I hope you are all well!
This is my first post here and I just wanted to share my feedback on what I think the largest flaw of ZuluTrade’s new “Profit-Sharing” account is.
So as I understand it, if a trader is profitable for the month, the followers pays a 20% commission to the trader. The trader then receives half of this commission and the other is held for “protection” so that if the trader is not profitable the next month, they can pay a “penalty”.
The issue here is that when the trader pays this penalty, it doesn’t go back to the follower, as it well should, ZuluTrade simply pocket it.
Now, the reason I think this is a, for me, fatal flaw and has made me reconsider if I want to be a signal provider her just a short time after joining is this:
All of the sales copy for this new account sells this as a ground breaking product that aligns the interests of the traders and the followers. Which makes total sense until you realise that it does the opposite of align the interests for ZuluTrade, which will now make more money when trader performs well and then makes a loss.
For the system to work and the ‘aligned interest’ pitch to be convincing, all three parties interests must be aligned in their interests. As it stands, this is not the case.
I’d love to hear your thoughts and perhaps some feedback from ZuluTrade themselves on how they justify this.