What is a Forex Trade Copier and How It Works

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With the modern technology in place, the world is more connected and smaller. Communication around the globe is simpler today thanks to the robust growth in the information sector. Forex trading has not been left behind. Today, accounts managers are able to operate several accounts from a single master account.

Don’t confuse trade copier software with a signal service which operates using a trade copier. Let me explain everything you need to know about trade copiers.

A trade copier will copy trades executed in the master account to several slave accounts as shown below.

What is a trade copier in Forex

Trade Copier demo: Instantly copying trade from one MT4 to other two MT4 accounts

Trade Copier demo: Instantly copying trade from one MT4 to other two MT4 accounts

The main trader will focus on effectively trading one account and the same will be posted in other linked accounts. Regardless of the computer or the location of the main trader, all his trades will be copied immediately to the slave accounts. Alternatively, amateurs in the trading world can also link their accounts to that of an experienced trader. Anytime the trader makes a trade, the same is copied in his or her account. In a case where one of your accounts is subscribed to be receiving forex signals, then that can serve as your master account and more accounts could be linked to it using trade copier. A trade copier works like a mirror, whatever happens in front of a mirror is reflected immediately.

Why people use Trade Copiers in Forex

First of all, many people confuse trade copier software with a trading signal service which operates using a trade copier.

A trade copier will never make you money on its own and it will never trade Forex for you without a trading manager or Forex EA running on the other end.

A trade copier is a software that will copy the trades between trading accounts and when a trading signal service uses the trade copier to deliver its trades to the customers’, people started to think that it’s a trade copier who makes the money. But the truth is, a trade copier is just delivering trades.

This is also known as copy trading and hundreds of thousands of people use this every day.

Here is what a trade copier can do:

  • Allows Forex traders to trade multiple accounts simultaneously so you can share your Forex signals with friends, family, and other investors
  • Allows copying trades of any Forex EA to other accounts so you can split the fees of any Expert Advisor with your friends and copy its trades between each other’s accounts
  • Allows creating investment portfolio of many accounts by copying them into one trading account
  • UK Traders can copy the trades from a regular account to their Tax-Free Spread Betting account to save on taxes
  • Allows to copy trades from an unknown offshore broker account into reputable local broker account so you can remove the risk of unregulated brokers
  • Allows any trader to become an independent Forex account manager because it’s an easy and cheap alternative to PAMM accounts
  • Allows reversing the trade direction when copying where BUY becomes SELL and opposite so you can turn a losing trading strategy into a winner

Trade copier for MT4

Considering that MT4 is the most widely used trading platform, there are a lot of trade copiers that are compatible with this platform. Basically, a trade copier will be installed at least in two MT4 platforms allowing them to communicate. Users must be careful when choosing a copier as not all copiers for MT4 will work appropriately. Some trade copiers will experience relay problems, some will make incorrect copies and can lead to huge losses. Others, usually are not able to copy partial close transactions or lack some other important features like adjusting of stop loss and take profit, risk management options, etc.

The image below illustrates how Signal Magician, a well-known remote copy trading platform, allows setting position size (risk) proportions for each Trader-to-Client connection.

Trade size proportion and risk ratio explained in the Signal Magician remote signal delivery platform.

Trade size proportion and risk ratio explained in the Signal Magician remote signal delivery platform.

MT4 trade copiers are usually based on Expert Advisors and for this reason you are free to work with any broker as long as you are using the MT4 platform.

When choosing a trade copier for MT4, the following should be considered.

First and foremost, the trade copier software company should offer you technical support.

Secondly, it should give flexible risk management options to allow you adjust your risk accordingly.

A good trade copier should also be flexible to allow you copy specific trades while filtering the ones that are not needed.

When Rimantas Petrauskas created the Local Trade Copier he considered these and many other features. LTC is considered one of the finest trade copiers in the market and trusted by hundreds of traders around the world.

Other factors to consider should include auto-scaling ability, should utilize small memory size and should be user-friendly.

But don’t stop reading if you are looking for something more than just a trade copier for MT4 to copy trades between accounts on the same computer.

Trade copier on MT4 Mobile app

Speaking of a Local Trade Copier from www.mt4copier.com, it is so flexible that you can even copy trades between MT4 Mobile app (on Android, Tablet, or iPhone) to other MT4 accounts located on another mobile device or computer.

Basically, it is possible to trade many MetaTrader 4 accounts from just one MT4 Mobile app and you can do that from iPhone or Android.

Trading dozens of MT4 accounts on different computers from your laptop and smartphone

Trade copier MT5 to MT4

With the demand for MetaTrader 5 growing, the focus is steadily shifting to the use of MT5 from the MT4. However, the use of MT4 is still popular and therefore the demand for a trade copier capable of copying trades between MT5 and MT4 is definitely on demand. With such account copier, orders placed on the master MT5 platform will be copied to MT4 terminals or vice versa.  The communication is almost instant. Copy speed and slippage will individually depend on the broker one is using.

