How the performance fee works and why it aligns interests

A performance fee is often read as just another cost. Properly understood, it is the mechanism that ties the trader's pay to your result — and that alignment is a desirable feature.

How it is calculated

A performance fee is a share of the profit the strategy generates for you — at QuantBy, 20% of profits. If the strategy produces no profit, there is no performance fee to pay on it. The trader is paid mainly when your account grows.

Why alignment matters

Models that charge fixed fees regardless of the result reward activity, not results. A performance fee does the opposite: it rewards the trader for the same thing you care about. Their incentive and yours point in the same direction.

Reading it honestly

Weigh the performance fee against the strategy's realistic, verified performance rather than its best month, and alongside the setup fee and the spread. Seen that way, it is less a charge to minimize than a sign that the incentives are in the right place.