Abstract：eToro is a multi-asset social trading platform that has gained widespread popularity among investors, traders, and social media enthusiasts since its inception in 2007. It offers users access to a wide range of financial instruments, including stocks, cryptocurrencies, forex, indices, and commodities, among others.
Is eToro Good for Beginners?
For any investor, choosing a suitable broker is crucial. eToro provides users with an intuitively designed trading navigation page, whether you are a novice trader or an experienced trader, you can easily use the platform to trade.
eToro is alsoregulated by CySEC, FCA, and ASIC regulators to ensure that it adheres to strict security and transparency standards, which ensures the safety of users' assets. Besides, eToro provides a “CopyTrader” function that is for novice traders. This function supports novice traders who do not have the ability to build their own portfolios.
In addition, it provides a community for traders of different experience levels. Through dedicated news feeds, users can gain insights and learn from each other.
The most significant advantage of eToro is that it does not charge commissions on stocks and ETFs, which greatly reduces the investment costs for novice traders and lowers the threshold for entering the market. Overall, eToro is a suitable broker for novice traders.
eToro Pros & Cons
✅Where eToro Shines
User-friendly and easy-to-use platform: eToro provides users with a convenient and fast operating platform that can be easily used by both novice traders and experienced traders.
Provide a wide variety of cryptocurrency trading services: eToro provides more than twenty cryptocurrency trading pairs, which attracts many cryptocurrency enthusiasts. For example, eToro provides BTC, Ethereum, Dogecoin, and Ripple.
Provide a resource-rich social area: eToro provides a resource-rich social area, which provides a friendly place for traders of different levels to communicate, and users can exchange and learn investment experience with each other.
Wide range of educational resources: eToro provides various educational tools such as News and Analysis, eToro Academy, and CopyTrader to help users make informed investment decisions.
Provide demo trading accounts: Users can practice with demo accounts to refine their trading strategies without risking real assets.
Operate under a strong regulatory frame: eToro is regulated by the Australia Securities & Investment Commission (ASIC), the United Kingdom Financial Conduct Authority (FCA), and the Cyprus Securities and Exchange Commission (CySEC), ensuring that it is a legally compliant and regulated broker, which safeguards users' assets.
❌Where eToro Falls Short:
Conversion Fees: eToro charges conversion fees for depositing or withdrawing funds in currencies other than USD.
Account management fees: eToros account will be charged account management fees if you do not log in within one year.
Does not provide margin trading for US users: eToro does not provide margin trading for US users, which will limit the use of investors who use margin trading.
Is eToro Legit?
In terms of fund security, eToro ensures client fund safety by holding them in segregated accounts with top-tier banks or qualifying money market funds. Detailed transaction records are maintained for client accounts, aiding in asset distribution in the unlikely event of eToro's insolvency.
Furthermore, eToro is a global multi-asset platform that is regulated by several financial authorities around the world. The platform holds trading licenses from the Australia Securities & Investment Commission (ASIC), the United Kingdom Financial Conduct Authority (FCA), and the Cyprus Securities and Exchange Commission (CySEC).
For potential clients considering using eToro, it is recommended that they carefully review the regulatory licenses held by the platform and understand the regulatory framework in their own country. Clients should also conduct their due diligence on eToro's reputation, user reviews, terms, and conditions before opening an account.
How to Trade with eToro?
Step 1: Register and Open an Account
- Find “Join Now” or “Trade Now” on the official eToro page, and click on it.
- On the next page, you will see a spreadsheet asking you to enter all your personal data.
- Please follow the requirements of this registration form and enter all relevant information. Logging via Facebook and Gmail is also possible.
- Before submitting your information for review, kindly take the time to familiarise yourself with eToro's Terms & Conditions and privacy policy.
- Upon completing your review of all the terms, please indicate your agreement with them by checking the appropriate box.
- Submit your information by clicking the “sign-up” button.
Step 2: How to Start Trading?
- Find the instrument you would like to invest in: you can look on eToro's home page, the search bar, your watchlist or a position you already have in your Portfolio.
- Click on the instrument and then on the ‘Trade’ button.
- Select BUY to open a long position, or SELL to open a short position.
- Enter the dollar value you wish to invest. Alternatively, click on ‘Units’ to enter the number of units you wish to purchase.
- Set rates for Stop Loss and Take Profit, and leverage, if applicable.
- Click on ‘Open Trade’. If the market is closed, you have the option to ‘Set Order ’.
As soon as you click on ‘Open Trade’ or ‘Set Order’, an order to execute a trade is created. During market hours, this is usually instant. If the market is closed, eToro will execute your trade the next time the market opens at the best price available at that time.
eToro Trading Platform
eToro provides its official mobile application, known as the eToro Money app, which is accessible for download on both the App Store and Google Play Store. The app offers users the convenience of managing their eToro accounts and conducting financial transactions directly from their mobile devices. Users can access features such as account monitoring, fund transfers, and trading functionalities through the app.
eToro Education
eToro provides a range of educational resources to support its users in their trading and investment activities. These resources include eToro Academy, News and Analysis, eToro Plus, Digest & Invest, Retail Investor Beat, Bitcoin Halving, and Account Security.
eToro Academy: The eToro Academy is an educational platform that offers a variety of learning materials, including tutorials, courses, and webinars. It covers various topics related to trading strategies, market analysis, risk management, and more.
