If you are just getting started in the crypto sphere, you might consider copy trading. From this article, you’ll get to know what it is and how you can benefit from it.
When making their first steps in crypto trading, beginner traders face multiple risks. They lack knowledge and skills. They don’t know how to tell scam coins from assets with good perspectives. To avoid these hazards and maximize your income from the onset, you should consider crypto copy trading. From this article, you will get to know about the essence and benefits of copy trades and how anyone can copy top-performing crypto traders.
How Is Crypto Copy Trading Organized?
Traders should never make spontaneous, random and impulsive decisions. Before buying or selling an asset, you should analyze crypto trading signals. But where can you find secure signals and how to implement them? The smartest way out is to rely on a crypto copy trading platform and copy crypto traders.
This is what you need to start.
- Think of which assets you would like to work with and which strategies to stick to.
- Choose a crypto copy trading platform where quality strategies are presented.
- Create an account on such a platform and link your exchange account.
- Choose a strategy to copy and subscribe it.
After these simple steps, all orders within the copied trader’s strategy will be automatically executed on your exchange account.
Copy trading can save you considerable time and effort. The process of copying is automated. You will not need to stay chained to your computer, tracking someone else’s behavior on the market. You get your income and pay for a subscription.
Worth mentioning, that some strategies can be copied for free and it’s a really good option for beginners traders.
Who Is the Target Audience of These Services?
Copy trading is especially popular among three types of users. The first type is busy people who permanently lack time and knowledge. They have some assets — but they need third-party help to manage them.
The second type is novice traders who know what crypto is and how to earn with it but they don’t have enough knowledge to trade on their own. These people prefer to carry out thorough research and investigate other traders’ strategies and then copy them.
The third type is experienced traders who want to get additional income from subscriptions on their strategies.
The frequently asked question is can you make independent decisions while copying? The answer is yes, of course. For instance, you will be able to use the Stop Loss tool. Also, you can open or close positions manually. Besides, you have a right to stop copying someone else’s strategy at any moment.
Copy trading has much in common with social trading, so what is the difference?
Social trading means that users actively exchange their experiences. They discuss their strategies, pros and cons of different assets, policies of crypto exchanges and so on. Copy trading does not necessarily involve any discussion.
What Are the Benefits of Crypto Copy Trading?
Novice traders will minimize their risks and diversify their portfolios. You will be able to learn on the go while making money. You will have enough time for your everyday work, family and any other activities. You will get positive impressions of the crypto market and you will be motivated to develop in this sphere.
For experienced traders, it is a chance to earn extra cash. They can earn by subscriptions to their strategies. Plus, it helps them to promote their personal brands and become influencers or celebrities in their sphere. Which, in turn, leads to more copying traders and greater income.
Does Copy Trading Have Any Disadvantages?
Yes, but they are not too numerous.
- You won’t acquire skills and experience while just copy trades. To avoid this you might analyze the market behavior of the more experienced trader.
- One day the professional you follow will inevitably make a mistake and you will both lose money.
- You will not get 100% of your income because you will need to pay a fee (most likely, a monthly one). Yet this fee will be very small compared to your potential losses in case of solo trading.
As you see, the advantages of copy trading definitely outweigh these insignificant shortcomings.
Final Thoughts
Copy trading is an ideal strategy for people who are just starting to make money on cryptocurrencies. You find a reliable copy trading platform or subscribe to a trader — and you automatically repeat their activities on the exchange. This should help you to get income with minimum effort and at a reasonable fee. You will be able to analyze professionals’ strategies, gain experience and get ready for independent trading.
Credit: Source link
