Everything You Should Know before Choosing Forex Copy Trading Software

by Nevena Jokic
forex trading


While forex trading may not be a competition (although there’s always the temptation to compare your results with others), it is very much about speed. Trade execution speed is critical to entering and exiting trades at desired prices. Failure to do so leads to slippage, potentially leading to unexpected losses or reduced profits. 

Speed is also how the world’s top traders stand out. Case in point: BlackBull Market, a New Zealand-based broker, ranked first in the industry for execution speed after consistently outperforming the industry when it came to Limit order and Market order speed tests. 

A study by CompareForexBrokers.com found that BlackBull Market achieved average execution speeds of less than 75 milliseconds — nearly half the industry average of 130 milliseconds.

limit order average execution speed
Source: CompareForexBrokers.com

The challenge of trade timing is precisely what forex copy trading software seeks to overcome. 

Imagine having the ability to replicate the moves of some of the world's most skilled forex traders automatically, right in your own trading account. Using forex copy trading software is like having a seasoned trader guide your every step, ensuring that even if you're a novice, you can step onto the trading floor with confidence. 

But before you make any purchase decision with the first copy trading software you come across, there are crucial bits of information you need to know. In this guide, we delve into the complexities of forex copy trading software, from its benefits to potential risks, ensuring you're well-equipped to make an informed decision. 

What Is Forex Copy Trading?

Forex copy trading involves the automatic replication of trades from one account (typically that of a seasoned trader) to another, allowing the latter to benefit from the former's expertise and strategies. It's like having a mentor, but instead of giving advice, their actions are directly mirrored in your account.

If you’ve heard of trade signal providers, you’re probably wondering if they’re similar to copy trading. Here’s how the two differ from each other — we’ve also thrown in a definition for manual trading. 

  • Manual trading: This is the traditional form where traders make decisions based on their due diligence, intuition, and market analysis. From buying to selling, every action is initiated by the trader.
  • Signal providers: These are entities or platforms that offer trading signals or suggestions. They provide a heads-up on potential trade opportunities, but the final decision to act rests with the individual trader.
  • Copy trading: This sits somewhere in between. While the initiation is automatic, the underlying premise is that one is “copying" the strategy of another trader in real time.

Related reading: Everything You Need to Know About Trade Copier Signals 

You can think of copy trading as a collaborative tool. It's a blend of automation and human expertise, where traders, especially novices, can bypass some of the initial hurdles and tap into the vast knowledge pool of those who've been in the trenches for years.

Benefits of Using Copy Trading Software

While different forex copy trading software providers may offer different features, most (if not all) of them will share a common set of core functions and benefits. These include: 

  • Time savings: Let’s face it, not everyone has the luxury of time to constantly monitor forex markets, analyze intricate charts, or stay updated with global financial news. Copy trading software lets you automatically execute trades based on the actions of more experienced traders, eliminating the need for continuous monitoring.
  • Leverage expert strategies: There’s no denying that forex trading has a steep learning curve. Copy trading software allows newcomers to leverage the strategies of experts, ensuring a higher chance of success without needing years of experience. 
  • Potential for passive income: While all investments come with risks, using copy trading software provides an avenue for passive income. Your trades are automatically aligned with those of professionals, and profits (or losses) mirror their actions.
  • Democratization of forex trading: The forex market has always been inaccessible to the average person and is mostly navigated by financial wizards. Copy trading software levels the playing field, offering everyone a chance to participate and potentially profit.

Related Reading: The Benefits of Forex Telegram Signals for Successful Trading

Key Features to Look for in Forex Copy Trading Software

forex trading

Not all forex copy trading platforms are created equal. To ensure you’re getting your money’s worth, here are the essential features to look for when evaluating forex copy trading software. 

1. User-friendly Interface

The software should be intuitive and easy to navigate, even (and especially) for those who might not be tech-savvy. An uncluttered layout with clear instructions can make a world of difference in your trading experience.

2. Robust Security Features

The financial world is, unfortunately, rife with potential security threats. With your money on the line, you want to choose a platform with state-of-the-art encryption, two-factor authentication, and other security measures to protect your investment and personal data.

3. Real-time Data Synchronization

Markets move rapidly. The software should be able to sync in real time with the trader you're copying. Any delays can lead to missed opportunities or increased risks.

4. Customization Options

While the essence of copy trading is automation, controlling certain aspects can be beneficial. Look for software that allows you to set your risk levels and investment amounts or even choose to override a copied trade if you see fit.

5. Risk Management Tools

Even if you’re copying trades from a highly experienced forex trader, not every trade will be a winner. A good software solution will have built-in tools to manage potential losses, such as setting Stop Loss orders or Take Profit levels, ensuring you have a safety net in place.

6. Transparency and Data Analytics

The platform should offer transparent insights into the performance metrics of the traders you can follow. This includes their trading history, risk scores, success rates, and more. Additionally, post-trade analytics can help you understand and learn from each trade.

7. Responsive Customer Support

As with any tech platform, glitches or queries are inevitable. A responsive customer support system, be it through chat, email, or phone, can greatly enhance your overall experience.

Related Reading: What Does an MT4 Trade Copier Do?

Bringing Everything Together

Forex copy trading bridges your trading account and a more experienced trader, allowing you to automate trades with a high degree of success. However, copy traders can also be useful for experienced traders looking to diversify their portfolios. 

Follow the Telegram Connector blog to find more guides and insights into the world of forex trading. You can also begin your trading journey with Telegram Connector with our MT4/5 signal copier software and Backtester solution. Contact us to learn more, or get started with a FREE account!