Etoro Review

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$200 Minimum Deposit
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Full Review

Established in 2007, eToro is the world’s leading social trading platform with over 7 million users worldwide. Identified to many as a fintech start-up, eToro began as a general trading platform and slowly grew into a multi-asset platform synonymous with CFDs, cryptocurrencies, and stock assets. Today, eToro is among the top 5 best trading platform for Europeans. Additionally, it does a great job of allowing investors to easily invest in Bitcoin and a multitude of other leading cryptocurrencies via multiple payment methods.

eToro’s Background

As reiterated earlier, the company began back in 2007, just before cryptocurrencies had become a thing. eToro was the brain-child of three entrepreneurs who wanted to revolutionize the trading sector and make it accessible for just about anyone, anywhere. Part of their mission was to also reduce dependency on banks and other financial institutions that dominated the market. They wanted to disrupt the outdated banking system and usher in a new digital financial age.

In 2009, they launched the eToro trading platform ‘WebTrader’ that offered a range of professional trading tools for traders in all skill levels. In 2011, they made their second major debut. They launched ‘OpenBook’, which was the first social trading platform on the planet. It included their new trading feature, CopyTrader. CopyTrader would let any user of the platform copy other successful traders on the platform. In 2012, due to growing demands and changing markets, eToro added other financial instruments such as currencies and stocks.

By 2013, it further expanded its reach and launched a mobile app targeting both Android and Apple users. It’s also at this time that eToro made its move towards digital currencies, making it possible to trade Bitcoin via CFDs. In 2017, eToro finally added support for cryptocurrency trading to the platform starting with popular cryptocurrencies such as Ethereum, Ripple, and Litecoin. Since then, the firm has gone through many different development stages with the most recent one being the launch of eToroX, which is a fully regulated digital currency exchange platform.

Advantages and Disadvantages of eToro

Advantages

  • It serves a wide-range of markets: stocks, currencies, cryptocurrencies, etc.
  • It integrates social trading into its platform seamlessly.
  • It has a well-established reputation in the industry, well over a decade, making it trustworthy and secure.
  • It offers low-fees for non-European clients and free stock and ETF trading for Europeans.
  • It has an intuitive and well-designed user interface that’s beginner friendly.
  • It has an impressive catalog of supported cryptocurrencies.
  • It has a transparent fee structure.
  • It accepts multiple payments as deposits.

Disadvantages

  • It has a weak customer support.
  • It doesn’t offer support for many cryptocurrencies, only a selective few.
  • It doesn’t have the option to cash-out on cryptocurrency. Only fiat currency.
  • It has relative high fees: a $25 withdrawal fee and a $10 monthly inactivity fee.
  • The platform offers little customization features.
  • There is no option for cryptocurrency deposits and the system tends to crash often.
  • You don’t own any of the digital assets on the platform.

How to Register and Trade on eToro

Opening a new account on eToro is fairly simple and straight-forward. Here is a step-by-step procedure on how to do it:

  • Head on to the eToro official page and click on the button labeled “Trade Now” or “Join Now”.
  • Fill in all your personal data on the electronic form as it is a pre-requisite to opening a new trading account with eToro. Logging in via Gmail of Facebook are additional options so they shouldn’t bother you much.
  • Ensure that you have familiarized yourself with eToro’s terms and conditions before you submit your information for review. Once you have done so, check the appropriate box and submit your information by clicking on “Sign-up.”
  • Since eToro is in full compliance of Directive 2005/60/EC of the European Parliament and the Council that prevents the use of the financial system for terrorist financing and money laundering purposes, all investors will undergo the KYC process.
  • You will be asked to provide a Confirmation of Residence by providing, for instance, a valid utility bill dated no longer than 6 months. You’ll also have to provide Proof of Identity (POI) such as a valid driver’s license, passport, or any other form of official photo ID.
  • Thereafter, you will be asked to fill in an eToro questionnaire designed to custom-tailor a service package suited to your profile. Information requested via the questionnaire include professional status, level of knowledge of the capital markets, financial liquidity, investment goals, risk tolerance, etc.

The verification process takes a few days. In that time, eToro will go over your documents and update your verification status once they are done. Once verified, you will be notified. Additionally, you can also follow the status of verification on the eToro platform. Verified accounts have a green tick next to their usernames.

