Economy
Copying Your Way to Forex Riches: The Copy Trading Advantage
The world of forex is vast and can be confusing for beginners, but we don’t think this should be the case. It’s appealing to many because it promises greater financial freedom, a clear alternative to the traditional 9–5 working day, and the potential for large profits. However, navigating it can be challenging and requires a lot of learning, which can dissuade some novices.
That being said, there are ways to make the initial immersion process more manageable. One of these strategies involves copying traders with more experience, providing insight into their thinking and rationale. In this article, we’ll look at the copy trading method in more detail.
The Forex Landscape
Before getting too involved in the specifics of copy trading, we first need to run through the basics of forex trading and where the market is. In case you’re unaware, forex stands for foreign exchange and refers to the currency trading marketplace active worldwide and in many different countries. Unlike the stock market, the forex market is open all day during the week, making it easier for traders to access markets on the other side of the world and make more reactive moves.
Not only is it highly active, but the forex market is also the most liquid trading market, with a daily trading volume of over $6 trillion. This means there is potential for a fortunate few to make a considerable amount of money in a very short time, but this also comes with risks, and understanding the global market conditions is vital for success. This can be quite overwhelming for a novice trader. This is where copy trading can come in particularly useful and interesting.
What Is Copy Trading?
Because this isn’t a technique that’s super well-known among most forex traders, we’ll give you a brief understanding of what it is and how it works. In short, copy trading involves copying the moves made by more experienced traders in real time without making many decisions yourself. This method — also known as social trading or mirror trading — can be done automatically using various tools. It removes some of the risk associated with forex trading but may require more capital than usual.
How Does Copy Trading Work?
First, you’ll choose a reputable platform or copy-trading facilitator. These providers will connect you with traders and investors who are open to having their trades copied. Think of it as a marketplace of sorts. Next, you’ll want to choose a strategy that aligns with your trading goals. Each seasoned trader will have a style and level of risk that they’re comfortable with, so choose one that you think is the best fit — you can always change at a later stage.
Once you’ve settled on a trader you want to mimic and have decided on a rough strategy, you’ll need to determine how much you’re willing to risk when placing trades. They don’t always need to be done at the same level, but you should always check this beforehand. A seasoned trader will likely have more money to spend than a beginner or novice. You’ll then need to set your open and close positions in place, which will be synced to your chosen trader and done instantaneously.
Finally, you should regularly reflect on how your trades have performed and assess your overall strategy. Monitoring your bottom line and adjusting when needed is a skill that will be especially useful moving forward and will allow you to become a seasoned trader, but it will take time to master.
Risks and Considerations
While copy trading can have the potential to generate huge returns for traders looking to copy the actions of somebody with a lot more experience, there are still a few things you should be aware of. One of the most significant is the risk of loss and your overall risk tolerance, as this can derail your activity if you are prone to pulling out your capital before your trades have had the chance to come to fruition. A successful trader will know when to trust their guy and avoid panicking — this will take time to get right.
Copying a trader with a diverse portfolio is also something worth considering, as it will help shield your trades from industry-specific events that have the potential to ruin all of your hard work. Many successful traders will always have a diverse portfolio containing short and long-term investments. At the same time, they will actively review this at regular intervals to ensure that they have the balance just right. When they look to diversify further, they will always do their due diligence, which you should also do.
Conclusion
Copy trading has the potential to change how traders get into the world of forex, which will be sure to have a positive impact long term. It will allow beginners to find their feet and place real trades without the risks associated with being a novice, all because they’ll have a seasoned trader as a reference point. If you’re a newbie and want to try this, let us know how you get on.
By Adedapo Adesanya
Crude oil went down on Tuesday after a projection showed steady demand in the world’s largest oil producer, the United States, for 2025, Brent futures declining by $1.09 or 1.35 per cent to settle at $79.92 a barrel and the US West Texas Intermediate (WTI) crude losing $1.32 or 1.67 per cent to finish at $77.50 a barrel.
On Tuesday, the US Energy Information Administration said the country’s oil demand would remain steady at 20.5 million barrels per day in 2025 and 2026, with domestic oil output rising to 13.55 million barrels per day, an increase from the agency’s previous forecast of 13.52 million barrels per day for this year.
Also, the oil market shrank a few days after prices gained following new US sanctions on Russian oil exports to India and China.
On Monday, prices jumped 2 per cent after the US Treasury Department on Friday imposed sanctions on Gazprom Neft and Surgutneftegas as well as 183 vessels that transport oil as part of Russia’s so-called shadow fleet of tankers.
