Getting out of sync @CopyTrading

When I reviewed my CopyTrading portfolio a few weeks ago I realized, that the performance of my copied traders differ a lot (see chart below). Some are performing great, with a profit >10%. Others are losing up to 20% of my investment. As a result the overall profit of my CopyTrading portfolio is below 1%. So it was about time to think about rearranging my portfolio. First I started analyzing the charts of some traders and realized, that I am not properly synchronized with them. In this post I discuss two examples and explain what I believe are the reasons.

Performance of my copied traders in direct comparison:

Sync with @moosgruber

The following chart shows the performance of @moosgruber. The red line represents the performance in my portfolio. The green line is based on his eToro chart. This chart shows the performance based on an initial investment of $10.000. In calendar week 36 @moosgruber's "value" was $15.997,19. In order to generate the graph below, I calculated the relative difference of @moosgrubers "value" in each week to this initial value.

Both graphs in the chart appear to be somewhat parallel with a nearly constant offset. I wondered why this offset appeared in calendar week 38 and found the following reason: In calendar week 38 I added funds to all traders in my CopyTrading portfolio (check out my portfolio review from back then for more details). I haven't wasted a thought about getting out of sync by just adding funds, but for me it is pretty obvious that this is the reason (or at least one reason). So next time I will rather end copying a trader and recopy him with a higher amount.

Sync with @Kirex15

While the difference between my profit with @moosgruber and the profit according to his eToro chart was quite low and nearly similar, I figured I am completely out of sync with @Kirex15 (see chart below - in this case being out of sync was quite helpful, as it reduced the losses).

As for @moosgruber I added funds in calendar week 38, thus causing some issues. However, the difference here already appears after the first week of copying, so basically right from the start. Later the differences becomes even greater and exceed the differences for @moosgruber. What I found then was, that @Kirex15 recommends a minimum investment of $270 - more then I have invested right now. Unfortunately eToro doesn't show the trade sizes in a traders history, so I can only assume that I missed some of @Kirex15's trades because they were opened with less than 1% of her equity. In order to avoid such issues, I intend to better check on traders recommendation in the future before I start copying them.

Sync with @berrau

The graph below shows the profits of @berrau. Interestingly my portfolio and @berrau's eToro chart split apart in cw38 - probably due to me adding funds. Just four weeks later, both profits are nearly identical again, without any interaction. It appears as if the trading style of @berrau is very good for copying. Do you have any idea why?

Conclusion

The conclusion is rather easy to draw: It is important to check frequently whether the copy process is still synchronized properly. There are many reasons why a CopyTrade can get out of sync:

• The trader is adding or removing funds to his account
• The copier is adding or removing funds to the CopyTrade
• The amount invested in the CopyTrade is too small and not all trades are copied
• The trader gains some parts of  his profit by copying other traders, but the trades are to small to get copied

What is your experience with CopyTrading? What do you do to keep properly synchronized?

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Related posts:

Getting out of sync @CopyTrading pt. 2 - 13.01.2017
rearranging my CopyTrading portfolio

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Important remark: The results presented above and throughout my blog are no recommendation for your trading! I only share my personal findings and opinions to give ideas and let my followers and copiers know what I am currently working on. I can not guarantee the correctness of my tool and my presented results. Furthermore past performance is not an indication for future results. Only trade with money you can accept to loose!