4 Best Social Trading Platforms in 2021

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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.

1
eToro
The ratings shown on DailyForex.com are determined by hours of research from our editorial team into over 10 factors, including account fees, deposit/withdrawal options, regulatory status, tradable assets, and more.
Best social trading platform on the market
Excellent choice of options for crypto traders
2
FXTM
The ratings shown on DailyForex.com are determined by hours of research from our editorial team into over 10 factors, including account fees, deposit/withdrawal options, regulatory status, tradable assets, and more.
Best all around broker
High floating leverage + fast execution
3
ZuluTrade
The ratings shown on DailyForex.com are determined by hours of research from our editorial team into over 10 factors, including account fees, deposit/withdrawal options, regulatory status, tradable assets, and more.
Social trading system that works with dozens of brokers
4
Trade360
The ratings shown on DailyForex.com are determined by hours of research from our editorial team into over 10 factors, including account fees, deposit/withdrawal options, regulatory status, tradable assets, and more.
Crowd trading that lets you follow trading trends

Top Social Trading Platforms

eToro Best broker for social traders and crypto traders : 75% of retail CFD accounts lose money.
FXTM Best all-around: high floating leverage + fast execution.
ZuluTrade Social trading system that works with dozens of brokers.
Trade360 Crowd trading that lets you follow trading trends.

eToro
5.0/5 in this category
In Summary
Best broker for social traders and crypto traders : 75% of retail CFD accounts lose money

eToro was founded in the early days of the online retail Forex era, in 2007 – this broker occupies a unique space as the king of social and copy trading. eToro has a long track record and unique reputation to protect, although this image is more focused on its copy trading model than on any other individual feature, except maybe its special relationship with cryptocurrencies. 

Unique Features

Regulation

CySEC, FCA, ASIC

Minimum Deposit

$200

Type of Platform

Proprietary platform

eToro is regulated in Cyprus, the U.K., Australia, and the United States although its U.S. offering is firmly differentiated from its offering to the rest of the world.  

eToro guarantees several benefits to anyone opening an Islamic account: no rollover interest or commissions on any trade contracts lasting for longer than 24 hours will be charged, and no commissions or fees are charged to Islamic accounts for account management. Notably, interest-free leverage is also offered to Islamic account holders. 

eToro is a leading cryptocurrencies CFD broker. Following its 2019 acquisition of Danish blockchain company Firmo and Belgian crypto portfolio tracker application Delta, it released its cryptocurrency wallet for mobile devices. The proprietary sentiment indicator for digital assets based on Twitter activity presents a social trading tool millennials favor.

eToro Pros & Cons

Advantages

  • Excellent equity asset selection and broad cryptocurrency choices

  • Cryptocurrency wallet for Android and iOS

  • Twitter-based digital asset sentiment indicator

  • Simple social trading procedure

Disadvantages

  • Below average educational resources

  • Internal withdrawal fees plus higher core trading costs

  • MT4 trading platform not supported

  • Low leverage and higher minimum deposit

FXTM
5.0/5 in this category
In Summary
Best all-around: high floating leverage + fast execution

We have made FXTM our top-rated broker because in addition to its lengthy track record, it enjoys a very high level of regulation and reputation, and it offers a highly competitive fee structure which tends to keep down the cost of trading.

Unique Features

Regulation

CySEC, FCA, FSC, CMA

Minimum Deposit

$50

Type of Platform

MetaTrader 4, MetaTrader 5

FXTM, or “ForexTime”, has been around for a long time: they were founded in 2011. Recent years have seen them continue to steadily expand their business, and they are well- regulated by the U.K., Cyprus, Mauritius, and South Africa. The brand is owned by private companies incorporated in the U.K., Cyprus, and Mauritius. Customers of FXTM have access to more than 57 Forex currency pairs and crosses, precious metals, the major energies, equity indices, big cryptocurrencies, and a few individual American stocks. Talking of stocks, FXTM are quite unique in the area of trading stocks, as they enable direct trading through real legal ownership, not just wrapped as CFDs like almost every other similar brokerage offers.

FXTM offers traders a choice between two of the most popular execution models: customers may open either an ECN-type account, or one that trades by “straight-through processing”. Clients have a straight choice between two trading platforms, with both MetaTrader 4 and MetaTrader 5 on offer.

Through their Mauritius regulator, FXTM offer leverage as high as 1000 to 1. In the U.K. and Cyprus, they are limited by law from offering more than 30 to 1.

