Curriculum·R410 Copy Trading, Vaults, and Agentic Execution·about 32 min
The incentive structure, first
By the end of this lesson you can
- →Write down the leader's payoff function before looking at any performance figure
- →Compute what a profit share with no clawback is worth on a trade with zero expectancy
- →Show why the leader's optimal risk level is higher than yours
- →Identify the three ways a promoter can profit from your position rather than from theirs
Senior · enrolled learners
This lesson opens with The Atlas Trading charges, December 2022.
- What happened
- In December 2022 the SEC charged seven Twitter users and a podcaster, and the Department of Justice brought parallel criminal charges, in connection with a stock manipulation scheme run through social media. The defendants operated an online community called Atlas Trading, promoted as one of the largest free communities for individual stock traders, together with an associated Discord chatroom. They presented themselves as successful traders and encouraged a large following to buy particular stocks. When prices rose they regularly sold their own holdings into that buying without disclosing that they intended to. The Department of Justice stated the group profited by at least approximately $114M between about January 2020 and April 2022, and each defendant faced a maximum of 25 years on the conspiracy count and on each securities fraud count.
- The decision point
- The performance being displayed was real. The promoters were genuinely making money, the trades genuinely happened, and the returns they showed were not fabricated. What was not displayed was the source of the money, which was the buying their followers did. Before evaluating anybody's record, write down how they are paid, because if the answer includes your order flow or your capital then their track record is a description of you rather than of them.
- Recorded loss
- $114,000,000
What you will be able to answer
- →What do you write down first?
- →What is a profit share worth on a zero-expectancy trade?
- →Why is the leader's optimal risk higher than yours?
- →What are the three ways a promoter profits from you?
Orientation and Year One are open: anyone can read them without an account. From Year Two onward the lessons are for enrolled learners, because progress through the later years only means anything if it is tracked against a record.
It is free. We do not sell the list and there is nothing to buy at the end of it.
Sources and review
- https://www.cnbc.com/2022/12/14/sec-charges-social-media-influencers-in-alleged-100-million-fraud-scheme.html
- https://www.cnn.com/2022/12/14/tech/sec-influencers-pump-and-dump/index.html
- https://www.investmentnews.com/fintech/social-media-finfluencers-face-charges-in-114-million-pump-and-dump-scheme/230293
- https://www.cftc.gov/PressRoom/PressReleases/8549-22
Confidence high·Volatility low·Reviewed 2026-08-07·Owner unassigned
Contested
The Atlas Trading matter involved charges and the defendants were entitled to contest them. This lesson uses the alleged mechanism as described in the public charging documents and the reported profit figure, and takes no position on the outcome for any individual. The structural point does not depend on any conviction.
Profit share arrangements vary widely and some include high-water marks, clawbacks or the leader's own capital alongside followers. Per P7 those are genuine differences and part four is the test for whether they are present. The arithmetic in part two describes the common case with no clawback.
S205-04 owns tracing a leader's method at Sophomore level. R410-02 owns the record itself. This lesson owns the payoff function and nothing else. Keep the splits.