Can You Make Money from Copy Trading?

At the beginning of the 2000s, some Forex platforms started pushing the idea of trust management and copy trading. While many of their ideas became obsolete over the last two decades, the benefits of copy trading cannot be denied even by the fiercest of skeptics. So what is crypto copy trading? It is not a secret that some traders perform better than others. The proficiency of some traders makes the market seem as lucrative as it does. There is a certain degree of glorification of what active investors do. Movies and television are pushing the image of an all-knowing guru that makes millions using their wits and intellect.
While some of it is true, the reality is that some are just better at making money but not by a large margin. However, minute differences make some standout. If you utilize copy trading in crypto, you may join those who succeed.
What is crypto copy trading?
Social trading is a service provided by some automation services. The idea is quite simple: the system may choose the best performing portfolios and showcase them or allow you to follow specific users. Some companies even hire professional traders to be trust managers.
Users can choose the best performing traders and follow their lead by setting up their bots to copy all orders placed by them. You can try this strategy at WunderTrading — an industry-leading platform for automation in the world of crypto.
To start your journey in the world of social trading, you need to create an account:
Go to the main page of the WunderTrading website.
Create a new account using your e-mail address (requires confirmation).
Connect an existing account from an exchange of your choice.
Go to “Marketplace” and choose “Manage Copy-Trading”.
Start following traders or bots that seem profitable.
This particular instrument is an excellent choice for people who are starting to learn about active investments. Understanding the market and learning even the basics of technical analysis require time and effort. While you are studying and getting accustomed to the industry, you can create complementary income, start investing, and follow well-performing practitioners.
Is copy trading profitable?
The best crypto copy trading strategies revolve around choosing the right people to follow. Some traders perform better during bear markets while others excel at catching a bullish trend. While it is impossible to predict whether they succeed, working with several traders over a long period usually yields the necessary experience and knowledge.
Note that following hugely popular traders is rarely a good idea. Several factors make people using a crypto copy trading platform and following popular traders fail:
Simultaneous orders with big volumes often sway the market making the near future unpredictable.
Many big investors experiment with exotic assets like crypto making their decisions risky.
Robots that you follow and copy may be not adjusted perfectly.
The profitability of your portfolio depends wholly on whether the people that you follow make correct decisions. While it is a reliable method of increasing the safety of your investments for beginners, more experienced people usually stay away from any advice from strangers.
Note that you never know who places orders and why they do it. Some popular traders were just lucky with a couple of well-placed orders and now ride the wave of success. Some people make decisions under the influence of drugs and alcohol which is also something that you cannot know or predict.
Where you can try this feature?
Most modern exchanges have APIs so that other services can be integrated with them. For example, Bybit’s copy trading works without any external tools while KuCoin does not feature such instruments and relies on providers like WunderTrading.
It is crucial to consider a variety of factors when attempting to invest using social instruments. First and foremost, the crypto trading bot price (when you use automation) may seem like pocket change but together with exchange fees expenses stack quickly.
Look for exchanges that have features like social trading or go to specialized vendors like WunderTrading to try copying the best in the industry.
Should you invest “socially”?
Many elitists in the industry say that one must understand all the caveats of financial markets before one makes investment decisions. On the other hand, knowledge is a big wall that prevents millions from actively participating in rapidly evolving industries like crypto. If you do not have a natural talent or enough time to learn about markets quickly, you should consider social trading.
Copying those who have mastered the craft of money-making is one of the ways of building a secondary income stream. If you are interested in passive investments but with a twist of being involved in the market, this option will work wonderfully. Those who want to sit on their bank should think about HODLing (HODL is a meme in the cryptocurrency community meaning buying and never selling). People who want to learn about the ins and outs of trading, should just deposit some disposable sum on an exchange and try buying and selling on their own.
There are certainly merits to all strategies.