eToro is one of the pioneers in the world of trading. Launched in 2007, eToro is a company registered as a regulated Financial Conduct Authority in the United Kingdom, which allows it to operate in many European countries. As of recently, eToro launched in the United States too, expanding its user coverage.
Today, eToro has over 17 million users in 140 countries around the world, making it one of the biggest platforms for traders. eToro first launched as a graphics-intensive forex trader, although it’s now focused on cryptocurrency trading. Is eToro blocked in my country?
While eToro has launched in the United States, it doesn’t provide the same benefits to its residents. European users can trade many asset classes, including Contracts for Difference (CFDs), whereas U.S. residents may only trade cryptocurrencies for now.
On this page, we’re going to go over eToro’s primary capabilities, benefits, and overall efficiency for traders.
- 1 eToro Review
- 1.1 Is eToro Legit?
- 1.2 Thankfully, eToro is regulated by the following associations:
- 1.3 Regulations benefit traders greatly due to the following reasons:
- 1.4 Who Is eToro Recommended for?
- 1.5 eToro Pros & Cons
- 1.6 eToro Trade Experience
- 1.7 Some of the most popular features of eToro include the following:
- 1.8 Commissions and Fees
- 1.9 CFD Fees
- 1.10 Forex Fees
- 1.11 Stock and ETF Trading
- 1.12 Cryptocurrency Fees
- 1.13 Non-trading Fees
- 1.14 How to Open an Account with eToro
- 1.15 eToro Demo Account
- 1.16 eToro Education
- 1.17 eToro Customer Service
- 1.18 Conclusion
|📈 Demo Account||Yes|
|💸 Leverage||Forex 1:30, Commodities 1:10, Stocks $ ETFs 1:5, Crypto 1:2|
|📊 Available assets||Stocks, ETFs, crypto, forex, commodities, indices|
|💵 Deposit Methods||Bank Transfer, Maestro, Visa, MasterCard, Diners Club, PayPal, Skrill, Neteller|
|🗠 Minimum Trade On Stocks||$50|
|💰 Min Deposit||$200|
|⚖ Regulation||FCA, CySec, FinCen, ASIC|
|🌐 Countries||140 countries|
Is eToro Legit?
Thankfully, eToro has years of reputation on it, and most of its reviews are positive. However, there are some factors we still need to evaluate to determine whether it’s truly legit.
First, eToro is a well-known broker, which is already excellent news for everyone. According to research, eToro doesn’t have any current “scam” reports from users. Additionally, the platform encourages its users to take as many safety measures as possible to reduce the risk that comes with trading.
One of the things we found about eToro is that publications such as TechCrunch and CNBC have covered the platform in the past, and they’ve also left positive reviews, which is an excellent sign.
Overall, it’s safe to say that eToro’s platform is legit, well-respected, and trading in it is safe as long as you take all the necessary safety measures.
Is eToro Regulated?
A big indicator of eToro’s legitimacy is its regulation. Keep in mind that not all trading platforms are regulated, meaning there may be many problems with fees, transfers, and customer service in general.
Thankfully, eToro is regulated by the following associations:
- Cyprus Securities and Exchange Commission (CySEC) – European Union
- Markets in Financial Instruments Directive (MiFID)
- Financial Conduct Authority (FCA) – United Kingdom
- Financial Crimes Enforcement Network (FinCEN) – United States
- Australian Securities and Investments Commission (ASIC) – Australia
more info about online broker regulations.
There may be people who don’t know what regulations for brokers mean. In essence, if a broker is regulated, it means that it complies with every guideline established by a jurisdiction. In return, the company gets a license to operate there legally.
Regulations benefit traders greatly due to the following reasons:
Regulated brokers, such as eToro, must go through audits and submit reports to the designated association to ensure everything is going as planned; this ensures that no scams go through.
A regulated broker is required to show its users a risk warning before creating their first trading account. As a user, you must know everything about how the business operates, fees, and potential risks.
All users’ funds are segregated at all times, which is much safer if you want to make a withdrawal. Regardless of the time you decide to make a withdrawal, a regulated broker always has enough money to process the operation.
Leverage involves borrowing money from your broker (eToro, in this case) to make trades. Thanks to regulations, there’s an established limit for leverage, which protects your capital.
According to CySEC, this company’s regulated brokers must execute the Investor Compensation Fund in case something that compromises the company happens. In these cases, you’re going to get most (if not all) of your money back.
Regulated brokers require you to pass through ID verification and proof of address at the sign-up process. While it may not seem like much, this can prevent further issues, such as money laundering.
Who Is eToro Recommended for?
