Social, Mirror, and Copy Trading
Social trading is the future of online trading. Instead of having to monitor and analyze thousands of different financial markets you can choose the right provider to do that job for you. There is a huge benefit in terms of saving time and optimizing the entire trading process. Social trading basically refers to the gathering of financial information and trading based on this information. Copy trading and mirror trading are two automated social trading methods and refer to the process of automatically imitating the positions of other traders.
(A) Social Trading → Gathering Social Info and Manual Trading
(B) Copy trading & Mirror Trading → Automated Trading
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Social Trading Platforms
There are tens of different social trading platforms available. Each copy trading platforms offers different copy trading features. These are some key points of differentiation:
(1) Number of available Financial Instruments
(2) Number of available Copy Providers
(3) Management Fees (if any)
(4) Cost per Trade / Commission Structure
(5) Average Spreads
(6) Minimum / Maximum copy trading amount
(7) Ability to set Maximum Allocation of Funds
(8) Extended Risk Control (i.e. the ability to place a Stop Loss on the entire copy-trading relationship)
(9) Ability to monitor and to manage each copied position
(10) Ability to monitor the full trade history of the Signaling Service (or copy provider)
(11) Offering (or not) Demo Account
(12) Variety of accepted Fund Methods / accepted Currencies
(13) Customer support methods (and languages)
(14) Regulation and client account segregation
These are some popular social trading platforms offering copy trading features:
(1) Dukascopy Social Trading Community
Dukascopy is a Swiss-based Forex bank that offers social trading via the Dukascopy Community and Jforex automated platform. The Dukascopy Group offer two choices:
■ Dukascopy Bank (minimum account $5,000, only bank wire)
■ Dukascopy Europe (minimum account $100, bank wire and credit cards)
The Dukascopy Community is built in the Dukascopy website and offers full social trading features, including:
(1) Discussions & Market Analysis
(2) Social Trading Contests
(3) Full Copy Trading Features
(4) Live-Chat Support
Dukascopy Social-Trading Advantages:
-The spreads start as low as 0.25 pip plus $4.8 trading commissions per full traded lot
-There are no subscription fees
-There are no additional volume commissions
-The copied positions are opened automatically even when you are offline.
-Set-up a general Stop-loss level on your account
-Set-up a trading ratio for each copy provider
-Manage your copied positions via JForex or JForex mobile (alter or close any copied trade)
-Get 30% off all commissions paid for the 1st month (rebate link only that follows)
-Full client's account segregation
-Demo Account: Yes
Dukascopy Accounts:
■ Account Currencies: Euro | US Dollar | British Pound | Australian Dollar | Canadian Dollar | Hong Kong Dollar | Japanese Yen | Swiss Franc
■ Minimum Deposit: 100 USD
■ Funding Methods: Bank Wire, Maestro, Visa, and Electron
Rebate Link: You can enjoy also a 30% commission rebate for your first month of trading (works both with Dukascopy Bank and Dukascopy Europe):
(2) OpenBook Platform (eToro)
eToro is a very popular social trading platform. There is a wide variety of copy providers and an easy-to-use interface. On the other hand, eToro operates as a Market Maker (Dealing Desk broker) and provides very expensive trading. The EURUSD spread is 3.0 pips.
More about eToro Openbook: ► eToro OpenBook
-No US Clients
-Demo Account
-Minimum Deposit: $50
-Maximum Leverage: 400:1
-Expensive Trading
(3) ZuluTrade
ZuluTrade is a popular social trading platform supported by more than 50 Forex brokers worldwide. ZuluTrade offers full copy-trading functionalities plus binary options copy-trading. Note that ZuluTrade is affiliated with the ECN Forex broker AAAFX which allows also traders from the US.
-Instruments: Currencies, Commodities, and Equities
-Max capital leverage: 1:200
-Minimum opening deposit: Depends entirely on your broker. AAAFX requires $300 minimum deposit.
-Fees: ZuluTrade’s service is free, however, each Broker may charge a commission to use the copy service
-Demo Account: Yes
-Signal providers are not required to trade using their own money
-Extended Money Management tools
-Extended Performance Analytics
-Mobile apps
-Welcomes US Traders
The ZuluTrade Automator allows traders to create their own settings and rules. For example, traders can lock their profits or to manually update their Stop/Limit for every trade.
More about ZuluTrade: ► Zulu Trade
■ AAAFx Account Currencies: Euro | US Dollar | British Pound | Japanese Yen | Australian Dollar | Swiss Franc
■ AAAFx Minimum Deposit: 300 USD
■ AAAFx Funding Methods: Bank Wire, Credit Cards, Skrill, EPS, iDeal, GiroPay, Sofort, TeleIngreso, Qiwi
(4) Tradeo
The Tradeo social trading platform provides access to market news and trade sentiments. It also offers interaction and messaging with other traders. Tradeo operates as an STP broker.
-100 Forex & CFD Instruments
-STP Model
-Leverage up to 1:200
-Trade on MetaTrader 4
-Account currencies include USD, EUR, GBP, and JPY
-Minimum deposit is $100
(5) Ayondo (Ayondo Markets)
Ayondo is a European-based social trading network which operates also as a broker.
-Demo account
-Limited Choice of Providers
-Commission model is based on performance (gain %)
-Funding Methods: Bank Wire, Credit Cards
-Account currency includes Euro, US Dollar, and British Pound
-Minimum Account is 100 USD / EUR
-Regulated by FCA (184333 )
(6) Tradency Mirror Trader (Several Brokers)
The Tradency MirrorTrader platform is used by many brokers worldwide. The MirrorTrader allows to copy the trades of any customer of these brokers, and that means you can select from a great variety of providers no matter the broker you have chosen. The platform offers automated trading and copying features but no social trading features.
-Most signals are generated by robots and the positions are copied in real-time
-Fully-automated, semi-automated and manual trading features
-Trades can be copied proportionally
-Strategy Filters and Performance Monitoring
-Doesn't provide interaction between traders
More about the ► Mirror Trader
Basic Terms
Let's distinguish the terms of social trading, copy trading, and mirror trading.
- Social Trading
Social trading in general means gathering information from multiple financial sources in order to make trading decisions. Social trading provides indicators deriving from the data-feeds of other traders. These types of analytics can be very useful. In addition, traders can watch live the trading activity of others, interact with them, and even copy their trades manually. For those who like to automate their trading process and save some time, there are two methods of copying automatically the trading activity of others: Copy Trading and Mirror Trading.
- Mirror Trading
Mirror trading enables traders to “mirror” the trades executed by selected signal services. Mirror trading differs from copy trading in the way that a client account is linked with a signaling service. Mirror trading allows the use of multiple auto-trading services and that means differentiation of trading activity. Mirror trading requires close account's monitoring in order to make sure that there are sufficient funds to support any trading activity. In conclusion, mirror trading is a good choice for large traders who are willing to make large volumes and can devote time to monitor their account's activity and balance.
- Copy Trading
Copy trading is a similar method to mirror trading which enables the automatic copy of trade positions. These positions are opened, monitored and managed by selected providers who are also traders. The ability to copy trades is provided via a social trading network.
Copy trading enables traders to link a certain portion of their funds to the account of the copied investor. Any position opened by the copied investor is also copied by the trader's account according to the proportion initially selected. In addition, traders usually have the ability to manage and alter the copied trades. They can also cancel the copy relationship partly or entirely at any time.
■ Social Trading Platforms, Copy Trading, and Mirror Trading
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