eToro Forex and CFD Broker Review – Binary Options Zone

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Contents

eToro

eToro

Details

Broker eToro
Website URL https://www.etoro.com/
Founded 2007
Headquarters Kanika International Business Center 7th Floor, 4 Profiti Ilia Street Germasogeia, Limassol, Cyprus 4046
Support Number +44-866-350-0881
Support Types telephone , fax , email , online help
Languages 22 languages supported
Trading Platform web trading platform | mobile platform
Minimum 1st Deposit $200
Minimum Account Size $200
Minimum Trade Amount $25
Maximum Trade Amount each instrument has a maximum
Bonus Reffer a friend
Leverage 1:400
Spread fixed
Free Demo Account Open Demo
Regulated
Regulation Regulated by FCA, CySEC, and ASIC
Fees
Account Types standard
Deposit Methods bank transfer , credit/debit card , PayPal , Skrill , Webmoney , Neteller
Withdrawal Methods bank transfer , credit/debit card , PayPal , Skrill , Webmoney , Neteller
Number of Assets 1300+
Types of Assets FX, indices, stocks, ETFs, commodities, cryptocurrencies
US Traders Allowed
Mobile Trading
Tablet Trading
Overall Score 92

Established in 2007, eToro is a popular fintech startup. Well-known as an Israeli social trading broker, the company serves customers from the UK, Australia, and most of the other regions in the world. It is a multi-asset trading platform which offers primarily CFDs, but clients can also invest in stocks and cryptocurrency assets.

Trading Platforms

eToro relies solely on its Web Trading Platform, compatible with most of the popular web browser as well as mobile. Available in English, German, Spanish, Italian, French, Russian, Polish, Greek, Chinese, and Arabic, it is one of the few platforms that’s available in so many different languages. The company managed to combine design with functionality, even though one negative aspect is that it cannot be customized, given that panels are fixed.

The platform is secure, given that it has an optional two-step authentication system. Alerts and notifications are also available, the platform letting you know when an asset had reached a particular target. It also sends notifications when an order had been filled. There are portfolios and fee reports, as well, with assets lined up or a pie chart of your exposure.

Speaking of the mobile platform, it is user-friendly and has two-step login, being available both for iOS and Android devices. Unfortunately, there is no desktop platform available at eToro, which may be an issue for traders who rely on Expert Advisors.

Regulation

One of the main reasons why eToro managed to gain its reputation is represented by the FCA regulation of the UK branch. There’s also an Australian office regulated by ASIC and all of the other customers fall under the jurisdiction of the Cyprus entity, regulated by CySEC. Overall, we can say that the company is well-regulated and the big number of clients confirm that it offers reliable services.

Account Types

Things are simple when it comes to account types, as there’s only one live account available for all customers. Excluding European clients, which may have access to a professional account thanks to the latest CFD regulation, all eToro clients have access to the same account, no matter their deposit. With it, the can access currency pairs, stock indices, stocks CFDs, ETFs, commodities, and cryptocurrencies. Another downside of the eToro account is that the only account currency available is the US dollar. Any deposits in other currencies will be exchanged into USD at the spot rate.

Promotions

The most popular eToro promotion is “Invite a Friend”, which will get you $50 referral bonus for each successful referral. This is a company that wants to simulate social trading and this is one of the ways it has become popular.

Pros and Cons

  • Access to a wide range of trading instruments.
  • A regulated broker with some of the most popular financial agencies.
  • If you trade stocks or ETFs with zero leverage, you’ll own the underlying instrument, which will be like trading real assets.
  • No desktop platform available.
  • Only one type of real account.
  • USD is the only account currency available.

Educational Material

Since it encourages social trading, eToro has a Trading Academy, as well as constantly holding live webinars. Clients can find a lot of information about trading on the broker’s website.

eToro Review 2020

Summary

Recommended for traders interested in social trading (i.e. copying other investors’ trades)

eToro is a well-known Israeli fintech startup, a social trading broker established in 2007.

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eToro serves UK clients through an entity regulated by the Financial Conduct Authority (FCA), Australians through an Australian Securities and Investment Commission (ASIC) regulated entity. All other customers are served by a Cypriot entity that is regulated by the Cyprus Securities and Exchange Commission (CySEC).

eToro is not listed on any stock exchange, does not disclose its annual report on its site and does not have a bank parent.

eToro is considered safe because its UK and Australian arms are regulated by top-tier financial authorities and it is a well-known fintech startup.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

We selected eToro as Best broker for cryptos and Best broker for social trading for 2020, based on an in-depth analysis of 57 online brokers that included testing their live accounts. Check out the complete list of winners.

eToro pros and cons

eToro offers commission-free stock and ETF trading in Europe and offers generally low fees for non-EU clients. Account opening is fast and seamless. It has innovative features like social trading, which lets you copy the strategies of other traders.

On the negative side, eToro’s forex fees are high and the withdrawal is slow with a $5 fee charged. Also, it only offers one account base currency.

Pros Cons
• Free stock and ETF trading in the EU • High forex fees
• Seamless account opening • Withdrawing money is slow and expensive
• Social trading experience • Only one account base currency
eToro main features and highlights
��️ Country of regulation UK, Cyprus, Australia
�� Trading fees class Low
�� Inactivity fee charged Yes
�� Withdrawal fee amount $5
�� Minimum deposit $200
�� Time to open an account 1 day
�� Deposit with credit card Available
�� Depositing with electronic wallet Available
�� Number of base currencies supported 1
�� Demo account provided Yes
��️ Products offered Stock, ETF, Forex, CFD, Crypto

Gergely Korpos

Author of this review

Everything you find on BrokerChooser is based on reliable data and unbiased information. We combine our 10+ years finance experience with readers feedback. Read more about our methodology

eToro review
Fees

eToro offers free stock trading in Europe and has low CFD fees. On the negative side, forex trading fees are high and there is a fee charged for inactivity or withdrawal.

Pros Cons
• Free stock and ETF trading in the EU • High non-trading fees
• Low CFD fees • High forex fees
• Withdrawal fee
eToro fees snapshot
Assets Fee level Fee terms
S&P 500 CFD Low The fees are built into spread, 0.75 is the average spread cost.
Europe 50 CFD Low The fees are built into spread, 3 is the average spread cost.
EURUSD High The fees are built into spread, 3 pips is the average spread cost.
Inactivity fee Low $10 per month after one year inactivity

How we ranked fees

We ranked eToro’s fee levels as low, average or high based on how they compare to those of all reviewed brokers.

To get things rolling, let’s go over some lingo related to broker fees. What you need to keep an eye on are trading fees and non-trading fees.

  • Trading fees occur when you trade. These can be commissions, spreads, financing rates and conversion fees.
  • Non-trading fees include charges not directly related to trading, like withdrawal fees or inactivity fees.

In the sections below, you will find the most relevant fees of eToro for each asset class. For example, in the case of forex and stock index trading spreads, commissions and financing rates are the most important fees.

We also compared eToro’s fees with those of two similar brokers we selected, Plus500 and MarketsX. This selection is based on objective factors such as products offered, client profile, fee structure, etc. See a more detailed rundown of eToro alternatives.

