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What is Copy Trading and How Does it Work in 2023? Example

In 2018, professor Matthias Pelster of Paderborn University and Annette Hofmann of St. John’s University discovered that losses are usually higher for copied trades in the event of negative returns. They also suggested that investors who are copied by other investors were more likely to suffer from a disposition effect. Initially, some traders conveyed their intention to open or close specific operations at certain levels to their followers through newsletters. A trader announced the execution of a transaction, writing it in a virtual room instead of using the email, and followers could read and reproduce the transaction. When the chat rooms grew, other traders could also comment or post questions online, which required a persistent presence in front of the screen and often paying a fee to use the platform.

The premise behind copy trading is that people who are better than you at trading exist, and that you can copy their orders. If you’re someone who has just joined the market and wants to trade immediately, following an expert seems better than perfecting the craft for months – and potentially missing out on gains. Copy trading is a universal concept that works in all financial markets.


Harsh has experience of 12+ years in Fintech and 7+ years in Blockchain and Bitcoin. He has also moderated the panel of Blockchain experts and attended international blockchain events like BTCMiami, and Token2049. Select Covesting from the top menu bar, and use filters to find an ideal trader to copy.

what is copy trading in crypto

People-based portfolios differ from traditional investment portfolios in that the investment funds are invested in other investors, rather than traditional market-based instruments. Besides, it comes with its multi-asset crypto wallet, charts, AI-powered trading bot that can trade for you, and demo tokens for testing purposes. Back in 2017, the platform even launched its own ICO and NAGA utility token and raised over $50 million.

3 account types, 33 Forex currency pairs, precious metals, equities investments. Mobile MetaTrader terminals make it possible to trade anywhere. Confident and effective trading due to stable servers and platforms. After the registration process, you get access to bot strategies that you can opt for right away.

Maximize Your Crypto Portfolio

Investing in or trading gold or other metals can be risky and lead to a complete loss of capital. This guide should not be considered investment advice, and investing in gold CFDs is done at your own risk. If you’re following a trader who has a long-term track record of good trades, you’ll probably do well. Liquidity risk usually arises when trading with illiquid instruments, such as exotic Forex pairs, exotic cryptocurrencies, or low-cap stocks.

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Lock-up And Enjoy The Highest Earn Rates

It is worth keeping this in mind when you start copy trading yourself, as even the most well-versed crypto trader will still have knowledge gaps. This is unavoidable as those gaps are caused by a lack of historical data. However, it is not necessarily a bad thing, as sometimes, too much data can cloud judgment and lead to a false sense of what Is a copy trading platform security. At least with crypto, everybody is aware of their fallibility, leading to more caution. But, this is completely dependent on who you copy and how much money you are putting in. Now, if the expert trader you are copying has a low-risk profile, then you can safely put in more money without worrying about losing your investment.

what is copy trading in crypto

At Naga Trader, you can network, connect, copy trade, and invest in more than 800 financial instruments in traditional and emerging markets like cryptocurrencies. All in all, ZuluTrade lets you choose from over 10,000 traders. You can find them using its advanced search, which lets you sort them by different categories such as profits made by followers or copy traders. The Tradelize App lets you track your trades from anywhere in the world. With all 3 products, traders can scale up their profits with minimal effort. Some platforms take a percentage or commission, while others may charge fees or require extra deposits to cover the cost of the service.

Best Crypto Social Trading Platforms (

For this reason, the trader should have the skill to handle cryptocurrency investments. You’re basically looking for traders will a long-term record of profit. The Trality Wallet provides a seamless integration between the world’s most trusted exchange and the world’s best crypto trading bots—full flexibility without API keys. Trade directly on Trality without having to connect your exchange’s API key. With the Trality Wallet, you no longer have to manually configure and manage API keys from an exchange account in order to connect to Trality. The issue is that it can be risky, as the crypto market itself is risky.

