ZuluTrade Blog

Lets meet ZuluTrade's Position Sizing Experts!

Trading Floor | Friday, August 14, 2020 1:38 PM GMT

Starting from the most experienced to novice, all Traders have to deal with three basic elements: the system, psychology, and Position Sizing (or Money Management).

Believe it or not, building the strategy can be the easiest part of trading as the Trader is looking for the setup of the system's entry and exit. 
Psychology is a complicated part. Trader's character and personality play a significant role. Additionally, gaining experience is critical and helps you grow and improve yourself. This needs a dedicated blog post.
Position Sizing or Money Management (M.M.) is considered to be science itself. It's proven that an efficient M.M. can improve the profitability of a mediocre trading system while poor M.M. can even destroy the profitability of a solid trading system.

Let's review a hypothetical scenario of how the M.M works beneficial:

Account Currency: $
Instrument: EURUSD
Lot Size: 0.1 (mini lot) 

                           Pips          $
1st Trade:  
1 mini lot  →  - 5pips     -5$  (net) lost
2nd Trade:
2 mini lots →  -2pips     -$4  (net) lost
3rd Trade:
3 mini lots →   4pips      $12 (net) won
Total:               -3pips      $3

Obviously, the overall result in pips is negative while is positive in dollars. Our example is very simple as there are many complicated M.M. models.

But are there such Traders on Zulutrade's platform? 

Yes, there are!
Naturally, Investors must copy them by using PRO-RATA settings exclusively, as they will be benefited from Trader's M.M efficiency. On the other hand, If Investors use FIXED settings, then their copy-trading experience and profitability may not only lag but severely diverge in comparison to Trader’s returns. 

Let's review a few of those Traders and how you can identify them!

Status Silver EA
The first graph shows the performance of Equity while the second one in Pips. The difference is obviously huge! 

This is just for illustration and educational purposes. Also, the Traders’ statistics are subject to change due to the trading conditions.

Wilson Traders
Likewise, the first graph represents the performance of US dollars while the second one in Pips. The Pips PnL was negative while Equity PnL was positive.

This is just for illustration and educational purposes. Also, the Traders’ statistics are subject to change due to the trading conditions.

Same as the previous case, the Equity PnL is by far better than the Pips PnL. 


This is just for illustration and educational purposes. Also, the Traders’ statistics are subject to change due to the trading conditions.


Developing a solid position size strategy needs experience, back&forward testing, and discipline to comply with the system’s rules. However, if a Trader manages to reach the correct balance between the risk profile and return expectations, the desirable long-term profitability will be more feasible than ever!

More educational posts will be posted soon..stay tuned!


This post does not constitute any form of advice, recommendation, representation, endorsement, or arrangement by ZuluTrade and is not intended to be relied upon by a User in making any specific investment or other decisions. Investors should review the Traders Public Pages before copying their signals in a Real Investment Account. Past performance does not guarantee future results. Therefore, future drawdowns may be larger than the historical maximum drawdowns you see in Traders’ Performance page.

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