cTrader Copy is a powerful, fully integrated feature within the cTrader ecosystem designed as a flexible social trading and investment platform. It enables users to automatically copy the trading strategies of experienced providers, while also allowing successful traders to offer their own strategies for others to follow. This creates a collaborative environment where knowledge and strategy can be shared seamlessly.
The platform is built to be an easy-to-use and reliable solution, featuring a transparent fee structure and open access to strategy performance history. This allows for an informed and straightforward copying process, ultimately enhancing the overall trading experience. By logging into the cTrader web application with a cTrader ID, any trader can explore the Copy section, compare available strategies, allocate funds, and begin copying a chosen strategy in just a few clicks. There is no long-term commitment required, and participation is available to any trader whose broker supports the cTrader Copy feature.
Key Terminology of Copy Trading
Before diving in, it's important to understand the common terms used within the cTrader Copy environment.
- Strategy: This refers to the aggregated trading actions of a strategy provider, which are made available for investors to copy under a specific set of conditions.
- Investor: A trader who allocates a portion of their capital from their trading account to automatically copy the trades of a chosen strategy.
- Copy-trading Account: A separate account that is created when an investor allocates funds to copy a specific strategy. It exists under the same cTrader ID but is dedicated solely to that copying activity.
- Strategy Provider: A trader who makes their trading strategy available on the platform for other traders to copy.
How the cTrader Copy Mechanism Works
General Copying Logic
The core function of cTrader Copy is based on a simple principle: an investor allocates funds to mirror a specific trading strategy. These allocated funds are moved to a dedicated copy-trading account. This account is separate from the investor's main account and is used exclusively for replicating the trades of the chosen strategy provider.
Whenever the strategy provider executes a trade in their account, that trade is automatically replicated in the copy-trading accounts of all investors following that strategy. This includes modifications to existing positions.
Example:
If a strategy provider decides to partially close an open position on their account, the exact same proportional action will be executed in the investor's copy-trading account.
Important Note:
cTrader Copy does not support copying trades for stock or share symbols (e.g., AAPL, TSLA). While a strategy provider can still trade these instruments, their investors will not copy these particular trades.
The Equity-to-Equity Ratio Model
cTrader Copy employs an equity-to-equity ratio model to determine the volume of each trade that is copied. This ensures that the size of the positions in the investor's account is always proportional to the size of their investment relative to the provider's capital.
The volume for a copied trade is calculated using the following formula:Investor’s Equity / Strategy Provider’s Equity * Strategy Provider’s Volume
Example Calculation:
- Strategy Provider's Current Equity: $4,000 USD
- Investor's Equity: $1,000 USD
- Provider's Trade Volume: 4 lots
The copied volume for the investor is: 1,000 / 4,000 * 4 = 1 lot
This model automatically adjusts the volume of both open positions and future trades whenever there is a deposit or withdrawal made by either the strategy provider or the investor.
Warning:
It is crucial to understand that due to differences in trading conditions and execution times between brokers, the entry and exit prices achieved by the investor may differ from those of the strategy provider.
When Trades May Not Be Copied
There are specific scenarios where a strategy provider's trade will not be replicated in an investor's account:
- Insufficient Funds: The investor's copy-trading account does not have enough free margin to open the position.
- Instrument Unavailability: The investor's broker does not offer the specific trading instrument that the provider is using.
- Insufficient Leverage: The investor's account has a lower leverage setting than the provider's, making it impossible to copy the trade size without exceeding margin requirements.
Managing Funds and Account Balances
Deposits and Withdrawals
The equity-to-equity model dynamically accounts for all deposits and withdrawals. This means position sizes are continuously adjusted to remain proportional to the current amount of capital each party has invested.
Warning for Investors:
A strategy provider depositing or withdrawing funds from their account while they have open positions will directly impact the size of the copied positions in investors' accounts, which can potentially lead to losses or unexpected position sizing.
Investors can add or remove funds from their copy-trading accounts at any time. Adding funds will increase the size of copied positions, while withdrawing funds will decrease them. It is important to note that an investor cannot withdraw funds below the strategy's minimum investment requirement while copying is active. To withdraw all capital, an investor must first stop copying the strategy.
Understanding Copy Trading Exceptions
When you begin copying a strategy, all existing open positions held by the provider will be opened in your copy-trading account at the current market price. From that point forward, all actions are copied.
However, certain exceptions to the copying mechanism can occur:
- Minimum Volume: If the calculated copy volume is smaller than the minimum trade size allowed by your broker, the trade will be executed at your broker's minimum allowed volume step.
- Maximum Volume: If the calculated copy volume exceeds the maximum trade size permitted by your broker, the trade will not be executed.
- Market Hours: If the market for a specific symbol is closed, a position for that symbol will only be opened once the market reopens.
- Insufficient Margin: If your account lacks the necessary margin to open a position, it will not be copied.
Frequently Asked Questions
What is the minimum investment required to start copy trading?
The minimum investment amount is set individually by each strategy provider. You can view this requirement, along with other strategy details, on the provider's profile before you decide to invest. It can be as low as $100 for some strategies.
Can I stop copying a strategy at any time?
Yes, you have full control. You can choose to stop copying a strategy at any moment. Once you stop, no new trades from that provider will be copied, and your existing copied positions will remain open in your account for you to manage independently.
How are fees handled on cTrader Copy?
cTrader Copy operates with a transparent fee system. Strategy providers may charge a performance fee, which is a percentage of the profits generated in your copy-trading account. All applicable fees are clearly displayed before you commit to copying a strategy.
What happens if the strategy provider makes a deposit or withdrawal?
The equity-to-equity model will recalculate the size of all open positions and future trades based on the new balance. This adjustment happens automatically but can change the risk profile of your investment, so it's important to monitor your account.
Why wasn't a specific trade from my provider copied?
A trade may not be copied due to several reasons: your account lacked sufficient margin, the trading instrument was not available with your broker, your leverage was too low, or the calculated trade size fell outside your broker's minimum/maximum volume limits.
Is copy trading considered a guaranteed way to make profits?
No, copy trading does not guarantee profits. It is a form of investing that carries significant risk. The performance of your investment is directly tied to the performance of the strategy provider, and past performance is not a reliable indicator of future results. You can lose money.