Best Copy Trading Platforms

What is copy trading?

Copy trading is an investment method that allows traders, whether beginners or experienced, to automatically replicate the strategies of other, more seasoned investors. This approach is particularly popular in CFD (contracts for difference), cryptocurrency, Forex and stock trading.

How copy trading works

The principle of copy trading is simple: an investor (called a "copier") selects an experienced trader (called a "strategy provider") and configures their account to automatically replicate their positions. When a copied trader opens or closes a position, this action is replicated in real time on the copier's account, in proportion to the capital invested.

Why Choose Copy Trading?

Copy trading offers several advantages, including:

• Accessibility: It allows beginners to invest in the financial markets without needing advanced trading knowledge.
• Time saving: Investors do not need to analyse the markets themselves or make complex decisions.
• Diversification: It is possible to copy several traders and thus spread the risks.
• Progressive learning: By following the strategies of experienced traders, investors can understand the market mechanisms and refine their own trading strategy.

What is a copy trading platform?

A copy trading platform is an online service that allows investors to automatically copy the strategies of more experienced traders. These platforms act as an intermediary between professional traders (or strategy providers) and investors wishing to replicate their operations.

They offer risk management tools, performance tracking features and customisation options to adapt the copy trading strategy to your own financial goals.

Copy trading platforms work by connecting users' accounts to those of the traders they want to follow. Here are the main steps:

• Registration on the platform: the user creates an account and deposits funds.
• Selecting a trader to copy: they can filter traders based on their performance, risk level, trading style, and other criteria.
• Configuring parameters: the user chooses the amount they wish to invest and adjusts parameters like risk level or leverage.
• Automating transactions: once copy trading is activated, the positions of the selected trader are automatically reproduced on the investor's account.

Copy Trading and Social Trading: What are the differences?

Copy trading and social trading are often confused, but they have notable differences. Both allow investors to draw inspiration from the strategies of other traders, but their approach and operation vary.

• Copy trading is an automated process where an investor directly copies the trades of an experienced trader. Once the strategy is chosen, the orders are replicated without manual intervention.
• Social trading, on the other hand, relies more on the exchange of information and individual decision-making. Traders share their analyses, strategies and performance, but each investor manually chooses which transactions they want to execute.

What social trading solutions are offered by brokers in Ireland?

In Ireland, several brokers offer social trading and copy trading solutions to allow investors to follow and copy the strategies of experienced traders. These solutions are often integrated directly into trading platforms or accessible via specialised software. Here is an overview of the most popular software and the brokers that offer them.

How to choose a copy trading platform?

Choosing a copy trading platform is an essential step to maximise your chances of success while limiting risks. Several criteria must be taken into account to select the platform best suited to your needs and investor profile.

1. Regulation and security

When selecting a copy trading platform in Ireland, it's crucial to ensure that the platform is regulated by a reputable financial authority. In Ireland, the primary regulatory body overseeing financial services is the Central Bank of Ireland (CBI). The CBI supervises investment firms and ensures they adhere to strict standards, including the segregation of client funds and participation in investor compensation schemes.

Additionally, many platforms operating in Ireland are regulated under the Markets in Financial Instruments Directive II (MiFID II), a European Union directive that enhances investor protection and promotes market transparency. Under MiFID II, firms must implement measures such as negative balance protection and transparent fee disclosures.

It's also advisable to verify whether the platform is listed on the Central Bank of Ireland's register of authorised firms. Engaging with unauthorised firms can expose investors to significant risks, including lack of recourse in case of disputes or insolvency.

2. Available Traders to Copy

The diversity and quality of the traders offered are key elements. It is advisable to choose a platform that offers filtering tools to analyse the performance of the traders:

• Historical performance
• Risk level
• Trading strategy (short term, long term, scalping, etc.)
• Maximum drawdown

Some platforms also offer performance scores to make it easier for traders to choose who to copy.

3. Accessible assets and markets

Irish traders have access to a diverse range of financial instruments through various trading platforms. When choosing a copy trading platform, consider the variety of assets available to ensure alignment with your investment goals.