To have a clear overview of eToro, let’s start with the trading fees.

eToro trading fees

eToro trading fees are low.

We know it’s hard to compare trading fees for CFD brokers. So how did we approach the problem of making their fees clear and comparable? We compare brokers by calculating all the fees of a typical trade for selected products.

We have chosen popular instruments within each asset class:

  • Stock index CFDs: SPX and EUSTX50
  • Stock CFDs: Apple and Vodafone
  • Forex: EURUSD, GBPUSD, AUDUSD, EURCHF and EURGBP

A typical trade means buying a leveraged position, holding it for one week and then selling. For the volume, we chose a $2,000 position for the stock index and stock CFDs and $20,000 for the forex transactions. The leverage we used is:

  • 20:1 for stock index CFDs
  • 5:1 for stock CFDs
  • 30:1 for forex

These catch-all benchmark fees include spreads, commissions and financing costs for all brokers. Let’s see the verdict for eToro fees.

Stock fees and ETF fees

As a unique service on the market, eToro offers zero-commission stock and ETF trading for European clients. eToro, which is primarily a CFD broker, also lets you trade with real stocks and ETFs if you set the leverage to one. For non-EU clients, there is no zero-commission trading, but eToro charges low fees, i.e. the spread (the difference between the ask and the bid prices) is low. If you set the leverage higher than one, you will be trading with CFDs.

Stock and ETF commission of a $2,000 trade

eToro IG XTB
US stock $0.0 $15.0 $10.0
UK stock $0.0 $9.6 $10.0
German stock $0.0 $11.0 $8.8

CFD fees

eToro has generally low CFD trading fees. Compared to its closest competitors, its fees are roughly in the same range.

eToro CFD fees for a $2,000 long position held for one week

eToro Plus500 MarketsX
S&P 500 index CFD fee $2.4 $2.1 $2.6
Europe 50 index CFD fee $2.7 $1.3 $2.5
Apple CFD fee $6.3 $8.9 $6.4
Vodafone CFD fee $7.6 $6.7

Forex fees

eToro forex fees are high, although still lower than MarketsX’s.

eToro forex benchmark fees of a $20,000 30:1 long position held for one week

eToro Plus500 MarketsX
EURUSD benchmark fee $19.6 $17.9 $24.5
GBPUSD benchmark fee $16.2 $14.0 $25.0
AUDUSD benchmark fee $12.4 $12.6 $25.1
EURCHF benchmark fee $11.8 $9.0 $22.1
EURGBP benchmark fee $19.9 $14.6 $20.5

Non-trading fees

eToro has high non-trading fees, as it charges $10 per month after one year of inactivity, and its withdrawal fee is $5.

eToro non-trading fees

eToro Plus500 MarketsX
Account fee No No No
Inactivity fee Yes Yes Yes
Deposit fee $0 $0 $0
Withdrawal fee $25 $0 $0

eToro review
Account opening

Account opening at eToro is seamless and very fast.

Pros Cons
• Fast None
• Fully digital
• Low minimum deposit

Can you open an account?

Visit broker
75% of retail CFD accounts lose money

Most likely yes, as eToro serves almost every countries except for 36 (of which a big chunk are African countries).

What is the minimum deposit at eToro?

In most cases the required eToro minimum deposit is $200 . It is different for the following countries:

  • If you are from Israel, it is $10,000.
  • For residents of Australia and the USA, the minimum first-time deposit is $50.
  • For residents of Russia, China, Hong Kong, Taiwan and Macau, the minimum first-time deposit is $500.

Account types

eToro offers two very simple account types: there is a live account, as well as a demo (or virtual) account, where you can try out the platform with play money.

How to open your account

The account opening process is hassle-free and fully digital. In addition, it is also very fast, as we were able to open an account within one day.

You have to start by registering with your email account or with your Facebook or Google+ account. And that’s practically it, you can immediately access the trading platform and start to trade with a $100,000 demo account.

If you want to go further and fund it with real money, you have to verify your identity and residency by uploading the required documents:

  • Proof of identity: a copy of your passport or personal ID.
  • Proof of residency: a copy of a utility bill or bank statement.

eToro review
Deposit and withdrawal

Depositing money is free and easy, with a lot of available options, including credit cards. However, there is a withdrawal fee and only USD accounts are available.

Pros Cons
• Credit/Debit card available • Only one account base currency
• No deposit fee • $5 withdrawal fee
• User-friendly

Account base currencies

eToro only allows USD accounts, which means that your funding will be converted by eToro to USD. For example, if you deposit EUR, a 0.025% fee will be applied at funding and the same fee will also be charged when you withdraw EUR. Alternatively, you can deposit in USD, e.g. using your credit card. In that case, your bank will make the conversion at its own rate.

Base currencies at eToro vs similar brokers

eToro Plus500 MarketsX
Number of base currencies 1 10 9

Why does this matter? For two reasons. If you fund your account in the same currency as your bank account or you trade assets in the same currency as your account base currency, you don’t have to pay a conversion fee.

A convenient way to save on currency conversion fees is opening a multi-currency bank account at a digital bank. Revolut or Transferwise both offer bank accounts in several currencies with great currency exchange rates as well as free or cheap international bank transfers. Opening an account only takes a few minutes on your phone.

Deposit fees and options

eToro charges no deposit fees.

Similarly to other CFD brokers, there are a lot of depositing options:

  • Bank transfer
  • Credit/Debit card
  • PayPal
  • Skrill
  • Neteller
  • WebMoney
eToro deposit options
eToro Plus500 MarketsX
Bank transfer Yes Yes Yes
Credit/Debit card Yes Yes Yes
Electronic wallets Yes Yes Yes

A bank transfer takes 4-7 business days, and there is no maximum deposit. In comparison, while credit/debit card and electronic wallet deposits are instant, there are per transaction limits: $40,000 in the case of credit/debit cards, and either $10,000 or $20,000 in the case of electronic wallets.

You can only deposit money from funding sources that are in your name.

eToro withdrawal fees and options

eToro has a $5 withdrawal fee, which is high compared to other CFD brokers. In addition, eToro has a $50 minimum amount limit on withdrawals.

Withdrawal options are the same as the funding options: you can withdraw money using bank transfer, credit/debit card or electronic wallets, similar to other CFD brokers.

eToro withdrawal fees and options

eToro Plus500 MarketsX
Bank Transfer Yes Yes Yes
Credit/Debit card Yes Yes Yes
Electronic wallets Yes Yes Yes
Withdrawal fee $5 $0 $0

How long does it take to withdraw money from eToro?

We tested withdrawal by bank transfer, and it took 2 business days.

How do you withdraw money from eToro?

  1. Click on the ‘Withdraw Funds’ tab in the left-hand menu.
  2. Enter the amount you wish to withdraw (in USD).
  3. Complete the electronic withdrawal form as required.
  4. Click ‘Submit.’

You can only withdraw money to accounts in your name.

More funding and withdrawal info
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eToro review
Web trading platform

eToro offers a user-friendly and well-designed web trading platform. In addition, social trading is also available. On the other hand, the customizability is limited.

