Case study

Custom copy trading parameters to maximise broker revenue

Company profile:

A premium brokerage based in Kuwait that follows Islamic trading laws and specialises in Forex, CFDs, precious metals, and commodities trading.

The brokerage uses the Trade Processor liquidity bridge and margin engine, as well as monitoring tools to track the most successful traders it services and replicate their strategies to secure additional gains.

Issues and pains affecting the business

The brokerage relies on the copy trading functionality to maximise profit and commission revenue from trading volumes. However, there is a catch.

Main issue:

The Copy Trading plugin replicates trades precisely as they are, without allowing the adjustment of Stop Loss (SL) or Take Profit (TP) values unless specified by the source account.

Instead, the broker wanted to copy trades from profitable traders into their own target account, which was connected to the liquidity provider. The broker also wanted to manage risk by automatically setting their SL/TP parameters during copying.

Details of the project: milestones and number of people involved

The project took two weeks from the day TFB was made aware of the issue to the rollout in production.

The solution to the problem required a relatively simple implementation, so there were no significant roadblocks or delays on either the client’s or TFB’s sides.

The TFB team, represented by the client success manager and the technical specialist, communicated with the client throughout the 14 days to ensure everything ran smoothly. The project required three meetings in total, as the solution was offered during the introductory call. Once the development and preliminary tests were complete, a second meeting was held to present the results and confirm the chosen solution. Finally, during the final meeting with the tech team, the new solution was rolled out, tested, and implemented in production.

Solution and specific features offered

The proposed solution introduced two parameters: Auto SL and Auto TP settings.

With these parameters in place, the plugin could automatically set Stop Loss (SL) and Take Profit (TP) values a specified number of pips away from the opening price.

These parameters are adjustable:

In pips
As a percentage of the opening price

As a result, the client was able to define how far from the opening price the SL and TP values should be set.

An example of the solution provided by the TFB team

Although we cannot share the real example due to privacy concerns, we’d like to give you an example to help you visualise the solution that was designed and implemented.

Let’s consider a scenario where the EUR/USD opening price is 1.60 and increases to 1.70.

In this case, a client’s position becomes profitable, meaning the broker might initially face a loss.

However, since the broker operates on an A-Book model, it holds the same position as its liquidity provider. As a result, the broker recoups the losses from the client’s profit through its liquidity provider.

Ultimately, the broker’s earnings come from the spreads.

In addition, copy trading allows the broker to benefit further.

For example, if the broker copies the profitable EUR/USD trade from their professional client, they could earn an extra 0.10 lots of profit. This dual approach enables brokers to capitalise on client success.

Note: The reverse is also possible. If the client’s trade results in a loss, the broker may also incur losses. This is why copy trading is typically reserved for professional clients, whose performance is more predictable.

End result

Once the new parameters were implemented, the brokerage started seeing improvements in its profits and shared positive feedback with the TFB team within the first week of trading.

The Auto SL and Auto TP settings created a more flexible and resilient environment where the client was able to:

Minimise the risks associated with copy trading.

Maximise the revenue potential by catering to successful, experienced traders.

Create a more stable workflow that allows them to endure market volatility and crises with less negative impact than the competition.