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Copy Trading Profit Sharing Explanation

Kai.com
Updated

Copy Trading Profit Sharing Settlement Method and Account System:

1.When the lead trader closes the position, if the follower has made a profit and meets the profit-sharing requirements, the system will pre-deduct the profit-sharing amount from the follower’s account. The settlement will occur at midnight on the next day, calculating the follower's actual total profit for the day’s copy trades. The actual profit-sharing payable to the follower will be the total profit * the profit-sharing ratio of the lead trader.

 
2.If the actual payable profit-sharing is lower than the pre-deducted amount from the follower’s account, the excess deducted amount will be refunded to the follower's account, and the remaining amount will be settled with the lead trader.

 
3.Profit-sharing settlement cycle: Daily at 08:00 (UTC+8).

 
4.The copy trading account shares the same system as the contract account, and users can directly operate funds under the contract account.
 

Profit-Sharing Requirements:

1.If the follower and the lead trader no longer have any open positions related to the copy trades (i.e., all of the follower's copy orders for the day have been closed), the profit-sharing will occur the next day.

 
2.If the user has open copy orders that have not been closed, no profit-sharing will occur until the last position is no longer linked (i.e., all of the follower’s copy orders for the day have been closed). Profit-sharing will be aggregated and settled the next day.

 
3.The profit-sharing ratio of the follower’s profit is determined based on the lead trader’s level. For example, if the lead trader is an L1 trader (profit-sharing ratio of 12%), then the profit-sharing for followers copying this lead trader will be 12%. If the lead trader upgrades to an L2 trader (profit-sharing ratio of 14%), then the previous trades will be settled at a 12% ratio, while new trades will be settled at a 14% ratio.
 

Profit-Sharing Example:

"Estimated Profit to be Shared" includes: 12% profit-sharing portion for historical closed profitable orders and 12% profit-sharing portion for today’s closed profitable orders.
  • If the closed order profit is positive, the estimated profit-sharing amount will increase.
  • If the closed order profit is negative, the estimated profit-sharing amount will decrease.
Example 1:
  • User A follows lead trader M to open a BTC/USD contract and earns 0.01 BTC. Before the settlement time, User A closes the entire position.
  • Pre-deducted profit-sharing: 0.01 BTC * 12% = 0.0012 BTC. So, on the next day’s settlement, the lead trader will receive 0.0012 BTC in profit-sharing. If the exchange rate is 20,000 USD per BTC at the time of distribution, the total profit-sharing displayed on the homepage will be 24 USAD.
Example 2:
  • User B follows lead trader M to open BTC/USAD, ETH/USAD, and BTC/USD contracts. The profits are 300 USAD for BTC/USAD, 200 USAD for ETH/USAD, and a loss of 0.01 BTC for BTC/USD. Before the settlement time, User B closes all positions.
  • Estimated profit-sharing: 300 USAD * 12% + 200 USAD * 12% - 0.01 BTC * 12%. If the BTC exchange rate is 20,000 USD during settlement, the profit-sharing for the lead trader will be: 36 + 24 - 24 = 36 USAD.
Example 3:
  • User C follows lead trader M to open BTC/USAD, ETH/USAD, and BTC/USD contracts. The profits are 300 USAD for BTC/USAD, 200 USAD for ETH/USAD, and a loss of 0.01 BTC for BTC/USD. Before the settlement time, User C has closed the profitable orders but not the losing one.
  • Estimated profit-sharing: 300 USAD * 12% + 200 USAD * 12% = 60 USAD. No profit-sharing will be settled with the lead trader on the next day.
  • If User C closes the losing position on the 3rd day, and the BTC exchange rate is 20,000 USD, the profit-sharing for the lead trader will be: 60 - 0.01 * 12% * 20,000 = 36 USAD. On the 4th day’s settlement, the lead trader will receive 36 USAD.
Example 4:
  • User D follows lead trader M to open BTC/USAD, ETH/USAD, and BTC/USD contracts. Before the settlement time, User D has not closed either the profitable or losing positions. Therefore, no pre-deduction will be made, and no profit-sharing will occur.

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