Topic: The down side of copy trading (Read 313 times)

You may try copy trading when you are just a beginner in trading and you are only using small amount of money. But as you go thru your trading journey and you are already gaining strategies, better slowly trade on your own up until you become skilled in trading. In this stage, you don't need to employ copy trading technique because you already have the grasp of trading.

Just take note of the negative impact of copy trading and you may want to do solo
- being dependent on the other traders, you seemingly can't decide on your own
- waiting for their movement
- you can't learn your own tricks and tips
- you are limiting yourself to the capability of the trader you are following
- you won't feel confident even after years of trading

Yes of course, so what we have to pay attention to is not the risk of loss but the possible developments that you will get when you do it yourself by evaluating to identify mistakes that you may have made at that time that caused the loss outside of market volatility, because in the end I believe that evaluating to identify mistakes allows us to get changes for the better.
And if you feel that you are not at all interested in what is called a copy prediction from someone else, then that's good, it means you have taken the right action, my friend.
In the end, there is no compulsion at all to prefer to do it yourself because after all everyone has different things that they think are much better or more profitable, the point is to maintain and maintain your risk management.

That's right, when you experience losses with your own strategy, it  will be easy to identify and make corrections on such strategy but if you copied the trade, you just need to accept the lose because you were not the person that actually did the analysis. I don't know why it doesn't interest me to use copy trading, I rather prefer my personal analysis. I am not either judging anyone that participate in copy trading, they do make profit too in most of the trade.

copy trading is not magic button that will magically give you profit, you should analyze the trader characteristics based on their trade as well, some might work with better with big capital some might work better with lower capital.
so you also need to do your own due diligence which apparently not that many people think of, some newbie just copy trade and call it a day without reading the characteristic of the one they copied.

but to be fair, not even the best trader out there can trade in this shaky market, so many people are confused with current market direction, sudden BTC dump can liquidate your long position in ALT and sudden BTC pump might not trigger your alt long position to be profitable, overall really shitty days this past few weeks, can't deny i've lost some money navigating the market . but overall not that much lost.

Just like the name sound, copy trading is very risky and one need to be knowledgeable to understand what it takes to go in fully. Copying the trade of people that know how to trade can be always be profitable for us but one too need to understand the risk that is involved in it. If the trader lose, the copy trader is always going to lose. The risk can be huge if the trader make any mistakes or things goes against them. The cryptocurrency market is huge and we can make loses if we don't have concrete understanding about the market. Investing what we know we can afford is better because greed can increase our loses when we invest more than we can afford to lose.

If you have already prepared yourself before you start, you have to have the mindset that you want to grow money and there should be something that is driving you so that other people trade should not be your problem if you don't have time to trade I feel you should just allow it then when you have time, even if it was on percentage gain does not make any difference and I don't think I will be comfortable because my mind will always be their, and if it does not work i might feel is the person fault.  there is a lot when it comes to depending on another person's trade and this is new there was nothing like copy trading, a good point was made if you are trading,  your trading should be intentional with everything there is nothing left out, so that you wont make to may mistakes.

no matter what it might be take your time to do a market study which is the analysis yourself self and that why you can even be able to learn more By doing copy trading you might just become lazy with your trading and doing analysis you might just want somebody else to do it. when just need to concentrate more whenever we want to do trade because I feel like some people are just trying to force deep down they don't have an interest in trading but they will still feel they can do it and it is not by force if you can not trade just buy and hold that will be much better instead of the whole stress.

Well that's it, basically it cannot be denied that even though we analyze in our own way, losses are still possible and if using other people's predictions has the same possibility in terms of risk, then of course it is better for us to analyze in the way we have, one thing I will say is that even if for example you experience a loss using your own analysis but you will be able to make it a lesson and evaluate what mistakes you have made, while when you use other people's predictions then of course you will not know why you experienced a loss. I think we should pay attention to that direction, because even though you lose, you will most likely know the reason why you lost if you do it your own way where this action will prevent you from the same incident in the future.

