Definition and features of the copy trading service
Copy trading – an investment service that allows you to earn income in the financial markets by following the strategies of experienced traders. The service enables investors to profit by copying the transactions of professional traders, and traders, in turn, earn by charging a commission for using their Strategies.
Trader — an AMarkets’ client who has created at least one strategy in the service.
Investor — an AMarkets’ client investing in Traders’ strategies.
Client — an individual who performs trading operations in the platform as a Trader and/or Investor in accordance with this Regulation.
Investment account (Investment in a strategy) — a special account of the Investor, intended for copying trades of the selected Strategy.
Strategy – is created by the Trader to send signals to attract investments.
Strategy rating – a list of all Traders’ strategies, sorted in descending order by profitability. The strategy rating allows Investors who use the Copy trading service to see the performance on different strategies and select a suitable strategy to invest in.
Copy ratio – a copying coefficient. An Investor can scale up and down the Copy ratio. For example, if a Copy ratio = 2, positions will be copied with potential profit (and risk) two times higher than for the selected Strategy.
Loss limit – investment protection level. It indicates which part of your Investment you can afford to lose if the result of the strategy is unfavorable. If the Loss limit is reached, an Investor’s account will be automatically unsubscribed from the Strategy until the Investor decides whether he wants to resume copying the strategy. If he does, he will have to reduce the Loss limit level to zero or set a new Loss limit.
Trader’s fee — commission paid by the Investor to the Trader for using his strategy.
Company — the AMarkets company, which provides access to the Copy trading service to its clients.
1. General provisions
1.1 The Copy trading service is intended for Investors and Traders. It allows Investors to earn in the financial markets by copying the strategies of experienced Traders. Traders make a profit by earning commission from their Strategies.
1.2. Trader chooses the trading instrument and determines the order type in the Copy trading service independently in accordance with his trading strategy. At the same time, an Investor can adjust his capital level by setting the Loss limit and Copy ratio parameters.
1.3 When investing in a strategy, the funds remain in the Investor’s personal account. No one except for the Investor can withdraw or transfer funds from his account. The Investor gets full control of his Investment.
1.4 All settlements and transfers in the Copy trading platform, including withdrawals and accrual of the traders’ fees, are performed by the Company.
1.5 Claims of non-fulfillment or improper fulfillment of the Company’s obligations regarding client trading operations in the Copy trading platform shall be carried out in accordance with the terms of the Customer Agreement.
1.6 The Company shall take all necessary security measures to protect the confidential information of Investors and Traders from the third parties.
2. Account opening
2.1 Before using the Copy trading service, provided by the Company, the Client has to consider the offer and benefits of using this service. Before registering a Copy trading account, the Client will need to confirm that he has read the terms of these Regulations on the company’s website and/or in his Personal area and accepts it terms.
2.2 Account opening is carried out from the Client’s Personal area at AMarkets.
2.3 Every Client registered in the Copy trading service is an Investor.
2.4 A Client who has created at least one Strategy becomes a Trader. At the same time, he can also use the functionality of the Investor.
2.5 Every Client can open only one payment account and use it to log in to the Copy trading platform, deposit and withdraw funds, as well as receive the performance fee and turnover fee.
3.1 Investor can select any Strategy to invest in from the strategy rating.
3.2 When creating the first Investment in the selected Strategy, the Copy ratio and Loss limit parameters will be set at default values. The Investor can manually adjust these parameters later.
3.3 To start investing, the Investor has to fund their Payment account. The deposit amount specified by the Investor is transferred from the Payment account to the Investment instantly.
3.4 Copying will begin immediately after the Investor subscribes to a strategy. Positions copied from the Strategy to the Investment will be opened at current market prices.
3.5 The Copy trading service automatically selects the volume of copied positions proportionally to the size of your Investment’s equity, depending on the specified Copy ratio. The minimum trade size that can be copied to an Investment is 0.01 lot. It allows you to Copy transactions even to very small investments, provided that you have enough free margin in your account.
3.6 Investor agrees to pay commission to the Trader (Trader’s fee). The amount is indicated in the description of the Strategy. The type and amount of commission is defined by the Trader after the Strategy is created.