It is worth noting that from the above diagram, a user could simply connect one MT5 to an MT4 terminal. A good trade copier, in this case, should be one that can work for both demo and live accounts. Just like the other account copiers, MT5 to MT4 copiers should be user-friendly, utilize less memory and have good risk management tools.

Trade copier for Ninjatrader

With an increasing number of people now using the Ninjatrader platform, this software is becoming famous. More traders in the recent past have found Ninjatrader as a perfect alternative to MT4. Having a compatible trade copier with Ninjatrader comes in handy. Such trade copiers can be used to manage personal accounts or even send trades to your subscriber’s accounts. Such a trade copier should be able to give a user the ability to adjust his/her risk and at the same time be able to filter signals. When selecting a good trade copier for Ninjatrader, look for one that is:

  • Easy to install and use
  • Money management controls
  • Master account control status
  • Ability to adjust trade allocation

Trade copier for Binary Options

Some traders are slowly adapting to trading in Binary Options as opposed to Forex trading. This is partly because it’s considered easier to trade. What a trade copier for binary options does is simply copies Binary Options trades from one account to another, the difference is that Binary Options trades look different from regular Forex trades.

These copiers will allow users with less experience in trading Binary Options to operate on autopilot if they have a good source account to copy from. You can link multiple accounts in different locations. Alternatively, you can link accounts locally within a single machine. Users seeking to acquire a trade copier in this category should focus on a reliable copier that copies instantly; a copier that works effectively with both demo and live accounts. This gives the user a chance to test whether the copier is working correctly even before he commits real money. With these copiers, you will benefit so much by copying trades entered by more experienced traders.

How trade copier works

Trade Copiers for MT4 are built with two main components; the Server EA and the Client EA.

The Server EA acts as a master while the Clients EA acts as the slave. In other words, Server EA is the sender of the trades and the Client EA is the receiver of the trades.

When Server EA is attached to the MT4 account it becomes a master account. When a Client EA is attached to the MT4 account it becomes a client account.

The Trade copiers can be broadly classified into two based on the purpose the serve.

Local trade copiers

Local Trade Copier is a basically a type of software that is simply installed in two trading platforms that are running on the same computer. Both MT4 platforms must be hosted on the same computer or VPS and for this reason, it is called “Local” Trade Copier. It copies trades only to MT4 accounts operating locally, on the same machine. The software will operate just like an Expert Advisor ensuring accurate and efficient synchronization and communication between the platforms. These copiers can be used with any broker.

Remote trade copiers

Remote Trade Copier, on the other hand, can copy trades between accounts located on different machines. With remote account copier, the accounts don’t necessarily need to be placed in on the same VPS or computer. Of course, it would work just fine if copying trades within the same computer too. This type of copiers utilizes the internet (web server to be exact) to enhance the communication between two MT4 platforms that are located on different machines anywhere in the world. The two platforms could be in different countries, but the execution of trades is almost instant.

Forex Trade Copier concept illustrated. Local and Remote trade copier operation schema.

Forex Trade Copier concept illustrated. Local and Remote trade copier operation schema.

When using the LTC (Local Trade Copier) you have all the power in your hands. This copier gives you the ability to operate multiple accounts by one touch. It also allows one to adjust the appropriate risk for each on the slave accounts separately. If there are three client MT4 terminals, you can put different risk factors for each of the accounts. On the other hand, you can set the copier to only utilize just a portion of your account size.Other feature such as the stop and close at certain equity levels helps users reduce exposure of their accounts. Stop and close feature will help you lock your profits by closing orders when a certain profit is achieved.

Other features such as the stop and close at certain equity levels help users reduce exposure of their accounts. Stop and close feature will help you lock your profits by closing orders when a certain profit is achieved.

The Concept of Forex Copy Trading with Local Trade Copier on MetaTrader 4

The Concept of Forex Copy Trading with Local Trade Copier on MetaTrader 4

How to use trade copier

To get started, you will need to follow the below steps:

How to install Trade Copier

When you have at least two MT4 platforms installed and all necessary configurations done, you can proceed and install you LTC (Local Trade Copier).

 

Firstly, you need to open the auto-installer of the Server EA.It will scan your computer for all the MT4 platforms installed. When the scan is over, your copier is ready for installation. Click next and the auto installer displays to

It will scan your computer for all the MT4 platforms installed. When the scan is over, your copier is ready for installation. Click next and the auto installer displays the list of all available MT4 platforms. Select where to install your copier’s Server EA and then click Next. Choose those MT4 platforms which ones should act as master accounts (sending trades to clients).

Choosing on which MT4 platforms a trade copier will be installed

Choosing on which MT4 platforms a trade copier will be installed

Do the same for the Client EA but select MT4 accounts you want to receive the trades.

Whenever you have additional platforms you need the copier installed, simply re-run the auto-installer again.

Trade copier for scalping

It is worth noting that when it comes to copying scalping strategies, time is of the essence. A five seconds difference can create a major difference in terms of results between the client and master terminal. For most users, execution will take between 100 to 200 ms. Transferring trades between platforms will normally take approximately 400ms. Copying scalping strategies is possible but sometimes could be very challenging.

