Traderace Launches a Profitable New Trading Competition
by Shrutee K/DNS
It frequently seems as if
regulators globally are doing their best to discourage people from trading FX,
amidst claims that the process is unfair. Whether that stems from a perception
that the whole process is weighted too much in favor of brokers, there’s a lack
of transparency, or concerns that clients being left exposed to significant
potential losses, leveraged trading is struggling to shrug off a rather grubby reputation.
So, amidst the recurring claims
of fast execution, great customer service and tight spreads, it’s encouraging
to see some entities coming to market with a rather more innovative concept,
developed to find a new way of engaging both existing and potential traders alike.
Hong Kong based Traderace seems to be doing just this with its
newly launched trading competition. It’s been structured to make it simple to
understand, runs on a pure STP model and leaves the traders not only working on
building their own P&L as would be the case with any broker, but also
competing for prizes which are funded from the broker commissions generated.
The concept is understood to be a world first and if the company can achieve
its target of 200,000 participants, the prize fund is forecast to be in the
region of EUR1,500,000 per month.
Participants will be limited to
funding a maximum of five accounts per month, with a maximum deposit of EUR100
per account. That’s been designed deliberately to provide a level playing field
across the board, so that heavyweight participants aren’t immediately put at an
unfair advantage of winning either the monthly or annual competitions. Accounts
can’t be funded more than once in a month in a move to encourage responsible
trading, although the option to have multiple accounts allows several trading
strategies to be run in parallel.
These will be looking for both
the absolute return and also the greatest volume generated in a month. Leverage
terms and pricing will be set at industry standard levels, with popular
currencies offered at 400 times margin and industry standard spreads, with the
prize money funded purely from 70% of the trading commissions generated. This creates a fair and transparent
competition that should be both fun – and for some has the potential to see
them gain life changing sums of money.
As Antonis Nicholas
explains, “We decided to structure this competition in a way that deliberately
gives us as the counterparty no incentive to trade against clients. The full
STP model means we’re agnostic to each trade, meaning competitors are left to
trade against the market and one another. There’s negative balance protection
in place and we like to think of this concept as meeting both the needs of
professional and recreational traders alike.”
Traderace is working with the recently established
4XCube brokerage to deliver the necessary liquidity components. Participants
will deal over the popular MT4 platform, opening up the competition to the
widest possible audience, with the opportunity to trade on a range of
instruments including currencies and indices. IBs will also be incentivised to
encourage their clients to participate in the initiative.
In a world that at times seems to
be sorely lacking innovation, this illustrates that other options do exist. The
cooperative nature of the prize fund also provides valuable transparency.
Assuming Traderace can gain the necessary scale, as the company says the prize
payouts – which are in addition to an individual’s trading profits – could
prove significant.
Comments
Post a Comment