I have not heard much positive things about copy trading, the most I've heard about it are people expressing regrets and this is the reason I have never tried it before. According to people who have tried it, it usually start very well but along the line it begins to produce bad results due to software malfunctioning or a change in market dynamics. I will not encourage anyone to try copy trading because trading is more of a personal thing that one should take responsibility of and not rely on another.

Knowing that the market is dynamic and that every position started can still go against me make me to conceive fear in my mind and am scared that if I use a copied trade, I could experience an unexpected lose. I even trust my own analysis more than any of those so called professional that gives out their trade to be copied. I am not claiming to be more professional than them or to earn more profit than them but I just feel that it's right to lose one my own analysis, rather than any one's else.

It gets quite tricky in copy trading. If the person is already in profits and if we copy him then we "might" lose money.
If the person has just started then it becomes uncertain whether he will make profits or not.
If the person is losing money then there's no point to invest at all.
So in copy trading the best point is to copy when the person has just started trading and is making profits.

Others do copy trading because they do not have time to trade to themselves instead they are letting other people who trade to them with a percentage gain by the traders, but that doesn't mean they didn't monitor the trades at all because you are just copying their trade there's some instances on your own that you will close your trade if that's enough on your side. For example, the main trader makes another position and makes a mistake and of course they would like to make a new set of trades because you are copying possible with their emotions in trading affects your results too. Copy trading is just being convenient to those who don't have time to trade but its different if you are doing the risk for the safety of your asset.

that's actually true, some trader make really good gain at the start of bullrun it overshadowed their overall performance post bullrun or mid bullrun, this is why I also never trust copy trading to make profit, it's just really uncertain, although we can see historical trading data from the trader, but I don't think that's not good enough indicator aside just a proof that this trader has done some good trades, because the market is shaky, maybe their next few trades are the trades that gonna make them give the money back to the market who knows, if we apparently follow right at that time we gonna lose so much while the trader just make break even.

Usually I only make copy trading as an option when I don't have free time to analyze a market, such as being busy while at that time I have entered my daily or weekly trading session regardless of the results.
But of course I also agree with your opinion that copy trading is very likely to make someone experience big losses, and the problem is that they will not know about what makes them lose because they use other people's predictions that are applied in the copy trading system.

So that can be a pretty serious problem if you don't immediately remove copy trading from your list of choices, especially for a beginner where it is a learning stage for them in the sense that losses are something that must be learned and they will only be able to learn it or evaluate the mistakes when they trade in their own way so that in the future it will no longer happen, and also so that you do not experience delays in development.

Know that every trader experience certain losses with trading, as profiting from trading most especially with an unpredictable market, losses are inevitable. So if you are only here to copy trades from other experienced traders, believe me that won't guarantee all time profitability. Even experts still lose at some point, how much more for those who decide to trade without knowledge and experience.

This is why I don't suggest copy trading after all. It will only be profitable at first, but prepare for the worst losses the rest of your trades. The reason maybe why a lot end up quitting in trading and just settle on hodling.

Yeah, I don't advice newbies to start participating in copy trade because they can experience a huge lose without knowing how to go about it when the market take a bad turn against them. It's better to learn how to trade, even if you must copy other's trade, better you know how to trade on your own, so that you can be able to detect errors and make your own adjustment when need arises.

They should not try to use copy trading if they don't know the risks. If they don't have enough skill in trading, they better to learns from many sources so they will not rely on other people to trade. Maybe they can profit from copy trading but that will not always happen. When you want to use copy trading, you need to analyzes the market moves so you know when you should enter the market. If you only depend on that trader, that will not good for you because you will not know what happen to the market. If you can analyze the market, at least you will have an image where the market will go. But it is better if you trade by yourself so you will take responsibility with your money and know when you must quit trading before your money is gone. All things have its risks so you must know how to manage the risks not to become big and you know what you will do when the situation change.

