What is Copy Trading and How does it Work?
Copy trading is a long-term investment strategy anyone can use, regardless of experience and expertise level. Copy trading has grown increasingly popular among investors mainly for its ease of use, social environment, and time-saving investment characteristics. The automated nature of this service enables investors to minimize time and effort while increasing their own rates using strategies and abilities developed by excel providers.
Examining and following the trading strategies of reputable providers can benefit investors in leveraging their skills while learning along the way, especially those without a trading background. Through their innovative strategies, providers can help followers gain a thorough understanding of the global market, enabling them to capitalize on potential opportunities.
It is undoubtedly an effective service for investors who do not have unlimited free time to spend researching and preparing their investments as they normally would if they were trading by themselves. A successful strategy provider can be a valuable asset for investors of all levels. Thus, investors often consider selecting a top-ranking provider’s strategy as if they were choosing to invest in the products of a high-performing fund. The challenge, however, can often lie in identifying the right Provider with a suitable strategy to copy.
How does cTrader Copy Strategy Rank Work?
Most investors may be tempted to select a provider’s strategy based on an impressive return on investment (ROI), but this is not necessarily the most appropriate criterion or an indication of success. Furthermore, strategy providers cannot be guaranteed to succeed in the future based solely on past performances or recent high ROI activity.
The algorithmic equations for sorting strategy provider rankings should incorporate more elements than those mentioned above to be sound and effective. For this reason, cTrader encompasses additional components and data related to a provider’s strategy, including performance stats and detailed analytics. A number of supplementary filtering tools, such as filters, dedicated search boxes, and dropdown lists with additional filtering values, enable investors to obtain more specific information by personalizing results. Transparency and accuracy can be achieved through unbiased analysis of strategy experts’ past and current performances.
It’s worth noting that ranking serves neither as a scoring system nor a suggestion mechanism. Its purpose is to highlight providers who meet most of the criteria and strategies that would facilitate and add value to our investors’ experience. The cTrader Copy Strategy Rank aims to assist investors in locating the most suitable strategies and providers to follow based on their own personal goals.
As part of its ranking calculations, CTrader Copy collects detailed information about strategy profiles to provide the best possible strategies catered to every Follower’s type and investor’s objective. We constantly strive to improve our services, products, and ranking algorithms, so we are always interested in investors’ feedback.
The cTrader Copy Rank sorts strategies comprehensively based on a strategy’s all-time ROI as well as the strategy’s Equity-Based ROI, which is the Provider’s Own Funds used to achieve the all-time ROI result. Along with the above, the Trade Duration is also considered when calculating rankings. It is necessary to take into account both the number of days the provider traded the strategy and the number of own funds a provider used to achieve the strategy’s ROI percentage. It is also essential, however, to determine the strategy’s long-term performance. The Number of Profitable Months considers the months in which the Strategy had a positive ROI percentage minus the number of negative ROI results.
Moreover, the Total Live Followers, as well as the funding potential of a strategy and capital invested in it by its provider, are also crucial components in determining the rank of a strategy. The copied volume is determined by the amount allocated to the strategy based on the equity-to-equity ratio. The total number of followers’ Invested Funds and provider’s Own Funds placed in his trade is taken into account. Therefore, the more live followers the strategy has and the more funds they and the provider invest in a strategy, the higher the strategy will show on the Rank.
- Equity-Based ROI
- Trade Duration
- Number of Profitable Months
- Total Live Followers
- Invested Funds
- Own Funds
Other Useful Statistics
Aside from the parameters mentioned above, investors also have access to an additional set of instruments, including data as well as other tools, which cTrader Copy has put in place in order to enhance and simplify their investing activities. A wide selection of statistics is available to users for identifying and reviewing strategy profiles to make more informed decisions. Investors can navigate the profiles of ranked providers through the strategy list, search a strategy by its name, or conduct specific searches based on their personal criteria. Such statistics include, but are not limited to:
- Strategy Profiles
- Strategy Stats
- ROI (Monthly)
- Performance Stats
- Volume Breakdown
- Copiers Stats
Through our Traders First™ approach, we constantly enhance our copy trading services with risk management tools, filtering methods, charts, detailed strategy profiles, and customizable features. Providers can showcase their products through a leading cross-broker solution and charge fees in order to enable other investors to replicate their strategies. At the same time, investors can enjoy some of the most complete and personalized social investing experiences on the award-winning multi-asset cTrader Copy platform.