Succeeding in crypto trading requires knowledge about the underlying technology, finance, and patience. However, getting started with crypto trading is not as difficult as you may think. Several methods and tools can help you achieve tangible results, even without a comprehensive understanding of crypto trading. 

Crypto copy trading is one such way that can help absolute beginners to learn about the topic as fast as possible without facing massive monetary losses in the process. So, what makes crypto copy trading lucrative and the preferred entry point to the crypto world. Read this article to find out why.

Crypto copy trading - The basics

Crypto copy trading is a strategy where an individual can copy a particular trade from an experienced trader so that he can start seeing results without spending a lot of time gathering experience. This strategy is an effective way to automate buying and selling crypto.

How does it work?

Crypto copy trading uses software to automatically copy an experienced trade from a trader and use it for another investor. The automation software takes time to set up but provides great results when configured correctly. Crypto copy trading uses signals to alert the users of new trades available. It also helps you manually open and close positions before the principal trader. There is some flexibility in which trader you choose to copy so that you can switch your tactic whenever you want.

You can gain around 5% - 10% profit in return for a small fee that the platform collects.

Benefits of Copy trading

Copy trading is undoubtedly beneficial for beginners as well as more experienced traders. 

• Easy wins: Metrics on copy trading sites can quickly help you identify skilled traders, which, in turn, can earn you some profit.
• More time: Copy trading software can gradually help you get more free time for your obligations and responsibilities by taking care of most of your trading decisions.
• Up-to-date news: Through copy trading software, the investors receive notifications regularly. As a result, they do not miss out on opportunities and can make prudent decisions without panicking.
• Less research: Following expert traders will help you skip all the meticulous research and focus only on trading. You also get extra time to learn about cryptos without conducting constant research.
• Insight into the market: When you copy a master trader, you get an insight into the market and how to trade in it.
• Low fees: The fees in copy trading are fewer than hiring an investor to manage your crypto trades. 
• Diversify portfolio: Copy trading gives you the confidence to put your crypto tokens in various other markets. This diversifies and strengthens your portfolio in the crypto trading industry.

Drawbacks copy trading

• Less control: Although you can tweak some of the factors, there are a few decisions that you cannot alter. As a result, you lose some power in copy trading.
• Blindly following: This problem can be consequential, as the markets are volatile, and even the most experienced traders can lose money. If you imitate all strategies identically and don't adjust them according to your needs, you may inadvertently lose your money.
• Selecting the wrong trader: Your trades majorly depend on the trader you choose. So, picking the erroneous trader will act against you.
• Trade lags: Trade lags in a volatile market can prevent you from getting identical results as the master trader. Some sites can even cancel a trade if there is a vast gap in the trader's and market's price.
• Commission: You may have to pay commissions on some platforms. It means that the traders will get a small percentage of your profits as fair compensation for their work.

Conclusion

Altogether, crypto copy trading is a straightforward and practical way to trade your cryptocurrency. Learning from master traders by mimicking their moves can help you uncover useful tactics for trading crypto in the future. Assuming you take the time to do your own research and tweak the strategy to suit your own objectives, you will have a high chance of success in copy trading. All you need to do is to follow a reputable trader, use suitable software and consistently put effort to reap the benefits from copy trading.