Pros Cons
• User-friendly • Limited customizability (for charts, workspace)
• Clear fee report
• Two-step (safer) login
eToro platforms to choose from
Trading platform Score Available
Web 4.4 / 5 stars Yes
Mobile 4.9 / 5 stars Yes
Desktop No

eToro’s platform looks like a modern platform should in this day and age.

The web trading platform is available in many languages:

eToro platform languages

Arabic Chinese (simplified) Chinese (traditional) Czech Danish
Dutch English Finnish French German
Italian Malaysian Norwegian Polish Portuguese
Romanian Russian Spanish Swedish Vietnamese
Thai

Look and feel

eToro’s trading platform is a pleasure for the eye. With its clean design and great functions, eToro did a great job of combining good design with functionality. The menus and buttons are where you expect them to be, everything is labelled correctly and the color scheme is pleasant.

It is hard to customize though, as the panels are fixed. One exception is the watchlist, which is easy to configure.

Login and security

eToro has an optional, safer, two-step login system. This can make it more complicated to log in, but in turn it provides you with added security.

Search functions

The built-in search is predictive and easy to use. Type in a company or product name and you can see the results. Also, you can search easily via tickers.

Placing orders

Placing orders is self-explanatory.

You can use the following order types: market, limit, stop-loss, trailing stop-loss.

If you are not familiar with order types, read this overview.

Alerts and notifications

You can set price alerts and notifications easily. eToro’s alert function lets you know when an asset reaches a price target, and you also get a notification when your order is fulfilled. On the web platform, this is in the form of an icon update or a browser notification. On mobile, it is a push notification.

Portfolio and fee reports

You will surely want to know how your portfolio is performing and how much fees you have paid. You can decide how you want to see your portfolio reports: a list of your assets or a pie chart showing your current portfolio.

Finding the fee report is quite complicated at first. Click on the ‘Portfolio’ tab, then go to ‘History,’ and under the gear icon at the top right, you can access and download your account statement. This is a well-structured pdf file showing all of your cash flows, including fees. When you are following someone, you will see all trades separately. However, fees are not added up, but listed individually per fee deduction.

Visit web platform page
75% of retail CFD accounts lose money

eToro review
Mobile trading platform

eToro’s mobile platform is well-designed and intuitive. It is a pleasure to use.

Pros Cons
• User-friendly • No Touch/Face ID login
• Two-step (safer) login
• Good search function

The eToro mobile trading platform is available for iOS and Android. We tested it with iOS.

It’s available in the same 21 languages as the web trading platform.

The mobile platform has the same great functionality as the web platform. It uses mobile-specific intuitive functions, such as push notifications or good touch interactions. For example, you can swipe left and right in your portfolio to access charts or open a new trade.

Visit mobile platform page
75% of retail CFD accounts lose money

eToro review
Desktop trading platform

eToro does not offer a desktop trading platform.

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75% of retail CFD accounts lose money

eToro review
Markets and products

At eToro you can trade with CFDs and forex, as well as real stocks, ETFs and many cryptocurrencies. In addition, the broker also offers innovative services like social trading and CopyPortfolio.

eToro is primarily a CFD and forex broker. However, you can also trade with real stocks, ETFs, and a lot of different cryptos. eToro also has some nifty features, such as social trading (Copy People) and CopyPortfolio.

So, let’s break down eToro’s markets and products.

All non-leveraged buy positions for equities, ETFs and cryptocurrencies are traded as real assets. This means that when you buy stocks, ETFs or cryptos without any leverage (i.e. leverage is set to one), you will buy real stocks, ETFs and cryptos, not CFDs.

All other positions are CFDs:

  • leveraged buy positions and all sell positions of stocks, ETFs and cryptos
  • all positions of forex, commodities and indices

Within CFDs, in addition to the traditional way of trading, you can

  • follow and copy other traders’ trading (this is Copy People, also called social trading), or
  • invest in a compiled CFD portfolio (this is CopyPortfolio).

To learn more about CFDs, read our CFD trading tips.

Disclaimer: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

At eToro, you can trade with an average number of products. For example, there are fewer stock CFDs available than at Plus500, another CFD broker. The same can be said about currency pairs and commodities. On the other hand, eToro offers a wider range of stock and ETF CFDs than its closest competitors, and you can also trade with many of the most popular cryptocurrencies.

eToro Plus500 MarketsX
Currency pairs (#) 47 70 55
Stock index CFDs (#) 13 33 11
Stock CFDs (#) 1,900 1,800 2,000
ETF CFDs (#) 145 92 42
Commodity CFDs (#) 6 22 17
Bond CFDs (#) 4
Futures CFDs (#)
Cryptos (#) 17 14 5

You can change the default leverage level of the products.

Changing the leverage manually is a very useful feature when you want to lower the risk of a trade. For example, instead of trading with 5:1 leverage, only trade with 2:1 leverage in the case of stock CFDs. Be careful with forex and CFD trading, since the pre-set leverage levels are high.

CopyTrader

eToro has two distinctive innovations, both being great features, CopyTrader and CopyPortfolio.

CopyTrader is the so-called social trading feature. What is eToro really good at? Well, this is it! One by one you can copy the portfolio of traders who also trade with eToro. This can be quite useful. You can browse through the profiles of other eToro traders, checking their previous performance on an annual and a monthly level. Their portfolio is also public information. Additionally, eToro also applies a risk score to each trader. There are tons of more stats for each profile, like trades per week, average holding time, performance on charts, and you can also see their detailed profiles as well as their news feed comments. Imagine Facebook profiles, but with fewer inspirational and more market quotes.

The minimum amount you can invest in one trade is $200, while the maximum is $500,000. Furthermore, you can copy a maximum of 100 traders simultaneously.

There is one drawback of CopyTrader: you cannot close part of your position, only the full amount.

Disclaimer: Indicative prices; current market price is shown on the eToro trading platform. Past performance is not an indication of future results. The trading history presented is less than 5 years old and may not suffice as a basis for investment decisions. This post is not investment advice.

CopyPortfolio

CopyPortfolio is practically an investment fund, but under the hood it is a CFD portfolio. While with CopyTrader you were following one trader, with CopyPortfolio you can invest either in a theme or in a portfolio of top eToro traders.

  • Investing in themes means for example investing in a portfolio of big banks or cryptocurrencies. Practically, “Big Banks CopyPortfolio” consists of CFDs traded by the largest investment banks, such as Citi, Bank of America, HSBC or others.
  • The other way to invest via CopyPortfolio is to invest in a portfolio comprised of multiple “star” traders.
  • There is also a crypto CopyPortfolio available.

Disclaimer: Indicative prices; current market price is shown on the eToro trading platform. Past performance is not an indication of future results. The trading history presented is less than 5 years old and may not suffice as a basis for investment decisions. This post is not investment advice.

The proportion of CFDs in the specific CopyPortfolio is clearly indicated. You can check performance and asset distribution, and read the investment strategy. CopyPortfolios are built around a theme by eToro’s algorithms or by eToro external partners. This might all sound a bit complicated, but at the end of the day, this means you can invest easily in a quasi-fund. There is a minimum investment amount for CopyPortfolio, which is $5,000. eToro also checks your financial knowledge to determine whether CopyPortfolio is right for you.

