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Trading (regardless of whether we are talking about cryptocurrencies, currencies, contracts, etc.) is an activity that carries a degree of complexity. There are so many strategies and techniques that first-time users can get confused, and for that reason inexperienced traders always seek the guidance of an expert who can help them. Under this philosophy, the so-called Copy Trading was established in many pages.
If we talk exclusively about the world of cryptocurrencies, the tools that simplify investments are especially accepted by the community due to how volatile the market can be. For that reason, copy trading becomes a very important ally for traders who want to start and for experts who want to learn.
In this article we will tell you all about copy trading, one of the most sought after functions by all users. We also explain how it works and how you can develop your next strategies.
In copy trading you will be able to copy the strategies of an expert in order to obtain more and better profits.
Have you seen how some people make a lot of money trading cryptocurrencies? If you have ever looked for some methods to make passive income you surely took into account this market, finding yourself in a quite complicated world.
In a market as volatile as crypto, the trading strategies you probably saw on YouTube or on a blog may not work right now. So how do the experts do it? They spend a lot of time doing analysis, they are watching the market behaviors during the day and use part of their day to study.
For someone who does not dedicate his life to trading this is complicated to follow. Fortunately, cryptocurrency and investment platforms have launched tools to bring beginners closer to this world, and this is where Copy Trading comes in, a function that is increasingly sought after.
Copy Trading is an investment method that consists of copying (by its literal translation) the movements and techniques that another more experienced trader is doing. By literally copying all those techniques, the chances of making profits increase exponentially.
Copy Trading does not mean that you are manually copying all the moves of the expert trader. The platforms that have this feature do it automatically for you, so you only need to choose the trader you want to follow and activate the option.
By using this function your funds (or part of them) are connected to the expert trader's account. Therefore, this balance will be available to make all kinds of movements such as opening or closing positions, limit orders, take profit, stop loss and a large number of etcetera.
No matter if we are talking about a cryptocurrency, forex, commodities or currency platform, most of the websites that offer Copy Trading have the same functionalities.
Copy trading allows investors to leverage the knowledge of experienced traders by replicating their investment strategies. It also facilitates portfolio diversification by including a variety of financial products that may be new to the investor.
The key to copy trading lies in the selection of the trader to follow. This is achieved through software that monitors and analyzes all the movements and strategies of traders over time. It is important to keep in mind that there is a limit to the number of people who can copy the same trader, so it is essential to ensure that there is space available within your community.
Copy trading can be configured according to the user's investment preferences. For example, if you are a conservative investor, you can choose to invest a limited amount. On the other hand, if you have a higher risk tolerance, you can invest more money to potentially earn higher profits. In addition, there are options that allow you to withdraw in case the investments start to generate losses.
Each time the trader makes a trade, it is automatically reflected in the investor's account, replicating the same position size and direction. For example, if a trader invests USD 50 in the purchase of X currency, the platform will automatically use USD 50 from your account to make the same trade (or the proportional part).
Traders chosen by other investors receive a small commission, which varies according to the platform, and generally ranges from 7% to 10%. In this way, both the trader and the investors can benefit from good results or, on the contrary, be affected by losses.
The most successful traders have the most successful strategies. For this reason, it is possible to obtain great advantages in Copy Trading:
✅ Novices will be able to make their first profits in trading, increasing confidence in the markets.
✅ It allows novices to understand complicated financial markets and know the moves that have to be made to be successful within them.
✅ It gives more movement to the market, as it is a way for expert traders to earn more income, the platforms remain active.
✅ It is a way to make community, as traders of all levels live together and can share experiences together.
✅ Of course it is a way to earn more income, as both experts and beginners can earn from a single trade.
✅ The platforms allow you to do this automatically, so just activate the option and wait for the strategies to be successful.
Copy Trading is one of the most used and sought after functions within trading platforms. The best of all is that you can start right now if you wish, taking into account the following:
To perform copy trading, you need a platform or a copy trading app that offers this service. For example, within the cryptocurrency market, TruBit is an excellent option thanks to its diversification of markets.
Once you have created your account, you are ready to start.
The first step is to choose a trader that seems successful to you. The platforms provide various metrics to measure the trader's profitability, such as ROI, trading history and other relevant data that will help you make an informed decision.
It is important to be thorough in analyzing the trader's trading days, trading style and results over time. The selection of the trader is very important, as this will increase your success rate (although remember that no trader is infallible).
Once you decide to automatically copy a trader's trades, the next step is to set your goals and determine how much money you want to invest. During this setup, you can also define the size of the trades to copy and the risk limits, which gives you more control over your investment.
Remember that investing less money will limit your profits, but it will also reduce your losses in case things don't go as expected. On the other hand, investing a larger amount can increase your potential gains, but also your risks. All these aspects should be carefully evaluated before starting copy trading.
Once the trader is chosen and the investment parameters are set, the platform will automatically start copying the trader's trades. From this point, you will be able to monitor and manage your investments in real time. This step is fundamental, as it allows you to adjust or stop copy trading according to the trader's performance and changes in the market.
In summary, the steps to perform copy trading are:
There are several strategies that will work for you within Copy Trading, but remember that this does not ensure 100% of your profits.
Copy Trading in cryptocurrencies is very popular because the market is very volatile and specializing is more complicated. If you want to start earning Bitcoin (to give an example), then a platform like TruBit will be the best for you.
On TruBit you will find all the advantages of Copy Trade platforms for markets like Forex or forex, as automation is the main element here. Just set up your account and that's it, follow the trader that suits you best.
Some of the most important advantages that TruBit has are the following:
Copy Trading is one of the best ways to get started in this world. It saves you the development of strategies, the time of market analysis and decision, since you are copying (often exactly) the movements of an expert. This increases the chances of profit, although not a hundredfold, as there may also be losses.
There are many platforms to do Copy Trading, but in the cryptocurrency market TruBit is one of the best options, due to the fact that there is an automatic system that will help you with most of the configuration and you will only need to wait for results. Besides, you will have the opportunity to see the statistics of each Trader to make the best choice.
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