How to be a copy trader at Gate.io

Copy trading is a strategy which many people use when trading cryptocurrencies and other assets such as forex. There are many platforms that offer copy trading services such as Gate.io. In this article, we discuss the benefits and drawbacks of using copy trading as well as how you can use the Gate.io platform for that purpose.


What is copy trading?

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As the name implies, copy trading refers to the process whereby an individual automatically copies the trading positions of other traders. The process involves connecting the individual’s trading account with that of the traders whom he/she copies. As a result, the actions of opening and closing trading positions apply to all the connected accounts.

However, the individual who copies the strategies of other traders can terminate the positions at any time. On the other hand, the individual decides on the amount of money he/she allocates to a particular trader whom he/she follows. The good thing is that an individual can copy trades of two or more traders.

Nevertheless, in order to copy another trader an individual pays a small fee. Therefore, the professional traders who allow others to copy their strategies get compensation for that. The only research which the individual does is to find out the most profitable traders to follow. The interesting news is that copy trading platforms such as Gate.io provide a way to filter the traders that one wants to follow based on their profit and risk levels, among others.

The platforms may also have other means of controlling the loss which an individual copy trader can make. For example, they allow the traders to use stop loss orders. It is also important to note that copy trading normally focuses on short term trading such as swing trading and day trading strategies.


How copy trading works

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As already mentioned, when an individual copies another trader part of their portfolio is linked to the accounts of the the users he/she is copying. This means that all the actions which the trader will make in the future are copied. Copying another trader may involve executing the same strategy including the entries, take-profit and stop-loss orders.

Alternatively, the trader may choose to manually execute the trades after receiving notifications of the activities of the traders they follow.


How profitable is copy trading?

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If an individual finds a successful trader to follow, he/she can make much profit in a short time. In order to increase the chance of higher profit levels, the individual can copy several professional traders. This also ensures that if any of the copied traders make losses, the others may make profit. Nevertheless, copy trading does not guarantee profit since there are risks.



Probably the best advantage is that the individuals can automate trading by following professional and successful traders. This may result in profitable trades. What you have to do is to select the best traders and review their performances from time to time.
Secondly, it is very simple to find successful traders because the platforms supply you with various metrics. For example, you can get the profit figures of individual traders, average size of winning or losing trades as well as the average risk.
Finally, there is little or no involvement of emotions in copy trading. This is because the professional trader you follow is the one responsible for analyzing the market and executing the trades.


Drawbacks

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The major disadvantage of copy trading is that your trading results depend on the performance of the trader you follow. Therefore, if the trader makes a loss, you are also affected in a similar way.
Secondly, due to trading risks, past results do not guarantee future profits. For example, changes in the price of cryptocurrencies may result in losses. The trader may also fail to close the trade in a reasonable time due to liquidity problems.

Copy trading at Gate.io
Inarguably, Gate.io offers one of the best copy trading services in cryptocurrencies. And it is very simple to become a copy trader there. All you have to do is to follow several essential steps.

Opening a trading account
The first step is to open a trading account at Gate.io. Also, it is important to complete the KYC. After that make your initial deposit and you will be ready to trade.

In order to copy trade, you click Copy Trading in the navigation bar.


Once you do that you will find a variety of strategies which you can choose from. For example, under “General strategies,” you will find many traders you can follow. Gate.io gives you some metrics which help you to make decisions on the traders to follow. As an example, it shows you the rate of return for each individual trader.

In addition, Gate.io gives you various ways of assessing the best traders to follow. First it provides the users with the “Top Gainers. It also shows the “Most Copied,” “Ranking Top 10,” “Profitable Strategies Top 10,” and Trending Strategies Top 10.” All these are options which help individuals to select the best traders to follow.

Some examples of strategies which you can choose are Spot grid trading, Combined indicator perps and Smart rebalance. Therefore, once you are satisfied with a strategy or trader, you click “Copy.” You will have to complete the form that appears. Some of the information you need to input include the amount you intend to use for trading as well as the market.


Conclusion

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Copy trading is a popular trading strategy used in the cryptocurrency sector. It affords inexperienced traders the chance to copy the trading positions of experienced and successful traders. Although this may lead to high profit on the part of novice traders it is not a guarantee for profit. Gate.io is one of the leading copy trading platforms in the crypto sector.


Author: Gate.io Researcher Mashell C.
This article represents only the views of the researcher and does not constitute any investment suggestions.
Gate.io reserves all rights to this article. Reposting of the article will be permitted provided Gate.io is referenced. In all cases, legal action will be taken due to copyright infringement.