If you’re a passive investor who wishes to enjoy the gains in the stock market without having to spend years analysing and studying market movements, then copy trading is for you. Through copy trading, you can simply copy more experienced traders and make the same gains as them. Based on their years of trading the market, the trader you choose to copy will then determine what assets you buy and sell.
In this guide, we review some of the best copy trading platforms in the UK for 2021 and walk you through the process of copy trading.
In This Guide
There are a variety of copy trading platforms that you can use, and each of them has its own USP. Your choice of a copy trading app will depend on your level of experience and your requirements. A detailed review of each platform, enabling you to analyze and choose from the best copy trading platforms, has been given below, but here’s a quick list for you to get started:
When you are trying to choose the right copy trading platform to suit your needs, there are several things you need to consider.
After reviewing several copy trading platforms that are available, we have identified the best platforms, which can be found here.
Make no mistake about it, if you’re searching for the best copy trading platform in the UK, eToro is an easy winner. They have millions of customers, most of whom utilise the eToro copy trading feature, which is one of the most straightforward processes among copy trading platforms.
Another added advantage of eToro is that they have a very large social community that regularly shares insights and advice regarding securities to invest in and copy traders to follow.
It is free to open an account with eToro, and once you have done so you will have access to the thousands of traders who have signed up for the copy trading platform. They have a filter system that will allow you to reduce this sample size by narrowing them down through average gains, asset classes, and the average duration for them holding their trades.
Once you have shortlisted a few traders, you can then begin to research them more in-depth. eToro allows you to look at a particular trader’s portfolio to see how they’re doing on each trade, check what their returns have been on a monthly basis, and also shows you the risk appetite of the trader. It provides you with all the information you need to decide whether or not to invest with a particular trader.
Once you have selected a trader that you wish to copy, then it is as simple as selecting the amount and investing. The minimum amount that you need to invest is $200 (approximately £140).
Nevertheless, eToro allows you to invest with no management fees and charges zero commission, which is why it stands out as the best copy trading platform in the UK. They also have an education centre that has PDF guides allowing you to better understand their platform and the stock trading market.
eToro allows you to trade on a variety of asset classes, such as stocks, ETFs, cryptocurrencies, forex, indices, and commodities. You will have to pay a 0.5% forex fee if you choose to deposit money into your account in another currency besides GBP, but all asset classes can be traded easily with no commission. Once you have created your account, you will then have to verify your identity and address.
You can do these by uploading a copy of your passport and your utility bills/bank statements respectively. Once this is done and your account has been verified, you can add money on eToro through a debit card, bank transfer, as well as most online wallets such as PayPal. eToro is registered with the FSCS and is regulated by the FCA, therefore you can rest assured that your money is safe in their hands.
User-friendly trading platform A large number of clients and a very active social network to share insights and discuss market events Several asset classes to trade including stocks, CFDs, ETFs, cryptocurrencies, and forex No commissions or management fees Easy deposits and withdrawals Regulated by the FCA and registered with the FSCS
Not suitable for advanced technical analysis
67% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money
Meta Trader 4 (MT4) is one of the most used third-party platforms for online investment, and this is because of the plethora of tools that it offers for the implementation of specific strategies. Due to the advanced tools and indicators that it offers, the platform is one that is highly preferred by seasoned day traders. This also means that while copy trading with MT4, you will have the opportunity to copy seasoned traders who base their trades on technical analysis.
The platform is particularly suitable for forex trades, due to their EA’s (Expert Advisors). Once you have downloaded the software file and installed it on the MT4 platform, the EA will trade on your behalf. This will allow you to continuously trade during the day without having to do the research, as your EA will spot trading opportunities and trade on them.
The only major drawback of using MT4 is that it does not offer its own EA’s, so you will have to spend some time online researching and finding the right EA whose requirements and trading style fit within your risk parameters.
In addition to this, MT4 is not a broker, merely a trading platform. This means that you will have to find a broker that not only supports MT4 and EA’s but also charges the lowest fees. Capital.com is arguably the best broker to use with the MT4 automated trading platform, due to its tight spreads. There are very low commissions, and it is very easy to add money to your account through a debit or credit card. They also offer demo accounts that you can use to test out your strategies in a risk-free manner first.
Demo Account to test out EAs in a risk-free manner Tight spreads Low to no commissions
Does not offer a lot of other asset classes other than forex.
Your capital is at risk
The MT5 platform is a younger version of MT4 and therefore, it works in a very similar manner. However, instead of offering just forex tools, it also offers tools that you can use in order to trade CFDs too. However, it still does offer support for EA’s and a wide variety of technical indicators that are used by traders, and it contains several advanced charting tools.
However, MT5 offers a copy trading feature too, in addition to their EA’s. This feature is called mirror trading, and how it works is that you can browse through the traders on the platform, look into their trading style and pattern, and then elect to copy their ongoing trades. There is, however, a monthly subscription fee for this that MT5 charges in exchange for giving you access to the trader’s trading history on an ongoing basis.
