eToro Review

eToro Review

  • Largest Online Broker
  • US clients allowed
  • Ready-made CopyPortfolios
  • Commission-Free Stock Trading
4.5

Pros

  • 2000+ Assets
  • Wisdom of the Crowd via Social Trading
  • Intuitive Easy-to-use Platform
  • CopyTrader™ Technology

Cons

  • Small Leverage on Cryptos
  • No API connectivity

eToro Review: What is eToro?

Over the last months, many of our readers have been asking about eToro so today we are going to review this online trading platform that pioneered and democratised cryptocurrency trading for individual investors all over the world. eToro is also one of the most popular social trading platforms where its users can copy experienced traders and their top-performing investment strategies with a click of a button. In addition to that, eToro recently launched eToroX, an institutional-level crypto exchange designed for professional traders. In this eToro review, we are going to explore the eToro trading platform and share our experience of investing in Bitcoin, Ethereum and other altcoins with this broker. You will find out how to open an account with eToro and how to take advantage of the wisdom of the crowd and its social trading platform. We will cover all pros and cons of the eToro online broker and will also answer the question that so many of our readers have been asking – is eToro scam or legit? So, if you want to find out more, please continue reading this eToro review. 

eToro Review:; How to buy Bitcoin

eToro Review – About the Company

eToro is an award-winning multi-asset online trading platform that allows people to trade and invest in currencies (including Ethereum and Bitcoin), stocks, commodities, indices and ETFs in a simple, transparent and more enjoyable way. eToro is also famous for its investment products marketplace and social trading platform where you can follow and copy top-performing traders or invest in CopyPortfolios designed by the eToro investment team. 

 eToro is a privately owned company and was established in 2007 in Israel as a Forex CFD broker. In the past 10 years, a number of large financial institutions invested in eToro and its trading platform became extremely popular among individual investors. eToro currently has 15 million users in more than 170 countries offering revolutionary solutions for online trading in traditional and digital assets. 

In 2013, eToro was one of the first brokers to introduce CFD trading in cryptocurrencies, like Bitcoin and Ethereum. And in 2017, eToro launched its own cryptocurrency wallet that allowed investors to invest directly in cryptos and not via CFDs. At the same time, the company also introduces CopyPortfolios which is a long-term thematic investment product that bundles various assets in a predetermined investment strategy. Today, there is a wide range of CopyPortfolios available that range from technology, crypto, agriculture, biotech, artificial intelligence and other themes.

Unlike many other CFD brokers like AvaTrade or Plus500, for example, eToro combines allows you to trade CFDs as well as the underlying assets. You can buy stocks, ETFs and cryptocurrencies as an underlying asset if you don’t use leverage, and with leverage, you will trade Contracts for Difference (or CFDs). 

eToro Review:: Build Your Ultimate Crypto Portfolio

eToro Regulations & Licenses

eToro currently has offices in the United Kingdom, United State, Cyprus, Australia and Israel. eToro regulations include the Financial Conduct Authority in the UK, CySEC in Cyprus, MiFID in EU and ASIC in Australia. eToro is also compliant with European Securities and Markets Authority rules and provides EU and U.K. broker default protection for €20,000 or £50,000. That means that is something that happens with the company, its clients’ funds will be protected and guaranteed by the government and financial regulator. 

In this eToro review, it is also worth to mention that eToro is one of the very few crypto brokers that offers cryptocurrency trading for US-based investors. In July 2018, eToro opened its platform for the US-based clients and had phenomenal success with this market. 

So when it comes to choosing a reliable trading platform, eToro is one of the most solid that you can find on the market. It is regulated in the most strict jurisdictions such as the US and the UK and holds it’s client assets in aggregated accounts to ensure their safety. 

eToro Review: Investment Products Marketplace

As we mentioned before, eToro offers access to a wide range of assets that include stocks, cryptocurrencies, ETFs, indices, commodities and forex. The great thing about eToro that it allows you to invest not only in CFDs but also in the underlying assets when it comes to stocks, cryptos and ETFs. 

eToro Cryptocurrencies

eToro cryptocurrency trading platform offers access to most of the popular cryptocurrencies, such as Bitcoin, Ethereum, Bitcoin Cash, Ripple, Dash, Litecoin, Cardano, IOTA, Stellar, Tron and many other altcoins. You can invest in all those altcoins directly, i.e. buy the underlying asset and hold cryptos at your eToro wallet, if you don’t use leverage. If you want to use leverage which is for cryptos is 1:2, you will be trading CFDs. In addition to that, you can trade Commodity Crosses, such as Gold versus Bitcoin, or Currency Crosses BTC/EUR, BTC/GBP and 63 other currency pairs. You can also trade 12 different Crypto Crosses such as ETH/EOS, ETH/XLM, ETH/BTC and others. 

eToro Review:; How to Invest in Bitcoin with eToro

eToro Stock as Exchange Traded Funds

Today, eToro really became a global trading platform that democratised investing for everyone. With eToro you can invest in stocks or ETFs listed on all major global exchanges including but not limited to London, Amsterdam, New York, Frankfurt, NASDAQ, Hong Kong, Saudi Arabia, Zurich and many others. eToro also allows you to filter by industry, which includes Basic Materials, Conglomerates, Consumer Goods, Financial, Healthcare, Industrial Goods, Services, Technology and Utilities. 