• Forex: Major currency pairs like EUR/USD, GBP/USD, and USD/JPY are popular among Irish traders. Platforms such as AvaTrade and eToro offer extensive forex trading options.
• Stocks: Investors can trade shares of both domestic and international companies. The ISEQ 20 index, for instance, includes prominent Irish companies like Ryanair, Kerry Group, and CRH.
• Indices: Global indices such as the S&P 500, FTSE 100, and DAX 30 are accessible, allowing traders to diversify their portfolios across different markets.
• Commodities: Platforms offer trading in commodities like gold, silver, crude oil, and natural gas, providing opportunities to hedge against market volatility.
• Cryptocurrencies: Digital currencies such as Bitcoin, Ethereum, and Ripple are increasingly popular. However, it's essential to note that cryptocurrency trading is subject to specific regulations, and traders should ensure compliance with local laws.

4. Fees and commissions

Copy trading platforms apply different fee structures, which can impact your profitability. Here are the main costs to analyse:

• Spread : difference between the buying and selling price of an asset
• Commission per trade : some brokers charge a percentage on each transaction
• Inactivity fees : fees may apply if you do not make transactions for a certain period
• Profit sharing : some platforms charge a percentage on the profits made through copy trading

5. Features and User Experience

A good copy trading platform should offer an intuitive interface and powerful tools to manage investments effectively. Key features to look for include:

• Demo mode: test the platform with a virtual account before investing real money
• Risk management tools: stop-loss, take-profit, adjustment of invested capital
• Advanced charts and graphs: real-time analysis of the performance of copied traders
• Mobile app: access investments on the go

6. Reviews and Reputation of the Platform

Checking user reviews and ratings on specialized sites like Trustpilot or trading forums provides an overview of the advantages and disadvantages of each platform. Favour those with a good reputation in terms of:

• Reliability of transactions
• Responsive customer service
• Ease of withdrawing funds

7. Customer Service and Support

Good customer support can make all the difference if you have a technical problem or a question about how copy trading works. Check:

• Contact channels (live chat, email, phone)
• Availability (24/7, opening hours)
• Support language (English)

What assets can you trade with copy trading?

Copy trading allows you to invest in a wide range of financial assets, depending on the markets offered by the chosen platform. Some assets are more suited to copy trading strategies due to their liquidity and volatility. Here is an overview of the main assets accessible via copy trading.

How to Practice Copy Trading with an Online Broker?

Copy trading with an online broker is a simple process that allows investors to copy the strategies of experienced traders. Here are the main steps to get started and optimise your copy trading experience.

1. Choose a Broker Offering Copy Trading

Not all trading platforms allow copy trading. It is therefore essential to choose a broker that offers this functionality and is regulated by a recognised financial authority (Central Bank of Ireland, CySEC, FCA, etc.). Some of the most popular platforms include eToro, ZuluTrade, MetaTrader 4/5 (with signals), DupliTrade and Myfxbook AutoTrade.

Criteria to verify before choosing a broker:

• Regulation and security of funds
• Available assets (Forex, stocks, cryptos, indices...)
• Fees and commissions applied
• Quality and number of traders to copy
• Risk management tools and platform ergonomics

2. Create an account and verify it

Once the broker has been selected, you need to open a trading account by providing personal information and carrying out KYC (Know Your Customer) verification, which consists of submitting:

• A valid form of identification
• Proof of address
• A payment method to deposit funds

Certain brokers allow access to a href="https://hellosafe.fr/investissement/trading/compte-demo">demo account, which is useful for testing the platform and its interface before investing real money.

3. Deposit funds into your trading account

After the account is validated, the investor must fund their trading account. Brokers generally offer several deposit methods:

• Bank card (Visa, Mastercard, etc.)
• Bank transfer
• E-wallets (PayPal, Skrill, Neteller, etc.)
• Cryptocurrencies (on some platforms)

The minimum deposit amount varies depending on the platform (from 50 to several hundred euros depending on the broker and the asset chosen).

4. Select a trader to copy

Choosing the trader to copy is a key step to succeed in copy trading. The platforms provide various criteria to analyze traders:

• Past performance (yield over several months/years)
• Risk level (the more risks a trader takes, the greater the variations in their capital)
• Strategy used (short term, swing trading, scalping...)
• Maximum drawdown (maximum loss recorded)
• Number of copiers and reputation

Certain platforms like eToro assign risk scores to traders, allowing you to assess the stability and reliability of their strategy.

5. Define the amount invested and adjust the parameters

Before copying a trader, the investor must decide how much they want to allocate to this strategy. Several risk management options are available:

• Fixed amount to invest: choose a specific amount that will be used to copy the trader
• Automatic stop-loss: define a maximum loss not to be exceeded
• Adjustment of the copy level: some platforms allow you to copy trades in proportion to the capital of the followed trader

6. Track and Adjust Your Copy Trading Strategy

Copy trading is a passive method, but it's recommended to regularly monitor the performance of the copied traders and adapt your strategy if necessary.

