NEW YORK, NY / ACCESSWIRE / September 20, 2024 / As a convenient investment method, copy trading allows investors to trade with more professional strategies and with ease. However, not all traders are suitable for copying, and it is crucial to screen the right copy objects.
The core of contract copy trading is that users can follow the trading strategies of excellent traders on the platform to make profits. However, the platform's profitability and users' investment security depend on the professional level and risk control ability of traders. The followers and trading frequency of Tapbit copy traders are eye-catching, making it a leader in the copy business in the industry. As a rising crypto exchange, how did Tapbit do it?
Tapbit's Copy Trader Screening Mechanism
Tapbit's evaluation indicators for copy traders cover the trader's professional ability, risk control ability, and trading performance. For example trading behavior, educational background, professional qualification certificate, risk preference, stop loss setting, position management, recent yield, win rate, loss rate, maximum drawdown, and other dimensions.
Among them, Trading Behavior reflects the investment philosophy and operating habits of copy traders and is an important indicator for evaluating their ability and risk. The angles of trading behavior evaluation include:
Trading Frequency refers to the number of times a trader trades within a certain period. Too high a trading frequency may mean that the trader operates too frequently, is easily affected by market fluctuations, increases trading costs, and even leads to over-trading. Too low a trading frequency may reflect that the trader lacks sensitivity to market changes and misses profit opportunities.
The Trading History reflects the trader's trading performance in the past. The average holding time reflects the trader's trading style. The number of followers shows the attractiveness of the copy trader. The trading volume, PnL, ROE, and win-loss rate show the contract trading level, trading frequency, and other data of the copy trader. The Tapbit platform will select the trader with the best data performance, the most reasonable trading frequency (the evaluation of trading frequency needs to take into account the trading strategy, market conditions, and risk tolerance), the richest trading experience, and the most followers in a period, and push him to the trader ranking so that users can find the best copy trader with the best overall performance in each dimension on the drop-down menu.
In addition to the core data above, Tapbit colleagues responsible for screening copy traders will also consider the following dimensions, with the goal of not starting the elimination process after listing copy traders as much as possible. This pre-set screening mechanism also prevents user capital loss to the greatest extent and ensures the user's trading experience:
Leverage can magnify profits, but it also magnifies risks. Evaluating the extent and method of traders' use of leverage can determine their risk control awareness and strategy. Excessive leverage may lead to rapid losses, while cautious leverage can effectively improve the efficiency of capital utilization.
Risk Control ability is a key factor in measuring whether traders can effectively manage risks, and it is also an important indicator for screening copy traders.
Stop Loss is the operation of traders closing positions and stopping losses when losses reach a certain level, and it is an important means of risk control. Evaluating the timeliness and effectiveness of traders' execution of stop loss can determine their risk control awareness and execution.
Position Management refers to the operation of traders controlling the proportion of trading funds. Reasonable position management can effectively control risks and avoid a significant reduction in funds due to excessive losses in a single transaction. Evaluating the trader's ability to control the volume of a single transaction and the overall position can determine his risk control level.
Risk Diversification refers to the diversification of investments into different trading products or markets to reduce the risk of a single product or market. Evaluating the diversification of traders' products can determine their risk diversification awareness and strategy. Traders who are overly focused on a single product have a low-risk tolerance and are easily affected by the price fluctuations of a single product.
Market Adaptability refers to the ability of traders to adjust their trading strategies according to different market environments to adapt to market changes.
Evaluating the performance of copy traders in different market environments such as bull markets, bear markets, and volatile markets can determine their adaptability to market changes. In different market environments, copy traders should adopt different strategies to maximize risk control gain returns, and avoid the unpredictable major events that have a significant impact on the market evaluating traders' performance and response capabilities in extreme market events can determine their risk tolerance and resilience.
In addition to the above evaluation dimensions, Tapbit also has strict requirements for the quality of copy traders: trading behavior, educational background, and professional qualification certificates are all means of assessing the professional quality of copy traders. After all, data is temporary, but educational background and knowledge literacy are a person's basic qualities that cannot be changed.
Introduction to Tapbit's Outstanding Copy Traders:
By analyzing the performance of copy traders in the above dimensions, Tapbit will classify the registered copy traders and strive to create a safer and higher-yield copy investment service for users. At the same time, Tapbit has also established a periodic Elimination Mechanism for copy traders who no longer meet the requirements of the Tapbit platform. Some platforms are only hyped on data and have no interest in data other than ROE and PnL, such as a trading platform copy trader leaderboard in the picture below. This screening strategy, which only refers to the rate of return and ignores the transaction frequency and transaction level, is very disadvantageous to customers.
Establishing a scientific and rigorous trader evaluation and grading system is the key to the sustainable development of the contract copy trading platform and the protection of user interests. By evaluating and grading traders, the platform can help users better choose traders that suit them, reduce copy trading risks, enhance the credibility of the platform, and encourage traders to continuously improve their professional level and risk management capabilities. If a trader lacks experience or risk control capabilities, his trading strategy may cause the copy trading users to suffer significant losses. To ensure the stability of the platform and the interests of users, Tapbit strictly evaluates and grades traders and dynamically adjusts them according to their performance.
Tapbit screens copy traders and helps users understand the professional capabilities and risk preferences of traders, to choose traders that match their investment goals and risk tolerance to copy. It reflects Tapbit's user-centric business philosophy. The number of users on the platform has increased on a large scale, and the number of professional traders who have joined the copy trading ranks is in full swing. It is not surprising that the number of users who choose to follow copy traders is increasing day by day.
About Tapbit Exchange:
Tapbit Exchange is a leading cryptocurrency exchange platform that offers a wide range of trading pairs, competitive fees, and advanced security features. Tapbit is committed to providing users with a seamless and secure trading experience
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SOURCE: Tapbit