By Jonathan Dayan – Visualize a professional financial trader who was so good at what he or she did that they actually outperformed the world’s best investment funds. Imagine that it was possible for you to recruit this talented individual as your personal trading guru who you could learn from, interact with and even copy: trade for trade. Now imagine that doing so wouldn’t cost you a cent. That’s the potential opportunity that several social trading networks are now dangling in front of new recruits. If it sounds too good to be true then you should definitely read on.
The ability to recruit a “guru” who you can use as a model for your trading decisions is one of the key advantages offered by social trading networks. By using a social trading network you can see how every other member of the social trading community is investing, learn for yourself how successful individual traders are proving and even decide to directly copy the trades of any trader you choose. This is a powerful tool for traders at all levels of ability because frankly who wouldn’t want a guru to help show them the way, particularly if the privilege doesn’t cost you anything.
Choose Your Own Expert
These days, a lot of people out there seem to regard themselves as financial experts. Every month seems to bring ever more books and blogs advertising the latest sure-thing tip for better financial trading. As consumers and traders, however, what guarantees do we have that the experts we’re being asked to believe in are actually any more effective as financial trader than we are ourselves? Social trading networks offer the opportunity to actually see their top traders ranked right before your eyes. With a whole heap of usable statistics available on social trading websites like eToro’s OpenBook it becomes much easier for you to see for yourself how your potential gurus shape up. There are now thousands of traders active on social trading networks, and more all the time, as a result you now have the opportunity to select for yourself any trader or collection of traders to be your personal guru/s simply by reviewing the performance of the members of the social trading community.
Follow Your Guru
It’s now easier than ever before to follow the trading activity of traders you respect. Social trading networks offer sophisticated monitoring and alert tools which let you know what your chosen traders are trading and when they’re trading it. Better still, they give you the ability to keep tabs on their success rates so you can learn for yourself which parts of their trading strategies are yielding the most success and which are proving to be ineffective.
What You Can Learn About Your Guru Through A Social Trading Network:
- Which country they’re from
- The assets they’re trading
- The direction they’re trading in
- The success ratio of their trades
- The risk level they take in their trades
- When they open and close their positions
- What others are writing about them
Observe, Interact, Copy
At the center of the appeal which social trading networks offer is the ability to get to the heart of how other people trade the financial markets. With the range of trading tools that the social trading networks offer you can see every aspect of the trading of any financial trader you choose to observe. With messaging features bundled into most of the social trading networks you also have the ability to contact your chosen traders and ask them questions about their trading strategies or for advice in your own trading. Of course there is no guarantee that they’ll respond but those that do can offer you valuable hints and tips to help you improve your financial trading. Perhaps the most powerful ability offered by social trading networks is the capacity to directly copy any of the trades which other traders execute. The value of this is hard to overstate – particularly for first time traders, because it offers you the opportunity to profit from the financial markets together with the best traders on the network. Picture the situation: you’ve trawled through the trader rankings, picked out the trader you want to follow and now you have the opportunity to copy in real-time any or all of the trades which they execute – this unprecedented ability makes social trading networks a uniquely powerful tool for financial traders.
More Guru Power, No Cost
Just how powerful a tool social trading networks are for traders who are seeking to get the benefit of other traders’ wisdom is made crystal clear when you compare the kind of access you get to your potential guru through a social trading network with the access you get to a fund manager when you subscribe to an investment fund. Aside from the first and very obvious difference that you pay to get the benefit of a fund manager whereas social trading networks like the eToro OpenBook are completely free to join there are a number of other differences. Firstly, whereas as mentioned before you can see every aspect of a potential gurus trading behavior through a social trading network, when you invest in a fund you only get intermittent and limited reports on the activity of the fund as a whole. Secondly, when deciding to copy the trades of a potential guru the final choice whether to invest or not by following a particular trade is always your own. An investment fund, however, requires you to sign off on all the investment decisions made by the portfolio manager which takes away from you the freedom to query their judgment on a case by case basis or to follow them in only those parts of their strategy where they’re strong.
In conclusion here’s a lot to be said for the guru concept and for social trading networks in general. Information is power in financial trading and social trading networks supply it by the barrel load. In particular they give you the tools to see for yourself how other traders are performing, information which you can use to follow and even copy the trades of those traders you most respect. As a result, you earn the opportunity to recruit the power of a trading superstar to help boost your trading without it costing you money or the freedom to ultimately decide how you trade for yourself.
Forex Market Analysis provided by eToro
Disclaimer: Trading in the Foreign Exchange market might carry potential rewards, but also potential risks. You must be aware of the risks and are willing to accept them in order to trade in the foreign exchange market. Don’t trade with money you can’t afford to lose.
