Investors make millions of dollars daily from the rise and fall of foreign currency. However, the lack of required experience in foreign currency trading has sidelined beginners from making a fortune from the trade. Beginners generally fumble when it comes to opening and closing of trades and are unable to differentiate between the profitable positions and the unprofitable ones.
Using the trade copier system can help beginners overcome many of these problems. It allows them to follow up with trades in order to get a deeper insight into how Forex works so that they can start to trade independently. So far, trade copier software has become so popular and considered a great tool for successful trading for those who need help getting started.
So, what is Forex and how does Copy trading works?
Forex is an acronym for Foreign Exchange. Forex is a form of a market which allows investors to speculate on the value of the currency and make money from their correct predictions.
Copy-trading, on the other hand, is an investment strategy by which one investor takes the decisions or copy the trades of another investor. Usually, their copying investor is a beginner while the owner of the copied trade is a seasoned investor called the mentor. The seasoned investor is usually the one with an enviable track of success in Forex with a consistent profit inflow.
Setting up a Copy Trading Account
To start copy trading, you need to open an account with a broker. After this, you need to load your account with some funds. Then, a fixed sum from your capital automatically links to the account of your mentor. For each trade your mentor makes, your account will copy the movement and a proportional amount is deducted from your account. Thus, each time your mentor makes a profit, you also profit. Anytime your mentor loses, you also lose. Meanwhile, the system allows you to link to different mentor’s account for maximum profit.
Benefits of the Forex Trade Copier system
There are numerous benefits that can be linked to the use of trade copier system. The first obvious benefit is that the trade copier system totally eliminates human efforts since all processes are handled by the software. Hence, you can maintain a hands-free mode while the software trades on your behalf.
If trade copying is to be done manually, you can start to imagine the time and effort you have to put. Even if you are a full-time quick trader, you cannot be as fast as the software. More so, you cannot execute as many trades as software would. Manual traders are prone to errors too.
What’s more, the trade copier system allows you to capitalize on another trader’s expertise to generate profit for yourself. Even if you have no idea of what the market is, you can still continue to make money simply by copying the trade of a professional.
There are also some drawbacks to the use of trade copier system. For instance, your success or failure is dependent on the success or failure of another person. Thus, if your mentor loses, you also lose. Beginners are fully dependent on the success of another trade. This is not something that is always guaranteed.
Now that you understand the difference, you can make a good decision. First you need to find a good broker and register a live account. Some brokers offer PAMM system or copy trading, but if your broker does not, you can use a third party trade copier or PAMM system. It would be better if you choose a reputable broker that offers such options