  • All traders also come with their winning rate, total returns, AUM , number of trades executed, and the minimum deposit amount.
  • The simple fact is that most people don’t have the requisite skills and experience, which is why most people aren’t professional traders.
  • This might sound strange, as in many ways you are not making most of the granular decisions, but rather another party is.
  • EToro supports more than 16 cryptocurrencies for copying the trades.
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These apps work on trained models and can imitate others’ investment strategies. Also, some crypto copy trading apps allow you to choose multiple traders. But there are things that you should bear in mind when considering copy trading and profitability. Just as businesses must know their customers, so too should you do your due diligence when picking a reputable trading platform. Copy trading should only be done through a trusted source, and we highlight one of the best crypto trading platforms below.

Best Crypto Wallets

Remember that you don’t know how a trader will perform, even if they have a great track record. Monitoring your profits lets you adjust strategies or stop copying someone when necessary. After the connection, you can automate the whole trading process by either going with the bot trading option or by copying other professional traders. For bot trading, Shrimpy provides a variety of tools that you can use to create your own strategies and implement them on your bot.

Autocopy a leading trader Past performance is not an indication of potential future performance. To be eligible for this scheme, traders of the platform have to meet a number of straightforward conditions. The bonus is available only for real-money trades that are held open for at least 5 minutes before being closed. Digital assets are risky, check out the Risk Disclosure Document on your platform of choice for more details and consider getting advice from a professional. It depends on your skill level, and the time you have to dedicate to trading. If you are a total beginner with no hands-on experience, copy trading is the better option for you.

Today, many brokers offer copy trading with a variety of features. Deposit and withdraw your funds via crypto, cards and other methods. Manage your risks and maximize your profits even with small investments. Deposit and withdraw your funds via crypto,cards and other methods. Trading with NAGA Trader by following and/or copying or replicating the trades of other traders involves high levels of risks, even when following and/or copying or replicating the top-performing traders.

what is copy trading in crypto

The best thing about copy trading on Weex, is that the platform has extremely high liquidity, in fact deeper than industry leaders MEXC and Bitget. This means that your orders will be filled very quickly and you won’t experience much, if any slippage. Weex even has a guarantee regarding slippage, and if it exceeds their set threshold, they will reimburse you the amount that you lost.

Comparison of Best Crypto Investment Strategies

Hovering over any profile would give you more details about the traders, and this is useful to understand the trading style of a specific trader. The trading history presented is less than 5 complete years and may not suffice as a basis for an investment decision. Once you have identified a trader that you would like to copy, then click on “Copy” and configure the settings. Here you will see all the pro-traders, and you can pick a trader to copy based on their performance and statistics. I didn’t know there was a term for replicating someone’s trading actions in order to maximize profits especially if you are new to trading until now. Track your transaction history and enable daily reports on the state of your portfolio from multiple cryptocurrency exchanges and wallets.

What is Copy Trading in Crypto? Methods and Ideas in 2023

You can automatically copy the top crypto traders using Shrimpy. Copy trading is a form of investment that involves copying the trades of other traders. It all started in 2005 when the trading service Tradency first offered automated trading but skyrocketed in popularity with eToro and its CopyTrader service.

What are the pros and cons of copy trading?

Depending on your level of investment, though, these fees can quickly eat away at your bottom line, turning profits into losses if you’re not careful. NordFX is an international broker with over 10 years of experience in financial markets. Since 2008, the company has been awarded more than 50 prestigious professional awards. The number of accounts opened in NordFX by clients from almost 190 countries has exceeded 1,500,000 as of today. One of the key factors of successful trading is the correct choice of a company where you’ll open an account and do your trading. We’d like to highlight some of our advantages that can make trading financial markets easier, more effective and more convenient.

You do so for as long as you like, or as long their strategies are profitable. As you may notice, trading signals offer more flexibility than automated copy trading. Although they require you to manually enter the trade in your trading platform, they also offer the flexibility to change the entry and exit prices, or even not to take a trade altogether. The ability to control risk – As you may guess, the main drawback of copy trading is that your trading performance is completely dependable on the trading results of the traders you follow. If they make a bad trade, that bad trade will also appear in your trading account. Portfolio diversification is another plus point of copying trades.

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