People often get the two ideas of copy trading and social trading mixed up.
In both ways, you work with other people on your investments and make decisions based on what they tell you.
Even though their names sound similar, the two methods are not the same in important ways.
Social trading is a way to invest in which traders work together as a group.
Traders in the group share research and tips with each other, and more than one person may offer advice to help a trader improve their portfolio. Investors may even put their money together to make a bigger investment. Social media has made this type of investment very popular.
For example, people on Reddit or Twitter may start talking about their ideas and share market analyses to help other traders.
Social trading is a lot less formal than crypto copy trading, as you can see.
You don’t have to use any specific software or make a deal with an investor to split the profits.
A lot of people who use social trading look at a lot of different groups and listen to advice from many different social circles. Some kinds of social trading involve contracts for pooling money, but you don’t have to sign anything if you don’t want to.
Pros and cons of crypto social trading
Crypto social trading is different from crypto copy trading in that it has its own pros and cons.
There is a lot more freedom with social trading. You get to make most decisions on your own, but you can also listen to what other traders have to say.
Social trading also lets you work with other people to plan trading strategies that only work with a large number of users and funds.
But social trading is a lot more work than copy trading in crypto.
You have to build relationships with other people, trade with them, and spend a lot of time on social media to learn about things. Social trading is not only more hands-on, but it is also less reliable. In social trading, you can’t just set up an account and then sit back and watch what happens, like you can with crypto copy trading.
If you take advice from more than one person instead of just one trader, your plan might not be as well-thought-out. You can’t copy crypto copy trading’s long-term investment strategies through social trading. When social media overhypes news and makes people trade on impulse, using social trading for crypto can also be a problem.
How to Start CopyTrading Cryptocurrencies
The Bitget Exchange is one of the most well-known places to try copy trading with cryptocurrencies. Even if you still don’t know what crypto copy trading is, Bitget makes the process easy to understand.
Create your account and deposit some funds into the USDT-M wallet (the futures wallet)
Once you’ve done this, you can go to the Copytrading tab and search for a trader to copy with your funds.
Choose a trader to follow. Look through the cards of the main traders to find someone you want to follow.
You can think about things like how many trades they win and how much money their followers make on average.
Choose your trading parameters. Once you are following the main trader, Bitget will ask you to choose parameters.
Verify your choice: All you have to do next to start trading in crypto copies is confirm your choice.
When you click Confirm, you’ll start to copy what the trader does.
Is CopyTrading profitable ?
How often does crypto copy trading work? It works well in a lot of different situations. Experts in the field say that copy traders get about a 30% return on their investments when they copy a professional trader.
Most of the time, a trader’s return on investment (ROI) is between 3% and 57%. Keep in mind that crypto copy trade sites will stop your trades if your account balance reaches $0. This means that, unlike with some other trading strategies, you can’t lose more money than you put in.
Don’t forget that a lot of your success depends on the trader you’re copying.
To be successful, you need a good plan for how to deal with risks. Before you start crypto copy trading, you should really look into different traders. Choose the ones that have a good amount of activity, a lot of followers, and a steady rate of return.
You should also think about whether the trader makes short-term or long-term trades.
If you copy a long-term trading strategy but get out of your trade in a week, you might lose money. You can increase your chances of success by copying more than one trader at the same time, in addition to finding a good trader. This can make it easier for you to find a strategy that works.
In conclusion
To sum up, copy trading in crypto can be a simple and effective way to trade crypto. You can automate your trades and learn more about how the market works by copying the trades of more experienced traders. You can increase your chances of success if you take the time to learn as much as you can about traders and if you follow traders who have a good reputation.
Click here to register your Bitget account and start copying other traders
