Copy-trading lets you straight copy the stands taken by some other trader. Decide the amount you want to put in as an investment and copy the other trader in real-time. When that trader makes a trade, your account will do the same. You need not invest any effort in trading, but you will get the same return on each return as your signal provider.
In the recent 2 years, copy trading in Pakistan is getting the attention of the audience and it is getting over the traditional trading methods as it is one of the easiest methods to use other trader’s proficient experience. You also don’t drop any charge over the outcome. You still can close deals, and open new trades as wanted. No advanced knowledge of the financial market is required to take part in copy trading. Still, there’s a question of social trading vs copy trading and what is the scope of copy trading in Pakistan?
How does copy trading work?
There are 5 easy steps of copy trading that are discussed below.
- Select a signal provider who best meets your aims to follow, by utilizing the means given by the platform FXTM Invest to strain the available traders. OctaFX and Moneta are well known FXTM alternatives for copy trading in Pakistan. Which elements are important for you to follow a trader? There is no hard and fast rule. Possibly it is their number of followers, or how much profit they make, level of risk-taking, the total cost of funds they manage, or their return on expenditure. It is completely up to the copier, which elements are important to the person.
- Deciding the amount of investment is another major step. You must not put all the eggs in one basket. If you have chosen more than one signal provider, you should share the total amount of investment among them to avoid the risks of downfall.
- The next step is for the copy trading platform. It will replicate all the chosen trader’s stands in your trading account. But if the signal provider is investing more than you can afford as you are a beginner then it will trade by applying the ratio of amount for investment.
- The next step is to stabilize the trade. Add more funds if you are satisfied with the performance of the signal provider. Similarly, reduce the funds if you are not satisfied. Keep your container varied by not putting in all the amount in a single trader. You can always replace the signal providers, but you will need a separate Invest account for each signal provider to follow.
- There are no specific charges to use the copy trading module, besides those you spend on the Strategy Manager whenever they gain profit. Any brokerage charges that would apply to a normal trade will be applied to copy trades.
Social Trading VS Copy Trading
Social trading and copy trading are similar in terms of basis but there are many differences. Social trading is a broader term and copy trading is just a part of it. It is also said that copy trading is a type of social trading, but they are not the same and people are confused about it. Not all types of social trading are copy trading because in all types of social trading there is a person who is managing it all in an automated manner.
Copy-trading specifically defines the type of social trading in which your account is bound to the account of the person you follow. Their every activity becomes your activity. Their profits reflect your profits and their losses become your losses. Their activities are directly reflected in your account. In some platforms, you choose to manage your trades by stop copying the leaders and this is the maximum you need to manage by yourself. Because when you do copy trading you don’t even need to open or close the trades as the whole process is automated. This is the reason this process is called copy trading as it is a phenomenon that has its own definition and proper meaning. There’s still a question left: what approach should you use as a beginner?
Advantages of Social Trading
If you are a beginner and you want to learn trading techniques, then social training is more appropriate for you as its main advantage is that.
- It clearly lessens the amount of time taken for an amateur trader to interpret the exchange since the new trader can see the approaches of proficient traders, analyse them, and learn from them.
- The most beneficial use of social trading is to take the benefit of the most skilled traders by continuing or by countering their opinions.
- This trading type can be used as trader sensibility that assists you to make choices.
- However, some traders find it risky to grasp others in total reliance, the erudition should be utilized as a part of a decision-making method and not copying others foolishly.
Advantages of Copy Trading
If you are a beginner and you want to start trading instantly and main focus is not to learn the trading techniques, then copy trading is a good option to go. The benefits of copy trading are mentioned below.
- Most traders are not prepared to face the challenges of trading and they want an expert to guide them all the way then copy trading is a good option as it limits the potential losses.
- It does not require a lot of effort of planning, making a strategy and giving inputs.
- It automates the complete process of trading and hence helping you in managing risk more effectively.
- It is a one man show, the information provided is transparent.
Copy Trading Platforms
Following are some best platforms for copy trading in Pakistan:
eToro
Up to 100 individual traders can be copied simultaneously. Trade worth less than $1 can not be copied. It gives more than 2000 different financial assets. The minimum deposit is $200.
FBS
It is more convenient and provides a 100% deposit bonus for trading. You can deposit and withdraw through any system and currency. The minimum deposit depends on the trading account as it varies from $1 to $1000.
FXTM
Award winning broker but not recommended for beginners. it provides a variety of tools, resources, account types and platforms. The minimum deposit is $10.
How to become a signal provider?
The process of becoming a signal provider varies from platform to platform. The basic steps that should be followed are listed below.
- Login to the platform of your choice.
- Create an account in mql5.com
- Press the signal button to create your own signals.
- Fill the form and necessary details that are asked by the platform.
- You will start getting notifications about pending signals that need confirmation.
- After approval of your account, you are good to go.
If you want to know more about the steps that should be followed to become a signal provider read the guide provided by FXTM.
If you still have questions about becoming a copier, visit our above section of how copy trading works.
Why choosing Copy-Trading?
It is clear through Google trends and other means also that copy trading in Pakistan is becoming a hot topic and it is taking over the traditional means of trading. Everyone is busy in their life and most of us do not want to spare much time in understanding and getting experience in the techniques of trading. Still, people want to get into trading as it is becoming popular over the past few years. Copy trading is getting popular as it helps people in becoming a good trader by putting in minimum effort and getting a good outcome. But it is definitely not for the people who want to learn the traditional and effective techniques of trading. If you want to become a signal provider, you must go for social trading and getting your hands on the techniques of trading. But if you are just looking for making an investment and learning over time, copy trading is a good option for you.