eToro Review: Summary
Claiming to be the “leading social trading network” across the globe, eToro is one of the fastest-growing and most unique brokerage companies around. The firm caters to a trading community consisting of around 4.5 million registered traders in over 170 countries.
The major feature that sets eToro apart from competition is CopyTrader, which gives an eToro trader the ability to replicate the strategies of the most successful traders on the site’s social investment network. We evaluated the main features of this online trading company to help you decide if it’s the right fit for your investment needs.
Read on to know more about how eToro trading works, how to set up an account, the fees involved, and several eToro reviews.
What Is eToro?
eToro is a global online marketplace where investors from any part of the world can trade and invest in various assets, including currencies; commodities, like gold and silver; and indices, such as the FTSE, NASDAQ, and Dow Jones. The company offers a fully integrated solution, allowing investors to manage their funds using a simplistic interface.
The financial services company eToro EU LTD adheres to European regulations – specifically, the Cyprus Securities Exchange Commission. It keeps funds in tier 1 European banks for security.
Key Features of eToro
Simple, Easy-to-Use Social Trading Platforms:
eToro offers a seamless user experience, allowing you to use web-based and mobile trading platforms so you can access your account not only on your computer but on your smartphone or tablet as well. eToro makes managing your funds as simple as it can get.
Many eToro reviews rave about the company’s streamlined platforms that feature fast, convenient access to financial markets.
Investors also like the easy access of their trades using the eToro app, which lets you conveniently manage quick trades on the go. You may download the eToro app for free, whether you’re using an iOS or Android device.
eToro promotes interaction through a live chat messaging system and discussion boards where you can post an investment idea or ask questions. This efficient communication system makes copy trading much easier.
Copy trading is an outstanding, ingenious system that works quite well through the OpenBook platform. We’ll discuss this system in the next section below.
Free, Educational Courses:
Knowing that every journey starts with small steps, eToro guides inexperienced traders through free training and courses on the eToro platform. We like the availability of a large arsenal of learning tools and materials for both novice and pro investors.
The “trading academy” enables you to increase your knowledge of financial trading markets through videos, live webinars, and guides.
Free eToro Practice Account:
If you want to brush up on your stock knowledge and improve your trading ability, you can start with a free, fully functional eToro practice account, which comes with a virtual $10,000. Keep practicing until you’re confident enough to deposit actual funds and become a real trader.
eToro Bitcoin Trading:
If you’re aiming to trade Bitcoin as a long-term investment, eToro lets investors trade the highly volatile digital currency through a contract for difference, or CFD. Real-time eToro Bitcoin trading lets you open short or long positions and respond quickly to market changes.
What Is Copy Trading?
eToro is the pioneer of copy trading, an innovative social investment network that differentiates the company from traditional forex brokers. Copy trading enables you to interact with numerous traders from all parts of the globe, discuss trading ideas and strategies, and automatically copy successful traders.
Image source: Big Stock
eToro uses overall winning ratios, among other criteria, to determine the top traders. Copy trading is available both on the desktop platform and the eToro app.
eToro believes in building an “open investment network,” where investors with varying levels of trading experience can learn from each other. We find this a truly innovative idea, as tapping the wisdom of a community of traders can potentially make you a smarter investor and lead to higher probabilities of eToro forex trading success.
However, it’s important to be aware of risks; choose actual, successful trading gurus; and closely monitor your trades, as copy trading is definitely not a foolproof option, and some traders lose more than they win.
eToro Review: How eToro Trading Works
Copy trading involves using the eToro OpenBook platform to find top-performing investors, select trusted traders whom you want to replicate, and allocate part of your funds to copy them. It’s the primary advantage of using eToro as a trading platform, as you can witness in real-time what investors are trading.
While eToro used to allow traders from the United States to participate in its social trading platform, trading law changes prompted eToro to decline U.S. investors from joining the eToro trading network. Other countries in the blocked list include Iran, North Korea, Myanmar, Syria, Cuba, and Sudan.
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How to Set up an eToro Account and Start Trading
- Step 1: Creating an eToro account is easy. Simply click “Join Now” on the homepage, and enter your username, password, email, and phone number to become an eToro trader.
- Step 2: Choose a payment method to fund your account. eToro accepts major credit cards as well as PayPal, Skrill, UnionPay, WebMoney, and Yandex, among other funding options.
- Step 3: Find the most successful traders by visiting the OpenBook People page on the eToro platform and adjusting the filter settings. Evaluate the profile of each trader, especially the portfolio, trading statistics, and number of copiers. If you’d like to check particular markets, go to the OpenBook Markets page to discover top traders in your chosen markets.
- Step 4: Start automatically recreating trades into your account by clicking “Copy.” Enter the fund percentage you want to allot for the copying.
