What if you could start earning from forex without the need to dedicate a lot of time and resources, and to learn how each strategy works? What if you didn’t have to choose between your day job and forex trading? Well, social trading lets you do this more and more. Social trading in its most simple form is a type of trading software that provides you with the opportunity to mirror the strategy of pro traders.
The past few years have seen a surge in the number of forex brokerage firms incorporating different social trading features. Most of these have either resulted in developing proprietary software while others have adopted what are widely considered to be the leading social trading platforms on the market.
We have tested various social trading environments and come up with a list of what we consider to be the ten best social trading programs for 2021.
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How does social trading work?
Social trading is a form of networking that brings traders, investors, and analysts into one interactive environment. Here, they get to share ideas and insights about the industry while others get to collaborate in forex trading projects.
Inexperienced traders get to learn from the pro-traders by watching how they analyze markets, identify viable trade positions, and create winning strategies. These beginner traders can then copy suggested trading strategies and replicate them in their trading accounts.
There is a caveat though when it comes to social trading. Not every self-proclaimed trader/analyst is worth copying from. To help you identify the best traders to copy, social trading websites have come up with professional trader qualifications.
The qualification touches on such aspects of their trade as the percentage of wins posted by the trader, maximum drawdown, portfolio diversification, and invested amounts.
What Criteria are used to Rank the Best Social Trading Sites?
- Pro-trader qualifications
- Copy-trading commissions
- Ease of registration and use
- Number of trading instruments
- Minimum deposit
- Consumer experience
- Level of copy trading automation
Best Social/ Copy Trading Platforms for 2021
1. eToro – Best overall for all traders
eToro describes itself as the ‘world’s leading social trading platform’ – and for a good reason. It was one of the first forex brokerage firms to perfect the art of social trading by providing its clients with an automated copy trading option. This gives beginners, slightly experienced, and part-time forex traders an opportunity to profit from this highly lucrative market.
Others factors making eToro a market leader in the social trading world include its expanded world presence in several countries around the world. We also liked their pro-trader qualification criteria. This takes into account such aspects of their trading history as their biggest downturn, minimum deposit amounts, and hourly-risk score. Most importantly, they have two different types of copy portfolios. The first, allows you to copy elite traders while the market portfolio will enable you to copy best performing pooled fund/ trading portfolios.
- Hosts numerous social trading features that extend beyond copying a traders portfolios
- Maintains a highly transparent fee and price structure
- Low minimum operating balance of $200 and a reasonable 20% profit share
- Their customer support team that can only be accessed via email
- Hosts limited educational and training tools and resources
2. CentoBot – Best for Cryptocurrency traders
Centobot is a relatively new entrant in the world of financial markets. But it maintains one of the most technologically advanced software. We are especially drawn to it because of their recently launched Binary Cent trading feature – an advanced social trading feature that supports crypto copy trading.
We feature it here not just because it is one of the highly innovative crypto trading sites, but also because of its ease of use. You only have to create an account with Centobot and choose the BinaryCent trading option. This then directs you to a copy trading area where you are presented with a list of all the best performing traders. Here, you get to choose the trade positions to enter and the amounts for every trade. Note that you will need a minimum deposit balance of $250 to start trading.
- Highly transparent trading app
- Exposes you to the broadest range of crypto trading pairs that you can choose from
- Allows for the full customization of your copied strategies
- Not transparent about its strategies or the company ownership
3. Naga Trader – Best for global social networking
Naga Trader boasts of having some of the most advanced social trading features that include social networking and copy trading. Social networking involves coming up with unique projects that traders from all over the world can collaborate on. Copy-trading, on the other hand, allows Naga traders to replicate the success of elite traders to their trades. These two practices have gained unrivalled popularity in the global markets that they have earned Naga Trade a nickname – the “Tinder Of Trading.”
The brand that traditionally dealt with stock, commodities, and futures CFDs also has in its product list crypto coins. It also went ahead and launched their coin – the Naga Coin. It is available on both the MT4 desktop and mobile app, and you will need a minimum initial deposit of $500 to start trading.
