Building a successful copytrading system
Last updated
Last updated
In order to be successful at copytrading, you need:
A profitable and consistent lead wallet (after understanding completely how our summary works, it should be enough to address that properly after some research)
A good execution system, this means your copytrade bot must be good (use our partners, you will find a link for them in the bot menu). And this is very important because the bot has 2 very important tasks.
The first is to monitor everything the lead wallet is doing and the second is to send a buy/sell transaction after spotting the transaction the lead wallet is doing.
For such tasks, the bots use RPCs and there’s considerable differences between them. Expect that most of them will perform poorly, so monitoring and transaction landing will be slow compared to the best ones.
Make sure you verify wallet performance but also the trading deltas of the lead wallet. If the trading deltas are too low, that means the wallet opens and closes the position too fast. This means your bot will likely not execute as fast as the trader, drastically increasing your odds of losing.
Understand that, if a consistently profitable trader opens and closes positions fast, it means that’s probably his trading edge. It can somewhat be considered a “high frequency” trading system and your odds of copytrading successfully this system is very low.
In order to be successful copying a wallet, you should aim for traders with higher trading delta percentiles. The minimum could be low (as the trader may have done a trade or two that had to be closed fast) but the 10th percentile should be at least 60 seconds. That means only 10% of trades took less than 60 seconds and 90% of trades took longer than that, which means you will likely perform similarly to the trader as he’s trading on longer timeframes.
You can expect 1 to 5 seconds delay when buying/selling with a good copybot. This delay will likely not cause a considerable gap in buy/sell prices if the lead wallet is trading in longer timeframes like 5, 10 or 30+ minutes on average.
