The manager level system is crucial for our project, it leverages the skill of the manager and the level of funds he or she can attract, and while this idea seems simple enough on the surface, it is much more complex than it looks.

We never hid the fact that the current level system is not a final solution and is merely a placeholder until we can figure out a proper solution. Today we share more details in the evolution of the level system.

For those of you who are not aware, the current system has managers “battling out” for a chance to receive the next increase in level, competing against each other to top the monthly rankings, where the best performing managers of a level have the chance to level up and accept more investor capital. While this approach has a certain beauty in its simplicity, it just doesn’t account for many factors. To be completely honest, it doesn’t really account for anything, apart from the fact that a manager performed well within a certain time period in comparison to other managers.

Frankly speaking, there are just too many parameters to take into consideration. The number of metrics that can be used in order to determine the performance of a trader is truly mind-boggling and finding a solution was one hell of a task. Well, it would have been hellish had it not been for the active help and support from our community. A special task team was formed in order to curate the new level formula and they did a fantastic job telling us what they thought was essential to the community. What we are unveiling today is based on the idea of a formula suggested by our community and then perfected during a collaborative process between both the team and community.

For more than two months, we have been working together in order to come up with something that would suit the needs of all parties. We would like to especially thank all of the people who have participated in our level surveys and additionally thank members of our community with the following Telegram handles:

Alex, Angi, bitkolik, Mr. 94k, Bobby Ricky, Braiden, Crypto_Kadse, Cryptoxic, E.S, Enrique Espinosa, Ettore, gtarcrypto, happier, Hedgebitcoin, J Dent, Johnny Gonzo, mango, Max, MINA, MS92, Not Interesting, wew and 永治.

We thank all of you from the bottom of our hearts for the active participation in helping shape the future of the project.

Without further ado, we will share all of the information about the level system in detail, and we should warn you that it mostly consists of “nerd stuff”. If you don’t want to dive in the technicalities of the level system, you can scroll down to our TL;DR section, neatly located at the end of this part of an update.

The formula

The available amount of money for investing in the manager is calculated as InvScale * manager balance. InvScale is calculated according to a formula that takes into account the age of the program, the trading volume and the success of the trading manager:

Genesis ratio

This coefficient, which shows the ratio of the profit of the program to its risk, is set in the range from 0 to 1.

For each 30-day period, we calculate the PD by the formula:

(profit + 100) / (standard deviation + 100)

The formula is similar to the Sharpe ratio, but with the addition of +100 in the numerator and denominator, since otherwise, the profit effect on the final result is too large.

Next, we consider the formula of a weighted profit to deviation (from now on WPD):

, where:

PL — period duration in days (usually 30 days)

PD — profit/deviation according to the formula above.

WPD is limited from 0.6 to 1.1

Genesis Ratio is obtained as (WPD — 0.6) * 2, i.e. WPD translation in frames from 0 to 1.

If Genesis Ratio <0.2, then we believe that the program has a high risk and limit InvScale = 1 (the manager can attract no more than his deposit).

Weighted volume scale

It is calculated similarly to WPD, being a weighted average over all periods:

, where:

PL — period duration in days.

VScale = (period volume * 7) / (period start balance * period length).

For Forex, VScale is additionally divided by leverage.

If VScale> 2, then VScale = 2.

If the final Weighted volume scale > 1, then we set it equal to 1.

The essence of the formula is as follows: to obtain scale = 1, the manager needs to trade the volume equivalent to the balance of the program every seven days. However, by limiting VScale to 2 (instead of limiting to 1), the manager can get a scale of <1 in one period, but compensate for this at the expense of another period.

Next, we take the coefficient X = Weighted volume scale * program age / 90.

Program age is limited from 0 to 360, and X from 0 to 1.

Then we get InvScale = 3 + (X * Genesis ratio) * 17 (i.e. a number from 3 to 20)

If the manager trades without KYC, then all these indicators are not calculated, the available investment limit is always 1 000 USD (translated into account currency). Otherwise, the available limit is set in the range from 5 000 USD to 300 000 USD.

If investors’ funds exceed the final amount that is available to invest, then:

We divide investor funds by av. to invest to get the exceedance coefficient.

We divide the success fee by this coefficient, for example, if the success fee was 50%, and the funds were exceeded by two times, then the commission will be 25%

We calculate the reduced stop-out using the formula y = 90 / x ^ 2 + 10, where “x” is our exceedance coefficient, and “y” is the stop out. If the stop-out set by the manager is lower than the calculated one, then the manager’s current stop out level remains.

Visualised formula y = 90 / x ^ 2 + 10

The levels in the new system are not the cause, but the consequence of funds available for investment and are informative (except that the entry fee is still taken only from the 3rd level programs).

And one last thing! So that our managers don’t have to waste their precious time calculating the investment amount they can attract, and so that they could see how each parameter influences the outcome, our developers have come up with a sleek and handy calculator that will allow managers to know exactly how much they can manage without having to go through complicated calculations on their own.

The level calculator

A tl;dr section

Here is a summary of the formula without any technical mumbo jumbo. Below are the main things to take away if you are a manager: