Whenever a trade is opened, it can be copied by other traders. For every trade copied by other users, NAGA Trader will pay you a copy bonus according to the volume of the copied trade. Sounds complicated? Don`t worry we explain it to you.
When a User creates a trade and publishes it, it will be displayed in the Trade Feed and can be copied by other NAGA Trader users. Whenever a NAGA Trader User copies another User, the initiator of the trade will receive a push-notification as a real-time notification of how much Bonus has made. The income depends on the number of copiers of the User’s trade and the capital that User “moves”. These Terms and Conditions including the NAGA Trader Copy Bonus structure are subject to change at NAGA Trader’s discretion, at any time. Users can payout this copy Bonus at any time.
This Formula shows how exactly the Bonus is calculated:
Bonus: (in the Live Account currency) = (Notional Volume * Rate of copied and traded instrument's base currency to USD / 1,000,000 USD) * 50 USD * 2 * Rate of USD to Live Account's currency.
Explanations: this multiplier (2) means that NAGA Trader pays a doubled Bonus for a round-turn trade.
Note: NAGA Trader pays up to 50$ in copy bonus per $1,000,000 traded volume. The actual amount may vary between $10 and $50 and is subject to the decision of the company.
The following lines describe the logic behind the calculations that determine the traded volume in $, the commissions we generate and the bonus we pay out to our leaders (traders who are copied by other traders). Before going into more detail, let us first take a look at the term volume and why it plays such an important role in order to determine the commissions and the bonus we pay out.
Now you probably ask yourself? Earnings from what? The magic lies in the word spread and was described in the document NAGA Trader Trading made simple. It is basically an arbitrage business. You buy one share of apple for 100 USD and your clients buy it for 101 USD from you. The profit for you is one USD and covered in the spread – the difference between the sell and the buy price.
SYMBOL TYPE & EARNINGS MODE
As described at the beginning of this document, the volume generated by the traders is the crucial variable determining the commissions and the bonus. Thus, we need to understand how the volume is calculated in detail. This brings some new variables/terms into the game:
• Exchange Traded Funds
• All Equities (Equities NL, Equities ES, Equities UK, Equities CHF, Equities FR, Equities USA, Equities DE)
• Future Indices (not included in the list so far)
The above symbol types are then matched with the corresponding earnings modes:
EARNINGS MODE - LOT & LOT SIZE
These different earnings modes are further based on a basic underlying calculation:
What are lot and lot Size?
Since metals are usually traded in ounces and commodities like oil in the barrel, the lot sizes vary as well. In our case, we have for instance lot size = 5.000 for silver and 1,000 for oil. In case of Index (IDX), we have different lot sizes based on the traded symbol. For Dax, for instance, the lot size is 25 EUR.
HOW VOLUME IS CALCULATED
After describing the terms lot and lot size which determine the volume traded, we are now able to take a look at commissions which are based on the traded volume. The example below shows the underlying calculations:
Lot (1) * Lot Size (100,000) * Conversion rate EUR to USD (in this case 1.12) = 112,000 USD in traded volume.
Now we need to convert this to USD by taking the current conversion rate (let us say it is 1,10). So we convert 267,500 EUR to USD and get 294,250 USD.
CFD & CFDP:
HOW COMMISSIONS & BONUS ARE CALCULATED 1/2
Now we need to take a look on the commission we earned per Million traded in USD. Let us now assume that we earn 50 USD per one Million
USD in traded volume. For coming up with the commissions we earn we simply multiply the volume traded with the 50 USD and divide by 1,000,000.
At the moment we pay our users a copy bonus based on the type of the traded instrument and the traded volume. Let us now take a look at how the bonus is calculated. As mentioned the bonus is based on the traded volume in USD. We pay out 10 USD in bonus per 1 Million USD in traded volume. This is a commission for a single side trade. Commission for a round turn trade (opening and closing) is doubled and is fully charged at the opening of the order.
The formulas below show how exactly the bonus is calculated:
Bonus (in the deposit currency) = Traded volume * 10 USD / 1,000,000 USD * 2 * Rate of USD to account's deposit currency.
2= this multiplicator means we take a doubled bonus for a round-turn trade. The logic behind is that we want to display the total copy bonus when the trade was opened.
HOW COMMISSIONS & BONUS ARE CALCULATED 2/2
Example for Forex:
Bonus (in EUR) = (100,000 USD * 1 / 1,000,000 USD) * 10 USD * 2 * (1 / 1.39116) = 1.44 EUR in bonus.
The formulas below show how exactly the bonus is calculated for Commodities / Index
We need to take a look on the lot size. Dax for instance is fixed at 25 EUR. Meaning that if a trader opens 1 Dax contract, he trades 25 EUR * 10,700 (current price of Dax at the moment) = 267,500 EUR. Now we need to convert this to USD by taking the current conversion rate (let us say it is 1,10). So we convert 267,500 EUR to USD and get 294,250 USD. Now comes the bonus part where we would pay the user 294,250 * 10 USD *2 / 1,000,0000 = 5.89 USD. If we he was copied with an overall value of 1 Dax contract.
The formulas below show how exactly the bonus is calculated for CFDs
We need to take a look on the quote of the contract. Let us say we buy BMW stocks which are quoted in EUR. We buy 100 stocks with a price of 50 EUR each. We therefore buy a volume of 5,000 EUR. Now we need to convert this to an equivalent amount in USD. So we have traded (copies traded) 5,000 * 1,10 = 5,500 USD. Now considering the bonus payment, we end up paying 5,500 * 10 * 2 / 1,000,000 = 0,11 USD.
As we are a European company we want to display the bonuses in EUR. So what is here to do? We need to convert all paid bonuses in real time to EUR. Meaning that we consider the current exchange rate.
If you need further assistance, please do not hesitate to contact our staff.