Copy trading is very easy today, because there are a lot of trading platforms available online with integrated features for copy trading. Finding someone to follow, or subscribing to trading signals, is therefore quick and effortless.
Of course, copy trading is not without risk. The fact that a particular trader or signal provider have been successful in the past is not a guarantee for future earnings. Just as with ordinary trading, it is never a good idea to risk money you can´t afford to lose.
Before you engage in copy trading, you should answer these questions:
Do I want instant, automatic copy trading, where the master´s actions are copied into my portfolio in the blink of an eye? Or do I prefer to have more manual control, even if it means delays?
Do I want carbon-copy trading, where the master´s actions are copied to my portfolio without any changes or adjustments? Or do I prefer a more flexible approach, where I can adjust parameters for factors such as how much money to invest?
Answering these questions will make it easier for you to choose among the available solutions for copy trading, since some of them are much more automated and rigid than others.
That will vary depending on the platform, so chose platform carefully. Check which asset types they offer, and what the assortment looks like within each type.
Exemples of assets that are available for copy trading online:
Exchange Traded Funds
Contracts for Difference
You can also copy trade based on index speculation.
There are a lot of platforms available online where features for copy trading are included in the main offering. A few examples of well-known choices are Meta Trader 4, Meta Trader 5, eToro, DupliTrade and cTrader. Click the link to compare all the best copy trading brokers.
Copy trading is possible on smartphones and tablets. Many platforms that support copy trading have launched mobile apps for iOS and Android that makes it very easy to engage in copy trading on a mobile device.
Many platforms that offer copy trading also offers leverage. When you use leverage, you borrow money from the broker to carry out a purchase. This can of course be very tempting when it makes it possible for you to copy a big-time trader without having to make a big deposit into your trading account. It is risky, however, because you can end up losing more money than you ever had in your account, and be forced to pay it back with money from your everyday budget. Never risk money you can´t afford to lose. This is good advice for normal trading, but even more crucial when it comes to leveraged trades since you are trading with money that you don´t have.
Copy trading is an easy way to get started with trading, speculation and investing. We do however advice everyone to also learn about the trading world, the markets, the assets, and so on. Simply leaning back and letting ”the copy machine” do the job is tempting, but will put you in a vulnerable position since your lack of experience and know-how will make it difficult for you to spot good opportunities and stay away from bad situations. Do not select and follow masters blindly.