Stocks and ETFs

If you buy non-leveraged stocks or ETFs, you are buying the real asset. Usually, this feature is not offered by other CFD and forex brokers. In that sense, eToro’s selection of 16 stock markets to access is great. However, compared to stockbrokers like Saxo Bank (

35 markets) or Interactive Brokers (

80), it is poor. There are also risks you should take into account when you choose stocks. Your capital is at risk.

eToro Plus500 MarketsX
Stock markets (#) 16
ETFs (#) 145

At eToro, you have access to the following 16 stock exchanges:

  • Amsterdam
  • NYSE
  • New York Tech
  • Euronext Brussels
  • Euronext Lisbon
  • Frankfurt
  • London
  • Paris
  • Madrid
  • Milan
  • Zurich
  • Oslo
  • Stockholm
  • Copenhagen
  • Helsinki
  • Hong Kong

Cryptocurrency

Cryptocurrency prices can fluctuate widely and are therefore not appropriate for all investors. Trading cryptocurrencies is not supervised by any EU regulatory framework, such as MiFID. Therefore, when using eToro’s Cryptocurrencies Trading Service you will not get any investor protection.

Disclaimer: Past performance does not guarantee future results. Trading history presented is less than 5 years old and may not suffice as a basis for investment decision. Indicative prices; the current market price is shown on the eToro trading platform. Highly volatile unregulated investment product. No EU investor protection. Your capital is at risk.

You can trade with a wide variety of cryptocurrencies on eToro’s standard trading platform, far more than at other brokers:

  • Bitcoin
  • Bitcoin Cash
  • Ethereum
  • Ethereum Classic
  • Ripple
  • Litecoin
  • Cardano
  • IOTA
  • TRON
  • ZCASH
  • Binance coin
  • Dash
  • Stellar
  • EOS
  • NEO
  • Tezos
  • XRP

Technically, when you go long in any crypto, you will own the real coin. When you go short, it is a CFD.

eToro review
Research

eToro has good technical analysis tools. There are some analyst recommendations and market sentiment indicators available, but no comprehensive fundamental data.

Pros Cons
• Good interactive chart • No fundamental data available
• Trading ideas • No/poor quality news flow
• User-friendly
• Analyst recommendations

Research is available in 21 languages (the same languages that are available on the web and mobile trading platforms).

Recommendations

For some popular stocks, you can find recommendations, like analyst consensus (buy/hold/sell), average price target, hedge fund sentiment and insider trading sentiment. In some cases, you can also read the analyst reports. Unfortunately, these research features are available only for a very limited number of stocks.

Fundamental data

Some basic fundamental data on stocks is available on eToro’s platform. This includes the profile of the company and some very basic indicators and ratios such as P/E, EPS, dividend yield and beta. No fundamental data is available for asset classes other than stocks.

You can also sign up for a daily market analysis newsletter in which you get a useful list of the market highlights.

Charting

eToro’s charting tool is quite good and you can use many, ca. 70 technical indicators. We liked that charts are automatically saved, so you don’t have to waste your time setting up your indicators time and again. On the negative side, you can only see the data for the past ca. 6 months, no longer time horizon can be set.

News feed

The news feed is not really an official news feed, e.g. it is not like an integrated Bloomberg feed. Rather, it is like a market-themed Twitter feed, showing messages posted by eToro users and analysts. Hashtags (#) are used for themes and dollar signs ($) for assets. We were not a huge fan of this feature, but if your tastes differ you might like it.

More research info
75% of retail CFD accounts lose money

eToro review
Customer service

eToro customer service is good: you can reach it on several channels and get quick and relevant answers. On the flip side, you can’t reach them on weekends and it’s difficult to find the live chat service on the webpage.

Pros Cons
• Live chat • No phone support
• Fast response time • No 24/7 support
• Relevant answers • Difficult to find the live chat service

You can contact eToro’s customer service via live chat and a web-based ticketing system where you will get an answer by email. It was always quick and reliable when we tested it.

On the flip side, the customer service cannot be reached on the weekends, and it’s difficult to find the live chat function on the website as it is hidden under the FAQ under the ‘Help Center’ link.

eToro customer service, in theory, is available in all 21 languages the web and mobile trading platforms offer. We only tested customer service in English.

Contact customer service
75% of retail CFD accounts lose money

eToro review
Education

eToro’s education tools are limited, with only some medium-quality videos about investing available.

Pros Cons
• Demo account • Basic educational videos
• Intro guide to the platform

For practice, you can use a demo account. Other education tools are not really strong at eToro. There is one short tutorial video on how to use the platform, and some basic educational videos about investing and the financial markets.

The content discussed is intended for educational purposes only and should not be considered investment advice.

Visit education page
75% of retail CFD accounts lose money

eToro review
Safety

eToro is regulated by top-tier financial authorities like the FCA, ASIC and CySEC. However, it is not listed on any stock exchange, does not disclose financial information and does not have a bank parent.

Pros Cons
• Majority of clients belong to a top-tier financial authority • Does not hold a banking license
• Negative balance protection • Not listed on stock exchange
• Well-known fintech startup • Financial information is not publicly available

Is eToro regulated?

Yes, it is regulated by the Cyprus Securities and Exchange Commission (CySEC), the UK’s Financial Conduct Authority (FCA) and the Australian Securities and Investment Commission (ASIC).

eToro is based in Israel and was founded in 2007.

Is eToro safe?

To be certain, we highly advise that you check two facts:

  • how you are protected if something goes wrong
  • what the background of the broker is

How you are protected

eToro operates three legal entities and serves customers based on their residency. This matters because the entity you belong to defines the amount of protection you get.

  • Citizens of the United Kingdom can open an account at eToro (UK) Limited and thus they will be protected by the FCA. If eToro becomes insolvent, eToro UK clients can expect to be compensated by the maximum amount of £85,000 guaranteed by the Financial Services Compensation Scheme (FSCS).
  • Australian clients are served by eToro Australia, which is regulated by ASIC, the Australian financial authority. ASIC however does not provide any obligatory investor protection for a pre-set amount.
  • Other investors will have their live trading accounts with eToro (Europe) Limited, which is regulated by the Cypriot watchdog, CySEC. The amount of investment protection coverage at eToro Europe is a maximum of €20,000. This threshold is set by the Cypriot Investors Compensation Fund.

Here is a handy summary table for easy comparison:

eToro investor protection

Country of clients Protection amount Regulator Legal entity
United Kingdom £85,000 Financial Conduct Authority (FCA) eToro (UK) Ltd.
Australia No protection Australian Securities and Investments Commission (ASIC) eToro AUS Capital Pty Ltd.
Other clients €20,000 Cyprus Securities and Exchange Commission (CySEC) eToro (Europe) Ltd.

