How does the trader copying work?

Remember that if you do not want to risk with real money in the beginning you can open an

eToro demo account here.  

All the trades happen in real time, but you are using virtual money. This allows you to get familiar with the environment, try out following and copying different traders and also ask them questions.

When you are ready to trade with real money you can start trading with 50$, but it is recommended

to start with at least $100 - $200 as it allows you to open a position of 1 lot with a leverage of 1:100

thus not exposing yourself to bigger risk of higher leverages.

Deposit for example $200, but you will be able to allocate not more than 20% to a single trader –

this is a rule for the security of copiers. Thus you will not put all your eggs in a single basket and will

be encouraged to diversify your portfolio. So try to choose traders with different risk appetites and

different trading currencies, stocks or commodities.

eToro openbook allows you to see all the top performing traders, go through their trades, portfolios

and statistics.

How does the trader copying work?

Once you have Copied a Trader, click

the Trading button in the top menu. Once the

trader you’ve copied opens a new trade, you’ll

see it instantly in your account!

And the best part is that the trades will be opened in the same proportional amount! Your trade will

be copied as an exact proportion of how much of a percentage of the trader’s account was staked.

There is no minimum lot or unit size as fractional units are especially enabled for the purpose of

CopyTrader.

Unlike typical signaling systems where trades are always executed at pre-defined amounts, eToro

lets you choose the proportions. Therefore your actions will mimic not only the trading activity but the proportions of each and every trade as part of a portfolio.

Don’t be surprised to find trades opened for small or unrounded amounts. CopyTrader is simply

proportionally replicating the activity of the Copied investor.

eToro also has a new risk management feature called Copy Stop Loss (CSL) which is essentially an

automated risk control system that will allow you to set controls for the entire copy relationship, as a

dollar value. So if a trade goes bad the CSL will trigger and terminate that copy relationship.

To better understand the system lets look at an illustrated example:

Your deposited capital is $250 and you have found a trader who you want to copy. 

You choose to copy him with 10% of your capital which is 25$. So if your copied trader with an account of $1000 opens a position with $200 (20% of their capital) then your stake in this will be  20% of your capital (20% of 25$) = 5$. If the trade is successful and the trader earns +10% (200$ x 10%=20$) you will also earn 10% (5$ x 10% = 0.50$).

Losses also work in the same proportional manner - if the copied trader loses 10% of the trade, you

also lose 10% of your trade.