{"id":85437,"date":"2022-09-04T04:05:00","date_gmt":"2022-09-04T04:05:00","guid":{"rendered":"https:\/\/arielle.com.au\/?p=85437"},"modified":"2026-01-22T04:56:14","modified_gmt":"2026-01-22T04:56:14","slug":"what-is-copy-trading","status":"publish","type":"post","link":"https:\/\/arielle.com.au\/what-is-copy-trading\/","title":{"rendered":"What Is Copy Trading?"},"content":{"rendered":"Reading Time: <\/span> 11<\/span> minutes<\/span><\/span>\n

Copy trading lets you invest automatically without direct knowledge of the markets. By leveraging the technology of online brokerages<\/a>, casual traders can replicate (copy) the moves of professionals.<\/p>\n\n\n\n

Think of it as being able to glance at the exam papers of a top student back at school \u2013 except without penalty.<\/p>\n\n\n\n

You might wonder, \u201cIf it\u2019s so easy to copy someone else\u2019s financial success, why isn\u2019t everyone doing it?\u201d <\/span><\/div><\/div>\n\n\n\n

The answer is nuanced. Let me unpack it for you while answering the big question \u2013 is copy trading right for you?<\/p>\n\n\n\n

(Related: How To Invest In Index Funds In Australia?<\/a>)<\/strong><\/p>\n\n\n\n

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Why Is Copy Trading So Popular?<\/strong><\/h2>\n\n\n\n

Online share trading platforms<\/a> that offer copy trading give you convenient, automated access to professional, popular, or so-called \u2018master\u2019 traders that you can mimic, without lifting a finger.<\/p>\n\n\n\n

\"how<\/figure>\n\n\n\n

If your other life commitments do not allow you to dedicate more than a few hours a week to trading, copy trading provides an alternative.<\/p>\n\n\n\n

You\u2019re not alone, by the way. <\/p>\n\n\n\n

Social trading platforms are gaining popularity, with the market expected to grow by 7.8% CAGR between 2021 and 2028<\/a>.<\/p>\n\n\n\n

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Start Copy Trading With Our Featured Partner.<\/strong><\/h3>\n\n\n\n

Copy top-performing traders in Australia, trade Australian and international shares with eToro’s share trading platform..<\/p>\n\n\n\n

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Start Copy Trading With eToro<\/span><\/path><\/svg>

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eToro AUS Capital Limited ACN 612 791 803 AFSL 491139. Social trading. eToro does not approve or endorse any of the trading accounts customers may choose to copy. All instructions and actions related to copied trades will automatically be replicated in your account. When you select to copy a particular trading account you will copy all of their future trades, and you may select also to follow their existing trades. Past performance of an eToro Community Member is not a reliable indicator of their future performance. Your capital is at risk. Refer to the Product Disclosure Statement and Target Market Determination (PDS<\/a> and TMD<\/a>) before transacting. See full disclaimer<\/a>.<\/pre>\n\n\n\n
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1. Copy Trading Lets You \u2018Set And Forget’.<\/strong><\/h3>\n\n\n\n
Once you\u2019ve set up a copy trade, every move the trader you\u2019re following makes will be automatically reflected within your trading account, too \u2014 whether they buy, sell or adjust stop margins.<\/p>\n\n\n\n
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Important!<\/h3><\/div>
The amount of your trades is proportional. If the trader you follow invests 10% of their account funds in a certain stock or cryptocurrency, you\u2019ll also invest 10% of the total funds you\u2019ve allocated to your copy trade.<\/p><\/div><\/div><\/div><\/div><\/div>\n\n\n\n
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2. Easy Access To Successful Traders.<\/strong><\/h3>\n\n\n\n
You can choose from a range of top traders to copy with varying investment approaches, across a variety of asset classes. These traders are often referred to as signal providers.<\/p>\n\n\n\n
Who are these traders? <\/p>\n\n\n\n
They\u2019re users of the platform that have chosen to share their trades, and are vetted by the platform provider based on strong performance. <\/span><\/div><\/div>\n\n\n\n
These popular traders may also earn money by being followed or by offering subscriptions.<\/p>\n\n\n\n
Although you\u2019ll usually be able to review the trader\u2019s bio and stats, it may be difficult to get an in-depth picture of their experience, expertise or the rationale behind their trades. <\/p>\n\n\n\n
In other words, you may struggle to judge whether they\u2019ve been wise or simply lucky.<\/span><\/div><\/div>\n\n\n\n
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3. Compromise Between Knowing And Acting.<\/strong><\/h3>\n\n\n\n
Nobody becomes an effective trader overnight. It requires research, an intentional strategy, and continually monitoring and refining your approach.<\/p>\n\n\n\n
A casual, laissez-faire approach to trading rarely leads to success.<\/span><\/div><\/div>\n\n\n\n
But beginner traders quickly realise that keeping up with industry news, researching stocks, and learning to draw insights from technical indicators takes a lot of time.<\/p>\n\n\n\n
(Related: How To Buy Apple [APPL] Stocks<\/a>).<\/strong><\/p>\n\n\n\n
Copy trading is investing based on the skills others<\/em> have taken the time to develop \u2014 which may be a great stop-gap as you develop your own experience; or a strategy in its own right. <\/p>\n\n\n\n
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Important!<\/h3><\/div>
Even experienced providers might prefer to defer to someone else\u2019s expertise when they trade in unfamiliar assets as a means to diversify.<\/p><\/div><\/div><\/div><\/div><\/div>\n\n\n\n
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Is Copy Trading Good For Beginners?<\/strong><\/h2>\n\n\n\n
Yes and no.<\/p>\n\n\n\n
Yes because:<\/p>\n\n\n\n