The likelihood is that your audience will want to trade your signals for themselves. To do this, they have to open up a trading account at a brokerage, which is free. Brokers want clients, and most are prepared to pay you for the referral.
With this model, Telegram signal providers normally offer all their signals channels and their insight for free, with the aim of making money from the broker referral. In this model, the focus is on delivering the best free channel possible, so users don’t have to jump over a paywall.
Here’s an example of broker promotion in the channel information section:
This is a well-trodden path. Most brokers have partners or affiliate programs you can apply to join. You’ll get access to links and marketing assets that send the clients to the broker’s website. Any referrals will be tracked and you’ll be able to access your statistics in an affiliate portal.
There are several different types of payment model, and ultimately it is all negotiable if you can bring the broker enough business. The most popular payment models are:
- Cost-per-acquisition (CPA). This is when you are paid a fixed amount if the client meets some conditions. For example, you are paid $300 if the client deposits $100 and makes 5 trades.
- Spread share. This involves sharing all client volumes at a pre-agreed percentage, normally around 20%. If they trade in large volumes your commission will also be large. For example, if a client you’ve referred trades Wall Street 30 three times a day and stakes $2 a point, over a year this adds up to a total spread of $1506. At 20%, you’ll receive $301 per year. If they carry on trading, you carry on being paid, year after year.
- Hybrid deals: A combination of the two models above.
Most deals require exclusivity, which means you can only promote one broker. A word of warning though – don’t go for the best commercials, go for the best broker. Because you are promoting them, you need to do your research to make sure they’re trustworthy. If you refer your clients to an unregulated broker with questionable practices, it will damage your reputation.
If you don’t know where to start when picking a broker to work with, get in contact with us at support@signaldp.com, we would be happy to help you, even if you don’t use the signalDP platform.
Once you’ve signed up and agreed to commercials, it’s then up to you to promote the broker in line with its guidelines. Most people approach promotion by simply pinning a post in Telegram that recommends the broker and outlines the reasons why.
The channels that promote brokers the most effectively are the ones that do it with context. Constantly posting a referral link to the broker, hoping your subscribers will click on it, isn’t going to work very well. The best promotions happen in context to the scenario. For example, if you get positive slippage on a trade with that broker, mention it. If you have some great customer support, mention it.
SignalDP has a useful contextual feature that allows you to link your signal through to a pre-populated order ticket with a broker, which is a great example of promoting in context. The link captures all your details, so you get credit for the referral and your subscribers get a seamless link through to the financial markets. Because it’s in context to the signal being entered, and saves your users time, conversion and engagement rates are high.
Here’s an example of a telegram message with a link through to an order ticket on mobile:
In our experience, the spread share model is by far the most profitable for signal providers, so long as you have a high-quality signals channel that subscribers keep coming back to. All the large signal channels that make serious money apply this model to some degree.
The pros of broker referrals:
- If you are on a spread-based referral model, you can share in the upside of large accounts.
- There is no paywall to convince the client to climb over – they will trade your insights anyway with a broker so you might as well help them connect to one.
- Spread share agreements can give you a large tail revenue, where you earn commission for years after referring the client.
- Under most arrangements, even if the client stops following your signals but continues trading, you’ll get the commission.
- No upfront investment required to enter a referral agreement.
- There are some very clever tools on signalDP to help connect your subscribers to the global markets.
The cons of broker referrals:
- If not managed correctly by the signal provider and broker, spread share deals might result in a conflict of interest through over trading.
- Your clients can still choose to trade with another broker, which means they might be getting your insights for free.
- You have to adhere to some promotion rules and conditions if you work with a well-regulated broker. These are not onerous and are in place for good reasons.