Getting into trading can be very difficult, especially when you don’t understand a lot about the financial market. You first have to learn a lot more about the different aspects of the market, and you have to learn a lot more about the different types of assets that you would like to invest in.
However, there is a way that you can get around to making a much bigger impact on your overall trading strategy, and that is with the help of copy trading. Luckily for most people, copy trading can be fairly easy to get into despite what most people will say. Here is a deeper look into how you can start copy trading.
Steps to start copy trading
Even though it can take some time to start making more educated decisions when copy trading, the truth of the matter is that you do not have to wait till you learn all about the market to trade them. And with the help of copy trading, you can easily skip most of the grind that it takes to get to a position where you can start trading more comfortably.
But you might think that there is something of a learning curve that comes with copy trading. That is not the case, and you just need to follow a few steps to start trading with the help of copy trading.
Decide On What Type of Copy Trading You Will Do
The first step to starting to trade with copy trading is to first decide on what type of copy trading you are going to be focusing on. There are two subcategories of copy trading that you should learn about before you can start trading as they can sometimes fundamentally change how you go about trading. These types include Social trading and Mirror trading.
Copy trading is the process of following a specific trader and investing in whatever they are investing in with only minor changes to the total investment that you make. On the other hand, social trading refers to individuals finding out about the process that more experienced traders have when they are about to make an investment.
They first want to learn about how the market works, and want to know how they can make the smartest decision when it comes to finding the right asset to invest in. This is less about copying off another trader’s assets, and they will instead like to learn how they can make better decisions.
Social trading takes a major departure from copy trading, since it focuses more on learning how to trade instead of just copying the trades and then learning why someone would do them. Mirror trading however, is more of a subcategory of copy trading than it is a major departure.
In mirror trading, you will only be taking the strategy behind the trader and not the trades that they make themselves. The trader could be investing exclusively in gold and stock, but they have a trading strategy that fits how you like to trade. You can take that, rework it a little, and apply it to your specific trading instrument.
Now that you understand how each of these tend to work, it is time to move on to the next steps.
Find the Right App
Once you can decide what type of copy trading you want to be focusing on, you can then move on to finding the right app so that you can start your trading journey. What you really want to find is a good app that not just contains a variety of assets that you can trade in, along with the copy trading feature that you want.
Having a variety of assets at your disposal is always a good idea since you can then find out the assets that suit your specific trading style and then start properly trading.
You should also look for a platform that has good socializing features. It should be easy for you to connect with more experienced traders and ask them for their trading strategy. Another good socializing feature that you should be looking for in your trading app is its ability to find experienced traders in the first place.
While anyone can just say that they are an experienced trader, the truth of the matter is that only a few of them will only be telling you the truth. But if a platform is tracking the statistics of a trader, then it will be able to tell you which of the traders you are looking to copy are legitimate. So, you can easily find out if the right trader is worth following when looking for a copy trader.
Find the Right Experienced Trader to Get Trades From
Once you can find the right platform that features all of the right social features that can help you make better decisions, you now need to find the right trader. There are no strict rules to trading, and if there are, they can always have exceptions.
In fact, one of the hardest things about having very specific rules in trading is that it can usually lead to a trader feeling overly restricted. Therefore, just because a trader is successful doesn’t mean that you will be chasing after them.
Instead, you want to then check the strategies that they deploy when they go about making the right decisions. By understanding the trader, you can then see if they have a trading style that is similar to yours. If the trading style is similar to yours, then you can copy them and slowly learn what makes them make these decisions.
Conclusion
Getting into the swing of things with trading is never easy, but copy trading can give you a significant advantage in trading, especially as a beginner. The best part is that you can eventually learn all of the fundamentals of trading through the copy trading platform ecosystem itself.
And as things continue to become easier, you can then become a better trader. And with the list above, you can even find out how you can start with copy trading.
You can read more about copy trading on Zulutrade website.