Best Copy Trading Platforms

What is copy trading?

Copy trading is an investment method that allows traders, whether beginners or experienced, to automatically replicate the strategies of other, more seasoned investors. This approach is particularly popular in CFD (contracts for difference), cryptocurrency, Forex, and stock trading.

How copy trading works

The principle of copy trading is simple: an investor (called a "copier") selects an experienced trader (called a "strategy provider") and configures their account to automatically reproduce their positions. When a copied trader opens or closes a position, this action is replicated in real-time in the copier's account, in proportion to the capital invested.

Why choose copy trading?

Copy trading has several advantages, including:

• Accessibility: It allows beginners to invest in the financial markets without needing advanced knowledge of trading.
• Time saving: Investors do not need to analyze the markets themselves or make complex decisions.
• Diversification: It is possible to copy several traders and thus spread the risks.
• Progressive learning: By following the strategies of experienced traders, investors can understand the mechanisms of the market and refine their own trading strategy.

What is a copy trading platform?

A copy trading platform is an online service that allows investors to automatically copy the strategies of more experienced traders. These platforms act as intermediaries between professional traders (or strategy providers) and investors wishing to replicate their operations.

They offer risk management tools, performance tracking features and customization options to adapt the copy trading strategy to one's own financial goals.

Copy trading platforms work by connecting users' accounts to those of the traders they want to follow. Here are the main steps:

• Registration on the platform: the user creates an account and deposits funds.
• Selecting a trader to copy: they can filter traders based on their performance, risk level, trading style, and other criteria.
• Configuring parameters: the user chooses the amount they wish to invest and adjusts parameters like risk level or leverage.
• Automating transactions: once copy trading is activated, the selected trader's positions are automatically replicated in the investor's account.

Copy Trading and Social Trading: What are the differences?

Copy trading and social trading are often confused, but they have notable differences. Both allow investors to draw inspiration from the strategies of other traders, but their approach and operation vary.

• Copy trading is an automated process where an investor directly copies the trades of an experienced trader. Once the strategy is chosen, the orders are replicated without manual intervention.
• Social trading, on the other hand, relies more on the exchange of information and individual decision-making. Traders share their analyses, strategies, and performance, but each investor manually chooses the trades they want to execute.

What social trading solutions are offered by brokers in the United Arab Emirates?

In the United Arab Emirates, several brokers offer social trading and copy trading solutions to allow investors to follow and copy the strategies of experienced traders. These solutions are often integrated directly into trading platforms or accessible via specialized software. Here is an overview of the most popular software and the brokers that offer them.

How to choose a copy trading platform?

Choosing a copy trading platform is an essential step to maximize your chances of success while limiting risks. Several criteria must be taken into account to select the platform best suited to your needs and your investor profile.

1. Regulation and security

When selecting a copy trading platform in the UAE, it's crucial to ensure that the broker is regulated by a reputable financial authority. In the Emirates, this includes regulators such as the Securities and Commodities Authority (SCA) or international bodies like the CySEC, FCA, or ASIC.

Choosing a regulated platform provides stronger protection for your funds and ensures transparent practices. Also check whether client funds are held in segregated accounts, and whether there are investor protection mechanisms in place in case the broker becomes insolvent.

2. Available Traders to Copy

The diversity and quality of the traders offered are key elements. It is advisable to choose a platform that offers filtering tools to analyze the performance of traders:

• Historical performance
• Risk level
• Trading strategy (short term, long term, scalping, etc.)
• Maximum drawdown

Some platforms also offer performance scores to make it easier for traders to choose who to copy.

3. Accessible Assets and Markets

Not all copy trading platforms give access to the same financial instruments. Make sure the platform offers markets that interest you, especially those relevant to investors in the UAE, such as:

• Forex (e.g., USD/AED, EUR/USD, GBP/USD)
• Stocks (e.g., Tesla, Apple, Emirates NBD, Amazon)
• Cryptocurrencies (e.g., Bitcoin, Ethereum, Ripple)
• Indices (e.g., S&P 500, DFMGI, NASDAQ)
• Commodities (e.g., Gold, Brent Crude Oil, Natural Gas)

A wider selection of assets enables better portfolio diversification, which helps to spread risk and adapt to different market conditions.

