Copy Trading for Beginners: A Step-by-Step Guide
For crypto trading beginners, the 24/7 market can feel overwhelming. You might lack the time and expertise to commit. Navigating market psychology and complex trading strategies takes years of experience. You’re not alone.
As pioneers of the perpetual swap, BitMEX is home to the most profitable traders in the industry. We don’t say this lightly — check out our leaderboard for yourself.
With Copy Trading, their expertise is available to everyone. Instantly replicate elite traders’ moves in just a few clicks, enabling you to mirror their trading success and amplify your portfolio.
Read on to learn how you can start Copy Trading.
If you haven’t signed up for a BitMEX account yet, we’re currently offering $5,000 worth of BMEX Tokens to new users – you can register here.
What is Copy Trading?
Copy trading is an automated trading tool that lets you automatically replicate the trades of experienced traders directly in your BitMEX account. When a selected trader, known as a Copy Leader, opens, closes, or adjusts a position, the same action is mirrored in your account.
BitMEX also offers Reverse Copy Trading, a unique feature that allows you to take the opposite side of a leader’s trades. This gives you the flexibility to execute a variety of strategies without having to actively manage your own trades.
Why Copy Trade on BitMEX?
- Access to the most profitable traders: Mirror the trades of the most profitable and experienced in the industry.
- Reverse Copy: Disagree with a Copy Leader’s move? Profit by betting against their trades, giving you more strategic flexibility.
- Simplified Trading: Trade crypto derivatives effortlessly in one click and learn from experienced traders.
- Diversify your strategy: Copy up to 5 Copy Leaders simultaneously to follow their exact moves. View each Copy Leader’s metrics – such as Winning Trade Ratio – to confidently build your trading arsenal.
- Made for Everyone: Automate your crypto derivatives trading, even if you’re busy or new to the market.
- Fully customisable: Every Copy Trade on BitMEX can be catered to your needs and risk tolerance. Control your trading capital and set your trading parameters like Take Profit and Stop Loss.
How Does Copy Trading Work?
Copy trading connects two key types of participants on BitMEX:
- Copiers: As a Copier, you choose to automatically mirror the trades of experienced traders. When you select a Copy Leader, every trade they make is automatically executed in your account. Let the elite traders do all the heavy lifting.
- Copy Leaders: These are the proven, experienced traders whose strategies you’ll replicate. They execute their trades as normal, and your account (along with other copiers) automatically follows their actions. As a Copy Leader, you can amplify your earnings with our profit sharing mechanism and build your reputation.
It’s a seamless way to participate in the crypto derivatives market, even if you’re new to it or short on time.
Ready to Start? Your Step-by-Step Guide
Starting your copy trading journey on BitMEX is straightforward. Here’s how you can get started:
Step 1: Sign Up & Verify Your BitMEX Account
First things first, you’ll need a BitMEX account. If you don’t have one, sign up here. Complete the user verification process – it’s a necessary step to ensure the security and compliance of our platform.
If you haven’t signed up for a BitMEX account yet, we’re currently offering $5,000 worth of BMEX Tokens to new users – you can register here.
Step 2: Explore the Copy Trading Marketplace
Once logged in, head over to the Copy Trading Marketplace. This is where you’ll find a full list of available Copy Leaders.
- Browse & Filter: You can sort and filter Copy Leaders based on various metrics like Cumulative PnL, Account Assets, Copiers, Cumulative Earnings of Copiers (USD), and 30D ROI to find traders that align with your goals.
- Search: If you have a specific leader in mind, use the search bar to find their profile.
- Deep Dive: Click on any Copy Leader’s profile to view their detailed trading statistics and historical performance. Transparency is key!
Before you start copying, it’s essential to familiarise yourself with the Copy Leader Rulebook.
Term | What It Means (Definition) | Example |
Win/Loss Ratio | Win: The ratio of the trades with realised earnings is greater than 0 Loss: The ratio of the trades with realized earnings is less than 0 | A Copy Leader with a Win/Loss Ratio of 65% means 65 out of every 100 trades they execute are profitable. |
Maximum Drawdown (MDD) | The maximum observed loss from a peak to a trough of a portfolio, before a new peak is attained | If a portfolio peaked at $1,000 and then dropped to $700 before recovering, the MDD would be 30%. |
Hold Average | The average time a token is held before a trade is made. | A “Hold Average” of 4 days means the Copy Leader typically keeps their positions open for about 4 days. |
Assets under management (AUM) | The amount of capital managed by the Copy Leader. This includes the Leaders and the Copiers’ capital. | If a Copy Leader has $10,000 of their own capital and is being copied by users who have committed $90,000 in total, their AUM would be $100,000. A higher AUM often indicates trust and confidence from a larger number of Copiers. |
Profit Sharing | The amount of profit distributed to the Copy Leader. | If a Copy Leader sets a 20% profit share and your copy trade generates $100 in net profit, $20 will be distributed to the Copy Leader, and you will receive $80. |
Return on Investments (ROI) | A percentage that shows the profitability of your Copy Trading position compared to the amount of capital you committed. ROI = (Net Profit / Cost of Investment) * 100. | If you commit $500 to a copy trade and it generates a net profit of $100, your ROI for that trade is (100 / 500) * 100 = 20%. |
Deposits | The amount of capital the Copy Leader deposits into their account | The Copy Leader initially allocated 1,000 USDT. His initial deposit will be 1,000 USDT. Later added another 200 USDT, their total Deposits would be 1,200 USDT. |
Withdrawals | The total amount of capital that has been moved out of a Copy Leader’s or your Copy Trading account. | If the Copy Leader initiated a copy trade with $1,000 and later withdrew $300, their total Withdrawals would be $300. |
Initial Balance | The starting amount of capital in a Copy Leader’ account when it was first established. | When you first set up a copy leader account and commit $500, your Initial Balance for that specific copy trade is $500. If you add more later, your initial balance will still remain $500. |
Step 3: Choose Your Copy Leader & Set Up Your Trade
Once you’ve found a Copy Leader you like, it’s time to set up your copy trade:
- Click the ‘Copy’ button on their profile.
