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Yieldfund, a quantitative trading company based in the Netherlands, has released a new study on copy trading to determine whether the strategy creates value for retail traders. The study, which sampled trader data over a 90-day period, analyzes the performance and profitability of traders who use this method to copy futures market trading.

The study examined 100,236 copy trading outcomes from 1,486 trading accounts across three major exchanges and found that fewer than half of the copy traders in the sample were profitable.

The data from the sample highlighted a few key findings, which are leader-, copy trader-, and platform-related. While 97% of leaders using their own capital were profitable, only 48.48% of their followers achieved positive returns during the 90-day data sample.

Additionally, it was observed that despite profitable ROIs on the platforms, this didn’t always translate into dollar-value profits, highlighting the gap between the perceived success of trading accounts with high ROIs over a 90-day period and the actual results experienced by most retail traders.

Jesse Simons, CTO at Yieldfund, highlights that “our analysis provides a transparent view into the realities of copy trading. While most retail traders see copy trading as a set-and-forget strategy, our findings show the opposite, highlighting the importance of informed decision-making and robust risk management.”

The study aims to clarify misconceptions about copy trading and the high ROIs achieved by copy traders, which don’t always translate into similar returns for ordinary traders. While the study does show that leader ROIs are real, “the disparity in profitability between traders and leaders underscores the need for traders to focus on learning and protecting capital rather than seeking high returns through little effort,” adds Simons.

The findings suggest that many copy traders are drawn to leaders with high short-term ROI without fully understanding the associated risks of trading, such as high leverage and inadequate stop-loss strategies, which can quickly erase gains. The full study is available on Yieldfund’s website, offering a more detailed analysis of these results.

About Yieldfund

Yieldfund is a Dutch quantitative trading company that uses fully automated systems based on mathematical models to invest in the cryptocurrency market. It offers three investment plans of 1, 2, or 3 years, with a minimal one-time investment of €10,000. Notified with the Dutch Authority for Financial Markets, Yieldfund offers annual returns of up to 60% accompanied by weekly payouts and 100% initial capital repayment. For more information, visit www.yieldfund.com.

The post New Study Finds Fewer Than Half of Copy Traders Are Profitable appeared first on Cryptonews.

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