Imitation or faux in trading can lead to cease, be your own prototype and representative that everyone will copy from you and also admire you, trading can be beneficial and it can also be unprofitable, to be a beneficiary of trading you have to learn your own way of handling your business, and say no to imitation to prevent yourself from unmasking your money to unrestrained danger.


Observation is much better than coping or imitation, it is better for you to observe someone that is professional in trading than you and carried out your own analysis rather than copying someone, if you see some traders you will be thinking that they are professional and more profitable but they are the only one that know the challenges that they are facing.


Since learning how to trade is not prohibited, then it is advisable and desirable to learn how to trade and have experience on it, because there is not a professional in trading, every traders lose and also gain, they have there own ways of trading, and making money, they is not exception of loss and gain in trading, both of them are included in trading.

That is timing that is having some issues, this is why there aren't that many places that have automated copy trading, as in your leave your money to that person, who would use it to pump whatever they want and make money, and they just let you do it and because of that you end up seeing how there are people who got in later, and those who end up getting later they ended up being either good or bad, because of that it is something that is not the same.

If I join right as that person made the trade, then it goes down a lot but then recovers a bit, I am at a loss, but if someone joins when it started to recover they made a profit. This is why it's objectively better to just avoid copy trading and figure out how to make a profit yourself.

Copy trading will never leave advantages even for beginners. You probably think you are making decent profits, but only to find out you are just increasing your risk to lose, because you are trading without making sure if there is probability to win or not. And by copy trading from reputable traders do not mean you'll also be in profits, they also lose their trades which means you'll also end up losing as well.

I think the people who just copied the most recent ones are the ones who lost. If the recent trades that he had were negative, then they probably lost a lot. I think it also depends on when you joined the copy trading for that specific person because what if the recent trades were great as well? So it would be mostly dependent on the situation.

It is better to be the trader that your trade is copied than the trader trying to copy traders. Just like deciding to join signal groups, deciding to just be a copy trader without any intention to be better means that you are only trading for a short time. Copy trading is more than just copying and pasting; it requires time, and a trader who does not have time to execute trades as quickly as a trader they are copying will not profit so much.

Another downside of copy trading is that you will also never be able to have the assurance that your profit will be continuous.

Well, it's always recommended to avoid copying other traders and learn trading yourself but if someone has to copy a trader then he/she should only copy genuine traders who aren't risk takers and patient at the same time. Because the lead traders who don't use leverage or use very low leverage are often the ones who help the copiers to earn profits in long term.

Those copiers who want to earn profit should always try to look for those traders that have low ROI but safer trades. I believe anyone copying such traders won't lose so much even if the market dumps pretty badly because such lead traders often use leveraging to minimize losses and make profits overtime.

I have copytrader in the past and I can confirm that it's not all rainbow and sunshine like these exchanges will make it seem. I once copytrader a "pro" trader from a group I have been a part of for years. It was fine when the market was going up, but when market turned around, everything went to shit. Even worse, whenever there's high volatility to the other side of the trade, the trades are closed in a manner than the losses are so much bigger than what is shown as a stop loss. Closing all of those trades have a cascading effect that drops the prices further when exchanges try to close all orders at once.

The exchange in question is bybit. Copy-trading for me is a no-no activity.

That's the reality with copy trading. You can't guarantee that those traders you are copying are always profitable on their own trades since we all know how trading is quite hard to be consistently in profits. They surely lose at some point but if you see them winning constantly, it's most likely that they are just trading at their own risk, a small amount that it would be okay for them if they end up losing.

Copy trading will only be profitable if you do it while you are starting to trade. But if it means copy trading throughout your trades, that won't be profitable at all. Majority do end up losing while the ones they copied are silently rejoicing because of their commissions that they have gained while leaving those traders at loss.

I've done copy trading but it's the same as losing especially quite a lot, it's also not good if it's done continuously because this will make us dependent on other people's trading strategies, and we will not be able to be independent in trading, it's not a good thing for the long term, especially if you have aspirations of becoming a successful trader in crypto, all storms must be a lesson and all decisions must be based on analysis and personal decisions.

