Forex Copy Trading

Copy trading is a form of investment that has become increasingly popular in the financial markets over recent years. This popular strategy is beneficial for both newbies and experienced traders.

This strategy involves a trader copying a trade executed by another trader. In other words, copy trading allows a trader to replicate the trades of a more experienced trader automatically. The more knowledgeable traders are usually called Traders or Providers, while the traders who copy the transactions are usually called Copiers, Investors, Subscribers, or Followers.

The copying process includes opening positions, setting stop loss and take profit, and closing positions. There are several different types of copy trading, such as social trading and mirror trading. The difference lies in whether the processes are fully automatic or semi-automatic.

In copy trading, a trader must pay a commission, usually between 0-50%, in exchange for replicating successful trades of another trader. If the trades are unsuccessful, the copiers do not need to pay any commissions.

If you are interested in trying copy trading strategy, below are some reputable Forex brokers that offer copy trading service, along with their trading conditions:

XM Copy Trading

1. XM Copy Trading Program is a novel approach to modern trading that every new client of XM Forex broker is welcome to use for fast-tracking their way to the forex market without having to learn the ropes. Experienced traders get to share their strategies for a commission as well. The possible roles in this program are the Investor and Strategy Manager roles. Moreover, investors can invest their capital in pro trader’s strategies and managers can collect commissions for their services.

2. Investors ought to invest their money to be able to follow and copy their chosen manager’s strategies. Since these strategies are proposed and applied by the managers themselves, the investors only need to monitor the progress of their copied trades in real time. In addition, the investors are to pay the commission only when the trades bear fruit. Strategy managers can attract a multitude of investors by showcasing their proven strategies and get paid for the job well done – the commission is guaranteed when you succeed.

3. Both Investors and Strategy Managers can rest assured that their funds are safe and secure in this program. XM makes sure that your trading experience goes as planned with no hiccups. To enter the program as an investor or a strategy manager, first, you ought to register and get verified. Afterward, you can either copy strategies for great results or let others copy yours for a guaranteed sum of commission, both are great options with a lot to offer.

4. Investors need to head to the member’s area, click the “Create Investor” button, and complete the required steps to be able to choose, follow, and copy their preferred strategy managers by reviewing their entire profile (leverage amount, fees, total investment, etc.). The following formula will determine how much investment you need to make as an investor: Multiplier = (Investment Amount / Manager Equity) x (Leverage Investor / Leverage Manager). Strategy Managers also need to go to the member’s area, click the “Create Strategy” button, and complete the required steps to be able to share their strategies with potential investors. Managers can use MT4 & MT5 platforms and up to 10 different accounts in this program.

5. XM Forex broker uses the High-Water Mark Model for calculating your transactions. As previously mentioned, investors only need to pay commissions for copied trades that result in profits. Strategy managers get to collect up to 50% in commission if and when their trades result in profits. Additionally, the fee calculation process is done on a daily basis. This program enables Investors to join the FX market immediately with no prior trading knowledge, and Managers to earn more money by having access to a much larger pool of capital.

Payment methods: Bank wire, Credit Cards, Skrill, Neteller, Bitcoin, PerfectMoney

Regulations: CySEC, IFSC, ASIC, DFSA, FSCA
Country: Cyprus
Founded: 2009

Join XM Copy Trading!

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Advantages of Forex Copy Trading

While copy trading is especially appealing to less experienced traders, it actually offers some benefits for professional traders too. Here are several advantages of Forex copy trading:

✅ 1. A Good Way to Start

Using this strategy, even a new trader can participate in the financial markets with limited knowledge. Copy trading gives them a chance to familiarize themselves with the markets and build their confidence in trading before truly stepping into the Forex world.

✅ 2. Flexibility

Copy trading is time-saving and flexible as it eliminates the need for extensive and careful market research and analysis. The process is mostly or fully automated so it is especially beneficial for traders who do not have much time to trade or do research.

✅ 3. Learning Opportunity

Another benefit of copy trading is a valuable learning opportunity. By watching other traders trade, both new and experienced traders can get trading ideas, gain more knowledge and insights on effective trading techniques and risk management practices. Copy trading can help them understand the markets better. However, the learning opportunity is limited because copy trading does not explain what specific strategies are used by the traders and why they choose to use them.

✅ 4. Diversification

An important aspect of risk management in Forex trading is diversifying your portfolio. In copy trading, you can choose to invest in several traders who trade different assets in different time frames with different strategies. Therefore, you can minimize the risks by balancing your portfolio. When one trade is unsuccessful, you still have other different trades.

✅ 5. Earn Commission

This is the reason why many professional traders share their strategies to be copied by other less experienced traders. They can earn additional money since they will be paid a percentage of commissions. The commission calculation is based on several factors, depending on the broker. Traders will get bigger profits when they execute more successful trades and have more followers.