Anybody who has dabbled in trading knows that Forex trading has the potential to make tons of money. This is why, there are hundreds of thousands of beginners all across the globe trying to make sense of the forex market to become rich. Unfortunately, making money with Forex remains a pipe dream for most as they are unable to take the time needed to study everything they should to become good at Forex trading. This has given rise to a form of trading known as copy trading and many platforms out there have caught on to the forex social copy trading hype.
In simple terms, this form of trading maybe defined as copying the trades of another successful trader. On paper, it seems like a sure thing. After all, when you’re able to copy the trades of another successful trader, you should be able to make money. It is a great thing for beginners as they can take baby steps and learn a lot through this form of trading. However, not all the platforms out there provide enough risk management features and the necessary data to help you choose the right trader to follow. This is why, it is extremely important for you to do your research in order to choose the right platform for forex social copy trading.
One of the most important things you need to look at is the maximum proportion of your portfolio that can be invested in copying a particular trader. Most successful platforms limit it to 20%. In short, you cannot invest more than 20% of your money in copying another trader. This is a good thing as it will save you a lot of headaches. Another important thing you need to keep in mind is the data needed for choosing the traders. If you do not research carefully, you might end up following someone who is on a losing streak and when they lose money, you are automatically going to lose much more money.
To conclude, copying a trader is one of the better ways to make money in Forex trading for beginners. However, you need to be careful and do your research in order to make real money and to become a successful trader on your own.