When it comes to forex, traders across the globe are attracted to it because of the freedom and number of opportunities it provides. As a forex trader, you are meant to decide everything important. In a way, it is like being your own boss. But millions of newcomers require proper guidance before they can develop the skills to call their shots, use their preferred currency pairs, and create a trading style. The only way to learn forex trading quickly without spending hours studying about it is to copy another (more experienced) trader. It is possible through copytrading in India which is still a relatively new concept.
What is copy trading?
As mentioned earlier, copy trading is one of the direct ways to learn forex trading manoeuvres efficiently. But the best thing about this strategy is safety from unwanted risks under ideal conditions. Copy trading is the trading approach where an individual (mostly beginner traders) can copy a certain well-performing trader’s every single decision involving buying or selling to gain similar profits from those trades.
To get started with copytrading in India, you will need access to a capable and trustworthy copytrading forex broker. It is important to note that copiers (traders who are copying another trader) stand a chance to benefit only if their risk parameters align with the copytrading broker they have chosen. If there are multiple options available in the market already, one should start with something small, research properly, and risk as much capital as they can afford and are willing to lose.
How does copytrading works?
Copytrading works based on the performance history and the current trading decisions made by an expert trader. Copiers are advised to do a thorough search to find out the best performing trader to start copying. One can do that by glancing through their record and see how much improvement is there. Copiers should compare the financial goals and risk ratio of a trader being considered with their own to see if copying their trades could bring better results or not.
Quality copytrading brokers assist their clients to choose a worthwhile trader to copy by handing them a list of individuals who have an excellent track record on their trading platform. Copytrading works for people who have little to no prior experience in trading by themselves. But that does not mean it is easier than other passive investment ideas. Even though copiers do not have to make trade-related decisions, they are still required to decide which trader to copy.
In India, it is hard to come by a hard yes or no in the case of forex trading using brokers based outside the country. Experts advise Indian investors if they consider giving a try to copy trading to check related guidelines on SEBI’s website.
Prerequisites of brokers offering copy trading services in India
Being an uncommon practise among Indian forex traders, the requirements, benefits, and risks of copytrading are not known to many. However, there are some copytrading services available for those who are interested to learn from it and kick off their forex trading career in a cost-effective and less risky approach. The first step to properly start copytrading is associating yourself with a licensed forex broker that allows copytrading. The following prerequisites are found only in a quality copytrading forex broker.
- Easy to understand
As copytrading is predominantly the first choice of newcomers in the market, the copytrading broker you end up with must have a user-friendly interface. Once traders get accustomed to the broker’s functionalities, it is easier to take advantage of it daily for a smooth copytrading experience.
- Proper regulation
Authenticity is the most important aspect to any forex broker, including those which offer copytrading services to their clients. It is preferable under any circumstances to involve with a properly regulated broker that has been officially authorised to operate and accept clients from different countries such as India.
- Versatile platform
A copytrading-only forex broker is not the best option out there for beginner forex traders. As a first-timer, one’s go-to forex broker should be versatile enough to support the mainstream approach of currency trading. It is a great way to test the capability of an online brokerage platform under consideration.
- A long list of traders
Only a broker that has been operating for several years would have a list of successful traders to be copied. Copiers should keep a watchful eye on the user base, their performance records, and preferred trading conditions. A populated list of traders with proper trading activity is a sign of the success of a copytrading broker.
- Risk management
Without risk management options, it is not worth entering the forex market irrespective of whether you are only interested in copytrading. The overall risk factor in copytrading is less but not negligible and because of it, copying traders have to be extra careful. Only the best copytrading forex brokers implement risk management options to minimise trader losses.
Some of the Best copy trading services available in India
There are several copytrading brokers available for traders based in India but we will discuss 3 of the most reputed ones in the following section:
eToro
For the past few years, eToro has been consistently leading the copytrading brokerage services scene. It is a regulated broker based in the UK whose social trading platform has become a sensation for copy traders around the world. eToro supports multiple types of tradable financial assets so users get the option to create a diversified trading portfolio within minutes.
Features:
- Stocks and exchange-traded funds are available at zero commissions.
- Variable and low spreads are available for CFDs and popular cryptocurrencies.
- Regulated by 3 top-tier regulatory agencies like FCA, ASIC, and CySEC.
- Easy and most common payment channels are supported for deposit and withdrawal.
- The minimum investment required to start copying traders on eToro is quite affordable.
Pepperstone
After eToro, the second-most preferred broker with copytrading support is Pepperstone where both retail and experienced traders can start their career. Since it is a CFD provider, it is best if beginner traders could proceed with caution during copytrading with Pepperstone. It accepts clients from various countries as a strictly regulated broker.
Features:
- A demo account is available for new signups who wish to get to know the broker and its functionalities without risking real money.
- Most of the commonly-used payment methods are supported via this broker.
- The minimum lot size that can be traded using this platform is 0.1 lots.
- Supported trading platforms include MT4, MT5, and cTrader (for copytrading).
Avatrade
Founded in 2006, this broker has come a long way to become one of the active brokers in this space. It also provided copytrading services to millions of its clients every single day. For its constant and genuine growth, AvaTrade has also won many awards in the past few years. It is better known as an all-in-one versatile kind of forex broker that has multiple account types and thousands of financial instruments to offer. It recently launched AvaSocial, a new copy trading platform for clients new and old.
Features:
- It is a properly certified and regulated broker whose services (mainstream and copytrading) can be accessed by clients based in various countries across the globe.
- Its multi-faceted trading platform is compatible with different kinds of trading strategies like swing trading, scalping, mirror trading, and hedging.
- Deposit takes less time to process via cards but there are other online payment options like Neteller, Skrill, WebMoney, etc. are also supported.
- Withdrawals of funds require a verified account and 1-2 business days for completion as a security check.