HIGH IMPORTANCE. Strategy providers withdrawing capital - PROVIDERS NEED TO BE WARNED - NEED A WARNING POP UP DISPLAYED WHEN WITHDRAWING OR DEPOSITING CAPITAL.

Meth0d
07 Sep 2020, 17:10

RE:

nord0n said:

Hello everyone, 

I believe I have a REALLY important suggestion which needs to be considered.

This weekend.. I was in multiple positions, as per my strategy provider. This is totally fine.. however the strategy provider withdrew money whilst I and every other person who was copying had an open position.

This in turn affected the equity to equity ratio

This resulted in a significant loss for myself and more than likely every other copier who was following.. this is simply because the strategy provider is not warned of the consequences of doing such actions whilst having open positions.

The result in this is not only a loss for myself and others, but this will overall result in less profit for the strategy provider as this is resulting in unnecessary losses.

More losses = less profit for the copier = less profit from performance fees for the provider.

My suggestion.. is very simple.

If you're a provider.. and you withdraw money, whilst having open positions.. a warning will be displayed as such.

"Warning, you currently have open positions.
Withdrawing and depositing money during this time can result in unnecessary capital loss and will potentially affect your performance fees,
Do you wish to continue?"

If this happens.. I believe the strategy provider will fully understand the negative consequences of their actions and in turn will prevent such unnecessary losses.

A simple warning is all what is needed which I believe can be solved with a few simple lines of code.

Due to this measure not being in place.. I ended up with losing 4% of my capital as the strategy provider clearly did not understand the negative results of this action.

Had their been a warning prior to this as per my suggestion above.. I believe the strategy provider would HAVE waited until all existing open positions were closed, before going ahead with such action.

This is EXTREMELY relevant and must be considered by the Admins !

I had the exact same issue this weekend. The strategy provider withdrew funds while he had 2 OPEN positions held over the weekend. As a result, the equity-to-equity ratio got re-calculated, which is totally fine as per equity-to-equity ratio principle. The only issue arise when Positions are OPEN at the time of Withdrawal ! My positions got all closed and re-entered at a very bad entry price, resulting in more than 3% Loss.

A simple Warning message to the Provider would have avoided this unnecessary loss.