What Is Forex Copy Trade?

Copy trading is another form of automated Forex trading has been around for some time already but for those who are not aware of its existence, then it is something completely new. Forex copy trade practically allows those who doesn’t have any knowledge in Forex trading to copy the trade of experienced traders and reap the rewards or perish together.

Well, I maybe exaggerating a little when I said perish together but mark my words, it can happen to you if you don’t know what you are doing and just copy traders blindly.

There are many names associated with Forex copy trade. Some call it copy trade, mirror trade, follow trade, peer-to-peer trading, social trading and possibly other names that I am not aware of at this point in time.
Some go into details comparing how different are they from each other. In my opinion, they are all similar and differ from platform to platform in terms of settings on how you copy the traders and how you set your parameters to follow the traders on those platforms.

The Basics of Forex Copy Trade

What copy trade in Forex does is that it allows you to automatically copy traders that you feel has the experience to help you trade Forex profitably without you actually getting into the act of trading yourself. To follow the traders that you have selected, you can choose a certain percentage of money in your account or the lot size and also maximum number of lots to follow those traders. If the trader win, you win. If the trader lose, you lose.

This is just a basic explanation on how the copying process and there is more to it because different Forex copy trade platform has their own settings and work in different ways. You will have to check out those platforms to get accustomed to the parameter settings.

Also, It’s not a matter of just following the top traders and you sit back and relax and watch the money roll in. If that’s what you think, dream on! It’s not an overnight get rich quick scheme and will take some time for you to learn the ropes and find which traders are best to copy and which ones are best left alone.

Some of those traders have very big drawdowns. If you don’t know what you are doing and don’t monitor your account, your account can also be wiped out automatically by copying them!

Before you put your hard earned money in and start copying, most if not all of these copy trade platform offer free demo account for a period of time.
So by all means, please go and give it a try before you put in real money. A demo account is a good way to familiarize yourself on how the platform functions and the parameter settings. Pick a few traders that fit your profile and copy their trade in demo to check on their performance.

If you are not comfortable with your demo test of copying trade and find it difficult to profit maybe it’s not cup of tea. However, if you think it’s going to work for, keep testing out in demo till you get a real hang of it. Although some of these platform offer free demo for only a month, there are ways to get around that by opening up more demo when the current one expires.

Note:

• Not all traders on those platforms who top the charts are necessary the best traders to follow. There are certain statistics that you need to look out for and scrutinize before you start copying them. Look at them and take everything into consideration. Not all of them are necessarily trading with real money too, some of them are just using demo account.

So Does Forex Copy Trade Work?

The answer is yes and no. You can be very profitable doing just Forex copy trade and not doing the actual trading yourself. However, you have to be picky and know who you pick to follow.
You could be doomed if you don’t know what you are doing and picked the wrong traders to follow. I believe this is the 3rd time I am repeating myself about this so this should serve as enough advance warning for those who are venturing into the Forex copy trade arena for the first time.

If you are looking for some platform where you want to experiment with Forex copy trades, one of the most popular and transparent is Zulutrade. Will be writing more about these copy trades in other articles so keep a look out for them if you are interested in know more.

Good luck and Safe Trading!