those screenshots and wipe your ass and then your mouth with them.
      I removed the performance widget because I closed the account. Links to that account can be found both in this article and on the mentoring page. So I’m not hiding anything here.
      Yeah, for a while it was my recommended broker – I believed in it. Slowly I grew disenchanted, so first I removed the recommendation, then I argued with them on their forum (in addition to private correspondence) and finally I closed the account. What’s wrong with all this?
      If you use that language again, calling me shit or scam, your comment will go straight to spam.

      Reply
      1. John

        This ”Lie Detector” must be one of the many scammers you exposed or a very dumb hater.

        Reply
    2. BD

      10% drawdown is not an end of the world. I experienced 30% drawdowns. Was lucky to recover. Learned to be very careful and keep a hedge.

      Reply
    3. Trump

      What a nasty comment. Vlad is right that Darwinex is not going anywhere and here is an example: the second ranked trader on Autotrade is lotgenoten who has a Darwinex account and 732 subscribers http://www.myfxbook.com/autotrade. Look him up on Darwinex site, where he has only 5 investors!!! Ignore the 118k in ‘investors capital’ that’s fake money from Darwinia game. So what are we talking about here?

      Reply
  7. Just GJM

    Sorry but I disagree with your call. You should have left that live account up, it adds to credibility. Anyways, You not going to get signups, unless you jippo that account appearance, some good photoshop work… and please get out of those pyjama’s, bryl cream your hair and don a suite ….. :))))

    Reply
    1. JLTrader Post author

      If I were after signups I’d develop a course/chat-room (these have unlimited scalability, unlike one to one mentoring), hire a guy to churn-out content (daily updates, charts, all that nonsense), do YouTube videos showing ‘live’ trades (always winners), show the ‘trader’s life’ with pictures/videos and so on.

      That account is still up, so my credibility is intact. Excepting the money managers with long track-records who else among the ‘trading experts’ is honest enough to show losing periods in trading? There was no point in continuing it because the assumption at the start (Darwinex will be a big disruptor and all that) has been proven wrong.

      Reply
  8. BD

    Here is another contender – peeptrade.com
    I do not think that there is money for the traders, but it is great for ego.

    Reply
  9. Just GJM

    I would be interested in your thoughts on jkonfx.com ? And it would be good content to add to the blog.

    Reply
  10. Dan

    No chance to see a verified trackrecord again in the future? It would be nice…

    Reply
    1. JLTrader Post author

      Highly unlikely, but you know the saying: never say never.
      Thing is this: I see 2 reasons for having a public verified track-record:
      1. you want to legitimize a trading education business
      2. build a public track-record in order to access OPM
      I started it for reason no.2 but I don’t believe anymore it’s a viable way – I wrote an article about it.
      So you’re left only with the drawback of getting abuse (comments/mail) from morons because you have a few negative months.

      Reply
      1. David

        To be honest your account was slowly depleting during whole year, it wasn’t just a few month. Still courageous attempt, majority can not do even that😀.

        Reply

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