With constantly evolving technologies, cryptocurrency trading has also evolved and introduced new trading methods. Copy trading and bot trading are the two most popular ways to trade cryptocurrencies to maximize profitability. The main difference between them is that copy trading allows you to copy professional traders and a crypto trading bot helps you automate the trading process.
Copy trading vs Bot de Trading and resume
Copy trading is a process of imitating the trades of experienced and successful traders to make profits. Several cryptocurrency copy trading platforms allow investors to copy the trading strategies of veteran traders. Therefore, inexperienced investors with deep knowledge about cryptocurrency trading can benefit from this process to make profits.
For their part, cryptocurrency trading robots allow automatic execution of trades on behalf of investors in their absence. Since the cryptocurrency market is active 24 hours a day, investors can take advantage of these pre-programmed cryptocurrency trading robots and set some predefined criteria to execute trades. Unlike copy trading, trading with bots does not involve active participation and eliminates the risks that come with manual trading.
Differences between Copy trading and Trading Bots
Automation
While both copy trading and botting involve automation, there are minor differences when it comes to execution. Investors can manually choose individual traders and trading strategies to copy, while actively participating in monitoring and adjusting trades. This is not the case with trading bots.
Once traders set some conditions based on market parameters, the bots automatically execute trades when those conditions are met in real time.
decision making
In copy trading, traders make decisions about whether to copy a trading strategy or not. Only after they choose a trading strategy or a trader does automation come into the picture. Even after choosing a successful trader, investors can periodically adjust and customize their trading strategies.
On the other hand, trading robots make decisions on whether or not to execute a trading strategy based on pre-programmed market conditions. The best trading robots accurately implement trading strategies, eliminating impulsive human decisions.
Learning curve
Cryptocurrency copy trading has a good learning curve as it involves following experienced traders. Beginning traders look for successful traders and analyze their historical performance. In the process of copying experienced traders, they can learn many intricacies involved in cryptocurrency trading and benefit from their vast experience and knowledge. This is not the case when it comes to cryptobot trading.
Risk management
Although cryptocurrency trading is inherently risky, when we compare copy trading with bot training, the former can be riskier. This is because the risk tolerance of experienced traders may not always be the same as that of novice investors. Blindly copying successful trades is not a good idea without paying attention to your own risk management.
But in the case of bot trading, investors can consider their risk tolerance and execute trades based on it. Various types of orders such as limit orders, stop loss orders, take profit orders, etc. help them implement trades without risking their funds.
Accessibility and prices
Copy trading is more accessible compared to bot trading because to use them, investors need some technical knowledge and skills. It is easy for beginner investors to find successful traders and copy their trades.
But when it comes to bot trading, they must know how to adjust the settings of the bots. On top of that, cryptocurrency trading robots charge high fees, while copy trading platforms allow investors to copy other traders for free.