4. Fees and Commissions

Copy trading platforms apply different fee structures, which can impact your profitability. Here are the main costs to analyze:

• Spread: the difference between the buying and selling price of an asset
• Commission per trade: some brokers charge a percentage on each transaction
• Inactivity fees: fees may apply if you do not carry out transactions for a certain period
• Profit sharing: some platforms charge a percentage on the profits made through copy trading

5. Features and User Experience

A good copy trading platform should offer an intuitive interface and powerful tools to manage your investments effectively. Key features to look for include:

• Demo account: test the platform with a virtual account before investing real money
• Risk management tools: stop-loss, take-profit, adjustment of invested capital
• Advanced charts and graphs: real-time analysis of the performance of copied traders
• Mobile application: access to investments on the go

6. Platform Reviews and Reputation

Checking user reviews and ratings on specialized sites like Trustpilot or trading forums provides an overview of the advantages and disadvantages of each platform. Prioritize those with a good reputation in terms of:

• Reliability of transactions
• Responsive customer service
• Ease of withdrawing funds

7. Customer Service and Support

Good customer support can make all the difference in the event of a technical problem or a question about how copy trading works. Check:

• Contact channels (online chat, email, phone)
• Availability (24/7, opening hours)
• Support language (French or English)

What assets can be traded with copy trading?

Copy trading allows you to invest in a wide range of financial assets, depending on the markets offered by the chosen platform. Some assets are more suited to copy trading strategies due to their liquidity and volatility. Here is an overview of the main assets accessible via copy trading.

How to practice copy trading with an online broker?

Copy trading with an online broker is a simple process that allows investors to copy the strategies of experienced traders. Here are the main steps to start and optimize your copy trading experience.

1. Choose a broker that offers copy trading

Not all trading platforms allow copy trading. It is therefore essential to choose a broker offering this feature and regulated by a recognized financial authority. Some of the most popular platforms include eToro, ZuluTrade, MetaTrader 4/5 (with signals), DupliTrade and Myfxbook AutoTrade.

Criteria to verify before choosing a broker:

• Regulation and security of funds
• Available assets (Forex, stocks, cryptos, indices...)
• Applicable fees and commissions
• Quality and number of traders to copy
• Risk management tools and platform ergonomics

2. Create an Account and Verify It

Once the broker has been selected, you must open a trading account by providing personal information and carrying out KYC (Know Your Customer) verification, which consists of submitting:

• A valid form of identification
• Proof of address
• A payment method to deposit funds

Certain brokers allow access to a compte démo, which is useful for testing the platform and its interface before investing real money.

3. Deposit funds into your trading account

After the account is validated, the investor must fund their trading account. Brokers generally offer several deposit methods:

• Bank card (Visa, Mastercard, etc.)
• Bank transfer
• Electronic wallets (PayPal, Skrill, Neteller, etc.)
• Cryptocurrencies (on some platforms)

The minimum deposit amount varies depending on the platform (from 200 AED to several thousand AED depending on the broker and the chosen asset).

4. Select a trader to copy

Choosing the trader to copy is a key step to succeed in copy trading. Platforms provide various criteria to analyze traders:

• Past performance (return over several months/years)
• Risk level (the more risk a trader takes, the greater the variations in their capital)
• Strategy used (short term, swing trading, scalping...)
• Maximum drawdown (maximum loss recorded)
• Number of copiers and reputation

Certain platforms like eToro assign risk scores to traders, allowing you to assess the stability and reliability of their strategy.

5. Define the amount invested and adjust the parameters

Before copying a trader, the investor must decide how much they want to allocate to this strategy. Several risk management options are available:

• Fixed amount to invest: choose a specific amount that will be used to copy the trader
• Automatic stop-loss: define a maximum loss not to be exceeded
• Copy level adjustment: some platforms allow trades to be copied in proportion to the capital of the followed trader

6. Monitor and Adjust Your Copy Trading Strategy

Copy trading is a passive method, but it is recommended to regularly monitor the performance of the copied traders and adapt your strategy if necessary.

