Social trading emerged around 2010 and became a favorite among younger traders who prefer to engage with their community and learn to trade from each other. We've conducted an in-depth review of the social trading sector and identified the best social trading platforms.
High floating leverage + fast execution
Daily market research and Autochartist access
High level regulation in multiple jurisdictions
Impressive range of tradeable assets including vanilla options and gold options
Solid broker for scalping and hedging
Institutional-style trading opportunities for retail traders
- FXTM, Best all-around broker with high floating leverage and fast execution.
- FP Markets, ECN trading with leverage up to 1:500..
- AvaTrade, Highly regulated, choice of fixed or floating spreads.
- BlackBull Markets, Best ECN trading environment, with scalping and hedging.
- Eightcap, Competitive pricing + excellent daily videos.
5.0/5 in this category
Best all-around broker with high floating leverage and fast execution
FXTM provides one of the best social trading platforms with more than 2,000,000 clients and an excellent cost structure. It is also one of the most accessible ones with a minimum deposit of $10. Other benefits include maximum leverage of 1:2000, a 30% deposit bonus up to $250, 47 payment options, and the Loyalty Program, limited to $10,000. Big Four accountancy PricewaterhouseCoopers Limited (PwC) confirms the trader-friendly execution statistics. New social traders will benefit from the FXTM guide to increase returns. It maintains one of the best overall trading environments with a limited asset selection.
Excellent commission-based Forex pricing environment and transparency
Upgraded MT4/MT5 trading platforms plus proprietary mobile trading app
Quality market research and educational content for beginner traders
Proprietary copy trading platform, low minimum deposit, and high leverage
5.0/5 in this category
ECN trading with leverage up to 1:500.
fpmarkets is an ASIC-regulated Australian brokerage which launched in 2005. For most traders, the unique selling point of this broker is in the extremely wide range of tradable assets offered, providing the opportunity to trade over ten thousand individual stocks and shares including publicly quoted Hong Kong and Australian companies. Ffpmarkets also offers 60 Forex pairs and crosses, 11 equity indices, the major commodities, and 5 cryptocurrencies including Bitcoin. fpmarkets offers an unusual hybrid ECN/STP execution model, meaning their clients can choose between ECN style of execution giving a very high level of speed, and a “straight through processing” execution style which allows for more “natural” spreads.
FP Markets Pros & Cons
Choice of trading platforms and auxiliary trading tools
Very competitive cost structure and excellent asset selection
Low minimum deposit requirement and leverage of up to 1:500
Well-regulated and trustworthy
4.5/5 in this category
Highly regulated, choice of fixed or floating spreads
AvaTrade is one of the largest Forex / CFD brokers and well-known for offering their clients a choice of fixed or floating spreads. They have a very high and strong level of regulation. AvaTrade is directly regulated in Ireland (and by extension, the European Union), Australia, Japan, South Africa, and the British Virgin Islands. Outside the European Union, Ava offers maximum leverage on Forex currency pairs as high as 400 to 1. AvaTrade offers trading in over 55 different Forex currency pairs, 17 commodities, 20 equity indices, 14 cryptocurrencies, plus 66 individual stocks and shares. 2 bonds and 6 ETFs are also on the menu.
High-quality educational offering via SharpTrader
Excellent choice of trading platforms catering to various trading needs
Broad asset selection and cross-asset diversification opportunities
Well-regulated and trusted broker with oversight from a central bank
4.5/5 in this category
Best ECN trading environment, with scalping and hedging
BlackBull Markets was founded in 2014 in New Zealand. Like many antipodean Forex brokers, BlackBull Markets is an ECN broker, offering raw spreads and commissions. They are regulated in New Zealand by the Financial Services Providers Register (FSPR) and offer a maximum leverage on some Forex currency pairs as high as 500 to 1. In addition to their global headquarters in New Zealand, BlackBull Markets also has presences in the form of branch offices in New York and Malaysia. BlackBull Markets offers a relatively tight range of tradable assets: 27 Forex currency pairs and crosses, gold, silver, crude oil, natural gas, and 6 major equity indices. That should be sufficient for those traders with more focused strategies not requiring wide diversification.