Analysts say this move could have a significant price impact on Russian oil supplies from the fresh sanctions, however, their effect on the physical market could be less pronounced than what the affected volumes might suggest.
ING analysts estimated the new sanctions had the potential to erase the entire 700,000 barrels per day surplus they had forecast for this year, but said the real impact could be lower.
Uncertainty about demand from China, the world’s largest oil importer, could impact tighter supply this year.
China’s crude oil imports fell in 2024 for the first time in two decades outside of the COVID-19 pandemic, official data showed on Monday.
Meanwhile, the American Petroleum Institute (API) estimated that crude oil inventories in the US fell by 2.6 million barrels for the week ending January 10.
For the week prior, the API reported a draw of 4.022 million barrels in US crude oil inventories amid build season, while product inventories saw a hefty build.
In 2024, crude oil inventories dropped by more than 12 million barrels, according to the API’s inventory data. In the first few weeks of 2025, crude inventories have shed more than 6.6 million barrels.
Official data from the US EIA will be due later on Wednesday, confirming the actual level of stockpiles.
By Dipo Olowookere
The Nigerian Exchange (NGX) Limited came under heavy selling pressure on Tuesday, going down by 1.66 per cent as investors embarked on profit-taking after most stocks on the trading platform gained in the past few trading sessions.
It was observed that the industrial goods sector was the most affected yesterday as it went down by 4.99 per cent due to the decline suffered by Dangote Cement and others.
The insurance continued its downward trend during the day as it lost 2.80 per cent, the consumer goods counter fell by 0.27 per cent, and the banking index shed 0.10 per cent, while the energy sector appreciated by 0.29 per cent.
At the close of business, the All-Share Index (ASI) deflated by 1,745.16 points to settle at 103,622.09 points compared with the previous trading day’s 105,367.25 points and the market capitalisation moderated by N1.1 trillion to finish at N63.188 trillion versus Monday’s N64.252 trillion.
Business Post reports that investor sentiment remained weak on Tuesday after the bourse ended with 41 depreciating equities and 23 appreciating equities, representing a negative market breadth index.
Honeywell Flour lost 10.00 per cent to trade at N9.54, Dangote Cement declined by 9.98 per cent to N431.00, Julius Berger crashed by 9.98 per cent to N139.80, Sovereign Trust Insurance decreased by 9.68 per cent to N1.12, and Prestige Assurance tumbled by 9.30 per cent to N1.17.
On the flip side, Northern Nigerian Flour Mills appreciated by 10.00 per cent to N45.10, Livestock Feeds grew by 9.91 per cent to N6.10, Academy Press expanded by 9.90 per cent to N3.22, University Press increased by 9.82 per cent to N4.81, and Neimeth gained 9.76 per cent to quote at N3.15.
During the session, market participants bought and sold 503.3 million shares valued at N12.6 billion in 12,900 deals compared with the 505.8 million shares worth N8.1 billion traded in 14,259 deals a day earlier, indicating a rise in the trading value by 55.56 per cent and a drop in the trading volume and number of deals by 0.49 per cent and 9.53 per cent, respectively.
The most active stock for the session was GTCO with 54.4 million units worth N3.2 billion, Nigerian Breweries transacted 32.2 million units for N1.0 billion, Universal Insurance traded 30.8 million units valued at N22.6 million, AIICO Insurance exchanged 26.6 million units worth N47.2 million, and Chams transacted 20.0 million units valued at N40.9 million.
By Adedapo Adesanya
The federal government is offering two new savings bonds with interest rates between 17 and 18 per cent through the Debt Management Office (DMO).
In a statement by the agency, the country said retail investors can purchase the two-year bond maturing in January 2027 at 17.23 per cent interest, while the three-year paper maturing in January 2028 at a coupon rate of 18.23 per cent.
Bonds are very safe financial instrument that serve as investments because they are backed by the federal government, which promises to pay back the money.
According to the DMO, people can buy these bonds starting January 13, 2025, until January 17, 2025, with allotment expected on January 22, 2025, and the interest to be paid to investors every three months – in April, July, October, and January.
These bonds have some special features. They are tax-free under both company and personal tax laws.
Big investors like pension funds and trustees are allowed to buy them and each bond costs N1,000 each.
However, interested investor can only buy at least N5,000 worth, and can’t buy more than N50 million.
This comes after the Ms Patience Oniha-led debt office said the Nigerian government was offering three bonds worth N150 billion in September 2024.
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