The Impact of Social Networks on Forex Trading Performance
Since the launch of social networks, the world has been hooked and now they are part of everyone’s daily life. Social media has allowed friends and strangers in the world to connect and learn from each other from media sharing to insights on major world events.
The popularity of social networks also grew among the forex trading community. Traders embraced this trend with aim to learn and share trading ideas with the goal to improve their performance. As such, FX Junction emerged on the scene in 2011 as the first open social Forex network that allowed its users to create profiles, upload and share media, send messages and connect with other Forex traders in the world to share ideas and experiences, analyze trading performances and perhaps copy trades from each other without having the need to change their existing broker. As like with other social networks, FX Junction users became hooked and it’s popularity has been growing ever since.
Anyone who trades has hopes of making a profit, but in reality making a profit is very difficult. A curiosity has emerged among market participants pondering: “Can social trading networks have an impact on trading performance?” Everyone has heard the phrase “Follow the Leader.” We all know that not everyone can be a leader, but a leader can come from anywhere. FX Junction believes in this philosophy. To be a popular trader in a social network like FX Junction, traders have to prove themselves by linking their account to the social network and get the attention of other traders on the network by building a good reputation through a long-term positive and stable performance. Within the FX Junction social network, everything is transparent from the type of account and the trader’s broker to the amount of fees, if any, the trader is applying.
For several years, Finance Magnates has been gathering trader performance data from US retail Forex brokers and has began publishing the quarterly US Retail Forex Trader profitability reports. We believe it surprised many market participants who originally believed that all Forex traders lose, which the data showed was apparently not true. But, it did show that it is not easy be profitable trading Forex.
As FX Junction has been an active social network for over 5 years, we have also been able to gather performance data from all the traders within the social network. We shown a comparison of FX Junction’s quarterly trader performance data with the US retail trader performance data published on financemagnates.com. The table indicates that Forex traders on FX Junction achieved a significant edge in performance over Forex traders at US retail brokers.