Advantages of Forex Social Trading Networks and What to Consider: Copying a Trader in a Network
Forex Social Trading Networks On the internet is a lot of trading information about how to trade Forex online; which currency pairs are bullish and which ones are bearish? The trading platforms have a lot of advanced trading tools the users have access to in finding pips in the market.
In the last couple of years is a new feature available on some of the online trading platforms. It is called a Social trading network; it is a platform connected to the trading platform. It gives the traders possibility to follow other traders’ trade and even copying their trades. As it is social it is also possible to interact with other traders and develop trader experiences through the interaction.
The mindset of the article
The mindset in this article is to describe the advantages of a Social trading network and what to consider copying a trader in the network.
One advantage is the interaction between the social network and the trading platform. On the trading platform is a small window with information from the social trading platform. It provides the trader with information about the recent trades on the social platform and which trader is top traders and has a high win ratio.
It is an advantage as the information from the social net is inspirational and gives ideas of which currency pairs to trade. If the trader wants more information about a trader he can click on the traders’ link and find the history of the traders and see how he has managed the trades he had made in the past. If he has managed the trades well he will be a valuable inspirational source or even a trader considering copying.
What to consider copying a trader
The purpose copying another trader is to gain a profit. It is therefore important to analyze the trader to be copied. Analyzing others performance in a Forex social trading net is called social financial analysis. Some of the data an analysis includes are historical data as profit margin and latest trade figures; it could be the last few weeks of trade data and the profit ratio in recent trades.
As in regular Forex trading social trading has as well large potential rewards, but also large potential risk and it is in these trades also necessary to be aware of the risks. One way to minimize the risk is to analysis the traders’ performance and starts copying the trader with a small amount of money and then increases the money amount. In figures it could be 2 or 3 percentage of the investment capital on a Copy Trade. If the Copy Trade generates a continuous profit increase the percentage of the investment capital to a higher level.
A further description of a Social trading network is on my Forex website where there is a short video and a recorded webinar about a Forex Social network. I hope you will watch the videos and consider the social trading platform as your future trading platform.
Thank you for reading my article. Forex Social Trading Networks
Article Source: http://EzineArticles.com/expert/Martin_Grippen/1148322
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