Is Copy Trading the right fit for those who are not able to make their own successful strategy?
- Thread starter Cyril02
- Start date
Allegedly there are a few people that are successful doing copy trading on e.g. C2 but it is really hard IMO, because you need to understand all the common BS system vendors pull, and then filter them out in your essentially black box evaluation. Because most is BS you have to go through and reject a huge number of trade leaders before you find a single legit one (that you still need to carefully monitor). I gave up since I find doing my own trading more straightforward (not to mention interesting) than worrying about whether people I copy trades from are idiots. But there's a personality fit for everything, you will notice if it's something you really like doing.
Bad idea. When things get hectic or haywire, you won't understand what the intended strategy is supposed to do or how you are supposed to react. You would be better off giving your funds to the manager to trade on your behalf.
You talking about sharing your trade signals to other traders for a fee as in offering a signal calling trade alert service (you tell them what to trade, when to buy and when to sell) or you talking about you copying/mimicking the trades of another trader ???
Regardless, you should read up on behavior finance to understand that your cognitive decision-making process will sabotage your ability to copy/mimic the trades of another trader unless the trades are called in "advance".
That same cognitive decision-making process is the reason why traders can not trade successfully with real money their backtested/hypothetical winning trade strategy until it is designed as an automated trading system. Simply, there's a lot more involved when you hear another trader say if it's profitable, why not trade it yourself ?
The reality, most point-n-click traders can not trade a profitable trading system because of problems with their cognitive decision-making process (behavior finance).
P.S. It's the first time I saw a slang for signal calling trade alert service called copy trading. Usually, the slang is live trade rooms although copy trading is more accurate about what is occurring...one trader is copying trades signaled from another trader or one trader has his trading account linked to the accounts of other traders so that trades can be duplicated across multiple trading accounts...
The latter above, brokers have a name for it that I can not remember.
wrbtrader
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Yes, there are profitable signal providers, but the majority like over 90% are not (any) good. So you need to look for yourself and validate. And you can learn from their trades too. Do not believe there cannot be any successful signal providers like from other posters here because there are some. They just did not spend enough effort to find them. But in your case of lack of own strategy it is good to look for those. And you also need to diversify a bit because most of them are not super consistent in their results like having some bad months in 1 full year. So that is bit more difficult to achieve. I also would avoid all providers who are not clear and transparent in their results as summaries shown. If they need to hide their performance just skip those. Second any sign of deleting loss trades or any severe unhonesty is also a sign to skip them. And finally you can skip all those providers with 3 TakeProfits or more because usually the Risk Reward is not good and they do not count partials in their profits which is also kind of fraud. So you got a manual here, just do your own search now. I do not tell you more.