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Briefly about the eToro
The eToro is one of the largest brokers that has been providing its services almost all over the world since 2007. The Israeli company, in addition to trading CFDs, also offers commission-free stock trading and the purchase of cryptocurrencies. In total,
the company offers more than 3,200 investment products. You can also trade fractional shares on the platform, which means you don’t always have to buy the whole share, but you can buy just a fraction of it. If, for example, an Apple stock costs $144, you can buy a quarter of the stock on eToro for $36. Another great advantage is that eToro offers a trading platform in 19 languages, it is rare to find such a wide range of languages on similar platforms. The etoro.com provides users with a web and mobile application that you can test without risk with a free demo account. But what the broker relies on first and what makes it so popular is social trading. The broker allows its users to copy trades of other experienced traders.
In this review, we will look at what type of investor eToro is suitable for, as well as examine the pros and cons of the service.
|Regulation and jurisdiction
ASIC, FCA, CySec, GFSC, FinCen и FINRA
|Official website of the company
+7 (495) 648-64-43; [email protected]; 4 Profiti Illi Street Kanika, International Business Centre, 7th Floor, Germasogia, Limassol, 4046
- There is protection against negative balance
- Wide selection of trading instruments
- Large selection of payment systems
- Technical support is available only five days a week
- Big spreads
- Metatrader4 terminal is not available
Credit cards, bank transfer, Neteller, Skrill, PayPal, Webmoney, GiroPay, YooMoney
|Minimum deposit amount
From 0.1 points
Currencies, assets of stock and commodity markets, cryptocurrencies
What investment products the platform offers
The eToro platform offers hundreds of different assets to trade, with something for everyone. A current and accurate list of all assets can be found on the official website of the company.
Here are a few examples of the assets the broker currently offers: Stocks, Currency Pairs, Commodities, Cryptocurrencies, ETFs, Stock Market Indices.
Note: When it comes to cryptocurrencies, on eToro you can not only speculate on their price changes using CFDs, but now you can also buy cryptocurrencies and transfer them to your own cryptocurrency wallet.
However, trading cryptocurrencies in the form of CFDs is accompanied by a relatively high spread. Therefore, if you are thinking about trading cryptocurrencies, according to etoro.com reviews, it is much preferable to go directly to specialized exchanges such as Binance or Bitfinex. The user interface of the aforementioned cryptocurrency exchanges may be a bit less clear, but after a few days of using them, you will definitely understand how they work. The potential savings of purchasing cryptocurrencies is worth this minor complication. The decision is up to you.
With CFDs you can trade currencies, stocks, commodities, cryptocurrencies, ETFs or indices. But there is one catch. Traders don’t actually own any of these products. With CFDs, you’re just betting on whether the price in the stock market will rise or fall.
At eToro, you can trade nearly 3,300 instruments from six categories using CFDs:
- 49 currency pairs – EURUSD, USDCHF, GBPUSD, USDCHF…
- 2850 stocks – Apple, Netflix, Google, Microsoft, Tesla, Amazon…
- 32 commodities – gold, silver, oil, cotton, platinum…
- 13 indices – SPX500, NSDQ100, UK100, EUSTX50, DJ30…
- 264 ETFs – QQQ, TQQQ, SQQQ, SPY, VXX, EEM…
- 70 cryptocurrencies – Bitcoin, Ethereum, Litecoin, Ripple, EOS…
Physic stocks and cryptocurrencies
You can also buy classic stocks at www.etoro.com. Just place a non-leveraged buy order and the platform will immediately inform you that you are buying a real stock. Shares are stored electronically in a share account, so you can sell them again very quickly.
This works for cryptocurrencies as well, but they can only be traded without leverage. Thus, if you place a buy order, you are purchasing a real cryptocurrency, while sell orders are executed through CFD.
CFD trading uses leverage to multiply the profits and losses on your trades. Thus, even a small market movement can lead to large profits, but equally to large losses.
While most brokers have fixed leverage, eToro gives traders a choice. You set the amount of leverage for each order. Professional traders can request an increase in leverage up to x400.
The maximum leverage for non-professional traders is based on ESMA:
- x30 – Major currency pairs
- x20 – Major Currency Pairs, Gold and Major Indices
- x10 – Minor Indices, Commodities, Excluding Gold
- x5 – Stocks and ETFs
Clients also often wonder if eToro platform pays dividends. The answer is yes. It is the amount of money that a company regularly pays to its shareholders out of profits or reserves, depending on their shareholding in the company. So, for example, if Apple declared a dividend of $0.80 per share, a shareholder holding 75 shares of Apple stock would receive a dividend of $60.
What does the platform charge for?
The commissions in eToro are clear and relatively low. If you buy stocks, cryptocurrencies or ETFs (only ETFs from Europe) without leverage (X1), you are buying a real underlying asset. Then you do not pay a commission for the execution of the transaction and a commission for the transfer of an open trading position to the next day (so-called swap). We will now take a brief look at all the important charges:
Commissions for CFD trading
The difference between the buy and sell price (spread) – this indicator shows how much of your investment you will lose because of the coefficients. Spreads at eToro are constantly changing, but are generally comparable to those of competing brokers.
Overnight fees – a small percentage you pay for each trade you hold after the market closes. If you exit a trade before the market closes, you avoid the swap. You will see the number of daily swaps when you place your order.
Trade Arrangement Fee – the fee you pay for each trade in CFD shares or ETFs. The commission is 0.09%.
Commissions for trading real assets
Stocks – trading securities is free, so you don’t have to pay any commissions or swaps. Only the spread is reflected in the value.
Cryptocurrencies – you will pay a commission of about 2% for buying or selling cryptocurrencies, of which 1% is eToro’s commission and 1% is lost due to the spread. For lesser-known cryptocurrencies, the commission can be higher due to the higher spread.