Basically it is better to lose based on the results of market analysis and personal decisions, such as screenshots of my trading activity some time ago.

It should really be that the basic approach on things on which on the time that you would really be considering on dealing with copy trades when you are a complete newbie then there's no way that you would really be able to make yourself that able to become a better trader, and just like on what you have said that there's no learning that you could get from it, not unless if you would really be that trying out to learn with those
people then you are basically enhancing up your knowledge on which this would really be something beneficial for long term. It would really be just that basing up on personal choice on how they would be dealing up with trading and on how to learn from it. If you are someone whose really that trying out to become a better trader then it would be a sensible approach that you would be starting up with the basics and doing it via manual trading on which this is something more recommended and preferred on this aspect. Learning curve would really be much more significant rather than on doing copy trades.

As for the downside then profitability could be shown on exchange platforms as part of their features on which you could check out on how profitable they are and they are really that making up gains.
Yes you could make money but i just dont feel like that needing up to have those deductions of your earnings. 

Hmm, Yup for sure it's bad, and it's like you are sitting on an active bomb because it's not a traditional market where traders enjoy the certainty, in the crypto market even a long-time frame trader also uses the the max weekly frame.

Copy trading is not for newbies, even though by definition it looks like it is designed for those who have little knowledge about trading as they can follow the expert traders to execute trades efficiently but its completely opposite, those expert traders control your assets and take higher risks while trading and as most of the trades don't have enough capital as the expert traders do they lose most of their valuable assets.

Watch, analyze learn how those traders are trading and compare your own skills with and decisions with them then check out the results and compare your analysis-based results with those traders, this is what I recommend to newbies and those who like copy trading as it the only positive factor because you can improve your skills and trade decision making efficiency but never follow a trader and let them trade with your assets.

Speaking of the psychological cycle of the market, I agree with that, but if you are a trader, even bull market or bear market, you can still make money if you are capable of it, like you can short in a bear market to make profits or just some quick long, depends on your analysis and still make profits.

Like trading bots which are not for newbies too. People must start with learning about the market, including past market cycles, psychology cycle of market and kick off their journey with investment.

Investment is first thing they need to do, to get profit and to understand about this market better by their own experience. Then they can start trading but only with Spot and the warning is never use Leverages, Futures trading. These trading types are dangerous not only for newbies but for all including senior traders.

Trading bots, copy trading are for experienced traders who have enough time and experience in this market with another warning is all strategies can fail with time or at some wild changing time of the market.

Psychology of a market cycle
Bitcoin market cycle

Each exchange platform does have their own copy trading on which traders would really be that allowing for them to be copied in regarding about their positions. It would really be that impossible that you wont really be able to make yourself be wary about those numbers on which one is really that profitable on a particular period or on how long does the trader been doing trading and having those portfolio positiveness towards their trades or simply about their profits on a particular period. So checking out their stats would be essential.If ever they are really that neither negative then its part of the risks because copying someone
wont really be giving out that assurance about making profits. This is why it would really be that sensible that you should really be making out some learning too on your own.

Losing up money on copy trading would really be giving out that kind of regret when it comes to losing money which is really that totally different when we do make our own trades that came from our
own analyais. Copying someone? It would really be just that depending on you because it would really be that people are just too lazy or simply they cant have the time on learning up trading.
If you wont really be having that serious approach towards it then you wouldnt really be thinking on how you would be able to learn yourself.

It’s very hard to trust a random trader on crypto because there’s always a tendency that they will commit a risky trade due to the volatile of crypto. One bad trade can result to a huge loss so I never do copy trade even with a good portfolio of the trader.

It’s better to just trade on your own since you don’t know what will be the next move of the trader you are copying.

Yes, copy trading is not for newbies, although they can use it I don't recommend it, why? Because the essence of them to learn something, especially basics and they will strive hard to learn more will be useless.

They can use copy trade but make sure they also learn consistently, they must not settle for less than relying on others, they can be good trader also.

