Judge a trader by their worst month, not their best
Open any copy-trading leaderboard and you'll see the same thing: traders ranked by their best recent stretch. +80% in 30 days. +300% this quarter. It's the most natural number to show, and the least useful one to follow.
The 30-day number is the advert. The worst month is the truth.
Losses don't add up the way gains do
A loss needs a bigger gain just to get back to where you started. The deeper the hole, the faster the climb out gets steep:
| Account falls by | Gain needed to recover |
|---|---|
| 10% | +11% |
| 15% | +18% |
| 20% | +25% |
| 50% | +100% |
| 80% | +400% |
A trader who makes +60% and then loses 50% has not made +10%. They are down 20%. That's why we treat the size of the worst drop as the first number, not a footnote.
What a "great" month can hide
We backtested the kind of strategy that tops leaderboards: always long a basket of top coins, at 5× leverage, from 2021. Its best month was +585%. It was also wiped out twice. Both facts are true of the same strategy. A leaderboard sorted by the last 30 days would show you only the first one, right before the second.
How we hold ourselves to it
- A limit written down before the first trade. CriptoFocus is designed to keep its worst drop inside 15%. Bybit's own limit for its Pro copy traders is 20%. Ours sits well inside it.
- A brake in software, not willpower. The whole account is measured every hour, with deposits left out. As it falls from its peak, a three-step brake first warns, then halves new buying, then stops it, all before the 20% line.
- Ideas must pass their worst month first. Every rule has to keep the worst drop inside 15% across five years of data, in both halves of that history, before it's allowed near real money.
Questions to ask any trader before you copy them
- What was your worst drop from a peak, and when?
- What happens, automatically, when you're down 10%? 15%?
- How much leverage do you use, and is there a written cap?
- Has your strategy changed after a bad month? (If yes, the track record you see is for a different strategy.)
- Can I see every trade, losing ones included?
If the answers are vague, the 30-day number doesn't matter.
Risk notice: this article is for information only. It is not financial, investment or tax advice, and nothing here is an offer or solicitation. Cryptoassets are highly volatile and you can lose all of your money. Backtested figures are hypothetical and optimistic; live figures cover a short period. Past results never promise future ones.