Deposit fee – the broker does not charge a deposit fee. However, watch out for third-party commissions, for example, banks’ commissions when paying in U.S. dollars.
Withdrawal fee – you will pay a flat fee of $5 for each withdrawal.
Currency conversion fee – this fee applies to deposits and withdrawals in currencies other than the U.S. dollar.
Inactivity fee – If you do not log into your account for 12 months, the broker will start charging a monthly inactivity fee of $10. If you don’t have any money in your account, you don’t pay a fee. Open positions will not be terminated by the broker in connection with the payment of a commission. As soon as you log into your account (no transactions are required), the inactivity fee will be waived.
Documents needed for registration, Deposit and Withdrawal conditions
The registration process is the same as with any other platform. To create an account at www.etoro.com, simply fill in your email, username and any password on the registration form. After you submit your information, you will receive an email to activate your new account. Personal and contact information is entered after you log in to your account. You must also fill out a short questionnaire about your trading experience and income. Do not rush to transfer money to your account immediately after registration. You cannot withdraw money you have deposited or any profits you have made until you verify your account. To verify your account, the broker requires copies of two personal documents:
1) A valid identification document, such as an ID card, driver’s license, or passport.
2) Confirmations of address no older than 6 months. A utility bill (utilities, internet, phone, etc.) or a bank statement would be ideal.
3) If you use a credit card, the broker may also require copies of both sides of the card. For security, you can cross out the first 12 digits on the front side and the CVV code on the back of the copies.
A trading account can only be conducted in U.S. dollars. So if you send money from an account in any other currency, you can’t avoid currency conversion fees.
eToro platform supports 4 payment methods for deposits and withdrawals:
- Bank wire transfer
- Payment cards
- Electronic wallets (PayPal, Skrill, NETELLER)
If you deposit by card or through e-wallets, the minimum deposit will be $50 ($10 in the UK and USA). For bank transfers, the minimum amount is $500. When registering a corporate account, a minimum first-time deposit of $10,000 is required. In addition, the minimum for withdrawals is set at $30.
Depositing an account is almost instantaneous (except by bank transfer), but withdrawals are much slower because of the approval process. The broker claims that withdrawal can take up to 8 business days.
If you don’t want to risk your money, you can try out a demo account, where you can access all the features of the platform. you can create a demo account yourself at etoro.com – just enter your email and any password.
This account will provide you with virtual $100,000. In this unlimited trial account, you can test everything from copying traders to investing on your own.
Platform, CopyTrader and CopyPortfolio
Trading on eToro is done through an intuitive application that you launch in your web browser. This means you don’t need to install or download anything. There is also an eToro app for Android or iOS. Users can read basic information about each asset, view price charts and use other graphical tools. With Pro Charts, you can also use an advanced interactive chart and draw lines, use indicators or compare two assets.
The eToro platform has two really unique features. The first is the CopyTrader, which allows you to automatically copy trades of other traders.
There are thousands of active traders in the eToro database, and you can compare them by success rate, risk level, or even by what they trade. And it’s up to you who you copy. The minimum amount to copy one trader is $200, and you can copy up to 100 different people at a time. It works very simply. The trades made by the copied trader are automatically executed on the copying trader’s account. In addition, the system recalculates the size of each trade to maintain the ratio of each investment to the capital.
Of course, the eToro app is not the only platform that allows social trading, but it is probably the largest, oldest and most popular broker.
The second unique feature is the CopyPortfolio tool. This works similar to CopyTrader, but instead of individuals, you copy entire investment portfolios. For example, there are both cryptocurrency and stock portfolios that contain dozens to hundreds of different titles. The only drawback is that the minimum amount invested in one portfolio is $500.
For each trader you want to copy, you also set the maximum loss. If the trader fails and the loss exceeds the set value, copying stops. The default setting is 40%, but you can choose a value between 5% and 95% (calculated by the amount you have set aside for copying). The function is called CSL (Copy Stop Loss).
eToro platform is a reliable broker, licensed for the European and American markets. However, there are dozens of such brokers, which raises the question: Is this broker really better than the competition?
There are three strong arguments in favor of the broker.
The first is the diverse range of financial instruments. From one platform you can trade CFDs or invest in classic cryptocurrencies and stocks. So whether you’re planning long-term investments or short-term speculation with leverage, eToro won’t limit you.
Another advantage is the CopyTrader and CopyPortfolios functions. However, we must warn you that copying traders and portfolios involves high risk. You only see historical yields, which tell you little about future results. High profits indicate only that the trader is taking a big risk.
But the biggest advantage is the zero commission on physical shares and the ability to buy fractional shares, which is especially appreciated by retail investors.
Be careful with cryptocurrencies as well. For small investments, of course, eToro is suitable, but for larger transactions it is better to use proven markets or exchangers. This is due not only to the high spread, but also primarily to the choice of purchased cryptocurrencies.
Conclusion of the eToro review
The main disadvantages in eToro reviews highlight slow withdrawal processes, verification and communication. Some people wait a couple of days for a response from the support service and are not always happy with the quality of the content of the answer. Also, users have noted that the platform experiences technical failures, 3 times in the last 2 years. It’s up to you to judge whether it’s frequent or not.
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The company’s rating and reputation largely depend on whether its clients are satisfied. The reviews about eToro are not the most flattering, and therefore you should take a close look at them before deciding to cooperate with this platform.
To add a review of this company on the resource, you do not need to spend a lot of time. The whole procedure takes no more than 5 minutes, and this is already with registration. A letter with a link to confirm registration will be sent to your e-mail, and it will also contain detailed instructions on how to add a review to the site.
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