There is no investor protection for cryptos.

eToro also provides negative balance protection for forex spot and CFD trading, but only for retail clients from the European Union. Professional and non-EU clients are not covered with any negative balance protection

Background

eToro was established in 2007. The longer track record a broker has, the more proof we have that it has successfully survived previous financial crises. This means that it has already survived one crisis, which is a good sign. eToro is a privately-owned fintech startup, with owners including venture capital funds like Commerz Ventures Gmbh, the VC arm of Commerzbank, as well as Israeli US, and Chinese investors. eToro is lead by Yoni Assia, its well-known founder and CEO.

eToro is still considered a startup. It is not listed on any stock exchange and it also does not provide regular financial statements to the public. Hence, it is hard to know anything about its financial performance. It also does not have a bank parent, which could help provide capital to eToro in case of hard times. At the same time, being regulated by top-tier authorities is a great sign for eToro’s safety.

eToro review
Bottom line

eToro has zero-commission stock trading in Europe. Account opening is really fast and seamless. It has also a lot of innovative features, like social trading.

It has some drawbacks, though. Forex fees and non-trading fees are high, and eToro only allows USD accounts.

Overall, we would recommend eToro for its social trading feature and cheap stock trading.

Risk disclaimer

eToro is a multi-asset platform that offers both investing in stocks and cryptoassets, as well as trading CFD assets.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

Cryptoassets are volatile instruments which can fluctuate widely in a very short timeframe and therefore are not appropriate for all investors. Other than via CFDs, trading cryptoassets is unregulated and therefore is not supervised by any EU regulatory framework.

Past performance is not an indication of future results.

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75% of retail CFD accounts lose money

eToro review
FAQ

How does eToro work?

eToro is primarily a CFD and forex broker, but you can also trade with real stocks, ETFs and many cryptocurrencies. It is well-known for its social trading feature, with which you can follow and copy the portfolio of a trader who also trades with eToro.

Who owns eToro?

At the time of this eToro review, it is a privately held company, therefore it is not required to publish its ownership structure. What we know is that eToro does not have any banking parent company (little chance for a bailout in case of bankruptcy), and it is currently operating under two legal names. The well-known founder and CEO of eToro is Yoni Assia.

eToro is funded by venture capitalists. Here are a few of them:

  • Anthemis Group, UK
  • BRM Capital, Israel
  • CommerzVentures GmbH, Germany
  • Cubit Investments, Israel
  • MoneyTime Ventures, USA
  • Ping An, China
  • Spark Capital, USA

Who regulates eToro?

eToro is regulated by financial authorities in Cyprus, the UK and Australia, corresponding to one of the three entities eToro operates under:

  • eToro (Europe) Ltd. – Cyprus – is regulated by CySEC (the Cyprus Securities and Exchange Commission) under license # 109/10, for servicing EEA (European Economic Area) member states, and countries outside of it.
  • eToro (UK) Ltd – UK – is regulated by the UK financial authority, the FCA (Financial Conduct Authority).
  • eToro (AUS) Capital Pty Ltd – is regulated by the Australian watchdog, ASIC (Australian Securities and Investments Commission).

How does eToro make money?

eToro makes money through various fees, and the trading services they provide on their website. Although eToro does not make its financial statements public, the main source of revenue for eToro is likely to be:

  • Spreads: Spreads are the gap between the price you and the broker buys/sells at. To put it simply, if an Apple stock costs $100 at market price, eToro will charge $100.1 for it. The difference of $0.1 per CFD is kept by eToro. For further info, read how CFDs work.
  • eTtoro overnight fee: For this, you need to understand two things, leveraged trades and loans. Leveraged means that you can trade with more money than you actually have. Let’s say you want to trade Apple with 1:10 leverage and you have $10. This means that using leverage you can buy $100 worth of Apple with your ten bucks, as the missing $90 will be lent to you by eToro, which will charge you a fee (interest) for this loan.
  • Other non-trading fees: eToro charges fees for several services on their website, which are not directly related to trading, also known as non-trading fees. Some examples of non-trading fees are:
    • Withdrawal fees ($5/transaction): pay to withdraw your money
    • Conversion fees: pay when eToro converts money to fund your account

Can eToro be trusted?

eToro is regulated by CySEC in Cyprus, ASIC in Australia, and the FCA in the UK. This is a good thing. eToro is not listed on any stock exchange, nor does it publish its financial data. Overall, Brokerchooser’s view is that eToro is not a scam, but it is not a fully transparent broker either.

How does eToro copy work?

eToro copy, a.k.a. CopyTrader, is a tool for social trading, which works by you copying the trading decisions of other people, or other people copying your trades. You can search for traders and other users, and see how their portfolio has performed historically. Once you found a trader of your liking, you can copy their every trading decision, which is handled automatically by the platform. You can decide how much money you want to invest in copying another trader, and you can close your investment whenever you wish. If you want, you can also make money by having other traders copy you.

Are eToro profits taxable?

If you make profits by trading on eToro, these can be subject to taxation laws and regulations. This always depends on the country of your origin. For further information about eToro and taxes, we recommend contacting your local tax authority.

Can I use eToro in the USA? Can I use eToro in Canada?

Currently, people from the USA cannot use eToro because US regulation (the SEC) does not allow brokers to provide CFD instruments (eToro is a CFD broker) for US residents. This means no regulated broker will accept retail clients from the USA to trade CFDs, so in this sense it is not only eToro that cannot serve US residents.

eToro cannot be used by the residents of the following countries:

  • United States of America (residents and citizens, including its incorporated and unincorporated territories)
  • Belgium
  • Canada (including Quebec & Ontario)
  • the Republic of Turkey
  • Japan
  • Brazil
  • the Islamic Republic of Iran
  • Democratic People’s Republic of Korea (DPRK)
  • Cuba
  • Sudan
  • Syria

When will eToro be available in the US?

The US SEC (Securities and Exchange Commission) does not allow CFD instruments to be sold to US citizens. Until this law does not change, eToro will not be allowed to operate in the US under its current business model.

eToro

Rating Payout Min Deposit Bonus Regulated
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Var $200

Yes Payout: Var Min Deposit: $200 Bonus: Regulated:

Yes

eToro (Operating as eToro UK Ltd in the UK) are a rapidly growing social investment broker. The brand were pioneers of ‘social trading‘ – the practise of trading socially, sharing trading knowledge and giving users the ability to follow other traders – and profit from their trades. This is also known as Copy Trading.

65% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money.

“eToro make trading accessible. From Bitcoin to the price of oil – eToro allow retail investors access to a full range of markets in a no nonsense way.”

The firm are quick to adapt to trader demands, recently adding a Cryptocurrency fund which gives users quick and easy access to Bitcoin, Ethereum and 5 other cryptocurrencies. This flexibility has, in part, led to the rapid expansion of the firm.

Social trading requires depth of traders. eToro currently has 4.5 million traders, meaning there is a wealth of trading knowledge and no shortage of social interaction. The firm is regulated by the Financial Conduct Authority (reference 583263), giving UK consumers the maximum amount of confidence.

Jump straight to the eToro “How to” guides.

  • Demo Account – Yes ($100,000 trading balance in the ‘virtual portfolio’)
  • Minimum Deposit – $200 (around £140).
  • Minimum trade – $25 (around £18)
  • Signals service – No
  • Mobile App – Yes, all platforms.

