Social and copy trading broker eToro has made changes to its copy trading systems to provide its customers with the ability to keep the positions of a portfolio they have copied after they stop following it.
What is Stop, Copy & Keep on eToro?
eToro’s Stop Copy and Keep, is a new function that allows investors and CFD traders to stop copying the trades of eToro’s top traders, but by using the new function they can choose to retain the open copy trading positions, generated by that trader, on their account, should they wish to do so.
Before the introduction of Stop Copy and Keep, eToro clients who stopped copying a top trader would have seen their open copied positions, closed automatically.
This a small change to the copy trading protocol but quite an important one and you wonder why it hadn’t been introduced by eToro before now.
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What exactly is copy trading?
Copy trading allows a client to “piggyback” off of the experience, expertise and track records of more seasoned traders. eToro has created a marketplace where Top Traders display their track records and the number of other traders that are copying them.
From here, prospective copy traders can dig down into what are called investor pages for more details about individual top traders, which include a brief bio of the trader, statistics about their performance and the instruments they trade. There are also links to similar top traders to allow for comparison.
Potential copy traders can also review posts left by the top traders, and those who follow and interact with them, on the eToro trading platform.
eToro clients can start copying top traders with an investment of as little as $200 per trader, and they can copy up to 100 traders at once. The maximum amount that can be invested in any one trader is $2.0 million.
Are there other investment strategies that you can deploy using copy trading?
There is potential to create a portfolio based on investments in top performing top traders and to diversify your exposure across asset classes and trading styles as you do so.
Indeed eToro has introduced a Smart Portfolio facility for just this opportunity, aggregating top traders into groups with specific trading attributes, that in its words are “optimised for profit”. The composition of these smart portfolios are updated following periodic reviews. Copy traders can invest in these aggregated portfolios or in thematic portfolios created by eToro and its partners.