- It is actively involved in multiple global money markets
- You get access to leverages of up to 1:200 and low trading commissions
- It gives you access to the NAGA social trading network where you meet, interact, and share with fellow NAGA traders
- Doesn’t accept U.S clients
4. Ava Trade – Best for multiple copy trading platforms
AvaTrade – one of the most reputable forex brokerage firms in the world – will also allow you to copy trade on its site. Copy-trading here is granted to members with real active accounts either directly or indirectly. Here, you start by creating and funding your account before connecting it to ZuluTrade or Duplitrade.
You can then use either of these to copy and replicate an experienced trader’s strategies. This makes AvaTrade one of the few brokerages that give you more than one option when it comes to selecting a copy trading interface. The minimum deposit amounts for a real trading account typically stands at $100. You will, however, need a minimum $500 if you hope to copy trades found in their system.
- Ranks traders based on a proven history of successful trades and minimal drawdown
- The minimum trading balance of $100 makes it appealing to beginner traders and others with insufficient capital
- Hosts multiple social trading tools and features
- The low spreads and minimal fees and charges only apply to experienced traders as retail traders get exposed to hidden fees
5. Zulu Trade – Best for hosting the most advanced social trading features
Zulu Trade is by far, one of the most advanced social trading platforms. Founded in 2007, Zulu Trade has gone on to usher in significant changes in the world of forex and binary options trading. And all these can be attributed to its wide array of social trading features as well as the depth of its data collection and analysis tools. It also partners with one of the widest pool of reputable forex and CFD trading brokerage firms.
Zulu Trade works by gathering as much investor trading data as possible. It records elite investor’s trades, their trading strategies, and their aggression of taking up positions and compares it with other Zulu Trade users. A beginner can then decide on the pro trader to copy by first deciding on the strategy they wish to adopt and the target markets. They then will be presented with a list of all successful pro traders with whom they share a brokerage firm.
- Highly versatile as it allows you to copy and customize winning strategies to match your trading style
- Maintains a friendly user interface that makes Zulu Trade beginner-friendly
- Highly regulated and partners with a relatively high number of brokerages
- Limited tradable financial instruments as it only supports forex markets
6. Tradency Mirror trade – Best for risk effective risk management strategies on copied trades
Before eToro and ZuluTrade, there was Tradency – a pioneer forex broker that offers both social and copy trading services within its native mirror trader platform. It helped the social trading niche as most of the new social trading sites borrow heavily from its operations. However, as most networks sought to come up with more social trading tools, Tradency chose to maintain its original mirror trading tool.
This explains why it has minimal trading tools that involve networking, mentorship, or sharing ideas. The most you can do on Tradency is view the portfolio strategies of different elite traders and mirror (duplicate) them on your account. It also isn’t an independent brokerage but a trading software company. This implies that your preferred broker will determine such aspects of trade as leverage and the minimum deposit.
- Highly transparent with the current and historical trading data of the different signal providers
- Its risk management tools allow you to customize and control your exposure for every copied trading strategy
- Grants you total control of your trades and will enable you to close them by just logging into your mirror trader
- There have been incidences of double charge where brokerage firms charge extra commissions and fees to mirror traders
7. Ameritrade – Best for safe trades
Ameritrade is a highly reputable trading site offered by an equally reputable bank in the U.S – TD. The fact that highly regulated brokers back it gives investors a sense of confidence and trust that most other brokers and trading sites can’t match. Its approach to social trading is also different from that of major industry players.
For instance, while some like eToro and Zulu Trade pay too much emphasis to Copy Trading, Ameritrade seeks to leverage social media and industry influencers in helping its clients make more informed investment decisions. This involves coming up with social media bots that help traders get around the system, receive mentorship, and even execute trades automatically. There are also others that capture social media and Wall Street influencer’s sentiments towards different financial markets and shares it with their clients.
