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Thursday, November 14, 2019

Advantages of social trading over traditional trading

No coincidence that Social trading  ( trading society ) became a new phenomenon in the world of global investing. When engaging in social trading, you will find it has many advantages over you think, compared to traditional trading or trust services.


What is social trading?

Social trading  ( trading society ) sometimes also called social investing, an investment in the solution generated by the new generation of Web 2.0 technology. It allows us to automatically copy transactions made by one or more professional investors in a network like a social network. From there, you can repeat the results of other members, even if you don't have much knowledge and time to enter the market.
If Facebook is a place where people share news and pictures of themselves with others, then the social investment network works the same way, but people share their trading orders instead. because of the news.

Advantages of social trading over traditional trading


With the conventional type of trust, you have no basis to decide on a partner other than the advertisements. All services say that their method of investment is safe and effective. These ads sometimes make you wonder,  "If this company is so good, why don't they invest themselves to make money and have to open a service?"
In social trading, transparency is one of the top priorities, the leader's entire trading history will be public for other investors to choose. Monthly results, risk level, investment products, play style, maximum decline ... even detailed information about each order at the same time and detailed results will be published in detail. .
Some people may be skeptical of these results, but surely they will quickly accept after only a few days of copying, when they see the leader's published results completely coincide with the orders that have been opened on the account. your account.

Control ability

If you have a traditional trust investment, you have to give your money (or trading account) to another service and sometimes you cannot control the risk, then here you always have full control over everything. Leader activities are going on with your money.
Most trading networks allow you to have full access to the history, intervene on each order and even interrupt the copy feature at any time.
At the same time, the money in your account will always be yours, you don't need to transfer your money to anyone and there's no need to worry about losing money or having your account exposed.


You may also know that for every 10 investors participating in the market, up to 9 of them suffer losses, this ratio is even greater for new and inexperienced investors.
There are many skills you need to learn to become a professional trader. However, with social trading, all you need to do is to choose reputable and successful leaders. Top leaders often have very impressive results, because they come from many parts of the world and have better skills than most people. Their results can range from 15% to 100, 200% a year or higher, but we believe it is better than most amateur investors nonetheless.
You should also make it clear that the stronger the leader, the more risky the trading style is. Therefore, you need to determine the level of risk that you can accept, with a reasonable goal instead of focusing only on the highest profit.

Optimize the cost

Thanks to technology, social trading offers a far more affordable fee than traditional solutions. Investment deposit services can cost you 10 - 50% of your profits and sometimes there are some types of fees like the "property management" fee. As a result, after a year, you are not making much but only the trust service is rich to see.
As for the social trading solution, you will incur a very small additional cost, and even completely free in terms of copying. Because the exchanges have earned their commissions when the copy orders are executed, they do not need to charge additional copy fees or ask you to share the profits.
In addition, some social trading networks do not require you to run your computer continuously, (others may use the Meta Trader platform), which prevents you from having to invest an initial amount. or complex equipment.

Should we invest in social trading?

If you are a professional trader and have lots of trading time, social trading may not seem necessary to you. But for most people, we don't have enough time and ability to trade full time on our own. At this time, social trading will be an optimal choice:
  • You can start small
  • Use a good and reputable social trading service
  • Screen and select some top leaders according to appropriate criteria
  • Allocate capital to those leaders, set the level of protection
  • Monitor and adjust capital allocation if necessary
  • Summary of results and profit.

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