Just like MT4, MT5 is also just a trading platform and not a broker, and you will therefore have to find another broker that is compatible with the MT5 software. One of the best MT5 brokers that we have found is the CFD broker Libertex. It allows you to trade commission-free on most CFDs.
if you wish to trade other asset classes, then the commission is usually below 0.1%. You can deposit as little as $100, and this can be done through either your credit/debit card, a bank transfer, or any e-wallet.
Zero spread trading on CFDs Competitive commissions starting at 0% per trade Good choice of educational resources Established broker with a great choice of markets
Offers CFDs and not traditional stocks
Visit Libertex Now
83% of retail investors lose money trading CFDs at this site.
Avatrade is a broker that is compatible with a variety of trading platforms and allows you to trade on several financial markets on a commission-free basis. They have very light spreads on the major forex pairs such as USD/GBP and EUR/GBP as well as the principal commodities such as gold.
Once you have created and verified your account, the minimum deposit that you need is £500. After that, you need to select a trading platform, find a trader to copy, and then sit back. Your chosen trader will then buy and sell assets, and the profits of this trading will be reflected in your own account.
The best trading platform to use with Avatrade is ZuluTrade. It is quite similar to eToro and is very suitable for newbies. The process is also quite similar, as you have to choose a trader to copy from a selected list of traders. They provide a host of information that will assist you in selecting the trader whose trading patterns match your financial goals. There are more than 10,000 copy traders to choose from.
The major drawback of using Avatrade through ZuluTrade is that it is not a regulated trading platform, so your capital might be at some risk.
ZuluTrade also has a profit-based commission that you have to pay, which means that in case you suffer a loss, you will not have to pay any fees. Excluding certain mitigating circumstances, this is generally 20% of the profits earned. For example, if you invest £1,000 and make 10% on your investment, that would be a profit of £100. 20% of this would be £20, and therefore you would have net gains of £80.
Is compatible with ZuluTrade, MT4, and MT5 Commission-free platform Wide variety of traders to copy Educational materials to learn and increase awareness
Offers only CFDs and not traditional stock ownership
Visit Avatrade Now
Your capital is at risk.
IG Markets offers perhaps the widest choice of financial instruments that you can trade on. With other 16,000 shares from companies across different countries and sectors combined with commodities, currencies, indices, and cryptocurrencies, they offer the opportunity to invest in assets worldwide.
Their copy trading service works in much the same way as eToro, wherein you can create an account, deposit money through your credit/debit card or bank transfer, and then you are presented with a list of traders that you can copy.
After researching the traders, you can then select the one that matches your needs the best, and begin trading. The minimum investment required on IG Traders is £250. They also allow you to set up a demo account and see how you would perform with a particular strategy or trader without investing real money. They have minimum commissions on most asset classes, and the IG platform is compatible with MT4 as well.
Wide variety of asset classes Several markets worldwide Low commissions and tight spreads Low minimum investment FCA and FSCA licensed
High minimum contract sizes
A table showing the available assets and fee structure for each of the platforms discussed above has been given here for ease of reference:
Copy trading is exactly what its name suggests: it is a mechanism that allows you to copy another trader. For example, if the trader you are copying decides to buy stocks such as Facebook shares, your portfolio will buy Facebook shares too. The amounts will differ in direct proportion too.
Basically, copy trading is a way for you to actively trade without being an active trader because you outsource research, market analysis, and placing orders to another trader, and enjoy all the profits from their analysis. This is done in the same proportion as the trader’s portfolio. For example, suppose you invest $2000 in a copy trading platform with a trader.
If that particular trader invests 10% of their portfolio going long on Facebook, the same proportion will be applied to your account. Hence, you will spend $200 going long on Facebook. If there is a 20% gain on this trade, you will have gains of 20%*200 = $40.
Since copy trading is literally just copying another trader’s trades, there is no restriction on the assets that you can use for copy trading. Whatever assets are available at your copy trading platforms can be used for this purpose. Most copy trading platforms allow you to trade forex, whereas most have stock and crypto options too.
Most people who wish to trade forex do so through the MT4 and MT5 platforms, and therefore it stands to reason that the best forex copy trading also happens through these platforms. Through the use of MT4 or MT5 platforms, you can either get an EA, a bot or simply copy trade any trader that you think is good at what they do and matches your criteria.
Very few platforms allow you to trade actual stocks through copy trading, and eToro is among them. Most other platforms such as Avatrade just offer stock CFDs. Stocks copy trading works the same way as any other copy trading, and the commissions are generally lower because of the high level of liquidity.
Crypto copy trading is less common, and only more frequently found on platforms such as eToro. This is usually associated with the highest margins or commissions due to there being fewer such platforms, increasing regulatory requirements, and lower levels of liquidity.
Reading our reviews above of the different kinds of platforms where you can copy trade, you may have noticed that there are several different ways to go about the process. A brief description of each of the different copy trading systems has been given below.
The biggest and only true “all-in-one” trading broker is eToro, which allows you to buy, sell, and trade assets, all without commission. It is a broker as well as a trading platform, therefore you do not need to combine it with anything and can use it as is. All you need to do is simply set up your account, select a trader, and begin trading. Other copy trading platforms often only provide the platform and require you to combine them with another broker, such as MT4 and MT5 which are only platforms.
