Tips on Choosing Social Forex Trading
How do you choose a social forex trading network and platform that suits your needs? First, consider, what are your risk rewards expectations? There are several social forex trading that you can choose from.
1) Ayondo. This is the only social trading network that rewards traders not only for the benefits they generate, but also for their low risk management approach. If traders take more risks for a month (ie high drawdown), their commissions will be reduced. Therefore, overall, their main traders seem to be more aware of the risks than on other networks that only reward traders for profit (and therefore can attract more risk taking). With Ayondo, your allocations are also managed proportionately to the trader's account (ie if they risk 1%, only 1% of your risk is at risk). Most traders still send signals from demo accounts (which obviously tend to allow a more risky approach), although the number of real money traders is increasing rapidly in their networks.
2) eToro. The eToro trading also copies proportionately in your account in relation to the allocations for each trader. However eToro implements the default CSL (Copy Stop Level) to any trader you copy 40%. This means that when this trader loses more than 40% of the money you give him, your photocopying relationship is over. CSLs are put into place by eToro to limit your overall exposure to one trader, even though you can always override them manually from 5% to 95%. Limit the amount you can allocate per trader to 20% (ie they force you to spread the risk ). However, there is nothing to stop a trader from taking 100% risk in one trade so technically you can lose all your trader's allocation in 1 trading (or 20% of your account).
3) ZuluTrade. The risks you take are really up to you and how you configure your ZuluTrade account settings. Depending on your settings, 1 trader or even 1 trade can technically blow your full account. However you can limit the risk by applying the correct money management settings and by using their "ZuluGuard" feature. In terms of risk management, from all networks, ZuluTrade is likely to offer the most comprehensive tools to limit risk per trader (eg you can limit losses on accounts or per trader and add many restrictions on traders you copy).
Second, in terms of potential rewards, ZuluTrade lets you take the most risk / leverage and therefore offers the highest profit potential. Actually, with ZuluTrade it's up to you. Technically you can make a lot of money by risking a lot of equity per pip on just one trader. For example, assume you have USD 100 in your account and you allocate USD 10 per pip to 1 trader. If they trade and generate 10 pips, you will double your account with just one trading. However, if you move 10 points against you, you will lose your full account balance (10x USD 10) in 1 trading. The point is ZuluTrade gives you all the tools to limit your risk, they do not force you to do it. Therefore if you aspire to generate extraordinary profits with little capital expenditure, you can try this with ZuluTrade by applying high-risk account settings (similar to playing online casinos).
While your results are proportional to your allocation, ayondo lets you increase your leverage per trader. So leverage 2x means if the trader profit 2%, your account will increase 4%. Therefore, by using a high level of tenacity, you can get high rewards quickly, although it obviously also means high risk and potential loss of all your allocations. With eToro, you will find high risk and low risk traders following eToro. But since you can only allocate 20% to 1 trader, even if they multiply their accounts in a week, it does not double your account.
1) Ayondo. This is the only social trading network that rewards traders not only for the benefits they generate, but also for their low risk management approach. If traders take more risks for a month (ie high drawdown), their commissions will be reduced. Therefore, overall, their main traders seem to be more aware of the risks than on other networks that only reward traders for profit (and therefore can attract more risk taking). With Ayondo, your allocations are also managed proportionately to the trader's account (ie if they risk 1%, only 1% of your risk is at risk). Most traders still send signals from demo accounts (which obviously tend to allow a more risky approach), although the number of real money traders is increasing rapidly in their networks.
2) eToro. The eToro trading also copies proportionately in your account in relation to the allocations for each trader. However eToro implements the default CSL (Copy Stop Level) to any trader you copy 40%. This means that when this trader loses more than 40% of the money you give him, your photocopying relationship is over. CSLs are put into place by eToro to limit your overall exposure to one trader, even though you can always override them manually from 5% to 95%. Limit the amount you can allocate per trader to 20% (ie they force you to spread the risk ). However, there is nothing to stop a trader from taking 100% risk in one trade so technically you can lose all your trader's allocation in 1 trading (or 20% of your account).
3) ZuluTrade. The risks you take are really up to you and how you configure your ZuluTrade account settings. Depending on your settings, 1 trader or even 1 trade can technically blow your full account. However you can limit the risk by applying the correct money management settings and by using their "ZuluGuard" feature. In terms of risk management, from all networks, ZuluTrade is likely to offer the most comprehensive tools to limit risk per trader (eg you can limit losses on accounts or per trader and add many restrictions on traders you copy).
Second, in terms of potential rewards, ZuluTrade lets you take the most risk / leverage and therefore offers the highest profit potential. Actually, with ZuluTrade it's up to you. Technically you can make a lot of money by risking a lot of equity per pip on just one trader. For example, assume you have USD 100 in your account and you allocate USD 10 per pip to 1 trader. If they trade and generate 10 pips, you will double your account with just one trading. However, if you move 10 points against you, you will lose your full account balance (10x USD 10) in 1 trading. The point is ZuluTrade gives you all the tools to limit your risk, they do not force you to do it. Therefore if you aspire to generate extraordinary profits with little capital expenditure, you can try this with ZuluTrade by applying high-risk account settings (similar to playing online casinos).
While your results are proportional to your allocation, ayondo lets you increase your leverage per trader. So leverage 2x means if the trader profit 2%, your account will increase 4%. Therefore, by using a high level of tenacity, you can get high rewards quickly, although it obviously also means high risk and potential loss of all your allocations. With eToro, you will find high risk and low risk traders following eToro. But since you can only allocate 20% to 1 trader, even if they multiply their accounts in a week, it does not double your account.
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