Copy Trading Guide: How to Use Covesting at PrimeXBT
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PrimeXBT is a margin trading platform offering a wide variety of services for discerning traders. One of these services is called Covesting and serves as an integration offering copy trading—the act of imitating, or copying, someone else’s successful trading strategy for yourself. If you’re interested in using this tool or simply familiarizing yourself with it, this guide will answer any questions you might have (and possibly more).
What Is Covesting?
Covesting is a special module found at the PrimeXBT margin trading platform (that includes much more than just cryptocurrencies). It serves as a platform for those who want to share their winning trading strategies with the world, as well as those who want to learn from the pros. Both are incentivized in their own way: those creating the strategies get a cut of their followers’ profits, while those who are doing the copying don’t have to wreck their brains figuring out what to do.
Why Choose Copy Trading?
Getting into trading full-time is hard, especially when you add leverage to the mix. The risks are steep—simply put, as steep as your chosen leverage—but so are the rewards. Entering the margin trading scene when you are not sure what you’re doing can be a terrible idea if your luck runs out. Thus, following in the footsteps of provably successful traders can help you get your trading account off the ground, giving you more time and experience to catch the ropes and get your own strategy rolling.
On the other hand, if you’re already experienced, you can share your knowledge with rookies. Not only are you helping them, you will also receive some of their profits—and who doesn’t like having ways to generate passive income?
Some Terms You Should Know
Covesting has some specific terminology you should get familiar with if you want to use the module.
- Strategy is a set of all the rules a trader uses. In other words, this is what you will be copying in order to trade, preferably successfully.
- Strategy Manager is the name given to the pros who share their Strategies with others.
- Followers are the traders who choose to use a certain Strategy and don’t make their own.
- Total Profit % is the indicator reflecting the percentage change of the Manager's Equity (only in case the Manager did not deposit or withdraw funds from their Strategy account, in which case it is calculated as a compound percentage between each deposit/withdrawal and the next one).
- Today’s Profit % shows the change in Equity in a single day.
- Manager’s Equity are the funds a Manager has in a certain Strategy. This is not an indicator of the Strategy’s success, since this number changes with deposits and withdrawals (but the Total Profit % does not change).
- Trade Fees are exactly what the name implies—but the catch is that they are progressive, meaning that they change depending on the current Followers’ Equity of the Strategy in question.
- COV is the ERC-20 utility token of the platform, used to unlock utility options such as reduced trade fees, entry fees, and success fees, all of which last 30 days upon activation.
How to Get Started
To start using Covesting, you first need to log in, or create an account at PrimeXBT and deposit some BTC. Creating an account is very simple and takes little time, since there are no forced KYC checks. If you’re here to follow the pros, all you need to do is navigate over to Covesting and choose the Strategy you want to follow. Clicking on each of them displays more information, such as how long it has been active, how many followers it has, and how profitable it has been (along with a handy chart showing its historical performance). When you click the one you want to follow, you will also need to choose how much you want to invest—and you’re done!
Those who want to become Strategy Managers will have a different set of rules to follow (for one, they can’t have more than one active Strategy). Covesting’s Help Center takes users through the process step by step, while their support team is always there to help with everything.
If you know how to take advantage of it, Covesting can be a very powerful tool, no matter which side of a Strategy you’re at. Either you’re the pro who gets a passive income from sharing their secrets, or you learn while profiting off someone else’s knowledge and experience. In other words, everybody wins!