Over the past year we’ve been making significant steps in our efforts to lower risks by encouraging sustainable and responsible trading across our network and promoting consistent long term profits.
eToro believes that CopyTrading is an investment tool and should promote investment diversification and therefore lower risks.
In this post we will discuss three new changes to your CopyTrading experience:
Profiles with the highest risk score will no longer be available for copying
The maximum copy allocation will increase to 100% of your equity
A revised profile questionnaire that will determine what kind of limitations – if any – you might have on your CopyTrading activity
1) Why can’t traders with the highest risk strategies be copied?
This protects clients from inadvertently exposing their funds to the highest risk trading strategies.
How will it work?
When a trader reaches a risk score of 9 out of 10 (based on a weekly average score), they won’t be able to get new copiers. If you try to copy them at this point, you will receive a notification informing you that this trader cannot be copied. Once their profile decreases to 8 or below, they can be copied again.
Will I be forced to uncopy high-risk traders I’m already copying?
No. However, if a trader you are copying changes their strategy and becomes high risk, you should consider whether you wish to continue copying them.
Will existing copy relationships or copied trades remain open?
Yes. Existing copiers will receive a notification to help them decide whether to continue copying or to consider copying someone with a lower risk score.
Shouldn’t it be my decision if I want to copy high-risk traders?
This applies only to profiles with the highest risk scores. eToro promotes responsible trading and statistics show that copying these traders may result in financial losses.
What is a risk score?
You can read more about our risk score here.
What can I do to gain new copiers if my risk score is 9 or 10?
Diversify your portfolio, lower your average position size and use lower leverage.
Will I get a warning or have a grace period if my risk score exceeds 8?
No. However, you should regularly monitor your own risk score.
2) Why are we removing the max copy limit?
One of our main goals has always been to reduce risks. To meet this goal, we initially put in place an allocation limit of 40% when we had introduced the Copy Stop-Loss feature.
After listening to our users’ feedback, it was clear that you wanted us to remove this limit. We were reluctant to do so until we could add this new feature which will automatically disable the ability for users to copy high-risk traders. We are now able to remove the 40% allocation rule while maintaining our overall risk reduction goals. Therefore, we are pleased to announce that in the next few weeks you will be able to copy any trader with 100% of your equity.
As always, we encourage you to engage in responsible trading practices and constantly monitor the performance of any trader you are copying. If you want to learn more about responsible trading practices, feel free to contact our Community Representatives.
3) What do I need to know about the profile questionnaire?
Completing your profile is a compulsory part of our verification procedure and it gives us an indication of what you’re expecting from eToro.
The questionnaires’ results will determine what kind of limitations – if any – you might have on your CopyTrading activity. If you have not completed the questionnaire yet, we encourage you to complete it before your next copy activity.
You can find out more information about the revised questionnaire here.
How can I update my profile?
If you haven’t completed your profile yet, click here now.
For any further information, you can always contact our Customer Support team.