News and Analysis: eToro offers news updates and market analysis to keep users informed about the latest developments in the financial markets.
eToro Plus: eToro Plus is a premium subscription service available to eToro users. It provides additional features and benefits, such as advanced charting tools and priority customer support.
Digest & Invest: Digest & Invest is a feature offered by eToro that allows users to automatically invest in portfolios created by top-performing traders on the platform. Users can choose to allocate funds to these portfolios based on their investment goals and risk preferences.
Retail Investor Beat: A quarterly survey looking at the topics currently impacting the investment decisions and outlooks of retail investors globally.
Bitcoin Halving: Bitcoin Halving is an educational resource offered by eToro that explains the concept of Bitcoin halving events. It provides information about the periodic reduction in the rate at which new Bitcoins are created and its potential impact on cryptocurrency's price and market dynamics.
Account Security: eToro emphasizes the importance of account security and provides resources and features to help users protect their accounts. This includes two-factor authentication, secure login procedures, and educational materials on best practices for maintaining account security.
eToro Fees Review
Traders should pay attention to the cost of each transaction. Transaction fees need to be considered in the entire trading strategy. eToro's trading fees are crucial for investors, here is an overview of eToro's trading fees:
Non-trading Fees
Stocks Fees
Starting August 11, 2024, a commission fee of US$1 or US$2 may apply when you open and close a stock position, depending on your country and the stock exchange.
Please note that commission fees:
1. Are calculated in USD, regardless of the base currency of the stock being traded
2. Do not apply to CFD positions
3. Do not apply to ETFs
4. Do not apply to Copy trading or Smart Portfolios
ETFs Fees
eToro charges zero commission for ETF trades. This applies to any transaction regardless of size and the way in which your order was entered: manually, via CopyTrader, or Smart Portfolios.
Crypto Fees
When buying crypto assets on eToro, you gain ownership of those assets. eToro charges a single, simple and transparent fee of 1% for buying or selling crypto.
CFDs Fees
CFDs (Contract for Differences) offer a versatile method for trading various assets, enabling strategies such as short selling. Additionally, these positions can be leveraged for enhanced flexibility. CFD trading does not involve the acquisition of real assets and incurs spreads and overnight fees.
eToro Review on Products
eToro provides a range of financial instruments such as stocks, currencies, commodities, Cryptocurrency, ETFs, and indices. Clients can track and invest in these instruments using professional tools and analyses. The social investing feature allows clients to follow and replicate the investment activity of other clients in real time through the CopyTrader™ system.
eToro Account Type
- Personal (retail) account: eToros default account type. With this account, you can trade all the assets we offer, copy other traders, and invest in Smart Portfolios. The level of leverage that can be used is limited, but account holders have the highest level of consumer protection.
- Professional account: Professional account holders have the option to use higher leverage when opening trades. Only clients who meet certain criteria can apply for a professional account.
- Corporate account: Corporate accounts are intended for business purposes and used by legal entities. If you want to trade with capital belonging to your business, this is the account type you should open.
- Islamic account: This is a special account type for Muslim clients. eToro doesnt charge interest-based fees on Islamic accounts, in accordance with Sharia law.
All of these accounts come with eToro's virtual portfolio (demo account), so you can practise investing risk-free.
Compare to Similar Brokerages
FAQs
What is eToro Money?
eToro Money is a smarter way to manage your money on eToro. eToro Money is an e-money account managed by a mobile app. There is also a Visa debit card available to Club members in certain regions. eToro Money is provided by eToro Money UK Ltd for UK clients and by eToro Money Malta Ltd for EU clients.
How does CopyTrader™ work?
You can start copying an investor at any time. Each position in a copy is counted as a single investment and opens for you with the same proportional amount as a percentage of your allocated funds.
When you start copying another investor with our CopyTrader™ system, eToro implements an automatic reallocation of the assets. This means that your initial investment will proportionally mirror the copied investor's portfolio.
You can perform several actions in your copy: pause and resume copy, add and remove funds, set and edit the Copy Stop Loss, and close individual positions or fully close your copy.
Is eToro a safe and trustworthy brokerage?
Yes. It is supervised by three regulatory agencies, including CySEC, FCA, and ASIC, strict supervision can ensure that it complies with laws and regulations during its business operations and users' assets can be protected.
Is eToro suitable for beginners?
Yes, eToro is suitable for novice traders. It provides risk-free simulated account trading, rich beginner-friendly trading learning resources, and a strong learning community where novice traders can learn the strategies of experienced traders.
