What is Social Trading?

Social Trading has recently created some buzz among the traders and investors in the financial markets. Traders are always looking for new data that can be successfully processed into meaningful trading signals as part of their trading strategies. Social trading can provide such signals depending upon the social sentiments of a group of people.

One way to generate trading signal can be to collect the data on social sentiments from social media platforms like Facebook, Twitter, LinkedIn, etc. This way of signal trading on social signal has been going on for some time now.

There is another form of trading based on the social signal which is slowly gathering momentum. In this form of Social Trading, companies like eToro have created a dedicated social platform where one can post, share, like anything related to trading and based on the social sharing and response of the people on any particular instrument, he can make his decision to buy or sell. So, in this case, that signal generation happens from within the eToro platform. eToro even shows current social sentiment of particular stocks, currency pair, cryptocurrencies, commodity, ETF, etc.

There is a whole lot more that can be achieved with such trading platforms. One can actually copy the trading strategy of any person he/she likes depending upon his preferred style of trading. Before copying a trader you can visit his profile and check his risk appetite, past performances of his portfolio, the breakdown of his portfolio, most traded stocks, currency pair, etc.

Another amazing feature of social trading on eToro is CopyFunds. There many funds within the eToro platform. These funds are the collection of the trading strategies of various traders on the platform. So, for example, there can be a fund that is made from top 10 copied traders on the platform. Or there can be a fund which is a collection of all the traders with less than 5 POINTS on risk profile and more than 50% return in last 12 months. There can be several more examples like that.

Here is a demo of my eToro trading account and how I trade using a social trading platform. If you ever wanted to know what is inside social trading platform then this video is the best place for you.

The social trading platform also has features like sharing your chart analysis directly on your wall that other can see and comment just like social media platforms like Facebook.

So here is a recap of most important Features:

  • Share, Likes, Comments about your charts, analysis and recommendations within the platform.
  • Know if others are bullish or Bearish with Real Time Social Sentiments.
  • Copy Trading Strategies of other Traders and benefit from their knowledge.
  • Copy Funds which are a collection of trading strategies of different traders.

To start social trading today with an eToro account, click HERE.

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Hitesh Anand

I am a post graduate from Newcastle University, UK. I like studying and analyzing economic data and financial health of world.

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