PnL difference between accounts

InitialSteps

Differences in Profit and Loss (PnL) between copied accounts can occur for several reasons.

• Execution Timing: Trades might execute at slightly different times due to network latency or broker processing, which can lead to variations in entry and exit prices. Also, keep in mind that copies to follower accounts are not instant. This can cause a market order to be submitted to the follower account a few milliseconds after the order is filled on the leader account. This can result in an uneven fill price compared to the leader order, especially when copying trades in highly volatile instruments.
• Slippage: Market conditions can cause slippage, where the actual execution price differs from the expected price. This can vary between accounts depending on the broker and market liquidity.
• Trading on different instruments: When you have Replikanto configured for multiple instruments and you make trades on different instruments during the day, and as the account PnL combines all the instruments then it may happen that the PnLs do not match even using Exact Quantity or Ratio Value of 1.
• Account Settings: Different settings across accounts, such as risk parameters, leverage, or contract quantities, can lead to varying PnL.
• Broker Differences: If copied accounts are with different brokers, variations in fees, spreads, and order execution policies can impact PnL.
• Partial Trade Execution: In volatile markets, some trades may be partially filled or not filled at all in one account but executed fully in another. This can also result in an inverted trade where the exit order is filled without the entry order being filled. Find out more here.
• Disarmed Accounts: When using the Follower Guard feature, accounts can be disarmed causing them not to participate in some trades until they are armed again, which can cause PnL differences.
• Manual Trades: Trades made manually on follower accounts without going through the copier can influence the account's PnL.
• Different Account Types: When you use a Sim account (simulation type) as the leader and accounts of another type as followers, for example Prop Firms or Live accounts, this significantly increases the times when your follower accounts become out of sync with the leader account because simulation type accounts simulate the entire iteration with the market, allowing you to have orders filled that are not filled in the other accounts and vice versa.

To identify the causes of PnL differences, you can compare the execution lists of trades made on both the leader and follower accounts:

1. List all trades executed on the leader account and each follower account, noting entry/exit time, execution price, and number of contracts.
2. Compare each trade on the leader account with the corresponding trades on the follower accounts, looking for differences in execution times, entry/exit prices, and contract quantity. Identify any slippage.
3. Check for partial executions on follower accounts when trades were fully executed on the leader account.
4. Identify manual trades that were made on the follower accounts that didn't go through the copier.

It's recommended to check the PnL of accounts on the broker's website or in the broker's software, in addition to NinjaTrader, as there have been cases where NinjaTrader was not showing the actual PnL of accounts. Also, make sure all accounts have identical settings, use brokers with similar execution speeds, regularly monitor PnL and keep software up to date.

ExtraSteps

To investigate Profit and Loss (PnL) divergence between accounts, beyond the generic reasons, you can take these additional steps:

• Detailed Trade Analysis: Obtain and compare execution lists from leader and follower accounts, noting discrepancies in execution times, prices, and contract quantities. Analyze for partial executions or manual trades on follower accounts.
• ATM Strategy Configuration: Verify that, when using ATM strategies, each Profit Target is higher than the previous one, and each Stop Loss is equal to or farther away than the previous one. Also, be aware that if an ATM strategy entry is rejected, the stops and targets will not be entered, and if a Stop Loss or Profit Target is rejected, all ATM orders will be canceled. Orders can also be rejected if they are outside of the exchange's order bands.
• Replikanto-Specific Factors:
  • Out-of-Sync Followers: Be aware that when follower accounts are out of sync (indicated by a yellow color) it may require manual action or monitoring of the follower account.
  • Copy Methods: Check if the appropriate copy method is selected (e.g., Exact Quantity, Pooled Quantity, Ratio, Pre Allocation). If using the Ratio method, trades may not copy if quantities are not divisible by the ratio.
  • ATM Copy: If using ATM strategies, ensure the "ATM Copy" feature is enabled so that follower accounts use the ATM strategy to manage exits.
  • Follower Guard: When using Follower Guard, disarmed accounts will not participate in trades until rearmed.
  • Cross Order: Cross orders are not possible between instruments with greatly different prices, such as ETFs vs. futures, or between two futures contracts with different expiry dates.
  • Stealth Mode: Replikanto's Stealth Mode prevents the identification of Replikanto use.
  • Replikanto Duplication: Check that there are no duplicate Replikanto windows or tabs open using the same instrument.
• Connection and Platform Issues:
  • Broker Disconnections: Be aware that disconnections can pause trade copying.
  • PnL Verification: Always verify PnL on the broker's platform as well as NinjaTrader, as NinjaTrader may not display the actual PnL.
  • Software Updates: Keep NinjaTrader and Replikanto up-to-date.
• External Factors: Be aware of differences in risk parameters, leverage, and contract quantities that can impact PnL, and also note that risk and position limits cannot be changed in NinjaTrader. Also be aware that differences in broker fees and spreads will also impact PnL.

By performing these checks and comparisons, you will be able to identify and correct issues that are contributing to PnL discrepancies between your leader and follower accounts.