- Stretches social trading beyond the reach of the software to capture the pro-investor and industry influencer sentiments
- Has the backing of a fully registered and licensed bank
- Unlike most social trading platforms, it pays close attention to mentorship
- Will only support limited social trading tools – doesn’t support copy trading
- Attracts relatively higher transaction fees
8. Darwinex – Best for wide access to financial markets
Darwinex is probably one of the newest entrants into the global social trading scene. And it brings with it a new, unique, and highly effective strategy-sharing approach. Other social trading apps with a copy trading feature don't always reveal the trading strategy to prospective copiers, which is what make Darwinex an interesting option.
It classifies the strategy as an investor’s asset and hides it in a Darwin. Interested individuals will then pay an agreed sum amount to access the strategies. This is unlike brokerage software such as Zulu Trade and eToro that charge a percentage of earnings made from the use of the investor’s strategy. The trader is then can copy, replicate, and customize this strategy in their trading accounts without being subjected to additional costs.
- Presents the trader with highly sophisticated trading and risk management tools for trade customization
- Highly versatile and compatible with both the MT4 and MT5 platforms on Mac, Windows, Linux and as smartphone apps
- Gives you access to a wide range of markets with leverages of up to 1:200
- Doesn’t accept U.S traders
- You stand to lose both your investment and the amounts spent on buying a strategy should it fail
9. Tradeo – Best for the most transparent trading platform
Social trading refers to the different finance and investment industry player’s ability to interact freely, share ideas, and network. And Tradeo lives true to this. The forex broker provides its clients with not just one of the widest range of social trading and networking features but also the most transparent system in terms of costs and spreads.
Here, you have full access to any other trader’s signals and orders that are visible on the chart. This, according to Tradeo, makes it possible to social trade in a more personalized manner. They also have highly effective copy trading features that let you copy your favorite pro trader’s strategies and automatically replicate them on your trading account.
- The complete transparency and visibility of the trading strategies and market orders on a free chart make it beginner-friendly
- There is no limit to how much time or virtual currency you can spend on Tradeo’s demo account
- Relatively affordable minimum account balances for copy traders of $250 with attractive leverages of up to 1:200
- Doesn’t accept U.S clients
- Has a limited number of tradable financial products
10. MyFxbook Autotrade – Best cross-broker platform
First off, it is important to mention that Myfxbook is not a forex broker. It is a platform on which you can host your different broker accounts, and share your results.
In it’s less than a decade of active operations in the industry, Myfxbook has morphed into a household name. And this can be attributed to this unifying feature as well as its auto trading platform. Its rich social trading features are evidenced by the program's transparency. And this makes it possible for you to view orders and trading strategies entered into by other investors. Plus it has an automated copy trading tool that lets you copy and replicate winning strategies in your trading account.
- It is highly transparent making it beginner-friendly
- Helps you better manage all your trades in one place
- Maintains a strict qualification criterion for professional traders ensuring that you only copy your trades from the best
- It doesn’t offer brokerage services
Social trading has, in the past few decades, ushered in the much-needed revolution in the global financial markets. It has made collaboration on forex trading projects possible and eased most financial market trader’s access to mentors.
It has also ensured that you don’t need to spend months pursuing different forex training courses to start earning from the market. More importantly, it brings along a rich resource of trading tools and features like the all-popular copy trading. This has levelled the playing field and made it possible for beginners and part-time traders who lack either time or market analysis skills to reap just like their mentors.
Glossary of Trading Platforms
The trading platform fee refers to the amount a trader pays to use the platform and access its integrated platform features and tools. It can be a one –time fee paid for the acquisition of the trading platform, a subscription fee paid monthly or annually. Others will charge on a per-trade basis with a specific fee per trade.
Cost per trade is also referred to as the base trade fee and refers to the fee that a broker or trading platform charges you every time you place a trade. Some brokers offer volume discounts and charge a lower cost per trade for voluminous trades.
Margin is the money needed in your account to maintain a trade with leverage.
Social trading is a form of trading that allows for the interaction and exchange of trade ideas, signals and trade settings between the different classes of traders.
