Copy-trading has become very popular among market participants, finding a platform where this trading style is possible for both FX and options trading.
Traders often struggle to find a platform where higher quality service is available with an opportunity for portfolio diversification. Based on the trading environment, availability of assets, and customer service, we can consider the Pocket option a reliable investment method.
However, when you want to invest, you are playing with your hard-earned money, and you probably think of making more, not losing all of your investment.
In this manner, finding a reliable investment needs several precautions or research before injecting money into it. Whether you invest in Pocket option copy trading or not, you should follow some rules to be a successful market participant.
Tip 1. Make traders search
In this trading style, the platform works as a connector between the trader and investor. A good platform offers copy trading in an environment where the charge is adequate and the outlook is user-friendly.
After opening an account, you will see the list of traders who usually offer to copy their deals. The main aim of the copy follower should be towards the person whose he is following. In that case, finding a reliable trader is crucial.
You can easily pick any of them and start following trades. In that case, focus on risk management and diversifying assets to minimize the overall trading risk.
In the Pocket options social trading, you will see a list of traders to choose the reliable person. For example, if you want to invest $1000 in this platform, it is recommended to invest $500 on FX and another $500 in options trading.
Tip 2. Copy in proportion
As shown in the above section, copy in proportion has two parts:
- In the first part, you should choose how much percentage of your investment you want to allow. For example, if your trading account balance is $1000 and you want to allow 70% of the investment in copy trading, you should set it on the platform.
- On the other hand, you can set multiple copy traders at a time. Like 40% of the investment under Mr. X and 60% under Mr. Y. In that case, even if a trader makes a loss, you have room to regain the balance from another copy trader.
Tip 3. Use stop balance
It is a process to allow a trader to use a particular portion of their investment. By using such balance, you can set when the master stops trading. Similarly, you can set a minimum trade amount so that the master’s trade cannot be copied beyond the range.
For example, if you set the range like this:
- Min amount $20
- Max amount $50
If the original trade comes with $40, it is within the range, so this trade is allowed to be copied into your account. On the other hand, if the original trade comes with $60, it will not be copied to your account as it is above the max copy trade amount of $50.
Tip 4. Try social trading setting
After opening an account in a Pocket options social trading, you will find several settings like the investment amount, maximum loss amount, etc. You have to set these settings according to your needs from the platform.
Besides, Pocket options integrated all types of traders from different trading styles and instruments to make the platform more effective. In that case, you can follow an expert in forex while following another person for options. The social trading setting is available in the account section. You can access it once you open an account there.
Among other settings, you can focus on the traders’ profile showing detailed statistics of the trading environment with royalty level.
Tip 5. Research the platforms
The final but crucial part is researching the platform. The overall system of benefiting from taking and giving signals depends on how the platform allows people to work together. You might gain an enormous profit from following other people’s trade, but if the platform is not suitable, you may struggle in this industry.
In that case, the first thing to look at is the company’s regulation. IFMRRC regulates Pocket options, and its company name is Gembell Limited company located in the Marshall Islands.
Pocket option focused on beginner traders to remain profitable by following successful traders’ portfolios as per the above image. However, it would help if you remained under their regulation before allowing other people to copy from their accounts.
Moreover, focus on deposit and withdrawal methods, trading fees, swap charges, overnight fees, maximum leverage, margin level, news time spread, EA availability, and finally, the dispute policy.
The dispute policy is essential where the broker allows a certain amount as insurance against the loss incurred due to the broker’s policy. Any forex broker under the CySEC regulation has up to €20,000 as insurance.
Making money from trading is a smart way to generate profits from the online marketplace. However, investors cannot ignore the market risks associated with this. Although we have seen five tips to succeed in this trading style, there are some risks that you cannot eliminate.
Thus, a sudden market crash from uncertainties like Brexit, the 911 Twin Tower Crash, Covid-19 might create extreme volatility in the market. In that case, there is a possibility of facing unusual market behavior where the trading master and copier both face losses.
Therefore, a skeptical approach is required — you can minimize the risk during the uncertain market condition or stop dealing during the unfavorable market.