Darwinex Review 2021 – Read before signing up for the platform

BrokerDarwinex
Web address https://www.darwinex.com/
Founded in2012
Head officeLondon
Customer service+44 20 3769 1554
Type of supportEmail, Phone
LanguagesFR, EN, CN
Minimum deposit€500
Leverage1:30
Demo accountYes
Deposit methods  Bank transfer, credit card, PayPal, Skrill, Trustly
RegulatedYes
Mobile appYes
Tablet appYes
General rating4.7/5

Summary

Darwinex was launched in 2014 as a social trading and copy trading platform. The broker is based in London, where it is regulated by the FCA. The idea was to connect experienced traders with investors who want to automate the way they invest in the markets. Darwinex is at the same time a Forex and CFD broker.

Darwinex differs from other social trading brokers in the way its copy trading platform works. Instead of directly following a particular investor, or system, you are buying assets called DARWIN (Dynamic Asset and Risk Weighted Investment). These are traders’ or systems performance trackers.

If you’re looking for a reliable, regulated broker that allows you to automate your investments by following other traders, Darwinex is probably one of the best choices.

Account opening

Traders will find the right type of account based on their experience.

When you sign up for Darwinex, you choose your investor profile: a trader and potential signal provider, or an investor. The broker also offers you a demo account to test its platform without taking any risks.

We found the account opening process very fluid and quite fast.

Accounts are ECNs (Electronic Communication Network) for Forex currency pairs. In other words, Darwinex does not take the opposite of your trades to protect itself, it is content with commissions, deducted from your trades.

With Darwinex APIs, you’ll be able to set up your own scripts to automate your trading strategies. In partnership with BeeksFX, the broker provides VPS to enable you to run algorithmic strategies with ultra-low latency solutions. VPS is essential if you want to automate your strategies.

Professional account

The European Securities and Markets Authority (ESMA) imposes certain limits on the use of leverage for European traders. For major currency pairs, for example, such as EUR/USD, you cannot benefit from a leverage of more than 1:30.

Darwinex offers a professional account for traders trading high volumes wishing to have higher leverage. This type of account is not subject to the restrictions established by ESMA. However, you will no longer be protected by the FSCS mechanism (which we detail in the security section).

Professional traders will have discounts on trading fees. The larger the volumes, the greater the discounts. They also benefit from account managers to support them in their investments.

To have the status of professional trader, you must trade more than 500 lots per month.

Compensation for signal providers

If you offer your copy trading services on Darwinex, the broker pays you 20% of the profit made by your follower investors. These fees are paid quarterly. Darwinex uses the “high-water mark” principle to determine these fees. In other words, the investor only pays if the old losses are covered.

Because the number of investors on Darwinex is smaller than on platforms such as eToro, the potential gains for a signal provider may be quite limited. Plus, it will take you time to build your reputation with the D-score (which we’ll see in the financial products section). However, the platform allows you to import your past performance to Metatrader for example.

Deposit and withdrawal

Darwinex offers a multitude of deposit methods.

The broker accepts accounts in euros, dollars or pounds sterling. For each base currency chosen for your account, the minimum deposit is 500 units (500 euros, 500 dollars or 500 pounds). It is important to note that this minimum amount applies only to your first Darwinex deposit. The minimum amount for your following deposits is 100 euros.

For institutional accounts, the minimum deposit is 10,000 euros.

Regarding deposit methods, Darwinex accepts bank transfers, credit or debit cards as well as Trustly, PayPal and Skrill.

Bank transfers take an average of 3 to 5 days before your funds are available for trading. This is why card deposits are recommended for small amounts. In this case, your Darwinex account is immediately credited. However, this deposit method is limited to 10,000 euros.

Trustly is a payment service that allows you to make instant bank transfers. But it is only compatible with some banks, so you need to check with Darwinex’s support first before using this method.

Maximum deposits with Skrill and PayPal are limited to 5,000 and 2,000 euros respectively.

On the Darwinex side, the deposit fee is free, unless you use PayPal or Skrill, with which the deposit comes with a 0.5% fee. However, your bank, on the other hand, may charge you a fee.

