Mirror trading is a type of trading strategy that many people claim allows you to make money in the forex market even without having any time to trade and without any experience. However, does it live up to the hype? Is it possible to make money with mirror trading?
Mirror trading is profitable because it allows beginners to make money in the stock market without any prior experience. You will be mirroring the strategy of a successful trader to make money hands-free, and it allows you to save time while starting with a small investment.
Today, I will help you understand what mirror trading is and how it differs from similar trading types (specifically, copy trading and social trading). I will also help you understand why mirror trading is profitable and the benefits of mirror trading, so let us get into it.
IMPORTANT SIDENOTE: I surveyed 1500+ traders to understand how social trading impacted their trading outcomes. The results shocked my belief system! Read my latest article: ‘Exploring Social Trading: Community, Profit, and Collaboration’ for my in-depth findings through the data collected from this survey!
Table of Contents
What Is Mirror Trading?
Mirror trading involves mirroring the trades of successful traders. You will usually do this by creating an algorithmic strategy based on the trades of a successful trader or, more often than not, several very successful traders. You are not creating this strategy yourself, which would be way too much work for a beginner who does not know anything about trading. Rather, the mirror trading platform you use will be doing this for you.
Mirror Trading vs. Copy Trading vs. Social Trading
While the three terms mirror trading, copy trading, and social trading are often used interchangeably, the truth is that there are some slight differences between these three types of trading strategies. I will help you understand the differences between these three trading strategies and why mirror trading or another trading type might be better for you.
This short video is a great introduction to mirror trading:
Mirror Trading
Mirror trading involves using an automated system to make trades for you based on an algorithmic trading strategy that considers things like indicators. This trading strategy is usually based on successful traders’ trades, which have worked in the past and will probably work in the future.
Mirror trading isn’t perfect, but it puts your finances in the hands of algorithms qualified to handle various investments without losing too much money. It’s trusted by many beginners who want to slowly profit without risking their savings.
Copy Trading
Copy trading is a bit more refined than mirror trading. With copy trading, you are not using an algorithm to automate your trades, but rather copying a specific trader’s trades. For example, if they buy Bitcoin at the $40,000 mark, you will do the same in almost real-time. The delay has to be almost non-existent for this to work, but copy trading platforms take care of that for you.
You might prefer to copy a real trader instead of an algorithm because a real human can sometimes make decisions that an algorithm can not. Copy trading typically means you need a lot more money to put down since you’ll often times mimic high-dollar-risk trades of advanced traders.
For example, the algorithm might say to do one thing, but the trader might have read a recent news article that tells them that the algorithm might be wrong this time. On the other hand, copy trading has a disadvantage in that humans can make mistakes based on emotions.
Social Trading
Social trading is similar to copy trading. However, it does not necessitate copying a trader’s trades in real-time. Instead, you can follow a trader or various traders, then place trades yourself based on what that trader or traders are doing. Social trading is a bit broader than copy trading and also gives you a chance to make your own decisions and learn on the go.
Who Can Make Money With Mirror Trading?
Anyone can make money with mirror trading, as it opens the doors of trading to everyone, regardless of how much time you have or how much trading experience you have. Just deposit the money you want to invest, and the system will do the rest for you automatically.
6 Reasons Why Mirror Trading Is Profitable
In this section, you will learn why mirror trading is profitable and why you might want to choose mirror trading instead of regular trading.
It Saves Time
Mirror trading saves a lot of time. You won’t have to stare at your screen all day, deciding when is the best time to buy or sell a currency pair or spend time learning how to use indicators or set up a trading strategy.
You also won’t need to follow the news and try to figure out how it will affect a currency pair’s future. Mirror trading is perfect for people who want to make money with forex or other security markets but have very hectic and busy schedules.
You Don’t Need Any Experience
Another reason mirror trading is so awesome is that you do not need any trading experience to make money. Mirror trading will do everything for you automatically, including making the strategy that governs your trading, thereby leaving nothing to do except to provide the money.