Best practices for optimising your copy trading:

• Diversify by copying multiple traders to limit risks
• Regularly check performance and adjust investments if needed
• Do not panic in the face of market fluctuations and remain consistent with your strategy
• Train in parallel to better understand how the market works

What are the fees of brokers offering copy trading?

Copy trading platforms apply different types of fees that can affect investor profitability. It is essential to understand these costs before choosing a broker, as they vary depending on the platforms and assets traded. Here is an overview of the main fees encountered in copy trading.

1. Spreads: an indirect cost on each transaction

The spread is the difference between the buying (bid) and selling (ask) price of an asset. It is an indirect cost that the broker automatically integrates into each transaction, which means that the investor must cover this cost before being profitable on a trade. The higher the spread, the higher the cost of trading.

Example of spread on copy trading

An investor copies a trader who opens a position on the EUR/USD with a spread of 1.5 pips. This means that the moment the position is opened, they are immediately at a slight loss equivalent to these 1.5 pips. If the market does not evolve sufficiently in their favour, the transaction may not be very profitable.

2. Transaction Fees: A Percentage or a Fixed Amount

Some brokers, in addition to the spread, apply a commission on each transaction made. This commission can be a fixed amount per order executed or a percentage of the amount invested. Brokers who use this model are often those who offer tighter spreads.

Example of copy trading commission

An investor copies a trader specializing in stocks. For each purchase or sale of a stock, a commission of 0.1% is charged.

• If they invest 1,000 on a stock, they will pay 1 in fees when opening the position.
• If they close this position later for 1,200, they will pay a commission of 1.20 again.

Thus, their total fees on this transaction will be 2.20.

3. Management or Performance Fees: A Portion of Profits Paid to the Broker

Some copy trading platforms levy a commission on profits made through copied positions. This model is generally used by brokers that offer professional traders to copy and apply a profit-sharing policy.

Example of management or performance fees

A broker applies a performance fee of 20% on the gains generated via copy trading.

• If an investor makes a profit of 500 by copying a trader, they will have to pay 100 to the broker (20% of 500).
• They will therefore have 400 net of fees.

This type of fee is often justified by the quality and expertise of the traders offered by the platform.

4. Inactivity fees: a cost for unused accounts

Brokers sometimes impose inactivity fees if a trading account remains inactive for an extended period (often 3 to 12 months). These fees are charged monthly as long as the user does not perform a transaction.

Example of Inactivity Fee

A broker applies an inactivity fee of 10 per month after 6 months of no trading activity.

• An investor who has not used their account for 8 months will have to pay 20 in cumulative fees.
• To avoid these fees, they can simply execute a trade before the deadline.

This type of fee is particularly important to monitor if you plan to use a platform occasionally.

5. Withdrawal fees: a cost to recover your winnings

Some brokers charge fees on withdrawals, especially when the investor uses a bank transfer. These fees may be fixed or proportional to the amount withdrawn.

Example of withdrawal fees

An investor wishes to withdraw 500 from their trading account. The broker applies fixed fees of 5 on each withdrawal.

• In the end, the investor will receive 495 on their bank account.

These fees can be avoided or reduced by choosing platforms that offer free withdrawals or by using alternative payment methods such as e-wallets (PayPal, Skrill, Neteller).

Is copy trading suitable for beginners?

Copy trading is often presented as an ideal solution for novice investors, as it allows them to automatically copy the strategies of experienced traders. However, although this method facilitates access to financial markets, it is not entirely without risk. Here's an overview of the advantages and limitations of copy trading for beginners.

The advantages of copy trading for beginners

• No expertise required: Unlike traditional trading, which requires in-depth market analysis, copy trading allows beginners to invest without having to master technical concepts such as technical or fundamental analysis.
• Progressive learning: Observing the strategies of experienced traders allows novices to understand market mechanisms and learn how to better manage risk over time.
• Time saving: As copy trading is automated, there is no need to constantly monitor the markets. Orders are executed in real time, without manual intervention.
• Simplified diversification: Platforms allow you to copy multiple traders at the same time, which offers a better distribution of risk and avoids betting everything on a single strategy.
• Access to different asset classes: By copying several specialized traders, it is possible to invest in various assets (Forex, stocks, cryptos, commodities, etc.) without requiring in-depth knowledge of each market.

