Tutorial Covesting or copy trading on PrimeXBT
Due to the complexity of crypto trading strategies, cryptocurrency trading has remained a reserve of those with a high-risk appetite. However, crypto exchanges are making it simpler to trade by introducing new features. PrimeXBT, for example, has a feature that allows traders to copy trading strategies from other traders in a transparent manner, using what’s commonly known as copy trading or Covesting.
While copy trading is not new in the traditional finance space, its application in the cryptocurrency world is slowly gaining momentum.
Benefits of Covesting or copy trading
By copying trading strategies, traders and followers enjoy great benefits. Key among them include:
- Easy for new traders: New traders don’t have to understand the strategy; all they need is an analysis of how the strategy has performed. If it’s good for them, they copy and get trading.
- Saves time: The trader does all the research for you and you don’t have to research the markets.
- Wide range of instruments: Apart from cryptocurrencies, PrimeXBT supports Forex and gold trading. Therefore, the strategy is ideal even for non-crypto traders. For now, it’s only available for Bitcoin traders.
- Leveraged trading supported: With PrimeXBT being among the leading margin trading cryptocurrency platforms, covesting can be applied on leveraged trading.
Risks of Covesting
Please keep in mind that there are risks involved in Covesting. No trader can guarantee profits and you can lose money when using this strategy. We’ve even seen some traders getting liquidated. Never invest more than you’re willing to lose.
How to use covesting on PrimeXBT?
If you are not already a registered user, head over to PrimeXBT and create an account.
First you need to make sure that you deposited Bitcoin to start with Covesting. With our promocode you can get 35% first deposit bonus.
35% first deposit bonus at PrimeXBT
Next, go to the Covesting tab.
From here, you can copy the trading strategies of other traders. PrimeXBT provides the rating of traders that support Covesting. Also, you can sort the list using different preferences such as active days, profits, name, and followers.
You you can invest in BTC with multiple strategy leaders by allocating a section of your trading amount to each lead trader.
- To copy/follow a trader, click on Follow.
- Select the amount of BTC you want to invest in the trader.
- You are done. Wait for profits.
To get more information about a trader, click on their name. This displays additional details such as description, what they have to offer, total equity following, and the number of followers.
Note that you can access your portfolio from the left side of the window. From the portfolio, you can see the traders you’ve followed, how much profits/losses you have made so far, the amount of BTC invested with each trader, among other details.
The exchange does not have a dedicated leverage button. Instead, it uses cross margin. As such, all the funds in the trading wallet are used as margin.
The offer section shows how the profits from copy trading are shared among the trader, follower, and the exchange. The Covesting fees are between the 40% and the 25% of your profit. It is based on the amount invested:
- 001 – 0.3 BTC: Follower gets 60%, platform gets 20% and the original trader gets 20%.
- 3 – 0.5 BTC: Follower gets 65%, platform gets 15% and the original trader gets 20%.
- 5 – 1 BTC: Follower gets 70%, platform gets 10% and the original trader gets 20%.
- 1+ BTC: Follower gets 75%, platform gets 5% and the original trader gets 20%.
Covesting or copy trading with PrimeXBT is very easy. Unfortunately, nothing in the crypto trading world is risk-free. Being a margin trading platform, you can be liquidated even when you are Covesting. However, the Covesting feature is ideal for new traders looking to get their feet wet. Also, copy trading on PrimeXBT benefits experienced traders. For instance, instead of copying strategies, they can join PrimeXBT and create their own strategies for novice traders to copy.
As more followers embrace their strategy, the higher they climb on the list of profitable strategy leaders. By keeping 20 percent of gains made from your strategies from each trader, this forms a passive income generation stream.