You Are Not Relying on Emotions
A trading algorithm will do everything based on logic, rather than emotion, and what has worked in the past. Real-life trading, on the other hand, is not like that. You might be afraid you will lose your investment, so you sell early in a panic. If you hold, you might earn money after the dip gets corrected.
Fear of missing out and greed are other emotions that can wreak havoc on your trading success. If you put a lot of hope into one trade and see that it is going down, you might not sell and get out sooner rather than later. Instead, you might keep your money there, hoping it will go back up because you are emotionally attached to that trade, only to find that it never goes back up.
You Are Not Relying on One Trader
With copy trading, you are relying on one trader. This has some benefits since that trader is a human and can make human decisions that an algorithm can not. However, it also has its disadvantages, as all humans are potentially susceptible to bad trades based on emotions. You might want to diversify your investments and use both copy trading and social trading, in addition to mirror trading. Mix it up, so you get the most success. Don’t put all of your eggs in one basket.
It Is Easy To Trade
Mirror trading is one of the best ways to make money with trading because it is so easy. The entry barrier is almost non-existent and it is one of the easiest ways to make money in the forex and other financial markets, along with copy trading. Both are great for people who know nothing about forex. Anyone can make money with mirror trading and copy trading, including you! You don’t need to be an expert trader.
Risks Are Lower
There is always a risk involved in trading, regardless of how good of a trader you are. However, if you are a beginner trader, the risks will be higher simply because you don’t know what you are doing. With mirror trading, you won’t run into the same problems, thus reducing your risk.
Author’s Recommendations: Top Trading and Investment Resources To Consider
Before concluding this article, I wanted to share few trading and investment resources that I have vetted, with the help of 50+ consistently profitable traders, for you. I am confident that you will greatly benefit in your trading journey by considering one or more of these resources.
- Roadmap to Becoming a Consistently Profitable Trader: I surveyed 5000+ traders (and interviewed 50+ profitable traders) to create the best possible step by step trading guide for you. Read my article: ‘7 Proven Steps To Profitable Trading’ to learn about my findings from surveying 5000+ traders, and to learn how these learnings can be leveraged to your advantage.
- Best Broker For Trading Success: I reviewed 15+ brokers and discussed my findings with 50+ consistently profitable traders. Post all that assessment, the best all round broker that our collective minds picked was M1 Finance. If you are looking to open a brokerage account, choose M1 Finance. You just cannot go wrong with it! Click Here To Sign Up for M1 Finance Today!
- Best Trading Courses You Can Take For Free (or at extremely low cost): I reviewed 30+ trading courses to recommend you the best resource, and found Trading Strategies in Emerging Markets Specialization on Coursera to beat every other course on the market. Plus, if you complete this course within 7 days, it will cost you nothing and will be absolutely free! Click Here To Sign Up Today! (If you don’t find this course valuable, you can cancel anytime within the 7 days trial period and pay nothing.)
- Best Passive Investment Platform For Exponential (Potentially) Returns: By enabling passive investments into a Bitcoin ETF, Acorns gives you the best opportunity to make exponential returns on your passive investments. Plus, Acorns is currently offering a $15 bonus for simply singing up to their platform – so that is one opportunity you don’t want to miss! (assuming you are interested in this platform). Click Here To Get $15 Bonus By Signing Up For Acorns Today! (It will take you less than 5 mins to sign up, and it is totally worth it.)
Conclusion
Mirror trading can be very profitable. It is one of the easiest ways for beginners to profit in the forex market without any experience. It is also one of the best ways to profit when you do not have enough time to trade. I recommend all beginners get started with mirror or copy trading.
BEFORE YOU GO: Don’t forget to check out my latest article – ‘Exploring Social Trading: Community, Profit, and Collaboration’. I surveyed 1500+ traders to identify the impact social trading can have on your trading performance, and shared all my findings in this article. No matter where you are in your trading journey today, I am confident that you will find this article helpful!
Affiliate Disclosure: We participate in several affiliate programs and may be compensated if you make a purchase using our referral link, at no additional cost to you. You can, however, trust the integrity of our recommendation. Affiliate programs exist even for products that we are not recommending. We only choose to recommend you the products that we actually believe in.
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