Did I forget to mention that account names and account numbers can be covered? Naturally, you would also want to have the account holder's permission.
Or, you could mirror a client account onto a company owned account with the same starting balance at the same brokers and MT4 server.
Since either version of the above would not only show current, but also past performance (back to when the accounts start to trade), it would be the perfect way to show off your company's performance in a way which potential clients could trust. There would be no reason not to also brag about other performance on your website (both hypothetical and claimed real), but the Performance Test would be performance which anyone could look at and know came straight from the broker.
I'd love to see the exact FCA rule which would make this illegal. If there is one, please post a direct quote and a link to it.
Rebuttal Head Office
There are still a few issues with your suggestion. All feedback is greatly received however being a regulated product we have to stay within the FCA legislation.
We have connected hundreds of investors to our trading strategies and a key part of our growth has been our transparency.
We are active on forumns (which many my find strange) to demonstrate we are very real and can be trusted and open to feedback however we are always governed by legislation and it is the role of the legal advisors to outline what we can and can't do.
The product we offer is a retail managed forex account and as this is a retail product the guidelines set by the FCA are very strict and are there to protect investors and put the investor first.
By clearly showing the difference between simulated and live results investors are able to clearly see all history of the trading strategies, including how they performed prior to launch and how they are performing now. This is why COBS 4.6 requires this.
Likewise we use multiple strategies, and investors can choose to have a mixture of all available strategies deployed onto their account at anyone stage. The strategies we have available try to be wherever possible uncorrelated i.e should one enter a drawdown because of specific market conditions the other should not.
So with multiple strategies and investors joining all the time at different stages throughout the year your suggestion provides a number of challenges, challenges that to show accurate results on 3rd party verification sites would still results in a breach of the legislation referred to above.
Specifically....
1 - Mirroring trades from a clients accounts to a company owned accout to show what the live results are still results in the same issue, irrelevant of whose actual account it is and that is as follows....
2 - Taking the example of an investor joining on the exact day we launch a new strategy and us then using that account (company or actual investor) to show results on 3rd party verification sites creates the following issues:
- That the very first investor would have only deposited had they seen past performance and therefore this performance they would have seen would have only been simulated (because at that time there is no other results available)
- As we would have had to publish simulated performance to attract that very first investor and this information is then in the public domain we are then governed by the marketing principals of the fca to ensure that that information we made public right at the start regarding that strategy remains in the public domain whilst that strategy is offered, as this is the only way all future investors can get an accurate representation of the strategy.
- If we fast forward 6 months and use the account of an investor that deposits in 6 months time to show the performance of a strategy the only results that will appear on the 3rd party verification sites will be the results of that account from when it started. Which means that account would not show the previous 6 months results that had occurred on the strategy and therefore sharing this to potential investors as a way to encourage them to invest would not be an accurate representation of the strategy as it had previous past performance that was not being declared.
Therefore which ever way we look at this unless there is a 3rd party verification site that can show all history of a trading strategy, including the history prior to launch (simulated) and every trade thereafter (live) we are still faced with the same situation which is a breach of COBS 4.6
If the feedback is that investors would be happy to join a strategy without seeing any past performance of any kind, then we would be able to use a 3rd party verification site as part of our client acquisition process. We do not believe this is ever likely to occur as potential investors wish to see the performance of a strategy prior to it being launched.
We invite all those wishing to confirm the position outlined in this post is correct to either contact the fca or a legal advisor with a background in asset management fca legislation.