Best practices to optimize your copy trading:

• Diversify by copying multiple traders to limit risks
• Regularly check performance and adjust investments if needed
• Don't panic in the face of market fluctuations and stay consistent with your strategy
• Train in parallel to better understand how the market works

What are the fees of brokers offering copy trading?

Copy trading platforms apply different types of fees that can affect investor profitability. It is essential to fully understand these costs before choosing a broker, as they vary depending on the platform and the assets traded. Here's an overview of the main fees encountered in copy trading.

1. Spreads: an indirect cost on each transaction

The spread is the difference between the buying price (bid) and the selling price (ask) of an asset. It is an indirect cost that the broker automatically integrates into each transaction, which means that the investor must cover this cost before being profitable on a trade. The higher the spread, the higher the cost of trading.

Example of spread on copy trading

An investor copies a trader who opens a position on the EUR/USD with a spread of 1.5 pips. This means that when the position is opened, they are immediately at a slight loss equivalent to these 1.5 pips. If the market does not move sufficiently in their favor, the transaction may not be very profitable.

2. Transaction Fees: A Percentage or a Fixed Amount

Some brokers, in addition to the spread, apply a commission on each transaction made. This commission can be a fixed amount per order executed or a percentage of the amount invested. Brokers who use this model often offer tighter spreads.

Example of copy trading commission

An investor copies a trader specializing in stocks. For each purchase or sale of a stock, a commission of 0.1% is charged.

• If they invest 1,000 in an action, they will pay 1 in fees when opening the position.
• If they close this position later for 1,200, they will pay 1.20 in commission again.

Thus, their total costs on this operation will be 2.20.

3. Management or Performance Fees: A portion of the profits given to the broker

Some copy trading platforms charge a commission on the profits made from copied positions. This model is generally used by brokers who offer professional traders to copy and who apply a profit-sharing policy.

Example of management or performance fees

A broker applies a 20% performance fee on profits generated through copy trading.

• If an investor makes a profit of AED 2,000 by copying a trader, they will have to pay AED 400 to the broker (20% of AED 2,000).
• They will therefore have AED 1,600 net of fees.

This type of fee is often justified by the quality and expertise of the traders offered by the platform.

4. Inactivity fees: a cost for unused accounts

Brokers sometimes impose inactivity fees if a trading account remains inactive for an extended period (often 3 to 12 months). These fees are charged monthly as long as the user does not perform any operation.

Example of inactivity fee

A broker applies an inactivity fee of 10 AED per month after 6 months of no transactions.

• An investor who has not used their account for 8 months will have to pay 20 AED in cumulative fees.
• To avoid these fees, they can simply make a transaction before the deadline.

This type of fee is particularly important to monitor if you plan to use a platform occasionally.

5. Withdrawal fees: a cost to recover your profits

Some brokers charge fees on cash withdrawals, especially when the investor uses a bank transfer. These fees may be fixed or proportional to the amount withdrawn.

Example of withdrawal fees

An investor wants to withdraw 500 AED from their trading account. The broker applies a fixed fee of 5 AED on each withdrawal.

• In the end, the investor will receive 495 AED in their bank account.

These fees can be avoided or reduced by choosing platforms that offer free withdrawals or by using alternative payment methods such as e-wallets (PayPal, Skrill, Neteller).

Is copy trading suitable for beginners?

Copy trading is often presented as an ideal solution for novice investors, as it allows you to automatically copy the strategies of experienced traders. However, although this method facilitates access to financial markets, it is not entirely without risk. Here is an overview of the advantages and limitations of copy trading for beginners.

The advantages of copy trading for beginners

• No expertise required: Unlike traditional trading, which requires in-depth market analysis, copy trading allows beginners to invest without having to master technical concepts such as technical or fundamental analysis.
• Progressive learning: Observing the strategies of experienced traders allows novices to understand market mechanisms and learn how to better manage risk over time.
• Time-saving: Since copy trading is automated, there is no need to constantly monitor the markets. Orders are executed in real time, without manual intervention.
• Simplified diversification: Platforms allow you to copy multiple traders at the same time, which offers a better distribution of risk and avoids betting everything on a single strategy.
• Access to different asset classes: By copying several specialized traders, it is possible to invest in various assets (Forex, stocks, cryptos, commodities, etc.) without requiring in-depth knowledge of each market.

