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High-Water Mark (HWM) monthly

The Monthly High-Water Mark (Monthly HWM) in Darwinex Zero is a fee model that lets traders collect a 15% performance fee every month — rather than waiting until the end of each quarter — as long as profits exceed the previous month's high-water mark. When a month ends at a loss, the HWM resets to zero so that prior losses do not carry forward.

This system ensures that performance fees are only charged on actual profits generated, avoiding double-charging and rewarding each trader's net performance.

By default, these fees are settled quarterly — every three months, provided that the last high-water mark has been surpassed. However, there is an alternative designed for traders who wish to monetize their performance more frequently: the Monthly High-Water Mark.

What is the Monthly High-Water Mark (Monthly HWM)?

The Monthly HWM allows you to collect your performance fees every month, as long as you've generated additional profits above your last high-water mark.

Key differences compared to the quarterly model: 

Features of the Monthly HWM

  • More frequent payouts: Instead of waiting three months, you can receive your performance fees month by month.
  • Monthly reset: Each month starts from a fresh high-water mark of zero, regardless of the previous month's result.
  • Loss isolation: If you ended the previous month with a loss, that loss does not carry over — the HWM resets to zero so only profits above the new mark are charged.
  • Flexibility: Applies to all DarwinIA, Booster, or permanent allocations (not to investor capital, which always remains under the quarterly HWM model).

DarwinIA, Boosters, and permanent allocations have independent performance fee and HWM calculations.

 


Practical Example:

Let’s say you receive an allocation and generate €1,000 in profits in your first month.

  1. Your HWM1 is set at €1000.
  2. You receive 15% of those profits as a fee (€150).
  3. In the second month, you lose €500.
  4. No performance fee is paid, as you did not exceed HWM1.
  5. The HWM is reset to €1000, so in month 3, you'll earn fees on any profit above that.
  6. In the third month, you make €2000 in profit.
  7. A new HWM2 is set at €3000 (total accumulated profit = HWM1 + HWM2).
  8. You earn fees only on the difference: €2000 x 15% = €300.

Result: You earned €450 in performance fees in just three months, instead of waiting until the end of the quarter. Also, because of the reset in the second month, you earned more — with a quarterly HWM, you'd have received only €375 (€1000 from month 1 – €500 from month 2 + €2000 from month 3 = €2500 profit → 15% = €375).

How to activate the monthly HWM

To activate the monthly HWM, follow these steps:

  1. Log in to your Darwinex Zero account.
  2. Go to your user profile settings.
  3. Locate the Monthly High-Water Mark option and enable it.
  4. Confirm the change to apply the monthly HWM to your account.

Available only for new clients or those who reset their account, and can only be activated within a limited window after starting your subscription or account reset — check your account settings for the current timeframe.

Summary

The monthly high-water mark in Darwinex Zero lets you collect performance fees every month instead of waiting for the end of the quarter. It applies to DarwinIA, Booster, and permanent allocations, with the HWM resetting each month so that prior-month losses do not carry forward. Traders with strategies that generate consistent monthly returns can reduce their payout cycle from quarterly to monthly by activating the monthly HWM from their Darwinex Zero user profile.