*for Service Providers
Profit-Sharing is our best method of automated trading that allows connected users to receive 100% identical results.
The Trader and subscribers become one. This ensures the perfect execution of the trading strategy from entry to exit.
As a service provider, you can now choose to offer your service using the profit-sharing method.
- Available for Spot & Futures trading
- You must create & connect to your own service with a Zignaly Spot or Zignaly Futures
- Shared success -Based on performance through success fees.
- High watermark as fair win-win model
- 100% identical results for investor and trader
In this Article:
- How does Profit Sharing work?
- Success Fee
- High-Water Mark Calculation
- Frequently Asked Questions
How does Profit Sharing work?
For this model to be possible it is necessary to use a Zignaly Exchange account, which is a sub-account within the Binance Broker Program, in which Zignaly participates.
This allows us to create joint pools where both trader's and user's funds are allocated.
Whenever a user connects to your service, the allocated balance is pooled into one account.
When you open a position, you will have to take into consideration the whole capital that you are managing. Let's say you allocate 100, userA allocates 200, and userB allocates 50, you would be managing 350usdt in total. If you open a position of 10%, that would be a position of 35usdt.
The profit-sharing model works with a success fee instead of a standard monthly subscription fee.
You decide on the success fee for your Profit-Sharing service. Profits will be divided between the Investors, the provider (you) & a 5% rate to Zignaly. Let's say that you decide to charge a 30% success fee. The user will see a 30% success fee. 70% will go to the user, 25% to you & 5% to Zignaly.
The success fees are only taken once a position is closed and profits hit a new high.
High-Water Mark Calculation
We are using a high-water mark, each time there are profits, and profits + current balance is above the high-water mark, the profits will be shared, however, if there are open positions with losses at that moment, the negative amount will be retained until the positions are closed.
Every time that a position is closed, we analyze the status of the current open positions. If they are in profit (and generate new all-time high equity value), success fees will be paid, but if the current positions are in loss, we keep the current losses as a retainer. The next time that a position is closed, we calculate the pnl to balance the retain value.
When selecting to cancel the disconnection, no new positions will open but it requires the user to wait until all currently open positions, have been closed by the trader in order to disconnect from the service.
The balance will remain locked during this time.
See this article, for more information about liquidations and margins.
As the service owner, your allocated balance will also remain locked, with the exception of transferred success fees and the options to reinvest or withdraw your profits from each position.
This feature will be integrated with the new version of Profit-Sharing 2.0. Visit our Technical Roadmap for updates.
Frequently Asked Questions
Yes, but you can automate it with your own algorithm outside our platform. You can see more information in our Guide to sending signals.
If on the other hand, you are going to trade manually within the platform, you can see our article that explains how to use all the functionalities of our Trading Terminal.
In either case, to use our Profit Sharing service you must use a Zignaly Exchange account and manage it from our platform.
Learn more about Managing your service profile page
Continue to Create a Profit-Sharing Service
Zignaly Profit-Sharing Presentation