If you are looking for a broker with a good copy trading program, it is worth taking a serious look at FXTM’s “FXTM Invest” copy trading program.

FXTM Pros & Cons

Advantages

  • Excellent client deposit protection

  • Low minimum deposit

  • Free MT4 add-ons and VPS hosting

  • Good educational tools

Disadvantages

  • No cryptocurrencies or exotic currencies

  • Low leverage for retail traders

  • Internal withdrawal fees and an inactivity fee

ZuluTrade
4.5/5 in this category
In Summary
Social trading system that works with dozens of brokers

ZuluTrade is one of the best copy trading platforms available globally and maintains a leadership position in that field. It works together with more than 35 brokers, offering unparalleled access to traders and strategies exceeding 25,000,000. Diversification remains one of the most defining strategies for copy traders, and ZuluTrade delivers. Most aspects of the trading environment, like asset selection, leverage, cost structure, and minimum deposit, remain dependent on the partner broker the trader selects. ZuluTrade provides the infrastructure and connects via the MT4 trading platform. Brokers usually increase the spreads on ZuluTrade accounts, which is a fact that traders must consider.

Unique Features

Minimum Deposit

Broker Dependent

Type of Platform

MetaTrader 4, Web-based

Copy traders benefit from innovative tools including ZuluGuard and Automator. They protect copiers from non-performing signal providers and automate the copying process, respectively. The subscription-based Combo Plus providers copy traders with an option for full automation of copy trading and a competitive edge. ZuluTrade executed more than $1.2 trillion in trading volume, and the compensation model for signal providers remains superior to other copy trading platforms. It became a licensed portfolio management company in the EU in 2015, after receiving the EU Portfolio Management License, which competitors do not possess. In 2017, ZuluTrade became part of the Chinese-based Formax Group.

ZuluTrade Pros & Cons 

Advantages

  • Excellent social trading tools with a distinct competitive edge

  • Two compensation schemes for profitable signal providers

  • Superior choice of strategies across 35+ brokers

  • A licensed portfolio management company

Disadvantages

  • Pressure on signal providers to perform due to compensation requirements

Trade360
4.5/5 in this category
In Summary
Crowd trading that lets you follow trading trends

Trade360 does not offer direct copy trading but developed its own CrowdTrading technology, incorporated into its proprietary WebTrader. It monitors trading activity based on its clients and alerts traders based on increases in trading and order volume. The information appears in the sidebar of the WebTrader with a function to take a position in the asset. Traders may also use the copy trading function inside the MT5 trading platform, which allows automated trading. New traders will benefit from the educational content, and Trade360 dedicated one lesson to trading psychology, which many brokers omit.

Unique Features

Regulation

CySEC

Minimum Deposit

$500

Type of Platform

MetaTrader 5, Proprietary platform, Web-based

While this broker maintains licenses from two regulators, most international clients will trade with the unregulated entity. Trade360 features fixed spreads in a commission-free trading environment that combine for a relatively high-cost structure. The asset selection outside equity CFDs, which is average, is not sufficient for most traders. While the minimum deposit is $250, traders who wish to use the MT5 trading platform must have an account balance of $1,000. Full functionality is available from $5,000, making it the highest in the industry. The STP order execution model ensures conflict-free trading, but the multi-tier account structure can be challenging.

Advantages

  • Non-Forex Offering

  • The “Crowd”

Disadvantages

  • Limited Choice of Platforms

  • No Education Center

What is Social Trading?

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.

What is the Best Social Trading Platform for Your Needs?

The best social trading platform will offer an active community with countless trading strategies, a copy trading feature, and in-depth reports on each trader. They will also support the ability to copy numerous traders with seamless order synchronization. An option for the copier to take control of copied trades if desired is another valuable setting. One of the most beneficial tools a social trading platform can offer traders is an alert algorithm to warn copiers about the deviation of strategies, set parameters, or violation of risk management settings.

The History of Social Trading

Social trading gained popularity after 2010 and expanded swiftly over the next five years. The appeal of no-knowledge and low-cost exposure to financial markets appealed to new traders. The industry retreated from its peak as traders realized it was not as profitable as marketing campaigns advertised. The cryptocurrency sector revitalized demand for social trading platforms, as most retail traders use social media for information. Social trading remains popular among millennial traders and is on course to expand in size. I cannot stress enough that social traders cannot ignore the risks of social trading.

