Introducing Darwinian Dividends
- Why add Darwinian Dividends?
- Where do the dividends come from?
- How is the amount determined?
Collective data -> Darwinian Dividends
- It competes for investor capital with other signals
- Investors replicate trades while not knowing trade specifics in order to protect trader intellectual property (IP)
- Investors pay the standard 20% performance fee
- Not to the Exchange
- Not to anyone Exchange member
- But to every Exchange member
Community data -> just DWC?
In the long rung, Darwinex aims to share all raw community signals, not just DWC.
Before that, however, it needs signal wrapping/encryption technology. Barring that, publishing the raw data would gift free-riding signal users more than 80% profit share, as it would be possible for them to trade on the signal outside Darwinex, at the expense of the Darwinex community. Alas, encrypting everyone’s real-time signal to secure 20% success fee is a tough technical cookie.
Until we crack it, DarwinexLabs will act as the community data’s caretaker. In this regard, DWC is the result of transforming raw community loss aversion data into a tradable asset. Rest assured that DarwinexLabs is hard at work investigating useful siblings… but for now, you know why DarwinIA “just” pays dividends on DWC.
Distribution key -> meritocracy
- Member community data is valuable – check out DWC’s performance fee section
- 20% performance fee is the fair price for it
- Dividends belong to Darwinex members
- Pro-rata payment: every trader receives an equal pay-out?
- Skewed payment: according to some meritocratic criteria?
- The better the traders supplying individual DARWINs (=signals)
- The bigger the incentive for new traders and investors to join
- The more statistically significant the collective signal available to all
- The bigger:
– the 80% kept by demand (=investors) for individual and collective signals
– the 20% earned by signal suppliers (=DARWIN Providers)
- To the top 10 DarwinIA participants in a given month should DWC had accumulated 10K in performance fees paid, if not it will be paid in multiples of 1000 € starting from the winner downwards
- In T+1 monthly cycles, meaning that the winners in month X will share the performance fees accumulated up until the end of such month
- Performance fees paid 5500 : Top 5 DarwinIA winners will receive 1000 € each, with 500 € rolled over to the following months payout
- Performance fees paid 12.500 €: Top 10 DarwinIA winners will receive 1000 € each, with 2500 € rolled over to the following months payout
- Performance fees paid 1.500 €: The DarwinIA will receive 1000 €, with 500 € rolled over to the following months payout
The initial payout on March 1st 2018 will:
- Be paid to the top 10 participants in DarwinIA rankings in February 2018 if performance fees reaches 10000 €
- Be based on cumulative performance fees earned by DWC through end February 2019
- Per subsequent payouts, be capped at EUR 10k, with excess performance fees generated rolled over to the following months payout
What’s your take?
- Agree that community signal be leveraged?
- Agree with the distribution system?
- Want to contribute to encrypt it? – we’ll build out our data science team in 2018!
Do you want to know more about this unique DARWIN? Say no more! Here’s an insightful webinar about DWC hosted by Juan Colón where he explains the rationale, for Darwinex and DARWIN investors, of backing the DWC https://www.darwinex.com/darwin/DWC.4.20 community sentiment indicator:
You can leave your comments here, in our Youtube Channel or writing at firstname.lastname@example.org. Oooops, almost forgot to say! Please, do not hesitate to share this content with your fellow traders & investors by using the icons you see on the left hand side of this post 😉