A Guide to Zerodha Copy Trading - Everything You Need to Know

A Guide to Zerodha Copy Trading – Everything You Need to Know

We all do not mind making money passively in the financial markets. Zerodha, a popular trading platform in India, is giving investors a chance to earn passive income through copy trading. Are you in India? Learn how to replicate the trades of seasoned trades on Zerodha in this guide.

What is Zerodha?

Zerodha is a Mumbai-headquartered brokerage firm with numerous offices across India. It was founded in 2010. Through the Zerodha trading platform, you can access various financial instruments, including bonds, commodities, stocks, futures, and options.

Zerodha introduced its copy trading service in 2019. However, it grew in popularity in 2022 as many novice Indian traders started looking for ways to generate profits from the financial markets without prior trading experience.

How to Get Started With Zerodha

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To start copying trades on Zerodha, you need to open the broker’s demat account. But how do you register for this account? Firstly, go to Zerodha.com and click “Sign Up.” Secondly, enter your valid phone number and press “Continue.” Zerodha will send you an OTP to verify the phone number. Next, provide a unique password to complete the registration process.

Upon signing up with Zerodha, you must verify your identity to get the demat account. All you have to do is provide an identification document or a valid driver’s license. After the Zerodha team approves your documents, you can fund your demat account to begin copy trading.

Minimum Copy Trading Amount on Zerodha

Zerodha doesn’t impose a minimum copy trading amount requirement. However, the strategy providers do. Some experienced traders may want you to commit at least 4,000 Indian Rupees, while others may request 80,000 Indian Rupees.

Copy Trading Costs on Zerodha

Zerodha doesn’t charge you a fee to access its cost trading service. However, Strategy providers collect commissions from copy traders after successful trades. Further, the Indian broker charges a 0.03% fee on every executed order.

How to Copy Trades on Zerodha

Now that you understand the copy trading costs involved, it is time to learn how to mock the trades of successful traders. Here is how you can get started:

1. Go to your demat account and click “Copy Trading.”

2. Explore the many strategy providers listed on the Zerodha copy trading platform. You can visit their profiles to analyze their trading stats.

3. Select a lead trader based on your trading goals and allocate the required funds.

4. Next, employ risk management measures like stop loss and take profit, then click the “Copy” button. Your strategy provider’s trades will be copied automatically to your demat account.

While the Zerodha copy trading service is automated, it is advisable to monitor your copied trades every now and then.

How to Identify the Right Lead Trader on Zerodha

Finding the right lead trader is key to your copy trading journey. These are some of the factors that you should consider when selecting a strategy provider:

  • Gauge the confidence level other copy traders have in a particular signal provider – If a lead trader enjoys a huge following, then it suggests that copy traders have massive confidence in them. Moreover, if a lead trader manages a significant amount of copy trading funds, it signals that followers trust them.
  • Determine the leader’s monthly returns – No one wants to record negative returns on their trading accounts. That’s why it is important to follow a consistently profitable trader. Note that even profitable traders register losing trades occasionally.
  • Check the number of trades initiated by the lead trader – If the trader has numerous winning trades, it suggests they trust their strategy and that their trading success isn’t by chance.
  • Assess a lead trader’s maximum drawdown – Zerodha shows how much a trader has lost since they started trading. If the figure is high, then it may indicate that the trader’s risk management measures are not working properly.

Is Copy Trading on Zerodha Safe?

Yes! Being a highly regulated broker, Zerodha offers users a trustworthy copy trading platform. Moreover, the brokerage firm adopts effective security measures to keep user funds safe.

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