The limitations and risks for beginners

• Dependence on the performance of copied traders: copying a trader does not guarantee profits. Even experienced traders suffer losses, and it is possible to copy a strategy that proves ineffective in the long term.
• Lack of control over investment decisions: unlike manual trading, copy trading leaves little room for personalization. The investor automatically follows the decisions of the copied trader, which can be frustrating in the event of poor performance.
• Risk of amplified losses: some traders use high leverage, which can lead to significant losses if the market moves unfavorably. It is crucial to analyze the level of risk before copying a trader. The maximum leverage allowed for retail traders in the United Arab Emirates according on the regulation must be considered.
• Fees that can reduce profitability: some brokers apply fees on copy trading (commissions, spread, performance fees, etc.), which can impact the profits of beginner investors.
• The absence of a guarantee of results: even when copying a successful trader, the financial markets remain unpredictable. Past gains never guarantee future performance.

What strategy with copy trading?

Copy trading allows you to adopt different strategies depending on your investor profile, risk appetite and financial objectives. Some approaches favour stability and security, while others aim for higher returns by accepting a higher level of risk.

How to become a trader to follow for social trading?

Becoming a trader to follow on a social trading platform requires much more than just financial performance. You need to demonstrate a reliable strategy, good risk management and transparency that inspires confidence in investors wishing to copy your transactions.

First and foremost, it is essential to define a clear and repeatable trading strategy. Investors favor traders whose performance is stable and consistent over the long term. Whether it's scalping, swing trading, or long-term investing, a well-defined and rigorously applied approach builds credibility. Good risk management is also crucial: limiting drawdown, avoiding excessive leverage, and not exposing all of one's capital on a single position reassure potential copiers.

Transparency is another key element. The most followed traders on copy trading platforms regularly share their analyses, decisions, and results. Publishing updates, explaining positions, and being active in the community helps attract copiers and retain existing ones.

Finally, a regular presence and interaction with copiers build investor confidence. Some brokers even offer financial incentives to traders with a large number of followers. The more the trader inspires confidence, the more likely they are to be copied and increase their income through copy trading.

What is the taxation on income from copy trading in the United Arab Emirates?

The United Arab Emirates is known for its investor-friendly tax environment, which includes zero personal income tax for individuals. This makes the UAE an attractive destination for traders, including those engaged in copy trading.

No Personal Income Tax

In the UAE, profits generated from copy trading are not subject to personal income tax. Whether your gains come from trading forex, stocks, indices, or cryptocurrencies, you do not have to pay tax on these earnings as an individual resident.

This tax exemption applies regardless of whether the profits are made through manual trading or automated strategies like copy trading.

Corporate Tax for Professional Traders

As of June 1, 2023, the UAE has introduced a federal corporate tax of 9% on business profits exceeding AED 375,000. This applies to legal entities and individuals if they are considered to be conducting a business or commercial activity.

For traders operating as a registered business, or those whose trading activities are frequent and organized enough to be classified as a business, copy trading profits could potentially fall under this tax regime. In such cases, professional advice is recommended to assess your tax obligations.

Cryptocurrency Taxation

There is currently no specific taxation on cryptocurrency gains for individual traders in the UAE. However, companies dealing in crypto assets on a commercial scale might be subject to corporate tax if they meet the criteria of a taxable business activity.

Reporting Requirements

For individual retail traders, no income declaration or tax filing is required in relation to trading gains. However, if you're trading as a legal entity or your activities resemble a business, you may need to register with the Federal Tax Authority (FTA) and comply with the relevant reporting obligations.

P. Laurore

Finance expert

Co-founder of HelloSafe and holder of a Master's degree in finance, Pauline has recognised expertise in personal finance, which she uses to help users better understand and optimise their financial choices. At HelloSafe, Pauline plays a key role in designing clear, educational content on savings, investments and personal finance. Passionate about financial education, Pauline strives, with every piece of content she oversees, to provide reliable, transparent and unbiased information for independent and informed financial management. To this end, she has tested over 100 trading platforms to help internet users make the right choices.