The latest craze in the online financial world is online social trading where financial investors working online take advantage of user-generated financial content and advice. They use this information as the main determinant for finalizing trading decisions.
How Does It Work?
Online brokers provide investors and traders with all the information and tools they need for their activity. They provide them with all the statistics and data required to aid them in making their financial trading decisions. Live news feeds, charts and analysis tools are displayed, so users have the up-to-the-minute figures.
Social trading platforms provide their users with something more. These platforms also give traders and investors the chance to interact with other users and even more important, follow their favorite traders and their market activity. This gives them an opportunity to benefit from other investors’ knowledge and keep a keen eye on a select number of fellow traders as opposed to getting lost in the jungle of the market.
Another major advantage of this activity is the copytrade function, which gives traders the chance to copy the activity of fellow traders that they wish to follow. So if you, as an investor, are not confident in your ability to make trading decisions, you can rely on someone else’s knowledge and experience and simply copy his actions.
eToro – a pioneer in the field
One of the pioneers and leaders of social trading is eToro. It was the first to recognize the power of social activity in online trading. eToro social trading platform is Openbook. It’s one of the most comprehensive online platforms available for investors and traders .. It offers all the important functions of social trading as well as some other helpful features. For example, it offers a people discovery tool to search for specific investors. Users then simply have to copy and choose a level of investment and eToro will continue to copy the market activity of that selected investor. It also has lists of the most successful and the most copied traders, helping to simplify the copytrade decision process.
A Win-Win Situation
These platforms are extremely popular with both novice and advanced traders. Novices find them extremely useful as they allow them to enter the world of trading with relative ease, by interacting with other traders and by copying experienced users activity. Successful, experienced traders benefit from the social aspect, because they earn extra money by allowing others to copy their activity. The platforms of course benefit by earning more users. All in all everybody wins.
Continuing to Grow
Online social trading rose to prominence in 2010 and it shows no sign of slowing down. Brokers see this offering as an effective way of acquiring new clients and maintaining old clients and the traders see them as a great way to get started in the financial world.
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