Home » Copy Trading: How to Automate Your Trading Performance
Automated trading will help you make money with minimum time and effort. From this article, you’ll get to know how to make the most of it.
The popularity of trading has been growing steadily around the world. Thousands of people make good additional income on it, without sacrificing their full-time jobs. To facilitate the trading process, they rely on automation tools, such as bots and copy trading platforms. From this article, you’ll get to know the essence and benefits of automated trading and the best ways of doing it.
When you trade manually, you confirm each operation by clicking your mouse or pushing a key on the keyboard. When trading automatically, you don’t need to do that. You spend some time adjusting your tools — and then, they operate independently.
The tools will be meticulously sticking to your instructions. You’ll just need to check them from time to time to make sure that they operate as intended. Plus, you might want to fine-tune their settings and collect your profit.
Automated trading is relevant not only for the crypto sphere. But in this article, we’ll focus on cryptocurrencies. This industry is rapidly evolving. Here, you should be able to earn money a bit easier, compared to more conventional assets.
Reasons to automate your trading
If you have already tried to trade manually, you know how much time and effort it takes. Crypto exchanges operate 24/7 — but you need time for rest and private life. Besides, the longer you stay by your computer, the more tired and less focused you are. Tools of automated trading can work round the clock without fatigue, maintaining consistently high performance.
Robots make decisions quicker than humans. Sometimes, just a couple of seconds might be vital for your earnings. Automation considerably reduces delays. Your trading will take place at a maximum speed.
Emotions might influence you — but they can’t impact your tools of automated trading. Stress, despair or adrenaline might make you act unreasonably. But automation is always based on logic. Every step that an automated tool undertakes is aimed at maximizing your profit.
Benefits of automated trading
When you rely on automation strategies, you should be able to appreciate the following advantages.
The opportunity to start trading right away even if your experience is limited. If you prefer bots, you’ll need to get skills and experience. You should understand very well how markets function and which strategy is optimal for a particular asset. But if you opt for copy trading, you can start immediately and with minimum knowledge.
The ability to keep trading non-stop. If you have already tried to trade manually, you know how much time and effort it takes. Crypto exchanges operate 24/7 — but you need time for rest and private life. Besides, the longer you stay by your computer, the more tired and less focused you are. Tools of automated trading can work without fatigue, maintaining consistently high performance.
Exceptionally high speed of trading. Automated trading tools act much quicker than even the most skilled humans. They never get tired and their reaction speed never slows down. You’ll never miss a lucrative opportunity and you’ll be able to make the most of each jump in prices.
A chance to safely forget about the human factor. Software is not prone to emotions. When stress, despair or adrenaline overwhelm you, you might make a wrong move. Or you might hesitate for too long before making the right one. When trading on a crypto exchange, even a couple of seconds might be crucial to determine whether you make income or incur losses.
A large choice of exchanges, tools and strategies. You can try as many strategies as you wish. You’ll be able to easily scale your trading. When carrying out all the operations manually, you won’t be able to become that productive.
Experienced traders who sell their strategies get additional income with very little effort. The more efficient you are, the more investors copy your strategies. Your personal brand awareness raises, you attract even more subscribers and your profit grows. This cycle can repeat itself forever.
Below, we’ll analyze in detail two types of solutions that will help you automate your trading: bots and copy trading platforms.
Trading bots: what is it and how to use them?
A bot is a robot that can trade on an exchange like a human professional. It can place orders, close deals and react to signals. Yet it can’t act on its own initiative. You need to “explain” to it in advance what to do.
On the flipside, bots have the following disadvantages.
You’ll need to transfer your funds to them. You won’t have full control over a certain part of your savings.
Bots might be rather sophisticated — for instance, they might be good at algorithmic trading. But they can bring you only marginal income. For any other methods, they might be useless.
They might stop working because of a sudden bug. This doesn’t happen too often — yet you should check your bot systematically.
The most important issue is that you need to have extensive expertise to handle a bot. Before you start using this tool, you should gain experience in independent manual trading. Otherwise, you might not be able to program your bot correctly.
A bot might be a superb solution for experienced traders — but not for beginners.
How do copy trading platforms function?
You register on such a platform, link your trading exchange account to it and choose a trader whom you’d like to copy. In the profile of each trader, you’ll find the following information about him and his strategies.
How long have they been in the game?
How much profit have they made?
Which assets and exchanges do they prefer?
Which strategies do they stick to?
What’s their overall rating?
And so on
You pay a fee for the subscription and start to automatically copy the deals of the chosen trader. In turn, the professional trader will do their best to maximize their profit — and yours as well.
You can learn by analyzing the activities of the trader whom you follow. You’ll be able to see every step they make.
Compared to bots, copy trading platforms have the following advantages.
Even beginners with a lack of experience can start using them. Actually, it’s one of the best ways of getting started in crypto trading.
You remain the only person who has access to your savings. You won’t need to transfer coins to the platform.
If a bug takes place, you won’t need to fix it yourself. The team of the platform will promptly take care of it.
Instead of using a platform, you might subscribe to a private trader to copy their deals. But in this case, it might be trickier to choose a reliable professional. A platform guarantees that every trader it offers to you is 100% trustworthy and efficient. With private subscriptions, you can rely only on the trader’s self-presentation and the word of mouth.
Hopefully, this article came in handy and now, you better understand the benefits of automated trading. This method allows you to make a profit even if your trading skills and experience are limited. By using automation tools, you’ll save time and effort. Plus, you’ll minimize your risks of making mistakes. Copy trading platforms seem to be the best tool for crypto owners — feel free to try them right now!