Copy Trading
Practice of automatically replicating other traders' strategies.
Beginner-friendly explanation
Copy trading allows you to copy an experienced traderโs trades without placing orders yourself. When the trader buys or sells, your account automatically does the same.
๐ Example: You connect your account to a successful trader: when they buy Bitcoin, you instantly buy too.
Intermediate-level insight
Copy trading uses specialized platforms to synchronize a master trader's orders with followers' accounts. Fees, latency, and control over parameters (risk, position size) vary by platform.
๐ Example: On a platform, you can choose to copy 50% of a trader's orders instead of 100% to reduce your exposure.
Advanced perspective
In copy trading, evaluating the trader (P&L, drawdown, management style) is as crucial as the technical quality of copying (latency, slippage, scaling capability). A poor choice of trader or poor copying infrastructure can seriously impair performance.
๐ Example: A trader showing a 300% return may actually use risky money management, leading to large hidden losses behind the average.
Security
copy trading, trader copy, order synchronization, copy trading platform, follower account, risk management, performance, drawdown, slippage