As digital assets proliferate at a rapid pace, copy trading has surfaced as a highly sought-after trading approach among cryptocurrency enthusiasts, particularly those who are new to the field. So, let’s delve into what copy trading entails and how you can leverage this strategy to optimize your cryptocurrency profits.
What is Copy Trading?
Crypto copy trading is a kind of trading strategy that utilizes automation to buy and sell cryptocurrencies. Copy trading feature is usually available on crypto trading platforms that allows users to mirror the trades of successful traders on the platform. Copy trading particularly appeals to cryptocurrency novices or those lacking the time and expertise to make trading decisions, as it offers a hands-off way to benefit from potentially successful trading strategies.
Just like any other trading strategy, copy trading also boosts its own set of advantages and disadvantages. Before engaging in copy trading, there are some of the pros and cons of copy trading to know:
| Copy Trading | Pros | Cons |
| Automated Trading: Copy trading provides a convenient way for novices and investors who lack time or expertise to easily participate in the cryptocurrency market and gain potential gains without the need for in-depth market analysis and trading decision making capabilities.
Learning opportunities: By observing the operations of experienced traders, investors can learn new trading strategies and market analysis methods, which helps to improve their trading ability. Diversification: Copy trading enables traders to diversify their investment portfolio by following multiple traders with different trading styles. This can help reduce the overall risk and potentially increase traders’ chances of profiting in various market conditions. High transparency: Since cryptocurrency transaction records are stored on the blockchain, anyone can view and verify, copy trading also have a high level of transparency. |
Market risk: Although professional traders can reduce decision-making risk, the volatility and unpredictability of the cryptocurrency market itself remains. Fluctuations in cryptocurrency prices and market conditions can impact the profitability of the trades you copy.
Over-reliance on trader performance: trading results in copy trading are directly tied to the performance of the traders you follow. If a trader makes a bad trade, it will also affect your account. Choosing traders with a proven track record and monitoring their performance regularly is important. Fees and commissions: Platforms that offercopy trading feature usually charge certain fees or commissions for this function. Therefore, investors need to understand and consider the impact of these costs on investment returns. Technical risks: Copy trading relies on automated systems and network connectivity, and there may be a risk of technical failures or hacking attacks, resulting in disruption of trading or loss of funds.
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How to Start Copy Trading on BTCC?
BTCC, one of the longest-running crypto exchanges in the world, supports copy trading on its platform. If you want to try copy trading strategy on BTCC, follow below simple steps:
Step One: Create a BTCC account
Before you start trading, you need to register a BTCC account using an Email ID or Mobile Number, then finish KYC verification.
Step Two: Fund Your Account
After completing KYC verification, the next step is fund your BTCC account. There are three methods available for funding your BTCC account, including fiat deposit, crypto deposit and convert.
Step Three: Choose a trader to follow
Go to the BTCC homepage and select “Copy” > “Futures Copy Trading”to enter copy trading page. You can directly browse the market board on the page below. Based on different metrics, like Total PnL, AUM, PnL%, Win rate, No. of copy traders, etc., to choose your preferred lead traders.
If you wish to learn more about the Lead Trader before making your decision, you can click on their card to access their portfolio, which reveals more information, such as Number of trading days, Profit sharing ratio and Cumulative number of copy traders, Lead trading performance, etc.
Step Four: Complete your copy trading settings
Once you decide your preferred lead trader, click “Copy”. Next, you need to complete copy trading settings, including Copy trading margin per order, Maximum copy trading margin. You can click “ Advanced settings”to check more settings, like Take profit per order, Stop loss per order.
Step Five: Confirm your decision
After finish all settings, all you have to do is confirm your decision by checking the “BTCC Copy Trading Agreement and Guidelines” box and clicking on “Copy trade now”. Once you click on “Copy trade now”, you’ll start following the Lead Trader’s moves.
Step Six: Check up on your trades
From the “My Copy trader” tab on the top right side of the Futures Copy Trading page, you can monitor your trades at any time.
Final Words
In summary, copy trading emerges as a potent instrument for cryptocurrency investors aiming to optimize profits while mitigating risks. By adopting a strategic approach that involves selecting a reputable platform, meticulously assessing signal providers, allocating funds prudently, regularly monitoring and adjusting your portfolio, and maintaining a keen awareness of market dynamics, you can harness the full potential of copy trading to propel your investment objectives forward.