3.7 The calculations of a Performance fee is based on the principle of high-water mark. The fee is paid only if the Investor’s profit constantly grows and exceeds the previous high-water mark. If a Trader allows loss in some trading interval, the Investor won’t pay the Performance fee until profits of the subsequent trading intervals exceed previous losses.
3.8 The Turnover fee may be additionally set up by the Trader. This type of commission is calculated in USD per lot and paid right after a position is closed. For example, if a position of 0.5 lot USD/CHF was opened in the Investor’s account, and the Trader set the Strategy’s Turnover fee at 5 USD/lot, the Investor will be charged 2.5 USD in favor of the Trader after the position is closed.
3.9 The Performance fee is calculated and paid automatically at the end of each trading period, when the Investment is closed, or when funds are fully or partially withdrawn from the Investment.
3.10 In addition to the Turnover and Performance fees, the Investor may also be charged a transaction commission, in accordance with the Trading Terms and Conditions. For example, 0.04 lots of BRENT was copied to the Investor’s account. According to the Trading Terms and Conditions, the commission on commodities is $10 per lot. Thus, the Investor will be charged an additional: $10 * 0.04 = $0.4.
If a Trader has an ECN account, then a trading commission of $2.5/lot per side will be charged for transactions with currency pairs and metals. Commission for both sides is charged immediately after the trade is placed. For example, the Investor copied 0.1 lot of XAU/USD (gold). Commission on gold is $2.5/lot per side. Thus, when opening a transaction, the Investor will be charged: ($2.5 * 0.1) * 2 = $0.5
3.11 The Turnover fee, Performance fee, commissions and swaps cannot be less than 0.01 USD.
3.12 Investor acknowledges that transactions can be copied at the prices not included in the quotes flow in the client terminal and the Copy trading platform in the period between market snapshots but are still present on the counterparty’s server.
3.13 Market orders in the Copy trading platform are executed at the prices available in the Market Depth (order book). In the event of insufficient liquidity to execute the order of the requested volume at the first level, the order execution will occur at the next available price level until the declared volume is fully filled. When being executed at several levels of Market Depth, the price is displayed in the Investment statement as a weighted average and may not coincide with quotes, ticks and charts in the trading terminal.
4. Reporting period
4.1 The reporting trading period (i.e trading week) begins when the Investor joins the Strategy.
4.2 The reporting trading period end date is Saturday.
4.3 Trader’s fee specified in the Strategy description is calculated separately for each Investor and transferred to the Trader’s payment account in the Copy trading service.
5.1 Trader can create unlimited Strategies in the Copy trading service. For each strategy, a separate account is created in the MetaTrader 4 platform.
5.2 When creating a Strategy, the Trader has to specify the following parameters: strategy name, leverage ratio and account type. After the Strategy is created, the Trader can add a strategy description and indicate Trader’s fees. The fee rate settings can be changed later, but, in this case, the new settings will be applied to new Investments only.
5.3 Trader can monitor Investments in his Strategy in the List of investments section in the Copy trading platform.
6. Account funding
6.1 The payment account in the Copy trading service is funded directly or through an internal transfer from other accounts by submitting a deposit request in the Client’s Personal Area.
6.2 Once the deposit request is processed, the corresponding amount is debited from the Client’s Wallet.
7. Funds withdrawal
7.1. To withdraw funds from the Copy trading payment account, the Client must submit a withdrawal request in their Personal Area.
7.2 The size of a partial withdrawal from the Investment may be limited by the “Free Margin” indicator and can only be transferred to the payment account, where from it can then be transferred to the wallet by submitting a request in the Client’s Personal Account.
7.3. The withdrawal of funds from the Client’s payment account is carried out directly or through an internal transfer in the same currency as the Copy trading account base currency.
7.4. To withdraw all funds, the Client must not have open positions in the Investment.
8. Trading operations
8.1 The Trader carries out trading transactions in the Metatrader 4 platform. At the same time, the Investor maintains full control of his investment account and can manage his Investment in the appropriate section of the Copy trading platform.