Overall, eToro offers a good balance between features and tools over its desktop and mobile versions. However, keep in mind that trading is still considered risky, so you still have to take your time to learn its fundamentals before making any trades.
eToro is popular for allowing people to copy professional investors, but if someone doesn’t have the capabilities to conduct a proper market analysis, they may make a mistake, which increases the risks.
eToro Pros & Cons
eToro Trade Experience
(eToro’s Web Trader Interface)
There’s a lot of ground to cover in this area since eToro offers a plethora of different features for its users. In essence, eToro works by depositing a fiat currency in the user’s account (although you also have the option to transfer cryptocurrencies).
Once you finished making your first transfer, you may use eToro’s web or mobile version to start making trades according to your trading strategy. Thanks to eToro’s Popular Investor Program and CopyTrader features, you may copy trades from professional investors if you’re unsure of what to do.
To make a trade, you may click on the “Buy” or “Sell” button on your trading dashboard, depending on what you want to do. Additionally, you may create a watchlist to share with the mobile version of eToro.
Some of the most popular features of eToro include the following:
As mentioned before, eToro features an intuitive and user-friendly interface. Once you log into your account, you’re going to be greeted by an overview of the market’s current conditions, including live price summaries for each asset.
CopyTrader and CopyPortfolio:
Also known as “Social Trading,” you may place trades automatically based on how other traders did it. In essence, you choose the person you want to copy, and then the app is going to mirror every position they take automatically. If you want to limit your potential losses, you may establish a stop-loss level.
Keep in mind that you need a minimum of $200 to start copying other users, and you may invest up to $500,000 for this process. According to eToro, you may copy up to 100 traders simultaneously, which is more than enough for most people.
To make the choosing process easier for people, they can access popular eToro users’ portfolios, risk scores, and overall stats. Keep in mind that U.S. users may only research and copy other U.S. users.
As for eToro’s CopyPortfolio, you may use it to copy someone else’s portfolio and adapt it to yours.
Right after you create your eToro account, you’re going to receive a free digital wallet to store your cryptocurrencies. You may use this wallet on your PC/laptop or Android/iOS device, whichever feels more comfortable to you.
In case you want to convert your cryptos into a fiat currency, you may have to pay a fee of up to 5%. You can make a minimum transaction of $125 and a maximum of $10,000. However, keep in mind that any coins you transfer from the eToro platform to its wallet may not be transferred back.
eToro News Feed:
Keeping track of the latest market trends and news can be complicated or confusing for some people. Thankfully, eToro includes a news portal into its platform so that you can read about the latest market events.
While this is a nice addition to eToro’s features, it may still be a good choice to complement that information with your research; that way, you can develop a much better strategy for your analysis.
eToro’s dashboard allows you to look at detailed statistics for each stock, cryptocurrency, and others. This can help traders have a better idea of how the asset has behaved over a specified period, helping your investment strategies.
eToro has a decent selection of popular cryptocurrencies you can buy or sell on its platform. However, keep in mind this selection is reduced for U.S. traders.
Commissions and Fees
As with many other trading platforms on the market, all users have to pay some commissions or fees depending on the service they use inside eToro’s platform. Thankfully, eToro provides a solid spread fee structure, so it can be easy to understand by anyone who plans to trade there.
Currencies:The fees depend on the currency pair you’re working with, and it’s measured in Pips, which stands for “Percentage in Point.” If you’re exchanging EUR/USD, for example, you may have to pay one PIP in fees. However, you may have to pay up to 50 Pips in cases of particular exchanges.
Commodities:Commodity fees go from two Pips up to 20,000, depending on the instrument. Palladium is currently the most expensive commodity since it charges 20,000 Pips in fees.
Indexes:Index fees go from 100 Pips up to 1200.
CFD Stocks:Considering that CFD Stocks don’t involve ownership of any underlying assets, CFDs use short sell orders and leverage. The fee for each transaction is 0.09% of the total value of the trade.
CFD Crypto Trades:In this case, the fees for each transaction are fixed at 0.75% and are subject to overnight fees.
Overnight Fees:Considering that CFD positions tend to stay open overnight, you may have to pay an additional fee according to your position’s value. Those fees are used to cover leverage costs.
As with the CFD fees, Forex fees depend on the currencies you’re trading. In essence, you may have to pay from one PIP up to 50 Pips depending on the pair you chose to trade with.
Stock and ETF Trading
eToro doesn’t charge any commissions for trading stocks and ETFs. In essence, you don’t have to pay any management, rollover, ticket, or additional broker fees. Additionally, you don’t have to pay overnight fees either, meaning all you have to place into the trade is your investment.
However, keep in mind that you need a minimum of $50 to invest in stocks/ETFs; this amount includes leverage.
Crypto fees vary from 0.75% up to 3.9% depending on the crypto. As for transfer fees, the fixed coin transfer fee is 0.5% of the transaction size. The minimum fee is $1 and the maximum is $50 (keep in mind these fees are measured in units).
The minimum trade size for cryptocurrencies in eToro is $25.
