To add my 2c worth, there's a factor that I think is used to exploit inexperienced traders, and lure them into paying for what *appears* to be the most lucrative signal_service, frequently resulting in the demise of their account.
And that is
the measure of success of these signal_services. Should it be:
- Pips moved per entry and exit? And totalled over a period of time?
- Monetary gain on an account over a period of time?
- Percentage gain on account capital over a period of time?
Well, to all the newbies and experienced traders - there is only one true measure of trading success. And that is the first option - pips gained/lost. (For those who aren't sure - a pip is the smallest measure of a currency pair's move - eg. 0.0001 Euros on EUR/USD pair or 0.01 Yen for the USD/JPY pair)
Claims of monetary gain and % gain are false measures since they do not factor in the leverage, account size and position size that will definitely vary from one trader to the next.
Measuring the number of pips moved (in your favour or against you) is a measure that is independant of the trader's account size, the leverage they use, and the position size that they take. And therefore it is a measure that is independant of the RISK that a trader takes. Adding up the losses and gains each month/quarter and then charting the nett result per month/quarter would indicate the sustainability of the signal_service's success. (You could even plot a moving average through this chart to smooth out the peaks and troughs).
I advise people to keep away from services and sites that claim ludicrous monetary or percentage gains. To coin a phrase: "If it sounds too good to be true, it probably is."
So what is a reasonable nett pip gain to be expected from a respectable signal_service per month? In my opinion, any signal_service that is sustainably returning 500 pips per month (or more) is *exceptionally* good. These are far and few between. Factor that in to your account size, position size per trade, and leverage and you can calculate your own monetary and percentage returns. They will probably be higher than what I expect. But then I have been around the block a few times. I hope my opinion is helpful.