Best Payout Models for Forex Affiliates – CPA, CPL, RS, P&L
June 17, 2019
appeals to retail traders because of the enormous
potential for generated an extra income. The online trading increased
popularity gave birth to a new industry that generates
excellent revenues: the affiliates industry.
broker partners with various entities
(either individuals or companies) in the race to attract as many traders
possible. There is no standardized affiliate program due to the diversity of potential affiliates. For this
reason, a Forex affiliate
program may take various forms, depending on many factors (the size of
the affiliate business, what the Forex broker looks when associating with an
affiliate, and so on).
all payout models work for all affiliate businesses. In essence, the introducing broker
business works like this:
- affiliates take all the necessary steps to
introduce the Forex broker’s
services to as many potential traders as possible
- the higher the retention rate, the better
the chances that the broker will additionally reward the affiliate
- after the trader opens and funds a live
account, the affiliate will get paid
based on the affiliate
can say without a shadow of a doubt that
there is not one best profitable payout
model. Each model has its pros and cons and may
appeal to each affiliate differently.
instance, the CPA (Cost Per Acquisition) may appeal to the ones starting an
affiliate business as it implies a quick revenue and a shortened checkout
period. On the other hand, over the medium to long term, it doesn’t favor the
business like the RS (Revenue Share) model. Hence, depending on the time
horizon or the initial business plan, one affiliate may find the CPA model to
work better than the RS, or the other way around.
ideal payout model combines the advantages of the CPA and RS. A hybrid model,
therefore, will work best for most affiliate businesses.
instance, during the developing phases of
an affiliate business, the CPA is desired, until the initial investment is recovered. However, later down the road, an RS with the same broker will ensure constant
cash flow, but it has additional risks: the income will continue to pour only
if the trader remains active.
we know by now, statistics aren’t too favorable with the retail trading
industry. As it turns out, most retail
traders lose money, with over ninety percent of them doing so on their first
it is ideal that the affiliate knows what the experience of the introduced
trader is before choosing the payout type. Believe it or not, some brokers
brokers also use CPA (Cost per Action), meaning that the affiliate gets paid only after the trader fulfills a minimum traded
volume. Obviously, it isn’t something
that many affiliates favor, but if a trader is
able to complete the volume requirement
it implies that it is further suitable for a RS
scheme. However, the Forex
broker must be fully flexible with
an affiliate promotion
like this as it doesn’t want to pay commissions on an indefinite basis.
in all, a combination of CPA’s, CPL (Cost per Lead) and RS is the best payout
model for an affiliate
marketing campaign, and this is what all affiliates strive to achieve.