Social Trading Concepts

The social trading sector features four distinct sub-sectors, catering to various demands of social traders.

Mirror Trading

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.

Copy Trading

Copiers will select a trader to follow and duplicate all trades.

Social Trading

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.

Social Trading Platforms

While there are many social trading platforms, below are five that we believe social traders should consider evaluating for the best social trading platform.

DupliTrade

A mirror trading platform with potential, but only twelve strategies are currently available. Trading takes place in MT4 accounts, and DupliTrade lists twelve partner brokers.

Collective2

A subscription-based service that claims superiority over hedge funds. It is an attractive social trading platform for US-based traders, prohibited from international providers.

FBS CopyTrade

The proprietary social trading platform from international multi-asset broker FBS. With more than 16,000,000 traders, it is home to the largest community and a competitive trading environment.

MQL5

This is the copy trading service embedded in the MT4 and MT5 trading platforms, offering vast exposure to tens of millions of traders. MT4 is the most used trading platform and a leader in automated trading solutions.

Tradency

A FinTech company for mirror trading and automated solutions since 2005. It offers five distinct solutions to retail traders and professionals.

Trading Costs: Selecting a Social Trading Broker

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.

Minimum Deposit

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.

Factors for Selecting a Trading Platform

While social traders do not analyze and trade, the use of a competitive trading platform ensures that the traders they follow have access to a competitive set of trading tools.

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.

Configurability

A professional-grade trading platform supports all types of traders and offers vast configuration options to suit their style.

Performance

Superior technology delivers better performance and improved pricing and order placement, which increases profitability.

Execution Speed

Financial markets move fast, and the trading platform must feature lightning execution speed, especially for scalpers and high-frequency traders.

Security

Security is something many new traders take for granted from a well-established trading platform. Always check the provided security features.

Trading Hours

Depending on the assets, 24/5 or 24/7 trading is available at all trading platforms.

Asset List

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.

Account Types

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.

Account Currencies

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.

Social Trading Offerings

The best social trading platforms for January 2021 must 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.

Volume

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.

Flexibility

New traders want to try different approaches, and advanced ones adjust as their portfolio expands. The best platforms offer flexibility so that followers can create the portfolio they desire.

Pros & Cons of Social Trading

I recommend evaluating the following pros and cons of social trading before deciding if social trading is right for you.

Advantages

  • Collective knowledge gained via the trading community for improved trading decisions.

  • Trading histories allows followers to research the right traders to copy and engage with for optimized results.

  • Watch & Learn depends on the social trading platform and the level of engagement between traders and followers.

  • Confidence-building through active communication with strategy providers.

  • Emotion-free decisions as the social trading platforms copy positions from traders to followers.

Disadvantages

  • Can risk be limited? Unfortunately, no. Social trading carries significant risks to consider.

  • 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.

  • False sense of security is one significant problem and often results in new traders skipping the educational part of trading. It is a requirement to succeed, irrelevant to the strategy.

  • 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.

Is Social Trading Legal?

It is legal in most jurisdictions, but several regulators evaluate if they should reclassify social trading platforms as investment advisors. Should regulators take this step, providers must apply for the appropriate license.

Methodology

We reviewed over 100 brokers in depth based on eleven criteria from the perspective of a trader. Each research consisted of over 2,000 words and lasted more than ten hours. We ensured the most comprehensive approach to identify the best copy trading platforms.

The eleven criteria used in our research consist of:

  • Regulation and Security

  • Trading Costs

  • Asset Selection

  • Account Types

  • Trading Platforms

  • Unique Features

  • Research and Education

  • Customer Support

  • Bonuses and Promotions

  • Account Opening Process

  • Deposits & Withdrawals

FAQs

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.

Huzefa Hamid

I’m a trader and manage my own capital. I trade the major Forex pairs, some Futures contracts, and I rely entirely on Technical Analysis to place my trades. Today, I am also a Senior Analyst for DailyForex.com. I began trading the markets in the early 1990s, at the age of sixteen. I had a few hundred British pounds saved up (I grew up in England), with which I was able to open a small account with some help from my Dad. I started my trading journey by buying UK equities that I had read about in the business sections of newspapers. The 1990s were a bull market, so naturally, I made money. I was fortunate enough in my early twenties to have a friend that recommended a Technical Analysis course run by a British trader who emphasized raw chart analysis without indicators. Having this first-principles approach to charts influences how I trade to this day.

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