Forex: Rev Share or CPA?

[supercoco]

I think the CPA in Forex is not worth even be 350 $ USD, but 25% Rev Share is also a very low commission.
From my point of view has to be + competition for fares offered by the sponsors rise.

[Madnesz]

Yes, so it sounds - but for how long is the program gonna let you stay on CPA if they are constantly losing money with your players/traders, I wonder...?

This is the problem in the forex affiliate industry. The revenue share you get is not based on the amount of money earned by the broker. These brokers are market makers and in fact earn money because their clients loose. As an affiliate however, your revenue share is based on the spreads/commissions their traders pay, not on the amount of money the client looses, and thus generates for the broker.

A broker can thus easily pay $200 CPA for a customer that deposits and looses $200. If you would have been on a revenue share basis, you would only have made about 25% of the $10 they paid in commissions and spreads. You see the problem here?

At the same time, as I've experienced myself, this problem can become an advantage for the affiliate. I've had a trader who deposited 2K into his account, and started trading very well for some time. Because it took so many trades for him to loose everything, I ended up with a revenue share of $2800 (that is a MGR of $14,000).

As a solution to the problem discussed here, brokers could change their affiliate programs. I remember a presentation of a broker at the CAP Amsterdam conference in 2009, that introduced this change. They promised to pay the affiliate a percentage of the money the client lost at their trading platform (so just like it is in the casino industry). Unfortunately, I don't remember the name of that affiliate program.

[gamblingbutler]

This is the problem in the forex affiliate industry....
...A broker can thus easily pay $200 CPA for a customer that deposits and looses $200. If you would have been on a revenue share basis, you would only have made about 25% of the $10 they paid in commissions and spreads. You see the problem here?

Well, or imho you can see it as a chance for those affiliates who want to do CPA only. This means that if the broker can easily pay this kind of CPA then the affiliate needn't worry about being moved over to revshare due to bad player value. Please correct me if I am wrong.

[Madnesz]

Well, or imho you can see it as a chance for those affiliates who want to do CPA only. This means that if the broker can easily pay this kind of CPA then the affiliate needn't worry about being moved over to revshare due to bad player value. Please correct me if I am wrong.

You are right about this one, but as you say, it is a chance for affiliate who like to do CPA. Myself, I prefer to do revenue share as I try to signup the more serious trader that will stay around for a longer time.

Actually, I work mostly on a hybrid deal now, which provides best of both worlds...

[gamblingbutler]

You are right about this one, but as you say, it is a chance for affiliate who like to do CPA. Myself, I prefer to do revenue share as I try to signup the more serious trader that will stay around for a longer time.

Actually, I work mostly on a hybrid deal now, which provides best of both worlds...

Cool because then there is no issue whatsoever

I only wonder why you said that is the problem with marketing Forex as an affiliate when indeed there seems to be none

[AussieWebmaster]

You can grab an affiliate program for many things in forex - sell signals (ie. trade recommendations) sort of like sports handicappers, you can sell training programs, you can sell charting packages, you can sell demo account sign ups and you can sell CPA or rev share of actual accounts.

Depending on the type of traffic you have your close ratios will differ.

If you are going to CAC Amsterdam grab me and I can give you some ideas.