8.2 When performing trading operations, the Trader must be guided by the Regulations on trading operations depending on the type of his account. These regulations are available in the Client’s Personal area.
8.3 Trader’s Instructions result in creation, deletion, or modification of the Orders on Trader’s Investments and generation of signals, based on which the Orders in other Investments into the Strategy are created, deleted, or modified.
8.4 When a signal to open a position is received, the system calculates and places orders for each active Investment in this Strategy. The Investment volume is calculated by the Copy trading service automatically based on the Trader/Investor equity ratio, as well as the Copy ratio parameter. For example:
a) The Trader’s equity is 1,000 USD, and the Investor’s equity is 200 USD. The Copy ratio value is set at 1 by default. The Trader’s position size is 1 lot. The position size copied to the Investor’s account will be: 1 (trader’s position size) * (200/1000) * 1 (Copy ratio) = 0.2 lot.
b) The Trader’s equity is 3,000 USD, and the Investor’s equity is 500 USD. The Copy ratio is set at 3. The Trader’s position size is 1 lot. The position size copied to the Investor’s account will be: 0.1 (trader’s position size) * (500/3000) * 3 (Copy ratio) = 0.05 lot.
c) The Trader’s equity is 500 USD, and the Investor’s equity is 2,000 USD. The Copy ratio value is set at 0.5. The Trader’s position size is 0.6 lot. The position size copied to the Investor’s account will be: 0.6 (trader’s position size) * (2000/500) * 0.5 (Copy ratio) = 1.2 lots.
d) The Trader‘s equity is 3,000 USD, and the Investor’s equity is 500 USD. The Copy ratio value is set at 3. The Trader’s position size is 0.1 lot. The position size copied to the Investor’s account will be: 0.1 (trader’s position size) * (500/3000) * 3 (Copy ratio) = 0.05 lot.
8.5 The Investment may be closed by Stop Out. This is a forced closure of open positions without the consent and any prior notice to the Investor if the Investment’s Equity to margin ratio falls below the Stop Out level.
8.6 The Stop Out value for the Investment is set at 20%.
8.7 Investor can close positions in the Investment only in the process of its liquidation. When an Investment is being closed by the Investor, all its open positions are closed at the current market prices, while the positions on the remaining Investments in the strategy remain intact.
8.8 Trader and Investor agree that when the Strategy’s total profitability reaches -99% or less, such Strategies cease to be available for new investments, and new trading signals shall not be copied to Investors’ accounts until the total profitability of the Strategy exceeds the value of -99%. An exception is a partial or complete closure of positions by a Trader. Such trading signals will be copied to Investors’ accounts.
8.9 If there’s not enough free margin to copy a trade from the Strategy to the Investor’s account, the trading signal will be skipped and the position will not be copied.
9. Funds settlement
9.1 At the end of each reporting trading period, the Copy trading system calculates the drawdown for all Investments. The trader’s fee is also calculated and credited at the end of the reporting period.
9.2 Investment drawdown is calculated as follows:
9.2.1 When an Investment is created, it has a zero drawdown.
9.2.2 At the end of each trading week:
- If losses are registered at the end of the reporting period, the Investment drawdown increases by the loss amount.
- If the trading week was closed with net positive (profit):
- If the Investment had a zero drawdown at the beginning of a trading week, the drawdown remains changed.
- If there was a drawdown at the beginning of a trading week, and the profit received in the Investment is less than the drawdown, the Investment drawdown is decreased by the amount of profit.
- The drawdown of an Investment will be set equal to zero if its previous value was different from zero and the profit received is greater than or equal to this value.
9.3 Trader’s fee is calculated in accordance with clause 3.9.
9.4 If profit was received at the end of the trading week, the Strategy Fee (performance fee) is calculated:
9.4.1 If the Investment is in a drawdown at the end of the reporting trading period, the Strategy fee equals zero and commission isn’t credited to the Trader’s account.
9.4.2 If the Investment drawdown equals zero, the Strategy Fee equals to the Fee Rate multiplied by the difference between the Investments weekly profit and the Investment drawdown (if any) at the beginning of the reporting period.
