Past Performance is not indicative of future results.
Technical Information about how RandBots determines hypothetical execution prices
All results displayed on RandBots must be regarded as hypothetical. Elsewhere on this Web site we warn you about the risks of relying on hypothetical results. Hypothetical results can be vastly different than the real-life results you can achieve in your trading account, almost always for the worse. Since all results on RandBots must be regarded as hypothetical, we believe it is useful to explain how these hypothetical results are calculated on this site. The purpose of this page is to describe with some technical detail information about how we gather and calculate hypothetical results. How does RandBots decide what "trade price" to use in hypothetical results?
The general way RandBots works is as follows: Strategy Publishers enter buy and sell signals in real time. Strategy Publishers using RandBots must transmit to us specific buy and sell information in real time. In other words, strategy publishers do not send us a historical "track record" purporting to show how they would have traded in the past. Rather, they enter into our Web site (or use electronic transmissions through our software API) a specific, actionable recommendation, at the time that action must be taken - for example: BUY 50 shares of IBM at Market, or SELL SHORT 1 E-Mini S&P futures contract at limit 2105.50.
Once we receive this trade "signal," RandBots does two things.
First, it attempts to simulate how a real-life trader following the exact instructions of the publisher, at the exact moment that publisher makes the recommendation available, would fare. For this we use real-time quote feeds from various exchanges. Our simulation software uses the bid/ask spreads provided by these data feeds, where available. In other words, when a strategy publisher instructs us to BUY at market, we assume the trade will be executed at the ASK visible at the moment the signal is received.
Simultaneously, at the moment the strategy publisher enters a buy/sell signal, the signal is relayed into the brokerage accounts of the AutoTraders who subscribe to that strategy.
Some trading systems on RandBots have no subscribers, or no AutoTraders. In these cases, the results shown on RandBots will be based solely on quote-feed data, and are best-guess estimates of what a real trader might achieve. For strategies with AutoTrading subscribers, RandBots receives electronic trade confirmations from the AutoTraders' brokerage accounts. These electronic messages inform us about the actual execution prices achieved in real-life trading accounts. In these cases, RandBots displays as the hypothetical trade price the volume-weighted average execution price from all brokerage accounts reporting the specific execution in question. This data, while perhaps nominally more useful than hypothetical fills based solely on quote feeds, must still be regarded as hypothetical data, and the same dangers of relying on such hypothetical data still apply.
Please keep in mind that: These results are based on simulated or hypothetical performance results that have certain inherent limitations. Unlike the results shown in an actual performance record, these results do not represent actual trading. Also, because these trades have not actually been executed, these results may have under-or over-compensated for the impact, if any, of certain market factors, such as lack of liquidity. Simulated or hypothetical trading programs in general are also subject to the fact that they are designed with the benefit of hindsight. No representation is being made that any account will or is likely to achieve profits or losses similar to these being shown.
In addition, hypothetical trading does not involve financial risk, and no hypothetical trading record can completely account for the impact of financial risk in actual trading. For example, the ability to withstand losses or to adhere to a particular trading program in spite of trading losses are material points which can also adversely affect actual trading results. There are numerous other factors related to the markets in general or to the implementation of any specific trading program, which cannot be fully accounted for in the preparation of hypothetical performance results and all of which can adversely affect actual trading results.
FULL RISK DISCLOSURE
The following statement is furnished pursuant to Commodity Futures Trading Commission (â€œCFTCâ€) Regulation 1.55(c).This brief statement does not disclose all of the risks and other significant aspects of trading in futures, forex and options. In light of the risks, you should undertake such transactions only if you understand the nature of the contracts (and contractual relationships) into which you are entering and the extent of your exposure to risk. Trading in futures, forex and options is not suitable for many members of the public. You should carefully consider whether trading is appropriate for you in light of your experience, objectives, financial resources and other relevant circumstances.The risk of loss in trading commodity futures contracts and foreign currency can be substantial. You should, therefore, carefully consider whether such trading is suitable for you in light of your circumstances and financial resources. You should be aware of the following points:
You may sustain a total loss of the funds that you deposit with your broker to establish or maintain a position in the commodity futures market or foreign exchange market, and you may incur losses beyond these amounts. If the market moves against your position, you may be called upon by your broker to deposit a substantial amount of additional margin funds, on short notice, in order to maintain your position. If you do not provide the required funds within the time required by your broker, your position may be liquidated at a loss, and you will be liable for any resulting deficit in your account.