Another way of copy trading is not to copy trade a person, but instead, use a bot or an EA designed by a trader in order to execute your trades. There are several types of such algorithmic copy trading software that have been discussed above in detail. Basically, here a bot is given control of your portfolio and is allowed to trade on your behalf under certain constraints.
This is a much more moderate method of copy trading and one that is not so frequently used except by very experienced traders. In this system, if a trader spots an opportunity, they will then indicate that there is this opportunity to other traders on a group, usually online or on Telegram. The other traders will then analyse this to see if it is a good opportunity, and then they have the choice to either trade or not trade.
A similar form can also be set up in trading platforms, where the platform itself will notify you whenever a certain combination of conditions has reached. Then, you can analyse this to see whether or not you wish to trade on this signal.
There are thousands of traders that you can choose from in order to copy on the eToro platform, however since you are risking your money, it is important for the trader you choose to be an expert and have a track record of consistent profitability. Here are the three top traders you can choose to copy.
One of the most copied traders on eToro, Jay Edward Smith has among the highest average returns on the platform. HIs 2021 returns are close to 20.77%. He has an AUM of over $5 million, and over 28,000 people are copying him as of now.
While you can begin copying him with as little as $500 and withdraw your money at any point in time, he recommends that you invest at least $2,000 and keep it in for 2 years or more in order to get the optimal returns on your investment. He invests in a combination of stocks, commodities, cryptocurrencies, and indices, however, his primary focus is on stocks. He’s known for not using a lot of leverage and trading with a combination of technical, fundamental, and sentimental analysis.
One of the most popular forex traders on eToro, Olivier has his portfolio made up almost entirely of currencies.
Since the returns on forex trading are not very high, he aims for a profit of 1% every month, which would give an annual 12.6% return. With close to 8,000 copiers and more than $5 million in AUM, Olivier has a very low-risk rating, which means he is a risk-averse trader. His minimum copy recommendation is $500, and he recommends holding it for at least a year so that you can get optimal gains.
With over 21,000 copiers and a return of 18.37% in 2021 so far, Heloise mainly dabbles in stocks, with them making up 98.29% of her portfolio. The rest is divided between ETFs, indices, commodities, and cryptocurrencies. She has a very specific niche, and she mainly only trades pharma and tech stocks. Due to her specialised knowledge, she is able to employ advanced technical analysis to reduce risk and ensure good returns in the market. Her minimum copy-trade recommended amount is $1,000, and she managed over $5 million in AUM.
With eToro being the best copy trading platform UK in 2021, we have prepared a list of the steps that you need to follow in order to begin trading with eToro, which you can find below.
The first step towards eToro copy trading is to set up an account. As eToro is a regulated broker, you will need to enter your information and your contact details.
You will also have to provide your ID and address proof. For your ID proof, you can use any form of government-issued ID. For address proof, you will need to either upload your utility bill or a bank statement. Unlike most other copy trading platforms, eToro will usually verify your documents instantly.
The next step is to deposit funds into your eToro account. The minimum first deposit is $1,000, which you can add through your debit/credit card, bank transfer, or any e-wallets. Other than a bank transfer, both the other means will ensure that the funds are visible in your bank account immediately. The minimum investment per copy trader is $200.
The next step for you is to select a trader that you wish to copy. Click on the “Copy People” button, and begin filtering based on your requirements. For example, you could choose to only look at people who trade cryptocurrencies or have a minimum gain of 8% p.a. in the past 5 years. There are thousands of traders to choose from, and by clicking on any trader you can get more insights into how their trading history and pattern.
The last step once you have identified the trader(s) that you wish to copy, is to simply invest. By clicking on the invest button, you can decide what amount you wish to invest with them, and then sit back and enjoy your gains.
This guide has reviewed all the top copy trading platforms, from those that just provide a platform to those who are also brokers. They have been judged on the basis of the asset classes they offer, the fees they charge, and the number of traders they offer. While all of them are extremely worthy options, the single best choice that offers everything under one roof is eToro.
Not only is eToro regulated, but it is also trusted by over 20 million clients, which offers you a lot of trader options to copy. They have a seamless deposit and withdrawal process, alongside a very helpful community and educational guides.
Copy trading is basically copying another trader and taking on the same positions that they do so that you can benefit from their analysis and research. There are several platforms that allow you to choose from a host of traders to copy from, and this can be done across a variety of asset classes.
How copy trading works is that you choose a particular trader that you wish to copy, and then your traders are executed in the same manner and proportion as them. For example, if you invest $2000 with a trader, and they spend 10% of their portfolio shorting Tesla, then 10% of your portfolio ($200) will also be used to short Tesla. You will then get gains and losses in the same ratio.
Once you have selected to copy a trader, your platform will automatically open and close positions in sync with the trader that you have chosen to copy.
While there are several copy trading platforms that offer competitive services, eToro is by far the best trading platform for this purpose, because they are regulated and offer the widest variety of assets to trade from at no commission. It also gives you access to thousands of verified copy traders that you can choose from based on your needs.
Alan is the Chief Editor of TradingPlatforms.com. He is an experienced finance and investment writer who is an expert on the stock market.
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