With eToro, you can trade all your favourite stocks commission-free and don’t pay price per ticket which so commands with traditional brokers. But while eToro makes it very easy to invest and it’s the platform is super-user friendly, in this eToro review we have to mention that eToro has one of the most sophisticated trading platforms that we have seen. It also has a professional team of analysts that provide a constant overview of the market and trade recommendations for you to take advantage of. The number of ETF exceeds 80 companies listed on 13 exchanges. Stock indices can also be chosen for trading as CFDs with the highest leverage of 1:5. 

eToro Review:: Invest in Cryptos with eToro

eToro Forex

eToro Forex portfolio consists of 47 currency pairs with a maximum leverage of 1:30. You can trade the most popular currency pairs yourself or follow experienced forex traders and their top-performing strategies with some reaching as high as 70% p.a. return. 

eToro Commodities

With eToro you can invest in 31 most popular commodities, such as Oil, Gold, Silver, Platinum, Sugar and many others. When trading commodities you can take both long and short positions via CFDs and also use leverage up to 1:20

How to Copy People and Invest in CopyPortfolios with eToro 

eToro was one of the first online brokers to pioneer social trading but the company went even further with the introduction of professionally managed CopyPortfolios. 

eToro Review: How to Copy People

With CopyPortfolios you can invest in thematic investment strategies that are developed by the eToro investment team and its trading partners – professional institutional investors. CopyPortfolios are designed to invest in thematic stocks and other instruments such as ETFs that focus on a  particular theme, for example, technology or agriculture. eToro investment analysts constantly analyse the market and select the best stocks based on their research. Essentially, eToro portfolios are professionally managed investment funds that are available for individual investors with a very small initial investment. 

eToro Review:: Build Your Ultimate Crypto Portfolio

eToro Copy People works a bit differently, where you can screen all traders that are registered on the eToro platform and choose to copy their strategies for a profit share. You can weather copy their trades automatically or you can select which trades you want to make. Some of the most popular traders on eToro platform have more than 25+ thousand followers and achieve investment returns of 100% p.a. or higher. While such returns are quite exceptional, there is a large number of traders that are demonstrating returns between 30% to 50% p.a.

eToro Review:: How to Follow People with eToro

How to Start Trading with eToro?

eToro has made it very easy to open an account and start trading even for inexperienced investors. The company does not use white label professional trading platforms such as Meta Trader or other similar ones. Instead, it spent time and money on developing its own trading platform. The result – investing and trading has not been easier. But let’s start from the beginning and take you through the process of opening an account with eToro. 

1. Open Free eToro Account

First, you need to register with eToro and open a Free account but provide your name and email address. You can also register with eToro using your Google or Facebook account so this process really takes only a few clicks. After that, you will be able to access all platform functionality and see how it works 

eToro Review:: How to Invest in Cryptocurrencies

2. Complete your Profile 

As we mentioned before, eToro is a regulated broker and needs to comply with all financial rules and regulations. The company takes this very seriously but at the same time, it made the account verification process for its users very easy and straightforward. First, all eToro clients need to complete the KYC process by providing a copy of their passport and proof of address. KYC is completed automatically and in 97% of cases, account verification is completed within 5 minutes or less. In addition to providing copies of your documents, you will need to fill in personal information and answer some questions so eToro can determine the level of your investment experience. We encourage you to answer all those questions honestly to make sure you are not recommended products that can be too risky for you. 

3. Deposit Funds

In order to start trading, you will need to deposit funds on your eToro account. You can use Credit Card, Webmoney, Paypal, Giropay, Skrill, Rapid Transfer, Netteller or other popular methods, Depending what system you use, your fund can be cleared on your account from minutes to a couple of days in case you are using bank transfer. Once the money lands on your account, you are all set and ready to make your first trade. 

4. Practice with eToro Free Demo Account

If you have traded before and know what you are doing, please skip this section and continue reading the eToro review. But if you are making your first steps in trading, you might find this eToro feature very useful. For first-time registered users, eToro offers a Free Demo Account that allows you to explore full eToro trading platform functionality risk=free with $100000 of virtual currency.  Trading conditions, fees, quotes and order tickets are exactly the same as per real-money accounts, so the broker’s strengths and weaknesses can be trialled without any risk. This option is perfect for beginners traders who just start discovering the mechanisms of online trading. Experienced traders can backtest their trading strategies with eToro Demo or verify other traders’ performance to follow them in real-time conditions.  

