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What is Copy trading?
Before you begin
If you have come this far, it is because you are interested in the world of trading, more specifically in the world of Copy Trading.
You should know that we are experts in Trading and our mission is to help everyone understand what copy trading really is, all in a very practical way as you will see throughout our tutorials.
First of all, you should know that there are many ways to classify trading according to who is trading, to simplify we will say the most common ones:
- Manual Trading: Performed by a human whose job is to trade in a market, known as Trader. Must be aware of the market, receiving signals, analyzing charts… involves full dedication and professionalism.
- Expert Advisor: Made by a Program that trades according to predefined rules and configurations… trades for us but everything depends on 1 strategy that is usually a black box for those who do not know how to code.
- Copy Trading: Performed by a Platform that allows anyone to copy Traders or Expert Advisors. It does not imply dedication and the strategies are diversified by following several Traders not correlated between them.
This is why as trading experts we find in Copy Trading the best of professional Traders along with the best of Expert Advisors.
We hope that throughout this tutorial about “What is Copy Trading” you will be encouraged to try it out for free, here is the link to begin: Start in Zulutrade >
What is Copy Trading?
Let’s first understand what is trading, which is the basis of copy trading:
- Trading: Trading is the activity that can be done today by any person (Trader) or robot (Expert Advisor) to trade in financial markets. For example: buy Euros, buy Apple shares or buy Gold.
- Copy Trading: Copy Trading allows anyone to automatically copy the trades opened and managed by a Trader or by an Expert Advisor who performs trading.
Below is a comparison of the features that differentiate Copy Trading from Trading:
Example of how it works
What the Investor should do:
- The Investor opens an account in Zulutrade.
- The Investor copies one or more Traders in Zulutrade.
From here on everything is automatic:
- The Trader opens a trade in the market.
- Zulutrade opens the same trade in the Investor account.
- The Trader closes the trade.
- Zulutrade closes the trade in the Investor account.
- The Investor gets the benefits of his trade.
Investor: It is the person who automatically copies the trades of the Trader with his own capital.
Copy Trading Platform: Organizes and automates all the interaction between Traders and Investors.
Trader: It is the person or robot that executes the trades in the market.
You can start with Zulutrade in less than 2 minutes. The best way is to open a Demo Account and copy a Combo of Traders.
Now you know “What is Copy Trading“, if you want to learn more we encourage you to read the next tutorial: