Crypto trading is a complex task requiring extensive knowledge and skills about fundamental and technical analysis of the trades. As most of the traders lack the capability to develop a winning strategy, they waste their time learning a multitude of skills required to become a successful investor.
Do novice traders have no hope? Will they earn profits? Thankfully, there are some tools which help such traders to explore the potential of the crypto trading world, simplifying the trading process by following the trades of expert traders. Crypto copy trading is a dynamic concept which allows anyone to replicate the exact trades of proven crypto experts automatically. If you are new to crypto trading and are not aware of the successful trading strategy or mastering the markets, copy trading will be quite beneficial for you in all ways.
Table of Contents
Let’s understand this concept, strategy, and its benefits:
Traditional crypto trading requires market knowledge, the latest market trends, and conducting extensive research to back your trading decisions. Furthermore, after placing the order, you need to manage it and exit at the right time.
But the concept of copy trading is different from this. Today, the best crypto exchanges and trading platforms like Growlonix offer copy trading options to help newbie’s profitably. This platform is breaking ground by developing the best copy trading platform available to all the users. We also offer signals to the traders which helps them to make smart decisions.
A copy trader is an investor who makes trades by following what a signal provider does. In exchange for the service, these providers take a commission on profits made from that trade. Crypto traders will typically follow other traders in cryptocurrency markets without having any idea about crypto market trends. It means that trading results are entirely based on the decisions of the copied trader.
How crypto copy trading works?
Crypto copy trading allows you to take advantage of other traders’ strategies without making the trade on their own or without understanding the market trends in deep. It is a way for you to start investing in cryptocurrencies by going through someone else’s trades, which allows you to learn how this market works simultaneously.
But before copying the trades, make sure to choose the genuine and right crypto trading platform along with the copy trader with a history of successful trading decisions. Some people are worried about the risks involved in cryptocurrency copy trading. The main risk is that you could lose money if your trade does not work out well. However, if you consider all the factors involved, it is possible to be safe and end up with a profit on your investment over a long period.
Whenever a copy trader/expert trader opens any position, they usually broadcast this information to the other traders who can then decide whether to open a position or not, or their automated system like copy trading bots will do the same on their behalf as per the preset strategy.
Whenever the expert trader opens a position, the copier will get notified, and the positions will also be opened simultaneously if you are engaged in copy trading strategy. Then the copier will stay in these trades until the positions are closed by the expert trader or these are closed manually.
This style of trading is actually designed for amateur traders to help them trade smartly and successfully. In this trading, the portfolio activities of the expert traders are copied automatically to the novice trader’s account. This trading relies on the actions of other traders who they think are the masters of this game. Copy trading is linked with the automatic copying or duplication of the trade of winning traders. Once the signal provider, who is an experienced trader, has entered the trade, it will open and manage the same position in the novice trader’s account. Let’s understand copy trading with an example:
Copy trades are often limited to 20% of the trader’s portfolio. Trade sums are expressed as a percentage of the trader’s portfolio here.
Let’s say, the trader might have $1000 in his account. However, if there are no open trades, they can copy successful traders. If the trader is a beginner, it’s important for him to not invest in larger amounts so as to avoid losses. Instead, they should use only 10% i.e. $100 when they choose to copy the trade.
The original trader may have one open trade and this trade will be copied into the copy trader’s account. The $ 100 is actually the percentage amount from the trader’s portfolio. It will be 10% of their portfolio which exceeds $1000.
And, the copy trader would do the same if they conducted a trade for $100.
Risks of copy trading in the crypto market
We all know that the crypto market is highly volatile, and many trading strategies are copied and are time-sensitive. If such a strategy is copied by other users, there are chances that its value will be diminished, and many who are engaged in this kind of trade will end up at a loss.
Apart from this, liquidity is another concern. While these issues are important, some strategies may work effectively if copied. And, if the trader’s analysis is good enough to identify such strategies, copy trading will be quite beneficial for them.
Inexperienced traders or new users may face such risks or issues while copying the trades. They may not possess the right skills to evaluate such strategies, and therefore, there are chances of losses as they have to rely on the features offered by strategy makers or experienced traders. If you want to give your trading a go with copy trading, the best trading platform, Growlonix will do it smartly for you where you can place successful trades without risking your money.
The best crypto copy trading software
The copy trading platforms play an important role in automating the trading process, so that it becomes easy for novice traders to earn profits without researching the market in deep. One such copy trading software used by the traders is the copy trading bot. These bots are offered by third-party exchanges. These exchanges allow you to integrate these bots into specific exchanges.
Crypto trading bots automatically execute the trades based on the instructions given to them or set for them. These bots have copy trading features which lets traders to copy the other traders’ trades.
How to begin copying the trades?
So, you are ready to copy the trades now? Here, you need to follow a specific method to make sure that you are going to be successful in your trades. To start copy trading in the right way, follow the below steps:
- Choose the right copy trading software
- Choose the trader you want to copy
- Choose the copy trading settings
- Keep track on the results achieved
Why it is worth using copy trading on Growlonix?
Copy trading is an algorithmic trading tool that is intended for copying the trades of professional traders. Growlonix offers this easy and profitable way to start trading with relevant knowledge and skills. Considering copy trading here will reduce the loss of traders’ funds and increases their chances of earning good profits. The copy trading bots offered by the platform allow you to place the trades successfully in no time.
The best copy trading platforms aim to democratize the trading process and make lucrative crypto trading strategies available to the new investors, who can copy the trades of expert traders automatically with the copy trading bots. This kind of copy trading allows beginners to follow professional and profitable traders. Plenty of copy trading bot platforms are available that will automate your trading process and choosing the most genuine one is important.
The platform also offers trading signals which can be used by traders to take a position on the market. Once you have received the signal, you can edit settings and trading parameters in line with your trading strategy.