9.5 In addition to the Performance fee, a Trader can set up the Turnover fee.
9.6 The Turnover fee is calculated and paid after a position is closed, and is measured in US dollars per 1 lot of trading turnover.
9.7 The Turnover fee is not paid for trading Stock CFDs.
10. Responsibilities of the Investor and Trader
10.1 Investor and Trader guarantee that:
- the information and personal data they provided during registration as the Company Client, as well as during the execution of all documents related to these Regulations, are correct and accurate;
- they have read, understand and accept all adopted by the Company regulatory documents and their terms;
- they fully understand the consequences of their actions regarding the implementation of the provisions of these Regulations.
10.2 The Trader should monitor the volume of open positions in the Strategy and adjust them if necessary.
10.3 The Investor and the Trader are not entitled to transfer passwords from the trading platform and Personal account area to third parties and undertake to ensure their safety and security. All actions and activity carried out in relation to the execution of these Regulations and/or which involved using the login and password are considered executed by the holders of the said information. The Company shall not bear responsibility for unauthorized use of registration data by third parties.
10.4 Investor and Trader are not entitled to:
- assume any responsibility on behalf of the Company or place the Company under any obligations;
- use the Company’s brand name and/or trademark;
- publish or assist in any publications and announcements concerning the Company in mass media, publish or distribute any articles and letters related to the Company or assist in the writing of such articles and letters in any newspapers, magazines and other periodicals, Internet blogs and forums without the Company’s permission;
- make any guarantees, promises or announcements in relation to any payments on behalf of the Company or using the brand name and/or trademark of the Company;
- perform any other actions that may cause any damage to the Company or raise any lawsuits or claims against the Company from third parties;
- in the event that any claims/lawsuits are brought against the Company as a result of a violation of the terms and conditions of these Regulations by the Trader or Investor, the Trader or Investor undertakes to reimburse the Company for all the losses (expenses) incurred as a result of these violations.
10.5 The Trader undertakes to maintain the level of his own funds in the Strategy at no less than 2% of the total Investors’ funds. Otherwise, the Company reserves the right to optimize the margin requirements on the Trader’s and Investors’ accounts. At the same time, the Company shall strive to notify Clients of the changes via email.
11. Investment liquidation
11.1 The Investor can unfollow the Strategy at any time. When an Investment is being closed, all its open positions are closed at the current market prices. The Trader’s fee is calculated and paid. After that, the money is transferred from the Investment to the payment account.
11.2 If an Investor sends an instruction to unsubscribe from the Strategy, which has open positions on currently non-tradable instruments (i.e. during the weekend), these positions will be closed once trading is resumed.
11.3 If the Investment’s equity reaches its Loss limit level, the Investor’s account will be automatically unsubscribed from the Strategy until the Investor decides whether they want to resume copying the Strategy. If the Investor decides to follow the Strategy again, they will have to reduce the Loss limit level to zero or set a new Loss limit. If the Loss limit is outside the trading hours of some instruments, then positions in these instruments will be closed at the market price when trading in these instruments is resumed.
12. Strategy liquidation
12.1 The Company reserves the right to liquidate the Strategy in the following cases:
12.1.1 When fraudulent activity is suspected (with prior notification of the Trader by email),
12.1.2 Due to other reasons (at the Company’s sole discretion, without prior notice and disclosing the reason).
12.2 A strategy will be automatically archived if:
- no trading or non-trading operations have been performed in the account within 90 days,
- there are no funds and open orders on the account.
12.3 If a Strategy is archived automatically, all Investments attached to this Strategy will be automatically closed. The remaining funds in the investments will be transferred back to the investors’ payment accounts.
12.4 The Company reserves the right to close the Strategy automatically if the total profitability indicator reaches -100%.
13. Duration and Amendments
13.1 These Regulations come into force the moment they are accepted by the Client and shall be considered to be terminated upon termination of the Customer Agreement.
13.2 A Client acknowledges that the Company has the right to make amendments to the provisions of these Regulations at any time at its own discretion, having provided the Client with written notification about the changes at least 3 (three) calendar days in advance. Such amendments shall come into effect and are binding for the Client as of the date indicated in the notification.
