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#1 23-04-2019 16:07:15

johnedward
Admin & Trader
From: Paris - France
Registered: 21-12-2009
Posts: 2610
Website

Are traders on social platforms more profitable than other traders?

Are traders on social platforms more profitable than other traders?‏


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What's social trading all about?

Social - or mirror - trading refers to various new trading capabilities. These features consist of the ability to mirror and/or copy other traders' trades (including how they manage their money and position sizes).

The idea behind it is "the more, the better". Expert traders will rub off on newer and less-experienced traders. As with tutoring or mentoring, you'll learn how to paint portraits better with the help of others. 

Social trading was born from the concept that online investors will make better choices if they can communicate with or copy other successful traders. 

The most successful social trading platform is believed to be eToro. The company more recently went the social route as way to separate itself from competing brokers. Although the company started out as a typical broker, it has now added social trading to its overall trading offer. 

Intial findings suggest that traders on social trading platforms make a bit more money than others. As such, investing environments that improve profitability have an advantage over those offered by traditional forex brokers.

Why should forex brokerages provide social and mirror trade services?

Mirror trading currently is viewed as a means to make a broker more successful, as it encourages traders to trade more and makes it easier to learn the ropes. 

Such social platforms therefore favour customer acquisition and ensure that brokers keep these clients longer. One reason is that social traders seem to lose money on a slower basis and for those who win, they're even more profitable than they would otherwise be if they were trading on their own. There's also the viral effect; word of mouth helps attract other new social traders.

If you think this is a bit like MAM account trading, you're right. Once a profitable trader has been identified, mirror trading platforms are more easily able to attract new traders and therefore business.

Do social trading networks need to be regulated?

If you're a European trader, the answser is affirmative. 

Outside of Europe, things are much more fuzzy. A few regulatory agencies haven't really acknowledged these mirror trading platforms so no specific licences or permits are needed. As such, it's better to sign up with a social trading network that is overseen by a regulatory agency.

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#2 01-11-2019 22:53:52

Kryptoking
Member
Registered: 01-11-2019
Posts: 2

Re: Are traders on social platforms more profitable than other traders?

Hi John I'm up in Canada where forex and precious metal social trading EA's get blocked on the backend of brokerage accounts and platforms like etoro and zulutrader have been blocked basically.
Quite sad and disappointing but I found a local outfit here in Vancouver called unchartedfx and they offer copytrading through a mam account at myfxchoice (I talked to their rep that's what he told me), they claim they have a system doing 6-8% monthly which is an amazing return all things considered, they said I'm allowed to try them out with a demo account so no risk upfront for me really. Is there anyway this is a scam and what are things I can do to protect myself? Their copytrading page is unchartedfx.com/copy-trading any advice or input is greatly appreciated thank you for your time in advance. 🙏

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#3 15-11-2019 16:19:55

johnedward
Admin & Trader
From: Paris - France
Registered: 21-12-2009
Posts: 2610
Website

Re: Are traders on social platforms more profitable than other traders?

Hi Kryptoking, I guess the best thing is to just try it out with a demo account. But I wouldn't trade a penny using their system until they get a myfxbook record of their trades online (that way you will have confirmation from a recognised third-party that their signals and trades are worthy!).

(live link to their website removed)


"Anything worth having is worth going for - all the way." - J.R. Ewing

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