- Step 5: Manage your trades from your computer or through the eToro app, and diversify your portfolio as you like. You may opt to stop copying trades or take over trades whenever you want.
- Keep in mind that eToro will verify your trading account, and you should be at least 18 years old to register.
eToro Reviews: Is eToro Legit?
eToro has polarizing reviews regarding its legitimacy. Some users claim that the company scammed them and never returned their money. One eToro review mentioned that the site shows misleading graphs that show a positive return on investment even though the reviewer lost money.
Might Not Be Ideal for Investors With Minimal Time to Spare:
A few reviewers point out that copying traders often leads to a loss of money for most people, especially new traders.
Another eToro review emphasized that traders are not likely to succeed unless they attempt to become full-time investors with plenty of time to dedicate for monitoring trades throughout the day and lots of patience in contacting eToro customer support regarding certain system faults.
Relatively Stringent Withdrawal Process:
Withdrawal reportedly is a difficult process that may require verification, such as a passport, bank information or a utility bill.
Blocked Accounts Due to Verification Failure:
An eToro review mentioned that accounts are usually blocked when traders fail to comply with the verification process. Most of the eToro reviews claiming that the site is a scam note that their accounts were blocked, and they were not able to get a refund or withdraw their deposited funds or earnings.
Very User-Friendly Platform:
On the other hand, one eToro review emphasizes that the site works seamlessly and is a user-friendly platform for beginners.
Another eToro review remarked that, in his three years of using the eToro trading platform, he was able to meet good people and earn a number of copiers. The ease of use and social trading outweigh the limitations.
Copy Trading System Works for Beginners:
Other traders shared that eToro’s platforms are simple to use, and the copy trading system is ideal for novice traders that are earnest in improving their trading abilities.
Investors who are social media-savvy also will likely find it easy to use eToro. A review of eToro states that the eToro trading community feels like a close-knitted family, and the bonuses are a fun surprise.
To copy a trade, you may allocate $100 up to $500,000 depending on your funding method. The minimum deposit when using credit cards is $50 and the maximum is $5,000. A wire transfer has no limitations while the maximum deposit using WebMoney is $50,000.
Withdrawal fees vary based on your requested amount. eToro lists down the particular spreads and fees associated with currencies, indices, commodities, stocks, and ETFs on its Fees page. The company charges commissions at a position’s closing, and the fees differ depending on liquidity and market conditions.
eToro Trading Potential Extra Income
Copy trading is not just a unique, revolutionary feature that lets you interact with a community of investors; it also gives you the opportunity to earn a fixed monthly income as a trusted eToro trader as long as you’ve gained a considerable number of copiers and maintained sufficient account equity.
Elite Popular Investors
These star traders earn 2 percent annual AUM, 30 percent revenue share, 100 percent spread rebate, and a premium account. To join their ranks, you should have at least $300,000 AUM (assets under management or the total funds of your copiers), trade in adherence to eToro’s guidelines, and maintain $5,000 minimum account equity.
Champion Popular Investors
The same revenue share and spread rebate applies, although they earn a $1,000 fixed monthly payment. The requirements include 250 copiers, responsible trading, and minimum account equity of $1,000.
As a Rising Star, you’ll get a $350 monthly income, 25 percent revenue share, and 10 percent spread rebate. However, you won’t have a premium account. You need at least 50 copiers and $500 minimum account equity to qualify.
Cadets don’t get payments, spread rebates or premium accounts, but they enjoy a 25 percent revenue share. A verified account and at least one copier can promote you to Cadet level. eToro gives a deposit bonus to any Cadet who obtains five copiers.
Most registered traders start as cadets and work their way to the top by trading responsibly, sharing their strategies, earning their fellow traders’ trust, and acquiring lots of copiers. If you want to attract copiers, it helps to explain your trading practices and answer queries of other people who want to know about your trades.
Image source: Big Stock
Conclusion: Is eToro Forex Trading the Right Platform for You?
If you’re searching for an online trading platform with an easy-to-use interface; a community of active, socializing traders; and an excellent trading academy that lets you advance your trading aptitude, eToro is a good place to start.
However, keep in mind that not everyone has enjoyed the eToro trading experience, and yours may or may not be successful depending on various factors, particularly your willingness and dedication to monitor your trades closely.
eToro verifies every registered trading account to comply with financial service regulations, so we recommend completing the verification process to avoid the common pitfalls experienced by other users.
Also, while eToro promotes interactive copy trading, the company cautions investors that trading comes with risks, and past performance isn’t a definitive indication of future outcome. This holds true regardless of the trading platform you use, so educate yourself properly before diving in and investing large amounts.
You may want to try using your own free, eToro practice account to put your skills to the test and familiarize yourself with eToro forex trading and eToro Bitcoin trading before jumping into real trading. This way, you can improve your trading knowledge, even if you change your mind halfway and decide not to deposit funds.
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