What is a trading signal?
A trading signal is a trigger for action, either to buy, or to sell a security, generated by analysis. It can be used by many audiences, including those who outsource their analysis, and those who want to learn how the signal was generated.
A trading signal is not copy trading where you automatically have the trades of someone else copied in your account. Nor is it account management, where someone else is trading your account on your behalf.
A trading signal is just the information required to trade – the market, direction, target price and the exit levels. You still need to decide whether to follow the signal as an order, how much to stake, and what financial product to use.
Here’s what a signal looks like:
Traders use signals because it provides the perfect balance of trading your own hard-earned funds yourself, while saving time by having a third-party expert doing the bulk of the analysis.
What is Telegram?
Telegram is used by over 700 million people worldwide. It is a super secure, private and feature-rich messaging app. As a method of communicating trading signals, it is unrivaled. Using channels, signal providers can send as many one-to-many messages as they want.
The nature of Telegram’s public and private channel architecture means signal providers can monitor who subscribes to their channels. It’s also very fast, with instant global messaging, which is important when communicating time sensitive signals.
The app has no limit on channel subscribers. It’s free, although a premium service was recently introduced for a small monthly fee, which is worth considering. Signal providers control their own channels, so there’s no need to send audiences elsewhere. This is really important when trying to develop a business in this niche, as sending your audience to another app to consume your signal means giving up your most valuable asset.
If you don’t already have the Telegram app, you can download it here.
What does SignalDP do?
SignalDP is the world’s first decentralized trading signal distribution platform. We distribute and monitor trading signals in the provider’s Telegram channels. We work with signal providers on Telegram to help them add credibility, save time and monetize their insight, while retaining control of their channels.
We’ve seen thousands of signal providers from all over the world, so we’ve seen what works and what doesn’t.
You can learn more about SignalDP here.
A word on analytics
All successful channels analyze their performance in some capacity. The best channels measure key metrics carefully, and analyze how changes in approach and content impact on the metrics that count. As the saying goes, ‘what gets measured, gets managed’.
Telegram is relatively new, so there isn’t a huge range of analytics solutions out there. The ones to consider are:
- TGStat – If you run a channel.
- Native Telegram Statistics – Available to channels with >1,000 subscribers.
- Popsters – For message analysis.
- Chainfuel – For group management and analytics.
With a service like TGstat, all you need to do is integrate it, and leave it to collect data. It captures a lot, although you’ll probably find that some metrics are more important than others, at different stages of your channel’s development.
When in the early stages of creating a signal channel, the important metrics are:
- Engagement rate of subscribers (ERR) – This is how many of your total subscribers read your posts within a certain time period, normally 24 hours. The higher the better.
- Post popularity – This can be measured by views, shares, forwards, comments (if enabled) and reactions. Comparing the popularity of posts will tell you what content is working with that audience.
- Churn rate – This is how quickly people leave your channel. You want people to stay engaged with your content as long as possible, so you want the churn rate to be low. This is calculated by dividing lost subscribers in the period by total subscribers at the start of the period, and multiplying by 100 to get a percentage.