Trading Platform

The eToro trading window has been designed for simplicity and ease of use. The virtual portfolio (demo account) is opened for traders immediately, giving quick access for traders to get used to the platform before carrying out any ‘real money’ trades. The new platform has replaced the old ‘WebTrader’ view.

There are numerous routes to get to a trading window. The left hand menu gives traders access to their account details, including their portfolios (both virtual and real) and their bespoke ‘watchlists’. Trades can be opened by simply selecting the asset within either of these windows.

Alternatively, traders can select the ‘Markets‘ menu option. This opens up the full range of assets available at eToro. The markets can be filtered by category – Stocks, Commodities, Currencies and indices – and further filters can then also be applied – for example, traders may want to see stocks from just the ‘Technology’ sector. Once the desired assets are listed, selecting any of the markets will open a new window showing the latest conversations regarding that asset, as well as an option to look at the latest price charts. Clicking the ‘Trade‘ button then opens the trading window.

Webtrader

The trading window contains a lot of information, but the design ensures everything is clear. The Sell or Buy button is at the very top, followed by the asset, with the current value. The price movement for that trading day is also shown. To the right is a drop down list that allows traders to place an ‘order‘ if they want to wait for a specific price, or if the local market for that asset is currently closed. The default setting is ‘trade‘ – to open a trade immediately.

Beneath the asset information is the trade amount box. This can be amended via the -/+ buttons, or overtyped. Under the amount are three boxes – these will update as the amount is amended. The first is the stop loss – the point at which a trade will be closed if the price moves against the trader. This is a key field for managing risk. Amend the figure up or down as required.

Leverage

The centre field controls leverage. Traders should fully understand the additional risk leverage entails before using this feature, but it is possible to trade with substantial leverage – even higher on certain foreign exchange pairs. The leverage will also influence the costs of keeping a trade open overnight, or at weekends. Where markets are open over the weekend (forex, foreign indices and commodities) eToro will offer weekend trading.

The number of ‘units‘ that the trade will purchase will update depending on the trade amount, and leverage band selected. There is then a ‘Take profit’ field, which is a point at which the trade will be closed, if a certain level of profit has been made. Clicking the trade button at the foot of the window will confirm the trade immediately. The trade will then be visible in the portfolio area.

When traders first open an account at eToro, there is a useful wizard that introduces traders to all the relevant screens and guides them through making a ‘virtual money’ trade. It is a great way to make new traders familiar with the tools and screens. It can be accessed again at any time from the help menu.

How to use Copy Trader

The key feature for the social trading platform however, is the copy feature. If traders do not understand a particular asset themselves, they can profit from someone who does. This is the main draw of eToro. Many users will not actually trade themselves, they will simply invest in other traders who they believe will make profits.

In order to copy a trader, users first need to search for the people they most want to know about. The ‘People‘ menu option, opens up a huge database of all the traders on eToro. From here users can begin to filter down the results to find exactly the traders they want to copy.

Traders can be filtered by location, the assets they invest in, their performance and their recent activity. So if a user wants a UK based commodities expert, who has made at least 10% profit in the last 6 months – eToro will find a range of traders that fit the bill – in seconds. Results can then be filtered even further based on a whole range of values including risk, trading size and recent activity.

Individual traders can then be selected for closer analysis. Message boards, monthly trading performance and the current portfolio can all be double checked. Once a user has found a trader they wish to copy, they simply select the ‘copy’ button.

The copy screen is incredibly simple. The user needs to enter the amount they wish to invest, and a stop loss figure. They can also choose to open all the trades that the trader already has open – or none of them (and only wait to follow new trades). Those are the only choices the copier needs to make. Selecting the ‘Copy‘ button commits that amount to copy that trader.

Whatever trades are made will be emulated on the the user’s account, with figures amended relative to the amount the user selected to ‘copy’ with. It could not be simpler to profit from established traders.

Traders who are copied themselves, earn additional commission from the broker, based on the number of traders who follow them. So the setup is attractive to investors new to the markets, as they can follow market veterans. While experienced traders are also able to boost trading profits further, meaning everyone wins. eToro profits from their ‘spread’ or margin on each trade – they make a small percentage whether a trader wins or loses. But the firm know winning players will trade more often – generating them higher income – so they want to see players making a profit.

Asset Choice

The asset choice at eToro is very good. Stocks are a clear strength. There are over 250 companies from around the globe available to trade. Elsewhere, there are over 30 currency pairs, including all of the major Forex currencies. There are 10 indices available and just 3 commodities – this list is likely to get expanded.

Cryptocurrency trading has also seen massive expansion at eToro, with over 15 crypto currencies currently traded, including Bitcoin, Bitcoin Cash, Ripple and Ethereum. Those looking to trade crypto are well served at eToro, and it is certainly one of the best options at present.

eToro Fees

eToro make a small charge for leveraged positions held overnight, or over the weekend. This is standard practice for CFD brokers. This reflects their own costs in maintaining the position. The larger the trade (once leverage is considered) the larger the fee will be.

As an example a $10,000 position with no additional leverage will not incur a nightly charge. If the same trade had X5 leverage (so the position effectively totals $50,000) then a nightly fee of £8.48 would apply. The fees represent a tiny proportion of the overall trade value, but are worth being aware of if traders are planning to leverage a long term trade.

Mobile App

eToro offer a free mobile application and tailor the app based on the operating platform, meaning the user experience is optimised. The eToro iphone (iOS) version requires version 6.0 or above, while android needs version 2.3 and up.

The application itself attempts to emulate the trading look and feel of the full website. The searches are clear, and viewing areas large. The full range of assets available on the website are also there on the mobile app.

The app shows a full trading history, and all the live prices are available – as are the familiar searches for ‘Markets’ and ‘People’.

Trading accounts can be funded from the application and there are also some charting features included, which makes research possible ‘on the go’. The whole service is designed to make trading easier, and the mobile app compliments that aim.

The most recent upgrade (to both iOS and android versions) reduced the overall ‘footprint’ of the app, making it 50% lighter – but also much quicker. With speed being crucial for those quick trading decisions, the regular improvements are a great strength.

Payout

The payout details at eToro are not comparable to binary options brokers. Payouts will be scalable based on the leverage applied and performance of the asset. For this reason, traders must understand the risk in each trade.

Spreads are ultra competitive, and the firm ensure they are as tight as they can be. They recently reduced the spreads on Australian markets including AUD currency pairs. Some were reduced 300%.

The trading platform includes risk management elements such as stop losses, so that traders can control their risk. This is an important distinction from traditional binary options, where the risk is known with absolute accuracy.

Withdrawal and deposit options

There are a wide range of options to fund a trading account at eToro. Supported methods include credit card depoits (such as VISA, Mastercard etc). A full range of eWallets (UnionPay, PayPal, Skrill, WebMoney, Neteller and Yandex) and of course the more typical wire bank transfer is also an option

There is a minimum withdrawal of $50, which is fairly typical. A withdrawal will generally take 3 days. eToro charge a withdrawal fee of $25 for every withdrawal made. This is quite steep and higher than many rivals charge.