BlackBull Markets Pros & Cons
ECN/NDD execution model with deep liquidity
Institution-grade pricing for retail traders via proprietary price aggregation
ZuluTrade and Myfxbook for social trading
Leverage of up to 1:500
The emergence of cryptocurrencies and digital assets rekindled the interest in social trading platforms. It followed decreasing growth for several years. Millennial traders who prefer using their mobile phones flood the scene and account for the primary growth sector. Dozens of social trading platforms cater to the growing demand. They offer traders the option to copy their preferred traders with the push of a few buttons. Some communities are active and share trading ideas, discuss financial markets, and offer limited educational content. Others focus more on copy trading without much interaction between traders and followers.
The appeal of social trading attracts many new traders who lack knowledge and resources. Many ignore the fact that between 70% and 85% of retail traders lose money, making social trading prone to copying those losses. A 2015 report by the World Economic Forum (WEF) labeled social trading platform as a disruptive low-cost alternative to traditional wealth managers. According to a 2017 study by St. John’s University, traders with followers are more vulnerable to the disposition effect. It also creates a false sense of confidence among followers and copiers, promotes excessive risk-taking, and result in losses in most cases. While social trading may deliver select benefits, traders interested in using it successfully must conduct their due diligence, possess market knowledge to spot potential mistakes by the traders they follow, and monitor portfolios.
Social trading allows traders within the community to discuss financial markets, share trading ideas, and learn from each other. It is popular among new millennial traders, as it requires limited to no decision making. Social trading platforms enable traders to follow and copy others, but copiers should not ignore the risks associated with this approach. Between 70% and 85% of retail traders operate at a loss. Followers then copy losses across the social trading network.
Selecting the right social trading broker will pay dividends to traders. Following traders on the best social trading platforms can improve diversification, lower risk, and elevate profit potential. Social traders must understand the costs involved to calculate their risk-reward ratios. Transparent brokers will list them on their websites, and traders must understand them. The following three will have a direct impact on your profitability.
Spreads & Fees
Many brokers increase the mark-ups on assets to compensate strategy providers. Performance fees may also apply, depending on the social trading platform. All brokers charge swap rates on leveraged overnight positions, but they can vary and make a notable difference. Traders should also familiarize themselves with indirect costs like withdrawal fees and currency conversion charges, in addition to the usual spreads and/or commissions charged.
Traders can often start with as little as $100, but they should select providers with a similar portfolio size to follow.
Deposit & Withdrawal
I highly recommend using third-party low-cost payment processors and locate a social trading platform that supports them.
Ease of Use
Trading is demanding, but the trading platform should not be. A user-friendly and intuitive trading platform can improve trading efficiency and better results.
A professional-grade trading platform supports all types of traders and offers vast configuration options to suit their style.
Superior technology delivers better performance and improved pricing and order placement, which increases profitability.
Financial markets move fast, and the trading platform must feature lightning execution speed, especially for scalpers and high-frequency traders.
Security is something many new traders take for granted from a well-established trading platform. Always check the provided security features.
Depending on the assets, 24/5 or 24/7 trading is available at all trading platforms.
Once the portfolio grows, traders require a more substantial asset list to achieve cross-asset diversification, take advantage of more opportunities within each class, and keep their risk profile at acceptable levels.
Trading from the right account type is as important as the strategy. The standard account is where most brokers offer all features, but it is suitable for traders with a portfolio above $10,000. Traders with less capital can consider a mini account, while a micro alternative is for traders with less than $1,000.
Margin & Leverage
Leverage is an excellent tool for traders if used in conjunction with risk management. A low margin requirement grants more flexibility to traders and results in a competitive edge.
An account in the currency based on the most traded assets in the portfolio will lower currency conversion costs and currency fluctuations. Advanced traders maintain sub-accounts in numerous currencies.
The best social trading platforms feature all four points noted below to offer traders and followers a platform for success.
Follow & Lead
It forms the core of any social trading platform. It also promotes a greater understanding of financial markets and provides educational benefits for new traders.
The size of the trading community matters. Diversification and access to various trading strategies will define the outcome of followers.
Amount of Data
Followers must have in-depth data about the traders they wish to copy. It will allow informed decision making and avoid unsuitable or high-risk strategies.
