This depends on your point of view, but Social Trading is designed to make being a strategy provider simple and convenient.
- Trading periods: this necessary period of time is used to calculate a strategy’s metrics, but may present an inflexible timeframe for strategy providers.
- Commission payouts: Only occurs at the end of a trading period.
- Managing metrics: Growth and Risk are metrics that a strategy presents to investors; these are not in the control of the strategy provider.
- Drawdown: Accumulated loss in a strategy eats into commission, which can lower overall earnings; in other words, the losses hit a little harder.
- Untimely investments: Unfortunately even if a strategy provider is profitable, an investor that starts copying their strategy later on may not see the same amount of profit as the strategy provider, resulting in dissatisfaction.
All of these drawbacks can be mitigated with good risk management, and careful consideration. We recommend reading more about what goes into a strategy so that you can better manage them.