If you are hoping to take your first steps in the financial markets, you might consider copy trade as an excellent entry point. With copy trade, you can learn from successful investors and traders, improve your trading capabilities, reduce time spent on research, and move beyond your inexperience. This Copy Trade for Beginners guide is made for beginner investors and traders who wish to know more about the basics of Copy Trade and make their Forex trading experience more rewarding.
Copy Trade for Beginners Guide
Copy Trade is a popular and innovative trading methodology. By using this portfolio management technique, newbie traders can identify successful traders with a solid track record and mimic their strategy. Copying trades is becoming increasingly popular among beginner or inexperienced traders who wish to make trading decisions without researching on their own.
In simple terms, copy trading allows beginner traders to capitalize on the years of experience and knowledge of a successful trader without having to go through an extensive learning process. Practically, it’s a form of copying the actions of someone more skilled in trading than you are, but in a good way.
Beginner investors benefit from copy trading because it reduces their chances of making costly mistakes and allows them to replicate the profits of successful investors. It also gives them the opportunity to learn from skilled and competent investors along the way. However, it is advisable to review the trading history before exposing your capital to any risk.
Is Copy Trade Profitable?
Well, the answer depends entirely on who you copy and how much you invest. If you are mimicking an expert trader who has a low-risk profile, you can safely put in more money without having to worry much about losing what you have invested. However, if the trader you are copying has a high-risk profile but has high-profit margins, it might be better to invest less money. To put it into perspective, choosing the right trader to emulate will make your copy trading experience worthwhile.
Advantages of Copy Trading
Copy trade offers a variety of advantages that allow traders to explore a variety of investment goals with lower risks. Below are the best reasons you should consider copy trading to begin forex trading.
A Perfect Entry For Beginners
Many people are reluctant to try new things because they assume they lack the skills required to succeed. Copy trading is a fantastic option for individuals who are inexperienced or new to trading. Copy trade gives you the opportunity to start slowly and helps them learn how to trade properly. As a result, you can learn to trade Forex while also earning money. You may gain a great deal of confidence if you are able to make profits while following the strategies of experienced people at the beginning of your trading career.
You Can Learn From The Best
Copy trading is a highly effective way to explore the market and monitor some very successful traders as they open their positions and apply strategies. Following top professional traders in the market can help you gain more experience with minimized risks as you replicate the trading strategies of the best traders.
It Is A Great Time-Saver
Getting to know the financial markets takes time. Because the majority of the time spent in forex trading is spent on analyzing the market and making predictions on the basis of past performance, no matter how adept a trader is, technical and fundamental analysis will always take up a large chunk of their time.
Copy trade will be a great way for you to save time and make money at the same time. As a result of copy trading, new traders no longer have to conduct research on individual assets. By just copying the movements of successful traders, you can save all the time you would have spent on research.
Helps You Avoid Making Common Mistakes
New investors and traders are prone to make some common mistakes in their initial stages of trading. Copy trade allows them to avoid these mistakes for good. Some traders, for instance, take time to overcome their emotional decisions. Making investment decisions based on an obscure tip just because it “feels right” could lead to your ruin. By copy trading, you put your money in the hands of seasoned investors who have already overcome such barriers and are experienced and well-calculated.
Diversify Your Investment Portfolio
The proverbial “egg in one basket” error is another mistake new traders make, which means they fail to diversify. If you use copy trading, you’ll gain exposure to diversified portfolios when you copy other traders. Since copy trading applies easily to volatile markets like forex, cryptocurrency, and stocks, it can be applied to any trading instrument or market.
You’re More Likely To Earn Faster
Copy trade increases your chances of earning money faster than someone who tries to do it themselves. Nobody really trades Forex for fun. It is everyone’s ultimate goal to make some money from trading. With the help of seasoned investors, you will be able to close on more profitable positions and make more trades. Copy trade can be your sole activity, or you can make it a secondary one on top of your regular activities. You are likely to earn more money from trading online when you copy trade regardless of which method you choose.
How to Successfully Copy Trade
There are several ways to copy an existing trade. For example, a trader could copy all transactions, such as the trade-entry, the take-profit and stop-loss orders. Copy trading is also available in an automated version where trades are executed automatically. In contrast, a manual version allows traders to make their own trades. When one uses the manual version and employs their own discretion, the results should be different from the historical returns of a copy trader.
Finding a successful trader to copy can result in high profits. However, the most significant risk traders face when copy trading is market risk. When a trader copies an unsuccessful strategy, they can lose money. Additionally, traders are exposed to liquidity risk when volatile markets result in unstable conditions. Traders should understand the risks involved in trading before investing any money. Never take risks greater than what you can afford to lose.
Firstly, you have to select a broker with that you intend to trade. Make sure you choose a regulated broker, like AximTrade, who provides you with security, comprehensive leverage, a wide range of assets, and customer service. With AximTrade, you can now start copy trading with ease. Here are the simple steps to start copy trade with AximTrade.
You can set up a trading account with AximTrade with a few easy steps and explore unlimited opportunities for investment in the financial market. With four global forex awards in 2021, AximTrade provides the finest copy trading technology in the industry and offers the highest competitive leverage in the market.
AximTrade is a global brokerage firm that guarantees top-notch services to clients and partners. AximTrade is not just concerned with providing tailored trading accounts for specific needs, it is also committed to improving the trading skills of its customers with forex education.