Red Flag Traders
Traders To Avoid On ZuluTrade
There are some red flags that should be easy to spot that will help you to protect your zulutrade account. Many of the traders on Zulutrade look good for a few weeks, or even months, but are really just ticking time bombs. Don't be around when the timer stops.
This article is intended to highlight a few things to look for an avoid. It is in no way intended to cover every problem that traders may or may not have. Now, what to look for:
Trading Without Stops
Any trader who trades without stops should be avoided. Even if the trader is good, there are factors that you cannot control. There is always the chance of a power outage or internet connection failure. News can move the market fast and far. Trading without stop is the first thing that any trader learns not to do. Avoid this trader at all costs.
Disproportionate Win/Loss Sizes
Some traders get excited and pull profits off of the table far too early. Generally this is a good idea for a losing trade. You want to cut your losses short and let your winners run. This should cause your winners to be bigger than your losers. Any trader who regularly takes 10 pips of profits and has 200 pip losers on his books is noone that you want trading your account.
These are not actually red flag traders but you should still avoid them. Any trader with only a few weeks worth of records should not be traded on a live account. You can absolutely run them on a demo for a month and take a look at the results, but if the trader is worth trading, they will still be there in 6 months. And by then you'll have a much better idea of who you're dealing with.
Huge Gains After A Drawdown
Traders who have abnormally big winners at the end of a sizable drawdown have usually given up and are taking one last shot. Their accont recovers and to the untrained eye it looks like a solid winning trader. For every 10 traders that try this maybe 2 will survive and bounce back. This means that those 2 are floating around waiting for you. When they have their next drawdown they will likely try the same "hail mary" play and the results may not be so favorable. Don't trade your money on a wing and a prayer.
There are obviously many more tell tale signs that a trader should be avoided and for this reason this article will be added to from time to time. Check back soon to see what's new.
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