A lead trader's leaderboard return isn't a report card
The return on a copy-trading leaderboard is worked out by the platform with a method it chose itself, then ranked and put on display, and it covers whichever statistics period the page currently has selected. The percentage on its own says nothing about how the method works, which day the period starts from, or whether lead-trading accounts that lost everything and stopped are still counted. At most it shows that “one account went up this much over a certain stretch of time”. It can't show how that person does over the long run.
Before you open any lead trader's profile, find the button on the leaderboard page that switches the statistics period, then look for an explanation link along the lines of “how returns are calculated”. If you find one, check it against the questions in this article one by one. If there's no explanation of the calculation, treat the number as promotional material.
What's in this guide
01The platform calculates a lead trader's return: ask about the denominator and the period first
Leaderboards and rankings are something the platform builds for people to look at. A May 2025 report on copy trading by the International Organization of Securities Commissions (IOSCO) lists what a lead trader's page may show: a self-described strategy, current positions, capital invested, recently closed trades, trading frequency, profit and loss statistics, rank on a profit-and-loss leaderboard, and how many people are copying. Which of these fields appear, how they are calculated and which one the ranking uses are all up to the platform.
The same account can produce very different percentages under different methods. When you see a number, run through the right-hand column of this table first.
| What the leaderboard shows | What to ask |
|---|---|
| Return (a percentage) | Which money is the denominator: the starting capital, or does it include funds added along the way? Are losing positions that haven't been closed counted? |
| Statistics period (last 7 days, last 30 days and so on) | Can it be switched to something longer? What's the earliest date you can see? How long has this lead-trading account existed? |
| Rank | Which column is it ranked by? Ranked by another column, is the trader still near the top? Are accounts that stopped lead trading or lost everything taken off the board? |
| Number of copiers, copied funds | Is it a current figure or a cumulative one? Has it been rising or falling lately? |
| Win rate | Does it count only closed trades? How big was the largest single loss? |
Some platforms answer these questions in their help docs or in the small question-mark icons next to each metric; some don't. Rely on your own platform's explanation, and don't apply another platform's method to it.
There's another layer that has nothing to do with the leaderboard figure. Even if the percentage is calculated perfectly clearly, it is the lead trader's account figure. Your own result after copying has the profit share taken out and is affected by differences in fill price. How those deductions work is covered in why the copy-trading return shown isn't what you get.
02What EU and IOSCO regulatory documents flag about copy trading
On 30 March 2023 the European Securities and Markets Authority (ESMA) published a supervisory briefing on copy trading. It is addressed to firms in the EU that are subject to MiFID II and offer copy-trading services, and to the national authorities that supervise them; if the platform you use isn't one of those firms, the briefing wasn't written for it. IOSCO's final report on online imitative trading (copy trading, mirror trading and social trading), published in May 2025, sets out good practices for intermediaries. Neither is a law that directly governs platforms. What you can borrow from them is the questions they raise.
ESMA's briefing: how past performance is shown and how lead traders are paid
The briefing is meant for supervisors checking firms. Its text (ESMA35-42-1428) defines copy trading as buying and selling a client's assets based on another trader's trades, usually automatically. These are the points that bear directly on leaderboard numbers:
- Information given to clients, marketing included, should be fair, clear and not misleading; where it mentions the benefits of copy trading, the related risks should be shown just as prominently.
- The briefing lists questions supervisors can put to firms, and one set concerns past performance: it shouldn't be the most prominent part of promotional material; it should cover the previous 5 years, or less if the service has existed for under 5 years, but always on the basis of complete 12-month periods; and whether the firm clearly explains how past performance is calculated and presented.
- Conflicts of interest can arise from the way the traders being copied are paid, and from the fact that in many cases those traders may also be clients of the same firm. The variable-pay metrics the briefing gives as examples are the number and value of trades copied, the number of followers, and the performance of average assets under management.
- Firms should make sure the traders being copied meet minimum requirements for skill, trading experience or knowledge.
IOSCO's report: the leaderboard itself is named as something that can mislead
- Leaderboards and rankings provided by intermediaries may mislead investors about a lead trader's expertise, the strategy used, the products traded, risk-adjusted returns, past returns and the incentives the lead trader receives.
- Copy trading is often promoted as simple and profitable, while lead traders may lack experience or be unlicensed, and some of them may be advertising fake returns.
- Lead traders may change strategy or move to other products without notice.
- Some feedback pointed out that paying lead traders according to copiers' trading volume could create a conflict of interest between lead traders and copiers.
Hold the leaderboard you're looking at up against these points. Is the return the biggest number on the page? Is the risk warning just as prominent? Is the calculation method explained? Can you find the rules on how lead traders earn?
03How a lead trader's return can get so high
A very high percentage can come about in at least five ways, and the number on the leaderboard can't tell you which one it was.
- A short statistics period. A 7-day figure covers one week of the market. On days when the market moves in one direction, every account that opened positions with that move looks good. Set that against the 5 years in ESMA's briefing: a percentage built on a few weeks of records is nowhere near that length.
- Large positions and high leverage. At 10x leverage, a 1% price move in your favour returns about 10% on margin (before fees); a 1% move against you loses about 10% as well. The high return and the deep loss come from the same multiplier. How leverage magnifies gains and losses is covered in the article on whether beginners should touch leverage.
- Only the winning stretch is shown. If the start of the period can be chosen, starting it where a rally began makes the number look good. If the lead-trading account is new, the page only shows records from after it was opened. Whether a losing account stays on the board after it stops lead trading, and whether one person can open several lead-trading accounts, are both things to check in the platform's rules.
- Losing trades are still open. If the return only counts closed trades, an unrealised loss that is being held open won't pull the number down. It is counted all at once on the day the position is closed.
- Very small capital. Turning 100 USDT into 300 USDT is +200%. Whether the same way of placing orders would fill at the same prices with far more money is another matter.
These five can stack. When a new small account, high leverage and a week of favourable market all come together, the percentage can be enormous.
04Which fields to check first on a lead trader's profile
Each step assumes the page has that field. Platforms show different fields; where one is missing, count that item as no information.
- Switch the statistics period to the longest option. If the longest is only 30 days, or the account is only a few weeks old, treat it as having no long-term record.
- Find the maximum drawdown. It is the fall in an account's equity from a peak to the lowest point after it. This number says more than the return about how deep a hole you would have to ride out following this trader: after a 50% fall, it takes a 100% gain to get back to where you started. If the page doesn't have it, look at the deepest dip on the return curve and see how far it went.
- Watch how copied funds and the number of copiers change. If the page shows a trend, look for any obvious outflow of money or copiers recently, then go back to the trades the lead trader made on those days.
- Go through the trade history. If closed trades and current positions are public, see whether you can scroll back to the very first trade, how large the biggest single loss was, and whether any losing trades were left open for a long time. A page that only shows the last few trades gives you no way to judge what happened before.
- Find out how the lead trader earns. What is the profit-share rate? Is there extra pay based on copiers' trading volume or the number of copiers? Does the platform give lead traders additional rewards? If the lead-trading rules page doesn't say, ask customer support; if you still can't get an answer, count this item as no information too.
The more of these five items lack information, the less that return can support. If you do want to try with real money, pick a small amount following how much your first money should be, and during the trial compare your own account's actual profit and loss with the figures on the lead trader's profile.