Of course, it is possible to switch Local Trade Copier to operate at full speed by setting the SyncRate parameter to 1. In this case, it will copy the trades as fast as your computer and your Internet connection are capable of delivering them to the broker.

This video demonstrates how fast an EA-based MT4 trade copier can be.

Trade copying speed highly depends on these factors which pose a major challenge for scalping strategies:

  • The quality of your internet connection (Latency). For scalpers, latency should be anywhere between 1-10 ms. However, for long term traders latency of even 500 ms is pretty much okay.
  • The speed of a computer or VPS server. When running a trade copier, it is recommended that your CPU load should be below 70% as well as the RAM consumption.
  • Broker execution speed. Sometimes bad brokers will offer slow execution speed just to make sure you don’t benefit from Forex news trading, especially when your trades are going well. Monitor broker execution speed closely. Local Trade Copier helps with that and displays this metric on the chart in a special dashboard.
  • Copier synchronization rate (SyncRate parameter). This refers to the rate at which LTC synchronizes trades between the master and the slave accounts.

MT4 trade copier without terminal

Many people are looking for a trade copier software that can work without an MT4 terminal. However, it is important to educate yourself on this topic and protect from trouble in the future.

Both master and client MT4 terminals must be running at all times with the Server EA and Client EA attached in order to copy trades. Basically, there’s no other option to copy trades without software running.

Be careful with those computer programs that allows copying trades without running MetaTrader platform if you find any. They use unofficial MT4 Server API and you can be banned by MetaQuotes and get yourself in trouble. There were cases in the past when MetaQuotes sued companies for using unofficial MT4 Server API software. This is why I do not use such option and created the Local Trade Copier and Signal Magician to comply with the rules of MetaQuotes.

Just think about it. If trading signals on MQL5 Market require everyone to run MT4 accounts all the time to receive the trades, it means it’s the best and most reliable way to deliver those trading signals with Automatic execution.

But don’t get upset if you don’t like the idea of MT4 running at all times. There’s a solution that’s easy and affordable for everyone. It’s called a Virtual Private Server or VPS for short.

With a VPS server in place, you and your clients can easily have MT4 terminals running 24/7. This is just like having your virtual PC somewhere online. The implication of this is that you can install your MT4 platform along with the trade copier to this virtual machine.

Whether your computer is on or off, the platform and account copiers will be running throughout. This is a more reliable option as there must be a terminal to operate copiers. Inefficiencies such as slow internet and slow computers will not affect your trading as you will be enjoying high-speed internet offered by most VPS server providers.

Trade Copier Investor Password

A modern trade copier should allow you to copy the trades from MT4 accounts even if you have just an investor password login. Yes, even if you login to someone else MT4 trading account in a read-only view environment you can still copy those trades without them knowing about this.

This is called investor password trading and quite popular in the Forex world.

The video below demonstrates how you can copy positions between MT4 accounts if you have only an investor password (read-only) access to the master MT4 account.

Obviously, Local Trade Copier can easily do that.

Note that you still need main (a.k.a. master password) for all client MT4 accounts because otherwise there won’t be trading permissions and no one (including a trade copier EA) would be able to place trades.

Make money selling Forex signals

For traders who want to become not just another Signal Providers but also wish to turn such service into a real business, they need to take an extra step with custom branding.

This is possible with the white label copy trading platform such as Signal Magician. Signal magician allows you sell forex signals while operating as an independent business, have your private copy trading infrastructure and your branding for the business.

To start independent Forex signal business you need to:

  • Set up independent infrastructure for copy trading (Dedicated web server and Remote Trade Copier such as Signal Magician)
  • Link up your main MT4 account and MT4 accounts of your followers through the Signal  Magician
  • Trade main MT4 account and get paid by the subscribers on a monthly basis as you grow their accounts
  • Creating Forex signals web site would be a benefit because it would help to promote the service easier

forex-copy-trading-signal-book-mockup-65x100-2014-05-16Recommended book: How to Start Your Own Forex Signal Service

Conclusion

The concept of forex trade copiers has completely revolutionized the way Forex trading is done. Before its introduction, Forex trading was purely a game of experts; today amateurs can tap into the skills of experts thanks to trade copiers.

The cost of hiring account managers to operate some of your accounts has effectively reduced because all you need is operate one account and the same will be copied to other client accounts. Today complex data can easily be mirrored into a countless number of accounts. For those who wish to learn to trade, this is one of the fastest ways of doing it. You can easily follow how the experts are trading based on the copies being done on your platform. On the other hand, there is the flipside of using the trade copiers. If not used in the right way it could offer drastic results. Proper money and risk management skills must be applied, otherwise, your objective may not be met.

About the author

Rimantas Petrauskas

First I am a father, a husband and then the author of the book “How to Start Your Own Forex Signals Service”. I am also a Forex trader, a programmer, an entrepreneur, and the founder of ea-coder.com Forex blog. I have created two of the most popular trade copiers and other trading tools for MT4 that are already used world wide by hundreds of currency traders.

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