13.3 One of the following means of electronic communication shall be deemed written notification: e-mail; notification in the Platform; announcements on the Company’s website.
14. Risk disclosure
14.1 The Company does not guarantee any earnings and profit. The success of a trading Strategy in the past does not guarantee the same success in the future.
14.2 The Company is not responsible for non-compliance with individual agreements and arrangements between the Investor and the Trader. Any promises regarding guaranteed rates of return and profit, as well as potential compensation payments, should be interpreted as intentionally misleading information.
14.3 Investor and Trader accept possible financial losses in the form of direct losses or lost profit caused by the following risks:
- Trader’s lack of skills and knowledge necessary for successful trading in the financial markets;
- loss of control over the Strategy by the Trader;
- involvement of third parties into accessing and managing the Strategy;
- misunderstanding or misrepresentation of these Regulations by the Investor or the Trader;
- delayed filing of a claim against the Company, concerning trading operations on the Client’s trading account;
- unforeseen delays in fund transfers between accounts or delays in the processing of deposit/withdrawal requests or requests to close an account or an Investment;
- liquidation of a Strategy;
- technical malfunction and their consequences;
- exposure to slippage risks.
14.4 The Company shall under no circumstances be liable for the cases associated with the above mentioned risks and their consequences.
15.1 All types of agreements between the Company and the Clients on the execution of the terms of these Regulations may be concluded through mail, email, fax or any other method of communication allowing to verify that the document originates from the Company or the Client.
15.2 In the event that one or more clauses of these Regulations become invalid, null and void by any reason, it shall not affect the validity of any other clause hereof.
15.3 In the absence of a clear and unambiguous interpretation of the term in the text of these Regulations, one should be guided by: first, the definition provided in the relevant Regulatory documents posted in the Personal area and on the Company’s website (except for the Customer Agreement), second, the definition provided in the Customer Agreement.
15.4 The Company under no circumstances shall be liable for any direct, indirect, incidental or consequential loss or damage, including the loss of business, profit or reputation. The Company is not responsible for delays and malfunctions of the Service or the means of communication used by the Client to work with the Service, as well as communications between the Company’s servers and Copy trading services, regardless of their causes, including, without limitation, technical failures, errors in the operation of hardware or software, as well as due to actions of exchanges, governments or regulatory organizations, due to wars, terrorism or unintentional actions of the Company or Copy trading service.
15.5 The yield curve in the Copy trading service is plotted based on the time-weighted rate of return (TWR). The TWR method breaks the account’s trading history into separate intervals based on balance transactions, i.e., whether money was added or withdrawn from the account. The return is calculated for each interval that had no balance transactions (no cash flow changes). The total profitability of the account is calculated as the product of the yield of all intervals. The formula for calculating yield:
Yield = (Equity(n) – Equity(n-1)) / Equity(n-1) * 100, where:
Equity(n) – Funds at the end of the period (before replenishment)
Equity(n-1) – Funds at the beginning of the period (before replenishment)
15.6. Client acknowledges and agrees that the profitability of the investment account may differ from the Strategy’s profitability since several strategies with different profitability can be copied to one investment account and one strategy at different time periods as well.
15.7 The Company reserves the right to change the leverage ratio on the Trader’s account if the total Investor funds within the Strategy exceed 500,000 USD. At the same time, the Company shall notify the Trader of the changes in advance through all available communication channels.
15.8 Complaints shall be accepted by the Company within three business days of the dispute arising. The Client accepts and agrees that the Company shall have the right to reject the complaint in the event of a late submission. All complaints will be considered within five business days of receipt. In some cases, the consideration period may be extended. In the event that the client’s claim is already being processed, the claim shall be considered closed if the client did not respond to the Company’s official response within five business days.
15.9 The Company reserves the right to modify the Strategy’s Copy Ratio parameter on Investors’ accounts in accordance with its own risk management rules.
Beachmont Business Centre, 272, Kingstown
Saint Vincent and the Grenadines
Date of Last Revision 02/11/2022