The funds you deposit with a futures commission merchant for trading futures and forex positions are not protected by insurance in the event of the bankruptcy or insolvency of the futures commission merchant, or in the event your funds are misappropriated.
The funds you deposit with a futures commission merchant for trading futures or forex positions are not protected by the Securities Investor Protection Corporation even if the futures commission merchant is registered with the Securities and Exchange Commission as a broker or dealer.
The funds you deposit with a futures commission merchant are generally not guaranteed or insured by a derivatives clearing organization in the event of the bankruptcy or insolvency of the futures commission merchant, or if the futures commission merchant is otherwise unable to refund your funds. Certain derivatives clearing organizations, however, may have programs that provide limited insurance to customers. You should inquire of your futures commission merchant whether your funds will be insured by a derivatives clearing organization and you should understand the benefits and limitations of such insurance programs.
The funds you deposit with a futures commission merchant are not held by the futures commission merchant in a separate account for your individual benefit. Futures commission merchants commingle the funds received from customers in one or more accounts and you may be exposed to losses incurred by other customers if the futures commission merchant does not have sufficient capital to cover such other customersâ€™ trading losses. The funds you deposit with a futures commission merchant may be invested by the futures commission merchant in certain types of financial instruments that have been approved by the Commission for the purpose of such investments. Permitted investments are listed in Commission Regulation 1.25 and include: U.S. government securities; municipal securities; money market mutual funds; and certain corporate notes and bonds. The futures commission merchant may retain the interest and other earnings realized from its investment of customer funds. You should be familiar with the types of financial instruments that a futures commission merchant may invest customer funds in. Futures commission merchants are permitted to deposit customer funds with affiliated entities, such as affiliated banks, securities brokers or dealers, or foreign brokers. You should inquire as to whether your futures commission merchant deposits funds with affiliates and assess whether such deposits by the futures commission merchant with its affiliates increases the risks to your funds.
You should consult your futures commission merchant concerning the nature of the protections available to safeguard funds or property deposited for your account.
Under certain market conditions, you may find it difficult or impossible to liquidate a position. This can occur, for example, when the market reaches a daily price fluctuation limit (â€œlimit moveâ€).
All futures, forex and options positions involve risk, and a â€œspreadâ€ position may not be less risky than an outright â€œlongâ€ or â€œshortâ€ position.
The high degree of leverage (gearing) that is often obtainable in futures and forex trading because of the small margin requirements can work against you as well as for you. Leverage (gearing) can lead to large losses as well as gains. In addition to the risks noted in the paragraphs enumerated above, you should be familiar with the futures commission merchant you select to entrust your funds for trading futures positions. As of July 12, 2014, the Commodity Futures Trading Commission requires each futures commission merchant to make publicly available on its Web site firm specific disclosures and financial information to assist you with your assessment and selection of a futures commission merchant.
ALL OF THE POINTS NOTED ABOVE APPLY TO ALL FUTURES AND FOREX TRADING WHETHER FOREIGN OR DOMESTIC. IN ADDITION, IF YOU ARE CONTEMPLATING TRADING FOREIGN FUTURES OR OPTIONS CONTRACTS, YOU SHOULD BE AWARE OF THE FOLLOWING ADDITIONAL RISKS:
Foreign futures transactions involve executing and clearing trades on a foreign exchange. This is the case even if the foreign exchange is formally â€œlinkedâ€ to a domestic exchange, whereby a trade executed on one exchange liquidates or establishes a position on the other exchange. No domestic organization regulates the activities of a foreign exchange, including the execution, delivery, and clearing of transactions on such an exchange, and no domestic regulator has the power to compel enforcement of the rules of the foreign exchange or the laws of the foreign country. Moreover, such laws or regulations will vary depending on the foreign country in which the transaction occurs. For these reasons, customers who trade on foreign exchanges may not be afforded certain of the protections which apply to domestic transactions, including the right to use domestic alternative dispute resolution procedures. In particular, funds received from customers to margin foreign futures transactions may not be provided the same protections as funds received to margin futures transactions on domestic exchanges. Before you trade, you should familiarize yourself with the foreign rules which will apply to your particular transaction.
Finally, you should be aware that the price of any foreign futures or option contract and, therefore, the potential profit and loss resulting therefrom, may be affected by any fluctuation in the foreign exchange rate between the time the order is placed and the foreign futures contract is liquidated or the foreign option contract is liquidated or exercised.
THIS BRIEF STATEMENT CANNOT, OF COURSE, DISCLOSE ALL THE RISKS AND OTHER ASPECTS OF THE COMMODITY AND FOREIGN CURRENCY MARKETS.