Social trading, copy trading, and mirror trading are often considered to be interchangeable. They come from the same source – copying trades - but the similarities end there.
If you followed the whole GameStop excitement on Reddit, that is a prime example of Social Trading. Recommendations were made by traders on a social platform and people copied it utilizing investment apps like Robinhood. A whole new world opened up to a lot of inexperienced traders and they followed different investors and put money in and out of different stocks – with varying results. The stories of fortunes won and lost fueled a lot of the investment, but trading shouldn’t be considered a get-rich-quick scheme. The biggest problem with social trading is that it takes a lot of time and energy and you have to be on top of it all the time.
Mirror trading on the other hand, is an all-or-nothing kind of copy trade. It’s an automated process that is set up to follow a reliable strategy gleaned from a number of sources and you have to follow everything. You don’t have to pick and choose – in fact, you can’t. Once you’re in, you’re in. It’s not a small platform and it’s not for dabbling.
And then there is Copy Trading. Copy trading is generally achieved through a software application, such as Wyzer, that lets you assign funds to copy positions or portfolios of a given professional. This works great for someone who doesn’t have a lot of time and wants to follow along and see what happens. It is a good way to learn the markets and the strategies – at your own pace. Experienced investors use copy trading for market research as well. Everyone can benefit from the wisdom of a seasoned investor.
It's not magic; you need to pick the right application. Enter Wyzer. We have done the research for you. We have put together a group of top-notch investors who are audited and vetted. These investors get a fee for allowing you to copy their portfolios. As such, it is in their best interest to provide a variety of options for you to choose from. You see their performance history, based on their success rates and assets, and choose them based on all the information that is readily available. As there are no minimums and no contracts – they want to keep you with them and continue to provide solid returns. An established investor has reasons for why and where they invest – with Wyzer you can trust them and copy the portfolio with confidence.
Wyzer is also the easiest application out there for copy trading. Pick one of the many portfolios on our site, set an amount, and hit copy. That’s it. Now watch and learn.
Risk is inherent in any trading. The better the traders, however, the less the risk. Doing it on your own, without copying, has a greater risk than allowing the professionals to do it for you. That said, past performance is not a guarantee of future success, so you are always taking a risk
Knowing your investor profile is crucial to working out what type of investment suits you. When it comes to investments, are you a risk-taker? Or do you tend to invest small amounts in carefully researched funds? The way each of us approaches investments can vary greatly and have a huge impact on our financial future.
Hedge funds, investment bankers, and other professional investors are desperate to find out what the next GameStop will be before it's too late. It is worth remembering that the rise driven by Reddit has crushed some hedge funds betting against GameStop, the network of theaters AMC Entertainment and other popular actions on social media.