Social Forex trading seems to be the latest and greatest thing in the currency trading industry. In fact, it seems like every week a new social trading experiment is born, whether through a privately held company or through a brokerage looking for ways to attract new traders or to convince people that trading is incredibly easy. The downside to social Forex trading, of course, is that you never know whether you're really following an expert or just a lucky trader whose winning streak may end, leaving you with significant losses. A similar claim can be made about the Forex signal industry, though signals providers often provide long-term reports of their trades rather than just a few recent entries or exits as is common in social Forex trading (the industry is, after all, too young to really have long-term reporting available).
The latest social Forex experiment is ForexGlobes.com, a website branded as a social Forex signals service. Though it sounds like it combines the allure of signals with the social component so common among other companies, one can't help but question whether this service is actually offering something unique, or whether it's just another marketing ploy.
If you do want to dip your feet into the pool of social trading, make sure to weed out the hype from the help. Is the trader that you're following truly knowledgeable? Does he or she have references or a proven track record? You can cross-reference the statistics with the market fluctuations during the times that the trades were placed to make sure that the statistics are accurate. You should also measure the trader's risk-reward ratio to see if he or she is advising you properly or if you can potentially lose a significant sum of money on a failed trade.
In my own opinion (which doesn't represent DailyForex.com), it's probably safer to follow proven traders with a reputable company behind them than to rely on unknown traders who may not have the skills necessary to trade profitably for the long term. But then again, maybe I'm just being too conservative"¦