Copy trading, also known as mirror trading is a form of online trading that lets traders copy trade settings from one another. In most cases, it is the newbies and part-time traders that copy the positions of pro traders. The copiers -in most cases - are then required to surrender a share of the profits made from copied trades – averaging 20% - with the pro traders.
A Financial instrument ideally refers to the proof of ownership of financial commodities of monetary contracts between two parties. In the money markets, financial instruments refer to such elements as shares, stocks, bonds, Forex and crypto CFDs and other contractual obligations between different parties.
An index is an indicator that tracks and measures the performance of a security such as a stock or bond.
Commodities refer to raw materials used in the production and manufacturing of other products or agricultural products. Some of the most popular commodities traded on the exchange markets include energy and gases like oil, agricultural products like corn and coffee, and precious metals like gold and silver.
An ETF is a fund that can be traded on an exchange. The fund is a basket containing multiple securities such as stocks, bonds or even commodities. ETFs allow you to trade the basket without having to buy each security individually.
CFDs are a form of contractual trading that involves speculating on the performance of a particular trade in the market. CFD’s will basically allow you to speculate on the future value of securities such as stocks, currencies and commodities without owning the underlying securities.
The minimum investment simply refers to the lowest amount of capital injection you can deposit into a brokerage or a trading platform. Different brokers demand varied minimum investment amounts from their clients either when registering or opening trade positions.
A daily trading limit is the lowest and highest amount that a security is allowed to fluctuate, in one trading session, at the exchange where it’s traded. Once a limit is reached, trading for that particular security is suspended until the next trading session. Daily trading limits are imposed by exchanges to protect investors from extreme price volatilities.
A day trader is a term used to describe a trader who is constantly opening trades and closing them within a day. It is a common term used to refer to forex traders who open trade and only hold onto it for a few minutes or hours before disposing and having to leave no open trades at the time the trading day closes.
What is social trading?
Social trading refers to the art of collaborative trading. And it allows traders to watch and follow their peer's trading strategies and replicate them as their own through either copy trading or mirror trading.
How does social/ copy trading work?
When you are social trading, you are either trading in collaboration with the trading gurus or using their informed marketing strategies to your advantage. Trading in collaboration involves getting trading insights from these pro traders for free or at a fee. Using their strategies, on the other hand, involves watching their trading behavior and replicating their trade strategies on your account.
Is there a difference between social trading and copy trading/mirror trading?
Social trading is an aspect of trading in the forex markets that encompasses direct and indirect forms of collaborative trading. Copy-trading, also known as mirror trading, is a branch of social trading that involves copying trading strategies and market analysis behaviors of pro traders and replicating them in your trading account.
How do I tell the best pro trader to copy?
Different brokerage firms have a defined criterion that they use to identify pro traders. Nonetheless, some of the factors to keep in mind when determining a viable investor to copy include: 1. Their choice of markets 2. Aggressiveness in trade 3. Adherence to risk management practices 4. Percentage wins and biggest drawdown.
How much do I need to engage in social trading?
There is no standard limit as to how much investment is needed to start social trading. In most cases, the minimum initial deposit and trading account balances required for copy traders have to be set by your preferred brokerage firm.
Does social trading expose my trading account balance at risk?
Yes. While you may be getting insights and even copy the trading strategies of pro traders, your trades here aren't immune to risk. They too often have their analysis wrong, which exposes you both to risk.
Can I copy trades from more than one pro-traders at a go?
The number of trading strategies you can copy at any given time is dependent on the forex broker's rules of engagement. Brokers with the highest levels of transparency like Myfxbook and Zulu makes it possible to closely monitor and even follow the trading strategies of more than one professional trader.
Do I always have to use the pro-traders recommended settings?
No, virtually all the forex brokerage firms and their social trading platforms allow for the customization of the copied strategies. For instance, if you feel like your preferred pro trader is too aggressive with their positions, you can use the risk management tools availed to customize the position to fit your trading style.