Withdrawals are free if you request them by wire transfer. However, withdrawals by card, PayPal or Skrill come with a 1% fee, with a minimum set at 2 euros if the withdrawal amount is very small. The withdrawal fee per Trustly is set at 3.5 euros.

The account or card you will use on the platform must be in your name.

Darwinex Portfolio

Darwinex offers you a wallet on which you can store your funds. This way, you can make a deposit on Darwinex without allocating the funds to your trading account. You can transfer funds from your wallet to your trading account and vice versa. As an investor, your winnings will also be credited to your wallet.

Trading platform

A complete solution for copy trading. Signal providers will be able to use MT4 and MT5.

How Darwinex Works

Since its inception, Darwinex has continuously improved its platform and custom indicators to analyze traders’ performance. Its performance analysis tools are quite advanced compared to those of its competitors. However, it is important to note that you will not find the positions taken by traders. Darwinex therefore works to protect intellectual property by not disclosing the strategy of its signal providers.

However, this can have negative effects on the investor. Indeed, many signal providers use systems based on a martingale, or grid trading which consists of not closing its losing positions. By analysing the history of trades, such systems can be detected to avoid investing in them.

A martingale-based system can collapse overnight, resulting in huge losses to signal providers and therefore a sharp drop in the corresponding DARWIN sound. We will see what a DARWIN is in the financial products section.

Copy trading platform

Darwinex has developed its own copy trading platform. It has many features and tools that help investors better choose their signal providers.

For traders, Metatrader 4 and Metatrader 5 are available for CFD and Forex trading. This is a major advantage over its competitor eToro which is limited to its main platform.

Mobile platform

Darwinex is also available on mobile, android and iOS systems. The application is quite convenient, as it allows you to track the performance of your DARWIN. You can also initiate trades from Darwinex Mobile.

Fees and commissions

The cost of trading at Darwinex is quite advantageous. It is possible to scalp at this broker.

Darwinex’s fees depend on your trader or investor profile. For traders on Metatrader, the spread on the EUR/USD is on average 0.3 pip. This spread comes with a fee of €2.5 per lot when you open a position. This commission is also paid when you close a position. As a result, the total cost of a trade is 5 euros per position, added to the spread that is variable.

We find that currency pairs have on average a fairly tight spread under normal market conditions.

Here are the average spreads and commissions of some of the most traded assets on Darwinex.

AssetsSpread in %Spreads in  pipsCommissions in %Commissions in euros
EUR/USDN/A0.3N/A5
GBP/USDN/A0.4N/A5
CAC 40N/A0.9N/A5,5
Bitcoin0,03N/A0.3N/A

Performance costs

As we have already seen, Darwinex charges investors a performance fee of 20%. Which is pretty advantageous.

Markets and financial products

Darwinex offers an innovative copy trading method with the DARWIN concept. Forex and CFDs are available on Metatrader.

Le DARWIN

Most other social trading platforms rank the best traders that investors can track directly by linking their accounts to their systems. Positions are literally copied from one account to another.

Darwinex, on the other hand, lists the performance of signal providers in the form of DARWIN (Dynamic Asset and Risk Weighted Investment). A DARWIN has an initial value of 100. This value changes depending on the performance of the strategy to which it is linked.

DARWIN is an asset you can buy on Darwinex. It faithfully tracks the performance of other traders without directly linking your account to their systems. Darwins can be traded on Darwinex like an ETF, for example.

We find it an interesting system, similar to how ETFs work. If the signal provider loses capital, its DARWIN depreciates. Conversely, if it makes capital gains, its DARWIN gains in value. This allows DARWIN holders to track its performance.

Because DARWINs are traded like other assets, other investors will not be able to see the DARWIN you follow. In addition, this system allows signal-providing traders not to make their trading strategy public.

To buy a DARWIN, you need at least 200 euros. As an investor, the value of your portfolio will be determined by the DARWIN you own.

There are more than 2,300 DARWINs on Darwinex. The broker has a tool that allows them to be filtered according to their performance.

Darwinex

When you click on a DARWIN, you will have detailed information about the trading system used. The positions taken will not be displayed. You will have a detailed performance report, as well as information on the level of risk, frequency and distribution of trades over time, etc.