The best social trading platforms offer flexibility so that followers can create the portfolio they desire.
While following traders and Forex gurus is a simple task, it remains challenging to find the best Forex traders to follow. Forex brokers usually maintain a list of tools to help you narrow down the list of potential portfolio managers. Some of the key filters are:
- Days the strategy is active
- Number of followers
- Average annualized return
- Risk score
- Assets under management
Remember that past performance is not a guarantee of future performance. Copying a trader whose long-term goals and risk tolerance align with yours is the best route - avoid using a social trading signal provider based on popularity rather than merit.
Other features that you should consider include:
- Minimum Deposit: - Though many copy trading platforms have a low minimum deposit (perhaps as low as $100), it is important to consider that you will likely need significantly more capital in order to test different trade leaders' strategies and to find which once work best for you.
- Currency Paris: - Not every broker offers trading access to the same currency pairs. If your trading strategy is focused around a specific pair or group of pairs, make sure that an ample number of trade leaders are focused there.
- Regulation: - Make sure to check the regulatory status of any potential copy trading broker carefully before depositing.
- Charges, Spreads and Fees: - While there isn't usually a charge associated with copy trading, there is almost certainly going to be a fee associated with the trade execution. In addition to the spreads which are charged by every Forex broker, some brokers also have withdrawal charges and other hidden fees (such as overnight fees) that can impact the income you'll enjoy from each trade.
- how much money you can afford to risk
- what type of trading strategies you want to follow
- which asset classes you want to trade
- how much you wish to risk per trade
- Check the social trading brokers listed on this page to create a shortlist that meet your minimum requirements determined in point 1.
- Open demo accounts with your shortlisted brokers and explore the details of their offering. Try to find out their typical spreads, commissions, and overnight fees, and compare them. Regulation is also very important.
- Explore your shortlisted brokers social trading offering. Is there a better selection of traders to follow at one of them?
- If you still cannot decide on the best broker for you by this stage, try to break the tie by considering “nice to haves”, such as choice of trading platform, ease of access to customer support, etc.
- Now you have chosen a broker, continue to trade socially with them in a demo account for several months until you are profitable over a 6-month period. Find the traders you wish to follow by checking their historical metrics and explore allocation methods. Beware of traders with very even returns who never seem to take considerable losses – they are probably using fragile trading strategies or leaving losing trades open to avoid taking losses.
- Leave your demo account and fund a real money account.
The social trading sector features four distinct sub-sectors, catering to various demands of social traders.
It allows traders to copy a strategy rather than a trader. More advanced traders use it. Mirror trading requires more capital amid high trade frequency in a fully automated environment.
In copy trading,Copiers will select a trader to follow and duplicate all trades.
Traders will discuss and share ideas, but trade placement is manual.
Signals & Tips
Many traders publish them free of charge, brokers offer them, and paid-for signal providers also provide them. It is manual trading without interaction between traders and followers.
- Trading histories allows followers to research the right traders to copy and engage with for optimized results.
- Confidence-building through active communication with strategy providers.
- Hidden aspects of the traders who provide signals can add risks. Social trading platforms offer performance details but no information about the capital or diversification of the portfolio.
- Overconfidence usually leads to excessive risk-taking and long-term losses. Social trading sounds excellent on paper but is only as good as the traders in the community.
What is the best social trading platform?
The best social trading platform features a large and active trading community with competitive research tools.
What is a social trading platform?
A social trading platform allows traders to interact, share ideas, copy trades, and discuss financial markets.
What does social trading mean?
Social trading usually refers to copy trading, where members in the community follow traders in an automated trading environment.
What is social trading in Forex?
Social trading in Forex allows followers to copy other traders and participate in markets without learning how to trade. Following traders at one of the best social Forex trading platforms will improve the results.
Is social trading legal in the US?
Social trading is technically legal in the US, but almost no brokers offer it to US persons due to problems making social trading work with US laws mandating FIFO (first in first out) and banning hedging.
How do you use social trading?
You find traders you have faith in, then set your social trading account to copy their trades. Ensure you limit risk and diversify between a range of traders. Finally, monitor the results and be ready to “fire” traders who are not performing as well as you expected them to.