How to Open Buy/Sell Order with eToro

As we mentioned a number of times in this eToro review, one of the main advantages of this trading platform is an intuitive design that is very easy to use. When you are ready to start investing with eToro, you need to go to the Trade Market section of the platform and choose which asset class you want to invest in.

eToro Review::Investment Products Marketplace

Each asset will have its dedicated page, where you can find News Feed with related news, Stats tab with current statistics such as Previous Close, Days Range, 52 Week Range and 1-year return. You can also check the Cart with the real-time price and Research Section where you would find recommendations provided by eToro Research team. 

eToro Review:; How to buy Bitcoin

When you are ready to trade, just click the Trade button on the top right side and the Order window will open. For each trade you open, you can select if you want to make a Buy or Sell Order. You will then need to choose Trade Amount, i.e. how much money you want to put in the trade. For each Trade Order, you must also select a Stop Loss, which is a very important risk management feature.

eToro Review:: How to by Bitcoin with eToro

You can also choose what leverage you want to use and you can also select Take Profit, which means the trade will automatically close once the profit target per trade has been reached. In this eToro review, we want to specifically emphasise the importance of the risk management of your investment portfolio with Stop Loss and Take Profit features.  

eToro Review:: How to Sell bitcoin with eToro

eToro Trading Fees & Leverage

eToro charges no fees in case of unleveraged long positions for cryptocurrencies, stocks and ETFs. So if a trader buys cryptos or single shares (stock and ETFs) with the leverage 1:1, there will be zero commission charged by eToro. All other cases suggest several layers of fees, which are clearly stated in the order ticket before opening any deal. 

There are two types of fees in eToro: trading and non-trading fees. For example, the broker has an annoying flat withdrawal fee of $25, but deposits are not charged. There is also quite a large conversion fee of 2.5% (25 pips for EUR/USD) when depositing or withdrawing in other currencies except for USD. So, for example, if an investor wants to deposit and withdraw funds in AUD, he will be charged two times for currency conversion as eToro has accounts in USD only. Leveraged long and short positions for CFDs are also charged for overnight and over the weekend. Traders should pay attention to trading hours as they would not have a chance to close the deal if appropriate exchanges are inactive.

In terms of trading fees, eToro’s spreads for Forex currency pairs and cryptocurrencies are highly competitive. For instance, the most popular currency pair – EUR/USD – has a spread of 3 bps. However, all of the spreads and rollover fees are clearly mentioned in watchlists (the difference between the buy and sell price) and in order tickets. The only concern about the platform is that it’s not easy to get a report of charges for a previous trading period. 

eToro leverages depend on the asset class, and in most cases, they comply with regulatory restrictions. Another unique feature is that a trader can choose the leverage for every deal. For example, Forex pairs can be traded with leverage up to 1:30, while the leverage choice for cryptos is restricted to 1:1 or 1:2.  

eToroX, a Professional Crypto Exchange  

Initially, eToroX started as a cryptocurrency wallet which was later transformed into a professional crypto exchange. Today, eToroX offers professional crypto services for corporate and institutional-grade crypto traders with the transparency and security of a regulated cryptocurrency powerhouse. 

eToro Review: eToroX - Professional Crypto Exchange

eToroX offers API services with a FIX API protocol which is commonly used by systematic traders. Investors can have access to the Credit Line for spot trading with additional liquidity. Advanced order types include IOC, FOK and GTC FIG. It offers ultra-low fees and an inverted market-maker model. eToroX also has fully-managed cold-storage Custody as a Service (CaaS) solution and 24/7 trade support in multiple languages. 

eToro Review: eToroX - Professional Crypto Exchange

eToro Trading platform on Desktop and Mobile App

eToro represents a unique mix of social media and web-based financial trading platforms. Both beginner and experienced traders will easily comprehend the structure at a first glance while blocks and sections are user-friendly and informative. The eToro mobile app also reflects key features of the desktop platform with some restrictions to keep the fast operational speed. The software is online and available for gadgets working on most of the operating systems including PC, Mac, Android and iOS. 

eToro Watchlists can be easily configured with an option to open trades from any of them. This helps traders to monitor and filter different asset classes and market segments. 

Investors have access to the detailed trading performance of more than 15+ million traders from 170 countries. The Copy People advanced search engine allows users to filter traders by location, return and risk factor in order to highlight potential leaders to follow automatically. 

In contrast to many other brokers, eToro does not have compatibility with third-party platforms such as MetaTrader, for example. All of the deals are operated manually except the CopyTrade algorithm, so automated trading systems and advisors are not available.  

Is it safe to invest with eToro?

Given the number of regulations in different countries and the number of eToro users worldwide, and as a result of this eToro review, we can conclude that the broker is safe. The company participates in several investor default protection programs and complies with European Securities and Markets Authority (ESMA) rules, which makes it secure for investing. eToro is regulated in the UK and a number of other jurisdictions, and it also now accepts clients from the US. 

eToro Review – Our Verdict

Overall we liked eToro’s online trading platform and find it is suitable for both beginners and professional traders. You can invest in all major asset classes such as stocks, forex, indices, ETFs and cryptocurrencies. eToro has a community of more than 11 million users worldwide and also allows you to invest with and copy successful traders. Its social trading platform is considered to be one of the best in the market where you can find and follow many top-performing investment strategies. You can also invest with other people in eToroPortfolios which are essentially managed similar to funds. 

Many ordinary people are able to make an additional income by running successful investment strategies and sharing revenues with their followers.  

eToro is backed by some of the major global investment houses which are heavily invested in eToro to support its growth strategies. The team is also constantly working on new features and constantly improves its proprietary trading platform. 

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