The D-score

Darwinex uses algorithms that are not based solely on traders’ performance to rate them. Other factors are taken into account such as money management, frequency of trades, experience, consistency and scalability. All of these factors are combined to create an index called the Darwinex or D-Score score.

This score measures the relevance of a DARWIN and thus the linked signal provider. The D-score ranges from 0 to 100. The ranking algorithm favours traders who manage risk appropriately and penalizes those who have too volatile DARWIN.

The higher the D-Score of a DARWIN, the higher the probability of generating revenue by purchasing DARWIN. The D-Score is therefore the main element of DARWIN’s comparison.

Forex and CFDs

In addition to the DARWIN, which are a specificity of this broker, trading on Forex and CFD currency pairs is also available on Darwinex. The broker offers more than 40 pairs of Forex currencies, 250 CFD on stocks, 10 indices, 6 commodities as well as 5 cryptocurrencies.

Research

Search tools that are quite limited for traders, but adequate for investors.

Apart from their DARWIN research and analysis tool, and blog posts related to the company’s news, Darwinex does not offer many tools for Forex trading and CFDs.

However, the performance analysis tools on offer are quite effective. Investors will be able to use a number of parameters to search for DARWIN and the strategies that are right for them. You can sort DARWIN based on D-Score, performance, level of risk, etc.

Darwinex Research

Customer support

Darwinex offers different methods to contact them. The FAQs on the site are detailed.

Darwinex can be contacted by phone or email. To get answers to your platform-related questions, you can first head to the FAQs, which is quite informative. You will find the definitions of the different terms used on the platform.

Performance analysis and DARWIN indicators are also explained in detail to help you better understand the reports of a particular trading system.

Darwinex also has a forum where traders and investors can meet and chat. The forum is very active, so don’t hesitate to ask your questions. You can also find interviews with the best-performing signal providers.

Training

Training limited to the use of Darwinex.

We noticed that Darwinex’s educational part is only about its platform. You’ll find answers to your Darwinex-related questions and their multiple features and indicators.

But we think it would be interesting to offer training in Forex trading and CFDs. This would be very convenient for beginners, who are discovering the platform for the first time.

Security

A regulated broker that offers protection well above industry standards.

Risk management and money management

DARWIN is risky because it depends on the performance of traders or trading systems. When you invest in a DARWIN, you choose the amount of capital you want to allocate to your investment. The minimum of this one is 200 euros.

As with any asset, Darwinex lets you place a stop loss and take a profit for the DARWIN you buy. You can also place a buy stop or buy limit order. The buy stop allows you to buy a DARWIN when it reaches a certain value upwards. A buy limit allows you to buy at a price below the current Darwin value.

In addition, the best DARWIN have a fairly responsible money management, so quite cautious.

Regulation

Darwinex is regulated by the Financial Conduct Authority (FCA) in the UK.

Your funds are segregated and held by Darwinex’s partner bank, Barclays Bank UK. This institution is also regulated by the FCA.

You also benefit from the Financial Services Compensation Scheme (FSCS), which is a mechanism to protect investors to the tune of 85,000 pounds or about 95,000 euros. This means that if Darwinex were to go bankrupt, your trading capital would still be available and fully restored to 85,000 pounds. This is unlikely, however, as the broker’s activities are doing well.

Darwinex goes even further by offering protection of up to 500,000 euros to its investors.The broker is also authorized to offer his services in France by the AMF (Financial Markets Authority).

Conclusion

Darwinex is a social trading platform that has chosen to use an original approach to offer a high-performance copy trading service. We liked the DARWIN system. This may be of interest to many investors who wish to follow other experienced traders in a simple way.

For signal-providing traders, Darwinex has an advantage over eToro or Zulutrade, as the DARWIN system allows them to avoid disclosing their strategies while sharing their trading performance.

Darwinex is regulated by a reputable regulator and they offer good protection to its customers. In addition to accounting segregation, an effective risk management tool is in place to limit capital losses.

FAQs

How much does it take to trade on Darwinex?

You need an initial deposit of at least 500 euros.

Where is Darwinex located?

Darwinex is based in London.

Is Darwinex regulated?

Darwinex is regulated by the FCA in the UK. The broker is also licensed in France by the AMF.

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