Guru Tips: Selecting a Social Trading Network
This social trading network is rewarding to its traders in profits and low risk management approach. If more risk is taken during the month, the commission percentage is reduced. Top traders are more risk conscious than other networks that reward traders for profits, attracting more risk taking. The way Ayondo works is that if the trader you follow risks 1%, then only 1% of your balance is at risk. Most traders send signals from demo accounts but the number of traders with real money is on the rise.
Ayondo allows you to increase leverage per trader. For example, it the leverage of the trader is 2x, this means that the trader gains 2% and your account will gain 4%. High leverage means high rewards, with high risk and the potential to lose all of your allocation.
Traders with eToro are copied proportionally with respect to your accounts and the allocation for each trader. With eToro there is a default Copy Stop Level (CSL) to traders that you copy whose loss is more than 40% of the money given to them, then your trading relationship is over. This was started by eToro to limit exposure to any one trader. You can decide to override this if you choose, changing you CSL from 5% to 95%. eToro forces you to spread your risk, so it is in your best interest to limit the amount you spread per trade to 20%. Keep in mind that you can lose your full allocation of that trader in just one trade, or 20% of your account.
With eToro you will find high risk and low risk traders to follow. Being that you can only allocate 20% to any one trader, if they double their account in a week, this doesn’t mean your account doubles with it.
With ZuluTrade, the amount of risk you take is completely in your hands. You can set up your account to your liking in account settings. One option available to you is that one trader or just one trade can deplete your entire account. You can control this by utilizing the best money management settings and using the “ZuluGuard” feature. Out of all trading networks, ZuluTrade is the easiest to understand and navigate with respect to tools that limit the risk per trader. This is possible by setting restrictions on the traders you copy. With free range in ZuluTrade, you are able to take the most risk/leverage which in turn offers the highest potential profits. You can make a large profit by risking equity per pip on one trader.
What social trading networks offer demo accounts?
ZuluTrade, eToro, Ayondo, Tradeo, Darwinex and Tradency offer demo accounts that you can start practicing for free with virtual money.
Is it smart to choose from a small subset for traders to follow?
The best social trading network for this would be Darwinex because they allow you to choose from 50 pre-selected systems. Keep in mind that there is no guarantee that the traders selected beforehand will consistently outperform the best of traders with which they share signals on open networks. Whether you choose from a larger list or a sub-set list, you should always do your own research evaluating the amount of risk you are willing to take.
What is slippage and how much of it do you want?
The difference in the price you receive in your account and the price that the trader you copy receive in their account is called “slippage”. Extremely high slippage can have an impact on results as well as significantly low slippage is seen with integrated social trading networks (eToro, Ayondo and Darwinex). This is because they all use the same platforms with the same spreads and shorter delay time between copying.
Is it smart to invest less than $10,000?
All social trading networks allow you to invest less than $300. The only platforms that used to have high investment requirements were Signal Trader and FXPro SuperTrader. You can search any social trading network to find their minimum deposit requirement.
Copying Binary Options Traders. Having a Personal Account Manager. Social Interaction
ZuluTrade and AnyOption are both ideal for copying successful binary option traders because it’s easier to manage risk.
eToro is the only network that offers the experience of a personal manager, with a stipulation of having at least $20,000 in your account. Other networks provide phone, email and live chat support.
Social trading networks are not just used for copying traders, professionals and retail traders also use them to share trade ideas. For those who are looking for social interaction then eToro, Tradeo, Agea and Myfxbook are the most “socially active” networks. ZuluTrade also has a “social charts” feature which allows traders to leave comments in real-time.
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Remember that you have all the information about copy trading in our sections:
- Platforms: Information of each of the platforms of copy trading. Go to Platforms
- Guides: The best guides on copy trading. Go to Guides
- Reviews: Best reviews on copy trading platforms. Go to Reviews
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Currency trading with leverage implies an important risk for the investor and there is always the possibility of losses. These instruments carry a high risk if they are not managed properly and a profit can quickly become loss as a result of price changes. Due to the risk factor inherent to this type of trade, only funds intended for risk investments should be used. If you do not have extra capital you may be willing to lose, you should not trade in the forex market. It has never been proven that there is any system or portfolio of systems that is completely safe and no one can insure future profits or losses. Before you start trading in the forex market you should think carefully about your goals as an investor, your level as an investor and your risk aversion to determine if this is the type of investment you want to make. If you are in doubt you should seek advice from a professional financial advisor to advise you about the investment.