In addition, foreign currency conversion incurs a further charge ranging from 50 to 250 pips. This is again, rather unfriendly to the trader.

Withdrawals need to be made back to the same method as the initial deposit. This is to comply with Anti-money laundering laws. For the same reason, eToro also request certain ID documents before processing a withdrawal:

  • Colour copy of passport, including signature
  • Copy of a recent utility bill or bank statement (as proof of address)
  • If paying with Credit card, a copy of front and back, with CVV covered along with final 8 digits of the main number.

One down side to the eToro withdrawal process is the charges. Rival brokers allow one free withdrawal per month or do not charge at all. eToro charge $25 for any withdrawals. This is something the brand could look to improve in our opinion.

Complaints

eToro suffers relatively few complaints. One repeated issue is disgruntled copy traders who were disappointed when the trader being copied did not perform as they previously had in terms of profit. This is not a fault of the broker themselves. Withdrawal delays can cause some disputes, but new clients ensuring they complete their verification steps, can ensure there are no further hold ups when a withdrawal is subsequently requested.

The platform is extremely reliable and problems with connections or website availability are generally an issue at the client end, rather than the eToro servers.

Here is a brief video about eToro and Social trading;

Other Features

eToro offer their clients the following features and benefits:

  • Charting– eToro off candlestick charting, available via each asset screen.
  • Learn More – eToro have an in depth learning area where traders can learn about the tools within the platform.
  • News Feed – Tap into the latest news from Social media and see how other traders are viewing particular assets.

eToro is certainly a unique offering. For those looking to profit from trading, but without the skills or confidence to go it alone, the copy trader function is an excellent way to get introduced to the markets. Once a trader is more comfortable, they can begin making their own investment decisions.

For experienced traders, we feel the offering from eToro could be expanded, to allow more research and possibly advanced charting – the attraction for established traders of course, is the ability to make even more money on trades, by attracting followers. The social trading concept is one that is well worth investigating, and with a default virtual account, the platform can be trialled risk free.

CopyTrader™ System

eToro’s CopyTrader™ system is the perfect solution for traders who lack the time or experience to trade, by enabling them to attach some of their funds to other traders, copying every move they make in real-time. eToro works in full transparency, making each client’s portfolio, track record, fail/success ratio, and Risk Score available for all to see. Clients can use the “People Search” tool, and filter results according to Risk Score, asset classes, gain, and more.

Successful eToro traders can apply (there are criteria to be met first), and receive Popular Investor status. Once accepted into the program, traders could rise up the levels. These range from Cadet to Elite Popular Investors. Each level receives great perks along the way, such as:

  • Monthly payments
  • 2% of Assets Under Management (AUM).

All payments to Popular Investors are real, immediately withdrawable funds.

CopyPortfolios™: A Brand New Financial Instrument

CopyPortfolios™ are a brand new way to invest online. There are two types of CopyPortfolios™: Market CopyPortfolios, which group several assets following a predetermined trading strategy, and Top Trader CopyPortfolios, which group successful eToro investors together. Each fund is managed by a sophisticated algorithm to optimize the fund. With each fund composed of multiple elements, diversity and risk management are improved hugely.

The Copy portfolio feature offers the chance to follow a range of active traders, selected based on performance by the portfolio algorithm. Each trader is followed using a percentage of the fund capital, and those allocations will change based on performance. It is an interesting concept which reduces risk for the copying trader, and offers access to the best performing traders, without the need for constant monitoring of performance.

Market Copy Portfolios

An alternative to copying a range of traders, is to copy a range of assets within one asset class or category. For example, banking or technology. For example, the firm offer a fund based on “TheBigBanks” or another which gives the trader exposure to US based ETFs.

The concept is again appealing to traders who want exposure to a particular asset class, but do not want to setup a range of different copying trades. Now, they can get more diverse exposure, in a fraction of the time. There is even a fund that goes short across a range of assets, enabling traders to hedge against market crashes.

The list of portfolios is being added to all the time (with the broker taking requests from traders). So if there is no fund covering emerging markets, just ask.

Crypto Copy Portfolios

eToro have released a very topical new portfolio, focussed on Crypto currencies. The fund includes Bitcoin and Ethereum (These are available to trade individually), but also Ripple, Litecoin, DASH and others.

Investing in crypto currency has not been straight forward up until now. There are technical challenges as well as risk factors to try and manage. The eToro fund allows traders to gain access to an extremely popular sector at the click of a button. It is another sign on the firm delivering the investments that their customers want. They have seen crypto currency trading increase 400% in 12 months!

The portfolio, will be regularly analysed and then auto-rebalance once a month by an investment committee. The innovative fund will offer investors a diversified portfolio weighted according to market cap size.

Yoni Assia, CEO and co-founder of eToro had this to say on the new release:

“This CopyPortfolio is the first of its kind globally providing investors access to the world’s biggest digital currencies in one innovative portfolio. For those who believe in the technology’s potential, this is an opportunity to invest in a straightforward and simple way.”

CRISPR Copy Portfolio

CRISPR is the latest biomedicine achievement which has the potential to allow medical professionals to ‘edit’ DNA. Commercial uses would be almost boundless. From eliminating gene based diseases to changing physical attributes, the knowledge is ground breaking.

eToro recently launched the CRISPR CopyPortfolio, to enable clients to invest in this emerging industry that is revolutionising biotech. The CopyPortfolio launch created huge interest in early 2020.

The CRISPR CopyPortfolio comprises leading companies who are investing in this technology. The portfolio is rebalanced on a specific schedule to include the best exposure of technology available on eToro. The minimum investment amount for the CopyPortfolio is $5,000 – but there are no management fees.

Cryptocurrency Wallet

eToro have recently gone live with a crypto wallet service of their own. This allows their 10 million registered traders (and new customers), to buy and sell a range of cryptos, convert them, trade them and pay for services with them.

The wallet will be rolled out on a phased basis, so more and more customers will have access, and more and more cryptos and features will be released. This method ensures high levels of performance can be maintained as the application scales up. The app is available from both Google Play and the Apple App store. Platinum members will already be able to use some of the future tools within the app.

High security is maintained with multi-layer protection. The setup does however, allow traders to see their blockchain transactions, without having to expose their private key (security algorithm).

The wallet keeps eToro at the forefront of Cryptocurrency trading and makes accessing this complex market much easier for retail traders.

eToro “How to” Guides and Further Details:

Are profits taxable?

The answer is generally “no”, but traders do need to be aware of the position HMRC takes. Read a full, detailed response in this article on UK tax and binary options, written after consultation with HMRC.

Regulation

eToro offer contracts for difference (CFDs). These financial products are regulated by the FCA (Financial Conduct Authority), so UK consumers get a strong level of protection when trading at eToro.

eToro (UK) Ltd represent the UK based arm of the firm. They are registered at Companies House. Being regulated by the FCA (View details) ensures UK consumers have access to official channels for disputes. Or in the event of financial issues with the firm. So consumers can raise problems with the Financial Ombudsman Service, (to raise disputes) or the Financial Services Compensation Scheme (If eToro UK Ltd cease trading for any reason).

The consumer protection is far greater than at the majority of binary options brokers, and means UK investors can use the firm with absolute confidence.