- Input your Copy Trading balance: Decide how much capital you want to commit to copying this leader. The minimum deposit to start copy trading is USD$100 in USDT, BTC, or BMEX.
- Set Risk Parameters (Recommended): We strongly advise setting your own Stop Loss (SL) and Take Profit (TP) percentages. This gives you an extra layer of risk management, even when mirroring a pro.
- Automatic Fund Transfer: Don’t worry about manual transfers! Once you activate, your funds will automatically be moved from your main BitMEX account into a dedicated Copy Trading Sub Account.
Important Note: You will only replicate the leader’s subsequent trades, not any positions they are currently holding when you start copying them.
Term | What It Means (Definition) | Example |
Copy Trading Balance | The specific amount of capital you choose to commit and allocate to copy a particular Copy Leader. This is the fund pool from which your copied trades will be executed. | If you decide to follow a Copy Leader and commit 500 USDT as your Copy Trading Balance, all trades replicated from that leader will use funds from this 500 USDT pool.This balance operates independently; your capital in other accounts remains unaffected by Copy Trading activities. |
Stop Loss (SL) | A predefined percentage at which your copied trade will automatically close if the market moves against you. This helps to limit your potential losses. | If you commit $100 to a trade and set a 10% Stop Loss, your position will automatically close if its value drops by $10, preventing further losses. Please note that the stop loss is only a trigger. The final amount of capital to be received is subject to market conditions. |
Take Profit (TP) | A predefined percentage at which your copied trade will automatically close if the market moves in your favor. This helps to secure your gains. | If you commit $100 to a trade and set a 20% Take Profit, your position will automatically close if its value increases by $20, locking in your gains. |
Step 4: Monitor and Manage Your Copied Trades
You’ve started copying – now what? You can easily monitor and manage your positions:
- Navigate to the ‘Copied Trading Details’ button at the top of the Copy Trading interface.
- See More: Dive into additional details about your copied leaders and adjust your copy trading settings if needed.
- Transfer Funds: Want to increase your trading balance allocated to a specific Copy Leader? Use this option to add more funds from your main account.
- Stop Copy Trading: You have full control. At any time, you can click this button to immediately close any ongoing copied trades and stop copying the leader’s future moves. Your funds will automatically return to your main BitMEX account.
Term | What It Means | Example |
Return on Investment (ROI) | A percentage that shows the profitability of your Copy Trading position compared to the amount of capital you committed. It helps you understand how efficiently your capital generates profit. ROI = (Net Profit / Cost of Investment) * 100. | If you commit 500 USDT as your Copy Trading Balance and your position gains 100 USDT in profit, your ROI would be (100 / 500) * 100% = 20%. |
Earnings (Net Profit) | The total net profit generated from your Copy Trading activities after all trading fees and profit share (if any) have been deducted. | If your Copy Trading position makes a gross profit of 120 USDT, and after deducting $0.01 in trading fees and $12 in profit share, your earnings is 107.99 USDT. |
Beyond Copying: Become a Copy Leader
Think you have what it takes to be an elite trader? Become a Copy Leader on BitMEX to earn up to 50% profit share from your Copiers, establishing your reputation and maximising your earnings.
Click here to learn how you can become a Copy Leader on BitMEX today.
Important Considerations for All Copy Traders
While copy trading simplifies access to the markets, it’s essential to understand a few things:
- No Guaranteed Profits: Copy trading, like all forms of trading, involves risk. You can lose capital, so only commit funds you can afford to lose.
- Slippage & Fees: Differences in PnL can occur due to trading fees, funding fees, and slippage (the difference between your expected trade price and the actual execution price). BitMEX carefully vets supported trading pairs to minimisze slippage on liquid markets. More details here.
- Why a Trade Might Fail: Occasionally, a copied trade might not execute for various reasons, such as insufficient margin in your copy trading account, the leader using an unfulfilled limit order, or the trade not meeting minimum notional value. More details here.
- One-Way Copying: You’ll only copy trades after you start following a leader, not their existing open positions.
Looking for more information? We’ve got a range of educational resources to guide users through topics such as Copy Trading and more. You can find them under the Copy Trading section of this page.
To be the first to know about our new listings, product launches, giveaways and more, we invite you to join one of our online communities and connect with other traders. For the absolute latest, you can also follow us on Twitter, or read our blog and site announcements.
In the meantime, if you have any questions please contact Support who are available 24/7.
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