Social trading creates an environment for interaction between traders in real time and is the fastest-growing area for currency trading. It facilitates the sharing of knowledge between new traders and enables them to utilize the experience of savvy traders by replicating their strategies, techniques and trades.Â
If you’ve ever spent any time in the trading world s, you will have heard about Social Trading. We at CMTrading believe this is a great way for novice investors to begin trading Forex. Here’s the low-down on everything related to social trading, so you can decide if it’s right for you.Â
What is Social Trading?
Social trading is an easy trading method that avoids wasting a lot of time on fundamental or technical analysis.Â
With social trading, you have an entire community of traders on platforms such as MetaTrader 4 and other similar platforms, that assist you with trading . You can learn from other traders’ history, what worked for them and what didn’t, and then build your own strategy based on their record. This significantly reduces your learning curve and helps guide you towards good trading decisions.Â
What will Social Trading do for me?
Social Trading is a great way to wade into trading waters while still wearing you’re your lifejacket. Previously, in order to be a successful trader, you needed to acquire a wealth of personal knowledge and to invest a lot of time in the process. Now, trading platforms such as MetaTrader 4 can deliver live feeds of currency trading data, so you always know what traders around you are doing.Â
Of course, not all traders are created equal, so not all of them are relevant for your trading style and needs. Therefore CMTrading encourages you to follow only those who fit your style, and whom you believe will make the right trades. Once you choose the right traders for you, you can copy their moves and profit when they profit.Â
The 7 advantages of Social Trading Â
Harness the power of expert traders Â
We are living in the greatest age of access to information; traders today, regardless of experience, are spoiled for choice with social trading. Whether you are trying to generate a second income, or hoping to refine your trading skills, copying the top traders will help you become profitable in no time. The process of copying others is quick and intuitive. Â
Flatten the learning curve Â
Traditional trading requires years of experience and financial knowledge to be successful in the financial markets. This requires a huge investment in time and resources. With social trading, however, the learning curve is greatly reduced. Even beginners can watch and learn from their peers. At the same time, they can replicate successful trades and profit. Think of it as getting “crib notes” from the top students in a class. Â
Diversify your portfolio and limit risk Â
The phrase “don’t put all your eggs in one basket” applies heavily to trading. With access to multiple markets and assets, you will be able to diversify your portfolio. This means significantly minimizing your exposure to risk – if one asset or instrument drops you can shift to another in your portfolio.Â
Also, by interacting and watching watch the most popular assets traded by experts , you will gain exposure to different financial markets that you may never have even considered as viable. A whole world of untapped trading potential awaits.Â
Fast data access Â
Time is money and the fast-paced nature of trading means that you must make every second count. With social trading you will have access to social network features such as newsfeeds and messaging. This allows you to stay up to date with all trading news and economic developments. Â
Reduce stress and pressure Â
When markets collapse and global disasters hit, many individuals panic and are prone to emotional trading. Investment decisions should be made independent of emotion and the best traders out there know how to remain calm under pressure. This is a boon for novice traders as you’ll follow those with more experience and won’t have to deal with the pressure and stress of day trading. With automated trading, backed by an expert trader, you’ll have more certainty in uncertain times. Â
Trade with confidence, profit potential Â
The bigger the pool of traders the more there is to learn. The more there is to learn the quicker you gain experience. With so many ideas passing between individuals, novice traders can quickly become confident in trading and eventually making trading decisions on their own. Simply follow those others with high success rates and you’ll become a confident trader in no time. Â
It is a win-win for all Â
It is easy to see the benefits of social trading if you are a beginner but what do experienced traders get out of it? Social trading provides experienced and profitable traders with the platform to earn extra revenue from followers copying their trades. This is a fantastic way for veteran traders to not only share their skills but get rewarded for doing so; when you profit, they profit. A win-win for all.Â
CMTrading offers you the most powerful trading tools to help you become the best trader you can be.Â
