Successful cryptocurrency trading, investments and trading in general involve the use of fundamental and technical analysis. It is extremely important for a trader to have at least a small understanding of decentralized technologies and be able to follow the news wisely. SpyStream presents to your attention a trading strategy called copy trading, which you will learn about now.
What is copy trading
Copy trading is a unique trading strategy that consists in relatively consistent copying of the actions of another trader. For beginners, this is an excellent option that simplifies the trading process, increases the likelihood of making a profit, and reduces the likelihood of losst. The main task is to choose the investor to be copied wisely.
There are a lot of people who do not have the opportunity to devote a lot of time to trading. Then copy trading comes to the rescue – automatic or manual copying of other people’s methodologies, strategies and, finally, just individual transactions. Thanks to this, those who do not have much experience in trading, and even those who do not know how to trade at all, have a chance to succeed. Copy trading allows you to invest without deep market analysis.
SpyStream on copying schemes
The easiest way to talk about copying schemes is using cryptocurrency trading as an example. In principle, there are many people in the community who copy other people’s transactions, and those whose transactions are copied. There are three main categories of processes:
• copy trading;
• mirror trading;
• social trading.
By copy trading, SpyStream means copying in its simplest sense. In this case, one trader opens positions, the other repeats the actions on his account. There may be no connection between the two. Sometimes, of course, there is minimal communication to clarify the details.
Mirror trading is a more thorough approach, when not only individual transactions are copied, but entire trading strategies and methodologies. Here, acceptable risks, trading style, and a number of other parameters are duplicated.
The SpyStream platform allows you to automate copy trading and mirror trading as much as possible. Therefore, both processes are often generalized under the term “copy trading”.
As for social trading, it is very different from the previous ones. In this case, expert traders create communities in social networks, instant messengers, and there they share their experience. Students are trained, traders answer their questions, give recommendations. Subscribers may not trade at all, but simply study the information.
Copy trading is sometimes confused with trust management, when an expert directly manages the trader’s money. Regarding copy trading, the SpyStream team would like to clarify once again: expert traders do not manage money.
Advantages and disadvantages of copy trading
SpyStream recommends using copy trading for a number of reasons. Among the advantages of this approach, the following can be highlighted:
• the opportunity to trade without experience;
• automation of the process;
• the ability to reduce risks;
• the ability to receive a stable passive income.
Of course, the approach also has its drawbacks:
• there is a commission for using the services;
• there is no guarantee that the expert’s strategy will work again;
• it is difficult to learn to trade independently, simply by copying trades.
It can be seen that the advantages of copy trading are much more significant than the disadvantages. Therefore, SpyStream recommends that beginners and experienced traders use this strategy to achieve their goals. Our platform allows you to both copy other people’s methodologies and share your own. We look forward to seeing you.