The one whose trades you are copying is either a professional trader or a fraudster. If he is a professional, it is like trying to imitate a professional driver who performs dangerous stunts. If he is a fraudster, the possibility of losing your money is greater. In short, since learning to trade is free, consider it a good opportunity to learn a skill that may earn you more money.

I didn't know there was any upside to copy trading @Oshoshondy But JK in all seriousness, I don't ever see copytrading as a viable strategy. Its like following tipsters in anything. Sportsbetting, trading signals, they all don't work unless the trader/gambler shows you every single record, every single detail of trades/bets.

Which almost 99% of tipsters or signal providers don't. Those very few who do, will show its not always in profit.

I would stop copytrading asap bruh.

Personally, I don't like to ingage myself into copy trading and I think even before a trader must start to copy trade, they need to learn how to trade on their own so that they don't have to only rely only on copies. In copy trading, you don't have a full assurance of making profit because even those professional traders can also be wrong in some of their analysis.

I keep getting reminded of the school teachers who used to scold us during tests "Dont copy from your friend, write on your own"

I think that advice is a life advice and the same can be applied to this method of trading, if you are not using your own head, you are exposing your money to uncontrolled risks and thus losses.

I know that some newbies will find this method attractive, because they think it is a cheat code to earn money - unfortunately it is not so and thus I dont recommend it.

There are many exchanges that is having copy trading by now. I have seen it on Binance, OKX and many other exchanges. I presently use Bybit more. The picture is taken from Bybit.

It is swing trading. Swing trading is less risky than other form of trading as traders prefer to use less amount of money for it and not leveraging it. Although some people can say it is becoming holding. But be it swing trading or holding, what that matters is how you analyze the market. But swing trading is not good for shit coins.

Let a trading position opens for 90 days is very bad in my opinion.

In this volatile market, one of most important principle is don't let your trading position opens like forever and only wait to get profit from it. You must identify when you have to close your position, before you open it. If you are trading with leverage, this principle is more important as it can help you to exit the market and proactively avoid liquidations.

I've noticed that there are some expert trader that consistently losing after making some huge profit the previous year in copy trading, I think it's because every year the cycle is kinda different so it's hard to predict, some people might excel at some bullish period but just outright went so weak the next bullish period, or maybe is it intentional to make exit liquidity? who knows but in a nutshell, these copy trading aren't really effective means of making trade without knowledge either.

personally I just won't risk it following investment of other people, since I'm already so used to investing by my own and my performance is not that bad but not that impressive either. these copy trading are more suited for people that absolutely have no idea.

So whether you copy trade or trade on your own, there won't be any way to skip losing but to become a learner. Honestly, whenever I see content about trading and these people are suggesting copying trade as if it's very easy to trade, they're misleading a lot of people.

This is so true, why I see a lot of them suggesting this is because they all want to have that commission from the people that will copy them. It sounds very easy to make money from this if you have just heard of it but it's not and I hope the exchanges and people that knows about this won't advertise it as something easy.

what platform are you using?

You will rarely find a trader who is profitable long term, if they are profitable long term then their profits arent as high as those traders which are high up on the charts.

What they basically do is have a good week or good month and it hooks people to copy them so they can get some commission back. But eventually what happens is, they will take one trade which will go against them too far and their entire account will get liquidated.

Most trade with small amounts anyways, so if they blow up their account they dont care but the people who copy them will face huge losses. I would avoid copy trading at all costs.

I just decided to visit copy trading today again. I went through some traders that are copied. I saw the people that are copying them.

The first person that I checked that has opened a position for 90 days is making money. Some people that copied him is making money also but some people are losing money while copy him. There are people that copied him but make no money but not losing yet at the time I snapped this.


This is just like 5% of  people that copied him. I snapped the people from the top which gained most. I scrolled down to snap people from the down part which are the people that are losing most.


 


What lesson can you pick from this?

1. If the person just started trading, you will not know if you should copy him or not
2. If the person is making profit already and you copy him, you might be losing

Know that the person you copied might be losing.