Opening an account at eToro is entirely free of charge, and there are no management fees; this means you can open and manage your account without having to worry about any hidden expenses.
If you go 12 consecutive months with no login activity, eToro is going to charge you a monthly fee of $10 on your remaining balance.
Making a deposit on eToro is free of charge.
eToro charges a $5 fee for any withdrawal type you make Keep in mind you need a minimum of $30 to make a withdrawal.
CopyTrader and CopyPortfolios Fees:
Neither CopyTrader nor CopyPortfolios charges you management fees or hidden costs to use their services. In the case of CopyTrader, you may still have to pay for overnight fees and spreads.
eToro’s deposits and withdrawals work with USD only, meaning that if you make any transaction with another currency, these are going to be subject to conversion fees. These fees start at 50 Pips for bank transfers.
If you’re planning on using other payment methods, such as PayPal, Skrill, Neteller, Credit Cards, RapidTransfer, or Local Online Banking, you may have to pay different conversions that may go up to 150 Pips for deposits and 25,000 Pips for withdrawals.
In case you’re a member of the eToro Club and are a part of the Diamond tier, you don’t have to pay for any conversion fees. On the other hand, if you’re a Platinum or Platinum+ member, you receive a 50% discount for any conversion fees.
How to Open an Account with eToro
Opening an account on eToro is simple, although there are plenty of steps you must follow to ensure you create your account successfully. You may check out the process for signing up below:
Click on the “Join Now” button on eToro’s website.
Fill out the registration form with your personal information. You may also log in via Gmail or Facebook. Make sure to read and check eToro’s Terms & Conditions before creating your account.
All investors must go through the KYC process as mandated by the European Parliament and Council. The KYC process involves new traders to provide eToro with a Confirmation of Residence and Proof of
ID. Additionally, the trader must fill out a questionnaire that includes questions regarding professional status, financial liquidity, investment goals, and more.
If you do everything correctly, you may not take more than 10-15 minutes to complete the process. Currently, eToro offers four different account types, including the following:
- Retail Account
- Professional Account
- Islamic Account
- Demo Account
In most cases, you may go for either the Retail or the Professional account.
eToro Demo Account
(eToro’s Demo Account)
eToro’s demo accounts are an excellent way for beginners to test their skills before they jump into the real trading market. Keep in mind you don’t have to deal with any risks or losses while using this account type.
Demo accounts are funded with $100,000 of a “virtual portfolio,” and you may use that to test your new strategies before going live trading.
In the case of eToro, there are several education channels for both U.S. and Non-U.S. customers. We’re going to take a brief look at each one below:
The “eToro Trading School” offers weekly webinars that cover most of the content you need to begin trading. These webinars include topics such as: “Introduction to Trading,” “Building, Executing, and Managing Trading Strategies,” and “Risk Management, Goal Setting, and Journaling.” We believe this is one of the best options traders can get to enhance their trading skills.
eToro holds a London-based course where you can learn the basics of financial markets, trader types, key terms, and many more. However, since this course is only available for London residents, it’s not as convenient as other learning channels.
If you go to eToro’s “Education” tab, you’re going to come across the “News and Analysis” section, where you can take a look at updated, informative articles regarding the financial markets and other relevant information. While this may not give you such a deep insight into the fundamentals of trading, it can help you expand your knowledge.
Integrated Tutorials Within the App:
eToro does a great job at integrating brief descriptions of each section of the platform. It may not be enough to make you a professional trader, but it can help you get some basics checked.
eToro’s Online Trading Academy:
This “online academy” organizes all of eToro’s guides, podcasts, and webinars, and places them on a single dashboard that can be accessed by anyone. All courses, such as the “Investing 101” one, are classified according to the topic and trading level. If you’re looking for a place to find everything you need, this is it.
eToro’s official YouTube channel has a wide variety of free webinars, short explanatory videos, and more. The primary problem is that in some cases it’s hard to tell the difference between educational and promotional videos, which can be a nuisance for some.
Help Center and Media Center:
With eToro’s Help Center and Media Center, you can take a look at some FAQs which are organized depending on the topic; this is a great way to get quick answers.
eToro Customer Service
eToro offers an extensive customer service platform where you can submit questions and tickets both as a user or as a visitor. Typically, users can chat with an assigned live agent or get a response to their ticket within 14 days.
On the other hand, members of eToro’s Club have a designated account manager, which includes much faster response times. Finally, if you have a Platinum tier membership, you get priority customer support.
There’s no phone support available (except for Australia) and there’s no live broker support.
Thanks to its regulations, traders can enjoy their trading experience without having to worry about security breaches.
Keep in mind that the eToro experience may vary for U.S. traders since they have many limitations regarding the platform’s services. Still, it’s a great option for those who want a safe and effective place to trade.