One of the most significant requisites of a trader is staying updated on the latest trends in the finance world. You must have often heard that trading requires knowledge and experience. Well, this is true. Lack of right information and application of outdated trade techniques could lead to massive losses as a trader. Therefore, you need to be completely aware of the various aspects of trading and look for the best and the easiest ways to learn how to trade proficiently.
If you are someone who wants a lot of bang for your buck, Social Trading could be the right option. It is one of the most convenient and safest ways to invest money in the financial markets.
Now that you are curious about this term, read on to know about it in detail.
What is Social trading?
Social trading is like a social media platform for trading. It is a platform where traders come together to share ideas, discuss market situations and talk about everything related to trading and finance. One of the key features of social trading is that you can use it to track the trading results of other traders who are masters in this industry.
In social trading, your trading decisions are influenced by other skilled investors who keep track of the market regularly. The objective of social trading is to find the perfect trader to copy trading strategies and learn the methods and the patterns of successful trading.
There are many aspects of social trading. Copy trading is the most well known among them.
What is copy trading?
Most investors in the social trading platform copy the trades of the investors they follow. This strategy is called copy trading. It is an aspect of social trading. Under this method, your account is linked to the account of another trader. This is the trader you follow and wish to copy trading strategies from. In this kind of trading, you replicate their investment and thereby replicate their profits and losses.
With this strategy, you follow the traders who have successful strategies and copy them, trade for trade. This is one of the ideal ways for new investors to start trading in any finance commodity, be it forex, stocks or cryptocurrencies. By copying trades of successful traders, you learn the best skills and strategies and make money simultaneously.
What are the benefits of Social trading?
Social trading is the most reliable and smart way to learn to trade for beginners. There are many perks of social trading. A few of them have been mentioned below.
- Gain practical knowledge of the traits of a successful trader.
Social trading is a social network where you can follow traders who are experts in this field. You can view their trades in real-time and learn how they strategize their trades. This is extremely beneficial for the first time trader. You get a closer look at the most effective trading patterns. This can help you in making better investment decisions in the future.
- Get one on one mentorship.
The best thing about this kind of platform is that it lets you interact with other traders. Learning from experienced traders is the best way to learn to trade. You get to know a lot from their failures as well as their successes. There is no better way to learn this skill. With time, you can get the advice of the most successful traders in the community and become a professional trader yourself.
- Learn things faster.
Compared to the platforms that claim to teach you trading, social trading platforms are a much better alternative. It gives you the chance to learn from the best in the industry by observing the trading methods of the experts. You get to see the trades of other traders in real-time. This helps you analyze your own trading strategy. You can learn by comparing your trading decisions with the ones of the top performers. This is the fastest way to learn this skill.
- Earn while you learn.
Unlike conventional trading, you don’t have to become a professional to start social trading. It lets you copy the trades of experienced traders so that you start earning even as you keep learning. You don’t have to wait to learn everything to start earning. You can learn things as you keep trading. There is hardly any other platform that gives you this kind of convenience.
- Get access to an elite group of professionals.
Traders from around the world come to these platforms to trade and share their knowledge. You can become a part of the community by becoming a member of any social trading platform. You can then learn from the community or collaborate with other traders to create your own ventures.
Which is the best social trading platform?
There are many social trading platforms in the market. Among them, the one that is more known than the others is eToro. According to eToro’s official website, it is the leading trading social network platform in the world. It has over a million registered users trading every day.
Some of the other platforms worth mention are:
- MQL5 Trading Signals
- NAGA Trader
- Tradency Mirror Trader
- InstaForex ForexCopy
In conclusion, we can say that social trading is one of the easiest and most effective ways to access information that can help you make the right investment decision. You learn from a community and there is very little chance to make mistakes in such a situation. Besides, there are experts who are willing to help you learn better.
It is one of the most efficient means for beginners to learn to trade. You can earn while you learn without the risk of failing. Having said that, there is certainly a chance of losing money in trading. It very much depends on the trader you are following. The only way to reduce the possibility of failure is to keep trading and learn the lessons along the way.