As mentioned before, there are two types of copiers on the market. The first is investment platforms that allow you to track selected investors within their own software. In this section, we will now describe the process of copying traders using the example of an application that functions as a separate program. We describe the operation of the copier built into the broker in the second part of the entire article.
The transaction copier has two main roles by definition:
► It acts as an intermediary between the signal provider (the trader we want to copy) and the Investor who will follow the above-mentioned person.
► It secures the copying process in terms of technology. Thanks to it, all activities are performed automatically. It also scales the deal size.
Let's imagine a situation where we have 1,000 EUR in our account, but we want to follow a Trader whose investments are 100,000 EUR. A transaction of 1% of his capital will be for our entire deposit. Of course, we cannot afford such a move. In case of failure, we will lose all money.
It is for this reason that we need to copy trades proportionally. The copier takes care of this automatically. It's up to you to configure it carefully.
How does it work in practice?
► When an investor we follow opens a position, his Broker sends a signal to the copier.
► The copier receives information about a new transaction.
► The copier verifies the state of our account and compares it with the system settings.
► The copier sends a signal to our broker to open a new trade. It will be appropriately modified so that it corresponds to the amount of our investment capital.
► The broker accepts the order and trades on our behalf.