Bybit vs. eToro: Exchange With The Best Copy Trading Product

Several crypto traders crave attention, openly sharing their trades and promoting themselves for others to see and replicate. However, it's critical to be cautious of these traders who only showcase their winning trades. When you examine their profiles, you'll notice a complete absence of losing trades.

Instead of blindly following these "flawless" traders, platforms like Bybit and eToro offer copy trading functionality. This feature lets you discover traders whose strategies and performance you admire and subscribe to their updates.

Once you subscribe to your preferred traders, you can allocate some of your trading funds to them. By activating the autopilot feature on the platform, you can mirror their trades in real-time. It's as simple as finding a trader you resonate with, clicking the "COPY" button, and letting the platform take care of the rest.

In this article, we review the pros and cons of Bybit and eToro to determine which copy trading product is superior for crypto enthusiasts. But first, what does copy trading mean?

 

What is Copy Trading?

Copy trading is a form of investing or trading where individuals replicate the trades or investment strategies of other experienced traders. It allows inexperienced or busy traders to automatically copy the trades executed by professionals in real time, typically through a dedicated platform provided by a brokerage or social trading network.

Copy trading usually involves selecting a trader or multiple traders whose performance and strategies align with one's investment goals. Once a trader is chosen, their trades are automatically copied into the investor's trading account. 

The copied trades are executed proportionally to the investor's available capital, mirroring the actions of the selected trader. This way, investors can benefit from the knowledge and expertise of successful traders without having to actively trade or conduct in-depth market analysis themselves.

Copy trading has gained significant popularity in the retail market due to several reasons:

Accessibility

Copy trading allows retail investors to access the expertise and strategies of professional traders who might otherwise be out of reach. It allows individuals with limited knowledge or time to engage in the crypto market and potentially generate returns.

Learning

Copy trading can serve as a learning tool for inexperienced traders. By observing and replicating the trades of successful traders, individuals can gain insights into various trading strategies, risk management techniques, and market dynamics.

Time-saving

Many retail investors have limited time to dedicate to active trading or market research. Copy trading enables them to participate passively in the market while benefiting from the trades of experienced professionals. This eliminates the need for extensive research, analysis, and trade execution.

Diversification

Copy trading allows investors to diversify their portfolios by following multiple traders with different trading styles and asset preferences. This diversification can help spread risk and potentially enhance returns.

Due to its rising popularity and the demand from retail investors, copy trading has become a staple offering for Bybit, eToro, and many online trading platforms and exchanges. These platforms provide the necessary infrastructure and tools to facilitate copy trading, allowing investors to browse and select from a wide range of traders to copy. Some platforms also provide additional features such as performance statistics, risk metrics, and social interaction capabilities to facilitate the decision-making process for investors.

 

Which is Better? Bybit Or eToro

To determine which platform has the better copy trading platform, let’s explore the pros and cons of copy trading on both platforms.

Pros of Bybit Copy Trading Improved Integration with Derivatives Trading Terminal

Bybit has enhanced its platform with direct trading in a Master Trader Subaccount! Copy Trades are integrated with the main Derivatives Trading terminal, allowing investors to effortlessly copy trades from preferred traders on a single tan instead of a separate Copy Trading tab.

Full Suite of Derivatives Trading Functions

With the integration above, Master Traders can now take advantage of a comprehensive range of trading functions. Previously unavailable in the Copy Trading tab, features like Conditional Orders and Trailing Stops are now accessible to enhance trading capabilities. This integration empowers Master Traders with more tools and flexibility to execute their strategies effectively. 

Copy Trading via API

Master Traders can now execute automated strategies with the support of V3/V5 USDT Perpetual OpenAPI. This integration enables the seamless execution of trading strategies, allowing Master Traders to automate their trading activities and optimize their trading performance.

Trading on Autopilot with Third-Party Trading Tools

Bybit now allows Master Traders to seamlessly connect their Subaccounts to third-party trading tools, including 3Commas and Insilico Terminal, through API integration. 

