Forex trading is known to be a risky and speculative business; therefore new traders are naturally looking for ways to get more information about various sides of foreign exchange as well as about trading modalities and techniques. In recent years social trading networks have widely spread across the Web. Their subscribers are experienced forex traders, on the one hand, and beginners who are willing to adopt guru practices and hopefully to surpass them, on the other. Social trading, or copy trading, incorporate forex broker services along with a message board: traders are able to communicate, share trading experience of their own and to watch others’ trades; in certain cases it is possible to copy trades of the competent associates, that is, to have expert trades automatically replicated in the follower’s account, in exchange for a small commission. As a matter of fact, social trading networks have proven to be more profitable for their participants than individual trading.
Are you interested in trading the financial markets but feel like you don’t have the time to learn new strategies? Maybe you already trade but can’t find a way to take your trading up to a professional level, or perhaps you’re just looking for an easier way to improve on the strategies you are already using. If this is the case, copy trading may be for you. Whatever your reasons, copy trading opens up a world of unique opportunities in the markets. In this article, we’ll explain what copy trading is and how simple it is to get started.
Simply put, copy trading allows you to copy trades placed by other traders. The basic goal is to find another investor with a proven track record, and begin copying their trades. Their success may continue and you will be on the winning side of things but if trades do not go in their favour then you will also be copying their losses. Remember to always monitor and keep up to date with the trading performance of the signal providers you are copying. If all you want to do is copy trades, there is no manual intervention required. You simply click "copy" and your account will automatically start copying the trades of your chosen signal provider. If you would like further information on how to become a signal provider, our guide covers it in detail. You’re then free to go off and do other things while the app will keep running in the background. However, you should always keep an eye on your account, not only to track the performance but also to ensure that you always have enough margin in your account.
Mirror trading and copy trading are similar, but there are some key differences. With mirror trading, you are literally copying whatever the master trader does, including the same position size they place on their trades. With copy trading, you are following the same trading strategy and the exact trades the signal provider is taking, but crucially you can adjust position sizes. This means that if you are not fully confident in all the trades of the master trader, you can reduce the size of your position on certain trades you follow.
When choosing a copy trading broker it is essential to see if a network offers reasonable spreads and transparency, as these crucial features sometimes do not belong to the strong points of a social trading network. To have a better overview of social trading networks, we invite our community members share their opinion regarding the best offers. Vote for the best social network of today here!