What Is Copy Trading?

First of all, trading is the process of investing your money in the short term to generate profit from that money. Trading can be of different types, for example, day trading, swing trading, medium-term trading. According to one’s priority and their investment one can prefer what type of trading is suitable for them.

Now, starting with copy trading, it is the method for the people where one cannot give time to learn charting methods and patterns. When you do not have enough time to learn this all things, copy trading helps you make money out of your investments. Each coin has two sides, so is to copy trades. It has its pros and cons.

Copy trading is done on online Copy Trading Platforms, where it automatically divides your investment and portfolio in the exact proportion of any professional trader's portfolio. For example, if you have 1000 USD to invest. The trader's total portfolio is 10000 USD and is comprised of 10 stocks with 10% weightage for each. Then the Copy Trading Platforms divides you 1000 USD investment in those 10 stocks with 10% weightage for each stock.

Benefits of Copy-Trading:

• One need not learn more technical charts and patterns to trade in the markets.

• One can continue their profession and side by side generate profit from this strategy.

• This type of platform charges very nominal and can help to generate a very higher return, even more than any mutual funds or hedge funds.

• For any trader to start with is not easy, so if you are a newbie, you can join online copy trading platforms.

• By copy trading platform, one can learn about how professional traders make mistakes and even this can save a small or retail trader with many small initial mistakes.

Drawbacks of Copy-Trading:

• The only drawback of this strategy is that it works automatically, so few times it may even fail due to high market volatility. Also, you will never learn to trade until you will jump into it. So if it is for lift time or you need to make it professionally then you should learn it.

Procedure To Show How To Copy Trades Work

So, the copy trading procedure is very easy, you need to make an account on an online copy trading platform. Then you need to pay nominal monthly or quarterly or yearly charges, according to the platform and your money invested. So when you start trading, the system generates an automatic entry position according to your investment. You are supposed to enter for the position and then, according to system notification you are supposed to square off.

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