One of the unique and innovative ways to trade today is copy trading, which means you copy another person’s trades. Now, an important part of this concept is that there is an investor and a trader. The investor is the person that copies whereas the trader is the person whose trades are copied.
Now, how can you make copy trading work for you if you are a trader? Here are a few things to consider.
Join a Reliable Broker
A copy trading platform would pick traders from many online brokers. They then create lists of this traders and present them to investors, who can sift through the lists and pick their favorites to copy them. Since the copy trading platform is acting as the middleman, it has to take maintain reputation by picking up traders from the most reliable platforms.
If you are currently signed up with a reliable and well-known broker, the chances of you being on a copy trading platform are higher. Of course, you can pick the platform at will, but your chances of being accepted are higher when the broker you are associated with is well-known.
Stick to a Specific Strategy
The more specific you are with your trading strategy, the better results you will get from your copy trading endeavors. The investors who join copy trading platforms aren’t fully aware of how to pick the best trades. Their knowledge of trading is little and hence offering something that’s to-the-point, simple, and understandable makes sense.
So, you should stick to a particular financial market, pick certain assets, and have a well-defined risk appetite for investors to follow you.
Talk to Investors
Don’t be a quiet person if you are a trader and being copied by dozens of investors. The best copy trading platforms allow you to talk to your investors, interact with them, and even educate them on how you trade.
Be their mentors to have a strong relationship and a long-lasting bond. This will increase your following, and as a result, the return you get from your copy trading endeavors.
Last but not least, it would also make sense that you take your time and pick a regulated copy trading platform that has lots of investors using it.