Darwinex UnCut

On the DARWIN Exchange, every trading strategy “technically investable”. This does not mean that every trading strategy should be invested. Investors must find the needle in haystack!

Why investors and not Darwinex? Simple: as an Exchange, Darwinex does not give investment advice.

In this episode, podcast host Nick “The Moose” Batsford and Juan Colón talk about how DARWIN investors can tell skilled traders from lucky ones.

To pick investable traders in the DARWINian haystack is your call, not ours. But the Exchange makes information & tools available for investors.

Of these, in this podcast episode we'll cover the 12 proprietary attributes Darwinex has developed to evaluate trading strategies that are to be listed as DARWINs. 12 algorithmic filters to scan skill in the lucky pot. 5 years worth of quants invested in them!

Lucky traders delivered return yesterday but their luck runs out tomorrow. Good traders deliver future returns because yesterday’s returns weren’t luck.

In this episode, podcast host Nick “The Moose” Batsford and Juan Colón talk about how Darwinex manages DARWIN risk. In the previous episode we covered why DARWIN risk is managed independently from the trader.

How does Darwinex manage DARWIN risk?

We start explaining why VaR (Value at Risk) is a proper measure of risk. With 10% monthly VaR at 95% confidence, investors can go to a desert island without Internet next month, knowing that with 95% probability they’ll do better than -10% and with 5% probability they’ll do worse than -10%.

To explain VaR and expand on why it’s a proper measure of risk, we’re going to build up conceptually how we calculate it and compare it all along to partial measures of risk which is what most people use today.

We continue mentioning that DARWIN investors can set take-profits / stop losses on the DARWIN price if they want to bound their outcomes even further (at the expense of making them more likely - more on that later).

So, whilst DARWIN investors are in the desert island:

* The trader will have no incentive to change his risk

* He gets no cut in commissions

* He only earns on success

* He’ll ruin his score by changing his game

* Darwinex will control DARWIN leverage so that as DARWIN investors know those are the odds

* Apples to apples consistent with that DARWIN’s past

* Apples to apples comparable to past behaviour by every DARWIN

Prerequisite for an investable asset: risk is known, because it’s independently verified and managed.

Otherwise, it’s all a noisy haystack that smart investors won’t approach (they know better than gambling investor peanuts.

And the way is to build up our stack from:

* A trade -> trade level risk

* A position -> unit measure or risk

* A strategy -> proper measure of risk

In this episode, podcast host Nick “The Moose” Batsford and Juan Colón talk about the rationale behind the fact that DARWIN risk is managed by Darwinex, independently from the risk of a DARWIN’s underlying trading strategy.

The challenge with copytrading sites, PAMM accounts, Hedge Funds is delegating control over your risk. Someone other than you manages your unknown (your risk). And he’s got access to the Turbo Button: leverage.

How he manages the next trade is outside your control. You only know his past behaviour.

The best you can hope for is for him to continue his past (which is known) behaviour into the future (which is uncertain).

Neither of you know the future. And neither do you know his reaction to your unknown future.

“This strategy / hedge fund manager is low risk because it has a low drawdown”. Do you agree with that statement? If you do, watch The Deer Hunter and listen to this podcast episode.

At Darwinex, we don’t know the future either. But we control that future risk doesn’t deviate from past one.

In this episode, podcast host Nick “The Moose” Batsford and Juan Colón talk about where your money is when you trade through a broker.

When you google "FCA register Tradeslide Trading Tech", you'll see that:

- On the one hand, we are regulated as a broker  having thus permission to hold client monies

- On the other hand, we are regulated as an investment manager having permission to manage investor decisions which we conditionally make available to trading customers via DARWIN. Investors pick timing: what to buy, when? We pick risk: investor leverage is controlled by Darwinex.

Listen to the episode to know what happens to your money when you deposit it through your broker's platform. We'll cover the bank accounts on which the money is received, the guarantees provided to traders and investors, how prime brokers extend credit (leverage) to us -and who they currently are-, and how their financial strength matters.

In this episode, podcast host Nick “The Moose” Batsford and Juan Colón talk about the rules at the DARWIN Exchange.

"Just as New York Stock Exchange doesn’t tell you to buy Apple over Microsoft, we don’t tell you to buy NTI over ERQ."

We cover the rules traders need to follow to list their strategy in the Exchange and tap investor capital.

We talk about how investors are not given investment advice and that all investment styles are welcome. They can passively track the ETFs, i.e. the DARWINs or can actively trade them.

We cover the toolkit the Exchange offers to both traders and investors so they can perform their fundamental analysis.

And finally, we talk about the way the rules assure that Exchange participants have their “skin in the game”.

In this episode, podcast host Nick “The Moose” Batsford and Juan Colón talk about the DARWIN asset or: how to have your own Hedge Fund without the legal burden of creating one.

We'll explain how to leverage investor capital legally covering:

- the value chain: trader ---> Darwinex (asset manager) ---> investor,

- and the mechanics: lead trade ---> replica trade

In this podcast episode we’ll explain how today’s retail trading industry works, and how Darwinex stands apart from the prevailing conflicted Cash for Dealers model. Hosted by Nick “The Moose” Batsford.

Why is the Cash for Dealers model still prevalent?

Every trader needs a broker. Surely if this was so obvious everyone would know it? Why is the Cash for Dealers model still prevalent? Why isn’t this common knowledge? We'll talk about:

*The "sausage factory"

**1200 GBP to get first trade

**3000 GBP per customer

*The broker-dealer model

**Dealer is default mode and it's NOT necessarily wrong.

**Broker in high risk mode. This IS the problem.

**Conflict of interest in educating the lose peanuts crowd.

**Conflict of interest in preserving shareholder capital over customer intellectual property.

The Darwinex model is a brokerage only model in which all flow is brokered away onto independent counterparties. We provide traders with execution information disclosing how quickly trades got filled and who’s on the other side of it.

One of the 4 ways we fast track traders is by providing execution by being firmly on customers side. We trade with customers, not against them.

However, the dealer model is more “efficient” in monetizing customer flow making more from average customers. This is why broker-dealers can pay more for advertising. This is also why no one hears this podcast, so, if you like it -> share it!

Next episode: How we legally overcome the peanut problem introducing the DARWIN asset class.

Subscribe to the Darwinex Blog here: blog.darwinex.com

How many millionaires do you know who’ve made millions trading financial markets? Probably lots of hedge fund billionaires. But how many have made it from home?

There are three reasons for this:

1. It’s very hard to make 20% per year consistently over time.

2. Very few Hedge Funds worldwide have delivered that performance over a sustained period.

3. Compounding a small initial capital at 20% per year won’t make you billions.

This is the peanut problem. If you trade peanuts, the best you can make is peanuts - regardless of how well you trade them. In this episode, Juan and Moose talk about the financial ways that exist to solve this problem.

People with talent & passion are graduating from sports gambling and poker and are approaching the highest stakes casinos, i.e. financial markets. Over the coming episodes of this podcast we’ll talk about ordinary people (retail traders) who no longer trust biased advice from so-called “experts” who recommend on the basis of their own and not their customers' agenda. Some people have retail pockets but first class brains: amateur poker players who become professional FX traders as they outgrow online poker games and scale their bets or data scientists who approach the market algorithmically.