How Does Copy Trading Work?
The concept behind copy trading is just as its name suggests – it involves the replication of trades (orders) from one account to others. This practice is common in cryptocurrency, forex, and other markets. According to Google Trends data, copy trading is gaining popularity worldwide:
- Adjusting the display of Provider accounts. Among hundreds of accounts, you can sort options based on various criteria: such as profit size or drawdown, over a selected period.
- Information about traders’ performance. The capital change curve is highly beneficial for evaluation. To start copying trades of a selected trader to your account, click Copy. Then the system will prompt you to specify the amount and settings for stopping copying (for example, when the drawdown reaches -15%).
- Access to your account for copy trading. It will display the results of copying trades – you can manually stop copying at any time or lock in floating profit.
- A button for those interested in becoming a Lead Trader. This offers an opportunity to earn a share of the profit (10-15%) obtained by investors (followers).
How to Benefit from Copy Trading Cryptocurrencies
Button #4, highlighted in the screenshot above, is particularly appealing to those aiming to profit from cryptocurrency copy trading. Here is one possible scenario:- Use ATAS to gain a trading advantage in the cryptocurrency market and create a strategy.
- Sign up as a Lead Trader on Binance’s copy trading service.
- Show the effectiveness of your strategy by outperforming competitors. The greater your results, the more attention you will attract from potential investors.
- Gradually attract investors who will share profits from copying your trades.
How much can you make through copy trading using this approach?
Let’s say you are able to grow your account by 20% per month. You have attracted investment capital of $100,000, with a personal profit share of 15%. Your own capital = $5,000. The monthly profit = 0.2 * $5,000 + 0.2 * $100,000 * 0.15 = $1,000 + $3,000 = $4,000. Using copy trading, you can increase your profit by 4 times compared to if you were trading solely with your own funds.How to develop a profitable trading strategy for cryptocurrencies?
To effectively analyze and capitalize on cryptocurrency market opportunities, ATAS provides powerful analysis and trading tools, including:- Connectors for establishing a safe connection to cryptocurrency exchanges like Binance, ByBit, OKX, and more. Instructions are available in the Knowledge Base.
- Footprint Charts. Cluster charts offer filtering options and delta display, providing hundreds of variations.
- Crypto Chart Trader. Trading panel equipped with volume calculation functions, margin adjustment, and automatic exit strategy settings.
- Advanced indicators: Big Trades, DOM levels, Market Profiles, Cluster Search, Speed of Tape, and others.
- Additional modules: Smart DOM, Smart Tape.
- Market Replay. A trading simulator that enables you to trade not only Bitcoin but other cryptocurrencies using a detailed historical database. You do not risk your real capital. This kind of simulator lets you test your strategy in real conditions.
FAQ
What Is Copy Trading? Copy trading is a type of automated trading where the transactions and strategies of traders (providers) are replicated on the accounts of other users (investors, followers). Copy trading can be used not only for interacting with different individuals (social trading) but also for more efficient management of one’s own capital which is distributed across multiple accounts. How much can you earn from day trading? Copy trading offers earning opportunities for both investors (who can generate passive income without trading experience) and experienced traders (who can earn a share of the profits from attracted investors). In both cases, the amount earned from copy trading cannot be determined in advance. It depends on the size of the investments, the efficiency of the trader, market conditions, technical delays, and other factors. Exercise caution when making decisions related to earning from copy trading. Is it legal? The legality of copy trading depends on the jurisdiction and regulations in the user’s country of residence; in many countries, it is allowed under certain conditions.Conclusions
Copy trading is the replication of trading activity from one account to another (or to multiple accounts). Modern copy trading solutions offer flexible settings both for the trader (provider, the source of trading activity) and for the investor (follower). The ATAS platform provides powerful functionality for volume analysis and effective trading, including professional-level cluster charts, useful indicators, and many other advantages. For copy trading, ATAS offers two primary methods:- managing one’s capital across multiple accounts using the Following Manager;
- developing a personal profitable strategy and then attracting investors through social trading platforms.
Information in this article cannot be perceived as a call for investing or buying/selling of any asset on the exchange. All situations, discussed in the article, are provided with the purpose of getting acquainted with the functionality and advantages of the ATAS platform.