Trading hours

The eToro website is available 24 hours a day, but particular assets will only be available to trade when the market is open for that asset. So Stocks listed on the London Stock Exchange will be available during UK trading hours – but not outside of those. Outside of trading hours, it is possible to open ‘orders’ which will then be fulfilled when the market is next available. Traders need to select the price they are happy to trade at, and orders will be filled once the market is open and the price set is available.

How to find traders to copy

Finding traders to copy is simple, but does require some time and research in order to find the right trader for you.

From the Copy Trader screen, users are presented with a number of filters in order to narrow their search. These include:

  • Location
  • Market
  • Profit / Performance
  • Timeframe

eToro will also list the most copied traders, those with low risk or those trending.

It is important not to be drawn in immediately by a huge short term profit figure. One profitable trade may have masked 2 or 3 years of losses. So in order to find the more consistent traders, it is worth setting the ‘timeframe’ filter to a long term setting (one or two years). The handy ‘risk’ score, is also a very quick guide as to whether that trader fits the trading requirements of the user. (Risk score is explained in detail in a separate FAQ below).

Once a few candidates have been shortlisted, each can be clicked on to get a view of their past performance. Profits are broken down per month – this gives a great overview of consistency. Regular monthly profit is, of course, desirable – but the odd negative month is not a show stopper.

Users need to determine what they are looking for in a trader. A trader making regular monthly gains of 3% or 5% would be great, but some might be looking for a higher risk trader, who goes through sharp performance swings – hoping to catch them during an upswing.

So there is no right or wrong answer in who to copy, it will be down to the individual – but the more time invested in the decision of who to copy, the more likely that a user will find the right trader.

How to place a trade on the platform

The eToro trading platform is fairly simple and intuitive, but it is worth running through how to open a trade.

Essentially there are just three steps to opening a trade:

  1. Identify the asset.
  2. Click ‘Buy’ or ‘Sell’ to open a trade ticket (Or view the asset details and select ‘Trade’ from there).
  3. Confirm the trade details, select ‘Open trade’.

Firstly, find the asset to be traded. This can be done via a personal watchlist, or a brand new search. Click on ‘Trade Markets’. This will open a list of popular assets. These can be filtered by category via the tabs at the top of the screen (‘Stock’, ‘Indices’ etc). eToro then groups assets further, by location for example, or sector – such as ‘Technology’. Use the filters to find the asset of interest.

Once found there are a number of way to open a position. Traders can click on the ‘Buy’ or ‘Sell’ buttons to open a new trading ticket, or click on the asset logo to see more detail. The additional data includes the price chart, and also the feed – so traders can see what others have to say on that asset. From the detail screen, select ‘Trader’ to open a ticket.

With the trader ticket open, traders need to enter the amount they wish to invest, and then set the stop loss, leverage and take profit levels. Any overnight or weekend fees are listed below the ‘Open Trade’ button. Once a user is happy with the settings of their trade, they simply click ‘Open trade’ and the position will be added to the portfolio.

What is the eToro risk score?

The eToro risk score is a measure of market exposure that eToro give to each trader. The number is between 1 and 10, where 1 is very low risk, and 10 is very high risk.

The firm calculate this number via a number of measures. For example, they will consider whether the portfolio is diversified, whether the instruments and assets being traded are particularly volatile (or not) and most importantly, the levels of leverage and equity being used.

So for example, if a trader has their entire portfolio invested in three trades, all forex pairs including the US dollar, and all in the same direction, with the highest possible leverage – eToro will give them a high risk score. If another trader has invested 60% of their account balance across 20 different trades, with no leverage and a broad range of instruments that are not particularly volatile, they will get a low risk score. Even lower if some of those trades effectively ‘hedge’ each other (Perhaps the trader has brought some ‘safe haven’ assets to hedge some stock positions.)

As ever in investing, there is no clear “right or wrong” way of doing things, but the risk score does at least give traders a good idea of the risk appetite that another trader might have, meaning they can copy traders with similar investing aims to their own – or at least ensure they understand the level of risk they might be taking copying a certain trader.

eToro fees vary based on the instrument. For example, on Forex the spread will be 3 pips on the EUR/USD pair, but 7 pips on the EUR/AUD. The overnight fees will also vary. eToro also state that spreads might change based on trade volume and volatility. Overnight fees are not applied unless leverage has been used.

So calculating an accurate fee per trade might be quite difficult, particularly if the length of time the position will be open is unknown. Generally the spread and costs will amount to 0.5 to 1% depending on leverage.

The firm also charge a withdrawal fee. This is a flat $25 on all withdrawals.

They also apply a fee on dormant accounts. An account is deemed dormant where it is not used for 12 months. The fee is $50 per month. Open positions will not be closed in order to pay this fee.

How To Copy Traders

Copying traders is a key feature at eToro. It enables traders without the time or knowledge to copy the trades of successful eToro users. Here we explain how to copy traders on eToro.

Firstly, find the Copy People option on the user menu on the left of the screen. This opens up the copy area. Along the top of this screen are a number of filters. Each can be set to help users identify the traders they want to copy.

Filter Traders by:

  • Location – Find trades based by region
  • Market – Find traders who trade specific assets, for example forex or stocks
  • Performance – The last two filters are based on profits over a specific period

These can be tailored to narrow the search quickly and lead users to copy the right traders.

Further down the page, eToro will list certain traders based on current short term performance, those getting copied the most, or those with a particular risk profile. These are labelled ‘Top Investors‘.

If the user has found a trader of interest, they can click on the name to see more detail about the trades placed by that trader. Figures are broken down by month, and go back for as long as the trader has been making trades. Long term, consistent profit is a good sign. Users can also see the current portfolio. This shows if the trader is active and what current positions are open (and could therefore be copied straight away).

Once a user has found a trader to copy, they can click the ‘Copy‘ button from within the profile of the trader. Users will then need to confirm they understand that eToro will open and close trades on their behalf once they confirm the intention to copy a trade.

There is then one final step – but the most important. The final copy screen confirms the size of the investment the user wants to invest with this trader. The screen will confirm the average size of investment, based on the amount set by the user. In our example, a $5000 copy will involved average trades of roughly $550. Those copying need to know exactly how large their investments might be.

eToro Copy Trader budgets

There is then a stop loss figure, where copy traders can stop copying if losses hit a certain point. There is also a tick box to indicate if the user also wants to copy the existing positions. If ticked, any open trades will be copied immediately. If not ticked, the copy process will wait for any new trades to be opened.

Once confirmed, the copied trader will appear in the user’s portfolio, listed just like any other asset. The performance is listed, and from the settings buttons on the right, the copy position can be adjusted, or ended.

That is how to copy traders at eToro!

Step by step guide to Copying traders at eToro
  1. Open the ‘Copy People’ menu option.
  2. Use the filters to narrow the search.
  3. Review the shortlist, and the lists provided by eToro.
  4. Research individual traders. Look for consistent profits.
  5. Select the ‘Copy’ icon.
  6. Enter the amount to invest copying this trader.
  7. Confirm and check the details within the Portfolio

65% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money.

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