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MT4 Expert Advisors = good business model?

10 March 2015

Mt4 Expert Advisors are wildly popular. They let investors trade the intellectual property in an algorithm, and provide developers with revenues. Are they a good business model for algorithm developers? Here’s our take (hint, they’re effective but inefficient). The MT4 EA business model EAs are effective: there is a market for them. Metaquotes, Myfxbook, etc., are active communities where some […]

The House Always Wins #2: Information Asymmetry

9 March 2015

If you trade and/or generally like games involving a risk/return component, The Sting (1973) featuring Robert Redford & Paul Newman is a movie you’ll enjoy.   The movie just turned 43, but the plot is timeless – its ingredients are as old as humanity. Why? Because for as long as people have been around, some have always […]

Inside forex – broker incentives

5 March 2015

DMA, STP, NDD – if you trade forex, you know the broker choice alphabet soup. Our take? Don’t miss the wood for trees: ignore acronyms and focus on incentives instead. (If you’re feeling like a more in depth session on this, our FXStreet Brokernomics webinar that’s gotten quite a few hits). Broker incentives You go long […]

The House Always Wins #1: Loss Aversion

2 March 2015

Scores of retail traders lose money systematically – i.e. strategies replicating exactly their opposite trades, offer guaranteed pay-offs, given a statistically speaking representative time horizon, and sufficient capital to withstand the occasional loss. The question is: how does this come about? The answer is a cornerstone of behavioral economics. To understand the mechanics in detail, please refer to a fantastic […]

Introducing Long Tail investing

24 February 2015

The most re-assuring lesson Darwinex founders have learnt is that traditional investment firms will never “steal” our concept. Reading would have saved us anxiety: smart innovators actively encourage start-ups to disclose everything… if it’s really an innovation people think you’re nuts! “Institutional” asset managers seem to agree: when they hear about DARWINs listing independent traders, two objections invariably come up: Retail […]

Inside Forex – MT4 and Interbank Liquidity

10 February 2015

A bit of background 10 years ago independent traders could not trade Interbank Liquidity. Just as ALCOA doesn’t sell aluminum by the gram, Goldman Sachs doesn’t make markets in micro-lots! But then, some smart Russian engineers realised: sure, GS won’t do it, but how about we: Observe the price at which GS and say, UBS, trade EURUSD […]

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. -- % of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.