The challenges of using remote copy trading

When using Replikanto for remote trade copying (with your own remote nodes or via Trading Signal Service), several factors can impact the process and introduce challenges. This guide covers the key considerations for successful remote copy trading.

1. Connectivity and Reliability

Remote copying depends on stable internet infrastructure. Understanding these factors helps ensure reliable operation:

• Internet Connection: Remote copying relies on a stable internet connection for both the leader and follower machines. Disconnections, whether due to issues with your Internet Service Provider (ISP) or broker, can disrupt trade copying and make follower accounts unavailable.
• Network Issues: Even with a stable internet connection, disconnections can still occur due to ISP or broker issues. Replikanto cannot intervene in these situations, and trade copying will be paused during disruptions.
• Latency: The time it takes for trades to be copied can vary based on your CPU, and can increase with more follower accounts. Copying for local accounts (same machine) can range between 10ms and 200ms, copying over the same local network (LAN/WiFi) typically ranges between 50ms and 500ms, and remote copy over the internet typically ranges between 100ms and 1000ms. There's also a bottleneck in NinjaTrader that affects how it processes multiple order submissions.
• Communication Delays: When using remote copy, trade information is transmitted over the internet. This can sometimes be delayed or lost. We are committed to providing you with highly reliable services, leveraging the robust infrastructure of AWS Lambda and API Gateway, which aim for at least 99.95% monthly uptime. While we strive for maximum availability and have processes in place to minimize downtime, factors beyond our control, like internet outages, can impact service. We do regular backups and have a disaster recovery plan to ensure business continuity. In the rare event that AWS's uptime for these services falls below their target, they offer service credits, demonstrating their commitment to reliability. Rest assured, we are dedicated to delivering a smooth and dependable service experience, and we encourage you to contact us if you encounter any issues.

2. Trade Execution

Market conditions and transmission timing can affect how orders are executed on remote followers:

• Slippage: Due to market volatility and the time it takes to transmit trades, remote follower accounts may experience slippage, meaning that the orders might not fill at the exact same price as the leader account.
• Partial Fills: In volatile markets, trades might be partially filled or not executed on remote follower accounts while fully executed on the leader account.
• Order Rejection: Remote follower accounts may have orders rejected that were executed on the leader side, causing accounts to become out of sync in comparison with the remote leader.
• Cross Order Limitations: If using the Cross Order feature on remote followers (e.g., trading micro and copying to mini contracts), the two instruments may not always move in perfect sync and the order might not be filled on both sides.
• Market Order Only Feature: When using this feature, remote followers will always execute trades with market orders when the leader's orders are filled by the market, which may result in slippage.

3. Account Management

Proper account configuration and monitoring are essential for remote copy trading:

• Margin: Ensure all accounts (leader and remote follower) have sufficient margin to place and receive trades.
• API Rate Limits: Be aware of API rate limits from brokers, especially when using trade copiers as these limits can be reached easily. This may cause orders to freeze. Check with your broker for these limits.
• Account Synchronization: Replikanto does not guarantee perfect synchronization of positions or orders between leader and remote follower accounts. Large profit and loss (PnL) differences can occur.

4. Monitoring and Troubleshooting

Active monitoring and communication are critical when managing remote followers:

• Position and Order Monitoring: It is the leader's responsibility to monitor all follower positions and orders (local and remote) to ensure they are closed and cancelled appropriately.
• Communication with Remote Followers: When a leader is sending trade signals to remote followers (Replikanto nodes), it is crucial to recognize that the leader cannot directly monitor the remote followers' setups, accounts, positions, or open orders, which may lead to discrepancies.

Why Direct Monitoring Isn't Possible

Because remote nodes don't receive position information or active orders from the leader, the leader must use alternative communication methods:

• Lack of Direct Monitoring: The leader cannot directly monitor the remote followers' setups, accounts, positions, or open orders. This means that the leader cannot be certain that the followers' accounts are in sync with the leader account.
• Potential for Discrepancies: The inability to directly monitor follower accounts can lead to discrepancies in trades, meaning that the trades may not be in sync between the accounts.
• Importance of Communication: Because the follower nodes cannot know the leader's current positions or open orders, it becomes important for the leader to use instant messaging software to proactively communicate about positions and open orders.
• Follower Guard Limitations: Some actions of the Follower Guard feature are not available in remote mode and will not work because remote nodes do not receive position information or active orders from the leader.

Therefore, proactive communication through an instant messaging system is essential for leaders to keep followers informed of the current state of trading activity. We recommend using Telegram with your remote Replikanto nodes.

5. Key Takeaways

• Remote copy trading is inherently more complex than local copy trading.
• Replikanto offers features to mitigate some of these challenges, but users must be aware of the limitations.
• Proactive monitoring, communication, and risk management are crucial for successful remote copy trading.
• Users should thoroughly test their setup and understand the potential issues before copying trading with live account.
• Use Sim accounts on all remote Replikanto nodes for at least a month to test all the features and the remote copying before going live.
• Choosing a reliable broker with robust ISP provider and low latency is paramount.
• Use a high-quality internet connection or a VPS for smooth operation.
• Provide clear instructions to your remote followers on how to connect their accounts and set expectations about the risks involved in trading.

By paying close attention to these details, you can minimize potential issues and improve the reliability of your remote trade copying setup using Replikanto.