Transition to a new commission model: Index Commission Model

Transition to a new commission model: Index Commission Model

Contents

Introduction

Dear Users,

We will soon be transitioning to the Index Commission Model — an updated method for calculating performance fees. Below are the key rules for the transition:

General Transition Guidelines

  1. For indexes “Benchmark”, “Counter Trend”, “Trend”, “Benchmark Lite”, “Counter Trend Lite” and “Trend Lite”, the transition will occur automatically.
  2. For each active index investment, an initial High Watermark (HWM) will be set at the account’s profit level as of the last paid billing cycle*
  3. Going forward, the investor’s account HWM will be updated with each issued invoice.
  4. Under the New Model:
  • Investors will not be charged a commission (free invoices will be issued) until the account’s profit exceeds the current High Watermark (HWM).
  • Commissions will only be calculated on profits that exceed the High Watermark (HWM).

*-Investments are converted to the new model with an adjustment based on the account’s High Watermark (HWM) at the time of the last paid invoice. The transition does not affect historical invoices but will improve platform usage conditions going forward. The HWM is defined as the total profit of the investment at the moment the last invoice was paid.

Recalculation of Existing Investments

  • All unpaid invoices under the old Per Strategy model that relate to index products will be recalculated using the new Index Commission Model.
  • This change ensures alignment in the fee calculation mechanism, providing consistency across all computations.

Important Notes

  • If an investor manually switches indexes (e.g., from the “Counter Trend” index to the “Benchmark” index), the new investment will be treated as a new entry point, regardless of whether the switch occurs during the initial investment period or after the initial investment period.
  • In such cases, the commission will be immediately calculated based on the Index Commission Model with a newly set High Water Mark (HWM).
  • Custom portfolios (indexes created in the constructor) will continue to follow the Per Strategy Model without changes.

Conclusion

If you have any questions about the new commission model or need clarification, please don’t hesitate to contact our support team. We’re always here to help and explain any details.