Etoro Review

Selecting a brokerage firm to begin investing online can be a difficult process, especially when many brokers are very similar to one another. eToro, however, is different from the vast majority of other online investing platforms. This brokerage combines the innovative worlds of digital trading and social networking to create the world’s most well-known social trading site. Now, traders of all experience levels can use their collective expertise to trade more effectively and more profitably using eToro. Besides just being innovative, however, eToro still offers all of the standard features that the modern investor has come to expect from a well-equipped brokerage.

Background

It’s a well-known fact that successful trading takes skill and knowledge gained over months or years of hands-on trading experience. The reason that eToro is revolutionary is because it takes advantage of this simple fact to allow less-experienced traders to profit from the positions opened by those who are more experienced. Using eToro’s system traders can copy the trading positions opened by their peers. The eToro platform also allows investors to view the success rate and past performances of various traders, letting them pick whose trades they should copy based on their past trading history. Traders are also given a risk score, which allows others who plan to follow them to see whether or not their strategies are too risk-tolerant for their needs.

Of course, this social trading system can also work in the other direction. As you become more adept as a trader, you can allow others to copy your trades. When this happens, you are rewarded with a percentage of the profits that others make by copying your trading activity. With enough followers on eToro, you can make substantially more money than you would by trading alone. The better your trading record over time, the more followers you’ll gradually be able to attract.

On eToro, traders can choose to trade stocks, commodities, indices and Forex currency pairs. This trading system also offers some of the most generous leverage ratios in the financial industry, with some assets on eToro able to be leveraged at ratios of up to 1:400. eToro also features one of the most innovative risk management tools of any brokerage, called a trailing stop loss tool. When this feature is enabled, trades that have become profitable will remain open as long as the price continues to move in the direction predicted by the trader. If the price trend of the asset reverses, however, traders don’t need to worry about losing their gains, as the trailing stop loss feature will close the position, locking in the profits that have already been made above a certain point. Traders can control the exact stop loss margin in the trading platform when opening new positions.

Accounts

At eToro, users can open up two different types of active trading accounts. The first account type, the standard account, offers all of the features of the site, including social copied trades and leveraged trading. The second, an Islamic account, offers almost all of the same features, but eliminates interest on leverage in order to comply with Sharia Law. This opens up the world of online trading to Muslim traders without requiring them to compromise a core part of their religious beliefs.

In addition to active trading accounts, eToro also offers a demo account. Though this account involves no real money, it can be used to execute mock trades using real-time financial data. Demo accounts allow traders to learn and practice new trading and analysis techniques without going through the costly process of trial and error using real investment capital. For new traders, its a good idea to go through a trial period with a demo account before opening an active trading account.

Educational Materials

Aside from one of the most innovative trading platforms, eToro also boasts one of the best assortments of educational materials for new traders in the online brokerage industry. A combination of live webinars, active trading videos and a complete introductory course to trading is used to introduce new traders to all of the basic concepts they will need to know to be successful. New materials are also released from time to time.

Though not technically a separate educational resource, the entire eToro platform is, in and of itself, one of the best ways to learn online trading. Because new traders can see and copy what far more experienced investors are doing, eToro provides an environment in which beginners can make money and learn valuable skills at the same time. This system is especially useful for traders who want to see how different strategies work at the same time, as they can follow more than one other trader and compare the results.

Deposits and Withdrawals

After an eToro account has been opened, traders can deposit funds into via major debit or credit card, bank transfer or a number of electronic transfer services. Deposit minimums vary by country, but start at £50. There are also maximum allowable deposits that vary based on deposit method. The maximums range from £5,000 to £30,000.

Withdrawal transactions are conducted via the same method that a given trader uses to deposit funds into his or her account. Withdrawing funds from an eToro account can take from 1-8 business days, depending on what method is used to make the withdrawal. When making an eToro withdrawal, traders will have to pay a small fee. For withdrawals of £20-200, a fee of £5 is applied. Withdrawals of £200-500 carry a fee of £10, while any withdrawal exceeding £500 carries a fee of £25. As a rule, it’s best to make large withdrawals from eToro, as this can help you to save on the fees applied to withdrawing the same funds in several smaller increments.

Bonuses and Promotions

Like many other brokerages, eToro offers various bonuses and promotions to its traders. eToro runs limited-time promotions in the form of deposit bonuses and trading contests frequently, both of which have very generous terms. In addition, the company also offers a consistent refer-a-friend bonus that will add £100 to your trading account for every friend you refer who signs up for an active trading account.

Trading Software

As one might expect given its unique nature as a social trading platform, eToro has created its own proprietary trading software that traders can use to easily navigate the site’s many features. Through the eToro interface, investors using the firm’s social features can see top traders and what assets are currently the hottest in the social trading community. The one major downside the eToro software has is in displaying price history data. Though the price graphs used are functional, they aren’t as advanced as those offered by some competitors and independent financial analysis groups. If you’re a trader whose strategy is deeply rooted in technical analysis, you might want to consider using an independent source for price history graphs in order to make your work a little easier.

Customer Support

Before you decide to put your money and your investment future into a brokerage, you should know that that company has your back at every turn. eToro offers its customers a comprehensive FAQ and help section that will answer most common questions about using the trading platform and managing a brokerage account. If that doesn’t have what you need, however, you can always turn to eToro’s live customer support. Trained service professionals are available via phone, email or live chat 24-hours a day on Monday through Friday. No matter what your question or concern, these dedicated service representatives will be able to help you through it.

Safety

As with any institution that handles a large amount of money and sensitive customer information, digital brokerages need to take client safety very seriously. eToro is registered in both the European Union and the United Kingdom and is in full compliance with the financial regulations of each in the respective jurisdictions. eToro also uses advanced technological safeguards, including data encryption and firewalls, to ensure that all customer data and information stays secure.

Conclusion

Overall, eToro is one of the most innovative options available to traders in the digital marketplace today. For new traders in particular, its social trading features make it perhaps the best brokerage firm to start out on. Using social trading, investors can earn money while learning from some of the best, or even set their accounts to copy their favorite traders and treat trading as a mostly passive business. Those who are more ambitious, however, can learn from the elite traders on eToro and gradually develop into high-level traders in their own right. Using the eToro system, traders who follow this route can earn more money than they would trading the same volume anywhere else by earning commissions on successful trades that others copy. With all of the advantages of social trading, an excellent set of educational materials and a highly-focused customer service team, eToro is an incredible trading platform that should be on anyone’s list.