Empirical insights on social trading

Abstract

Social Trading is a method of investing where investors observe the trading behaviour of their peers and expert traders and follow their investment strategies using copy trading or mirror trading” Social trading has been seen as a valuable partnership by the brokers as it increases the lifetime of the novice traders without the expense and hassle of maintaining relationship with them over telephone or other medium of guidance. Some major players have come to capture the value in this space such as Tradency and ZuluTrade, who have created a platform with an ever-increasing revenue, often on revenue share basis. The platforms have seen rapid technological development driven by the need to accommodate an increasing number of knowledgeable traders, and also because of the entry of several players