The limits and risks for beginners

• Dependence on the performance of copied traders: Copying a trader does not guarantee profits. Even experienced traders experience losses, and it is possible to copy a strategy that proves ineffective in the long term.
• Lack of control over investment decisions: Unlike manual trading, copy trading leaves little room for personalization. The investor automatically follows the decisions of the copied trader, which can be frustrating in the event of a decline in performance.
• Risk of amplified losses: Some traders use high leverage, which can lead to significant losses if the market moves unfavourably. It is crucial to carefully analyze the level of risk before copying a trader. The maximum leverage allowed for retail traders in Ireland is 1:30.
• Fees that can reduce profitability: Some brokers apply fees on copy trading (commissions, spread, performance fees, etc.), which can impact the profits of novice investors.
• The absence of a guarantee of results: Even when copying a successful trader, the financial markets remain unpredictable. Past gains never guarantee future performance.

What strategy with copy trading?

Copy trading allows you to adopt different strategies depending on your investor profile, risk appetite and financial objectives. Some approaches favour stability and security, while others aim for higher returns by accepting a higher level of risk.

How to become a trader to follow for social trading?

Becoming a trader to follow on a social trading platform requires much more than just financial performance. You need to demonstrate a reliable strategy, good risk management, and transparency that inspires confidence in investors looking to copy your trades.

Firstly, it is essential to define a clear and repeatable trading strategy. Investors favour traders whose performance is stable and consistent over the long term. Whether it's scalping, swing trading or long-term investing, a well-defined approach, rigorously applied, helps to gain credibility. Good risk management is also crucial: limiting drawdown, avoiding excessive leverage, and not exposing all of one's capital on a single position reassures potential copiers.

Transparency is another key element. The most followed traders on copy trading platforms regularly share their analyses, decisions, and results. Posting updates, explaining trading positions, and being active in the community helps to attract copiers and retain existing ones.

Finally, a regular presence and interaction with copiers builds investor confidence. Some brokers even offer financial incentives to traders with a large number of followers. The more confidence the trader inspires, the more likely they are to be copied and increase their income through copy trading.

What taxation applies to income from copy trading in Ireland?

In Ireland, profits derived from copy trading activities are subject to taxation. The specific tax treatment depends on the nature of the trading activity and the assets involved.

Income Tax on Copy Trading Profits

If your copy trading activities are considered a trade, the profits are subject to Income Tax. The determination of whether an activity constitutes a trade depends on various factors, including the frequency and level of activity. Profits from trading activities are taxed at the individual's marginal tax rate, which can be up to 40%, plus Universal Social Charge (USC) and Pay Related Social Insurance (PRSI) contributions. 

If the copy trading activities are not considered a trade, any profits are subject to Capital Gains Tax (CGT) at a rate of 33%. Each individual has an annual CGT exemption of €1,270. 

Taxation of Cryptocurrency Gains

Profits from copy trading in cryptocurrencies are also subject to taxation. If the activity is considered a trade, profits are subject to Income Tax at the individual's marginal rate. If not considered a trade, profits are subject to CGT at 33%, with the annual exemption of €1,270 applicable. 

It's important to note that swapping one cryptocurrency for another is considered a disposal for CGT purposes, and any gains are taxable. 

Reporting and Compliance

All income and gains from copy trading must be reported in your annual tax return. For Income Tax, this is typically done using Form 11, and for CGT, using Form CG1. The deadline for filing these returns is October 31st of the following tax year. 

It's essential to maintain detailed records of all your trading activities, including dates, amounts, and the nature of each transaction. Failure to accurately report income from copy trading can result in penalties and interest charges.

Professional Traders and Business Entities

If your copy trading activities are substantial and carried out in a business-like manner, you may be considered a professional trader. In such cases, profits are taxed as business income, and you may be eligible to deduct related expenses, such as platform fees and other operational expenses. 

Companies engaged in trading activities are subject to Corporation Tax at a rate of 12.5% on their trading profits. Non-trading income, such as passive investment income, is taxed at a higher rate of 25%.

P. Laurore

Finance expert

Co-founder of HelloSafe and holder of a Master's degree in finance, Pauline has recognised expertise in personal finance, which she uses to help users better understand and optimise their financial choices. At HelloSafe, Pauline plays a key role in designing clear, educational content on savings, investments and personal finance. Passionate about financial education, Pauline strives, with every piece of content she oversees, to provide reliable, transparent and unbiased information for independent and informed financial management. To this end, she has tested over 100 trading platforms to help internet users make the right choices.