This enables Master Traders to leverage advanced trading features and execute automated strategies for enhanced portfolio management and increased profitability while effectively managing risks. Once the integration is set up, all trades conducted through these third-party tools will automatically synchronize with Bybit,

Seamless Account Management

Conveniently handle multiple Master Trader Subaccounts with ease. Bybit allows you to efficiently monitor and control all your Subaccounts in one place.

Effortless Management of Trades

Bybit has introduced an enhanced feature within the Asset Overview section specifically for Master Traders. Selected Derivatives accounts will now be clearly labeled as a "Copy Trading" account, providing investors with a clear distinction and easy identification.

With this update, investors can access important information such as Unrealized Profit and Loss (PnL), the total profit share you earned, and conveniently export Order and Trade history. This functionality provides a comprehensive view of trading performance, similar to how you would view your regular Bybit account Order and Trade history.

Automated Strategies Badge

In recognition of the increasing popularity of automated trading strategies among Master Traders, Bybit has introduced a new feature highlighting their usage. Now, when Master Traders employ automated trading strategies, a special badge will be displayed prominently on their profile page.

Cons of Bybit Copy Trading Unavailability in the USA

Bybit Copy Trading is not currently available for users residing in the United States. This limitation restricts access to the Copy Trading feature for traders based in the USA, limiting their ability to take advantage of Bybit's functionalities.

Geographical Restrictions

In addition to the unavailability in the USA, Bybit Copy Trading may have other geographical restrictions that limit access to the feature in certain regions. These restrictions can vary depending on local regulations and compliance requirements, which may prevent traders from specific countries or jurisdictions from participating in Copy Trading on the Bybit platform.

Pros of eToro Copy Trading Chat With A Wide Selection of Traders

eToro Copy Trading provides users with a diverse range of traders. Users can explore and select traders based on their performance, trading style, and risk profile. Furthermore, the platform enables users to communicate with the chosen traders, allowing for potential knowledge-sharing and insights.

Range of Tradable Assets

Depending on the user's location, eToro offers a variety of tradable assets, including cryptocurrencies, stocks, forex, and commodities. This gives users diverse options for diversifying their investment portfolios and taking advantage of different market opportunities.

Social Trading Community

eToro functions as a social trading platform, allowing users to interact with other members of the eToro community. This social aspect enhances the trading experience by enabling users to share ideas, strategies, and insights with fellow traders. The community aspect fosters collaboration and learning among traders.

Cons of eToro Copy Trading Execution Delay

One potential drawback of eToro Copy Trading is the possibility of execution delays. Since Copy Trading involves replicating the trades of other traders, there might be a slight delay between the original trade execution and its replication in your account. This delay can result in slight differences in trade prices and potentially impact the overall performance of your copied trades.

Inactivity Fees

eToro imposes inactivity fees on dormant accounts that have been inactive for a certain period of time. If you're not actively participating in Copy Trading or any other trading activities on the platform, and your account remains inactive for an extended period, eToro may charge inactivity fees. These fees can reduce the profitability of your overall investment and should be considered when using the eToro Copy Trading feature.

Verdict

Thanks to its recently improved and updated features, Bybit edges out eToro as the exchange with the best copy trading product. Furthermore, eToro offers multiple investment options but provides access to only 80 cryptocurrencies. Bybit, on the other hand, offers over 350 cryptocurrencies, spot trading, futures, margin trading, perpetual swaps, options, and leveraged tokens. It also offers financial services like lending and borrowing.

Regarding fees, eToro charges a 1% fee for buying and selling cryptocurrencies, while Bybit offers more competitive fees starting at 0.1%.

However, it's important to note that copy trading also carries risks. Past performance does not indicate future results, and blindly copying trades without understanding the underlying strategies and risks can lead to losses. It's crucial for individuals engaging in copy trading to conduct thorough research, diversify their copied trades, and manage their risk effectively.

Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.