In case your documents are rejected, eToro sends an email with clear explanation of why the documents were rejected and what you need to do to remedy the situation. Nevertheless, once your account is verified, it’ll be possible for you to enjoy all the full benefits of the eToro platform.

Regulation and Safety

eToro is one of the most transparent company in the fintech sector. It incorporates a variety of cutting-edge security protocols to ensure that it remains secure. At the base-level, it has partnered with Incapsula to secure its online website from a DDoS attack. Incapsula filters through the incoming eToro traffic and forwards only the valid requests while blocking the spam.

At the moment, the site offers 2 Factor Authentication (2FA), login attempts limitations, and uses whitelist attribution models to prevent automation attacks. Other security features include data encryption with a dedicated secured mechanism to prevent CSFR attacks. Furthermore, all users on the platform are required to complete Identity Verification as part of their KYC procedure and updating any financial information requires dual-process verification.

At the company level, eToro is fully regulated and adheres to FCA, the ASIC and CySEC guidelines. It also takes extra precaution by storing traditional funds in secure European banks of tier 1. With that said, eToro also works as fast as possible so as to resolve issues as soon as it can.

eToro Fees

The charges on eToro are quite hefty compared to other exchanges. Furthermore, they vary from asset to asset given the number of trading options provided by eToro. For instance, Bitcoin costs a whopping 0.75% fee when exiting a position while other altcoins trade at a 2-4% fee. This is actually higher than in most exchanges.

Additionally, there is a withdrawal fee of $25 applied to each withdrawal (which is only fiat). For those who aren’t active on the platform, eToro charges an inactivity fee of $10 per month for those remain inactive past 12 months. You can imagine how this affects long-term traders. It practically forces you to log in and check in on your investments to avoid getting the $10 per month fee.

You can find the full list of fees right here.

eToro Supported Instruments and Payment Methods

Cryptocurrency investments in the platform are conducted in the form of CFD. This means that you can only speculate on the price and don’t actually get to own the actual coins. Some of the cryptocurrencies supported on the platform include:

  • Bitcoin (BTC)
  • Ethereum (ETH)
  • Ripple (XRP)
  • Litecoin (LTC)
  • Bitcoin Cash (BCH)
  • Dash (DASH)
  • Zcash (ZEC)
  • Binance Coin (BNB)
  • Stellar (XLM)
  • IOTA (MIOTA)
  • EOS (EOS)
  • NEO (NEO)
  • Ethereum Classic (ETC)

eToro supports a wide range of options for depositing money to its platform including:

  • PayPal
  • Skrill
  • Credit/ Debit Card
  • Wire transfer
  • Neteller
  • Webmoney
  • Giropay
  • China Union Pay
  • Yandex

eToro Customer Support

The eToro site alludes to a 24/5 support but this is far from the truth. For starters, they don’t have any phone number listed, except for the Australian branch. The Help Center links to a FAQ page as well as a login-gate for a ticketing system, which makes it hard to reach customer support. Additionally, the ticketing system is extremely slow and when it gets to you, getting straight answers is difficult.

The only way to get through support is via the ticketing system. They don’t even have live chat, which is especially important when you need support instantly. Additionally, when you use the ticketing system, you get answers between anywhere from a few minutes to three hours. The platform also maintains active Twitter and Facebook accounts. However, these are often used for marketing and analysis entries.

In theory, their customer service is reachable in a multitude of languages: English, German, Italian, Spanish, French, Polish, Arabic, and Chinese. At the moment, we can only verify that the English version works. If you are interested, you can test out the other languages for yourself.

Features

There are two distinct and exciting features that eToro offers. They include CopyTrades and
CopyPortfolio. Below we take an in-depth look at what each feature is about.

CopyTrades

CopyTrades is one of the features of eToro that make it a leading social trading platform. With this feature, you can copy, one-by-one, the portfolios of successful traders on eToro. Beginner investors may find this tool quite useful. There are tons of people that you can browse through which may be overwhelming at first. Luckily, apart from their pictures, there’s far more information about these traders.

For instance, when you are selecting a trader to follow, you have access to their past performance on a monthly and annual basis. This is because their portfolio is made public. Additionally, each trader is assigned a risk metric to them to help you make an informed choice. There are tons of other metrics provided such as a profile description, their news feed comments, traders per week, performance on charts, etc. It’s like Facebook, but with all the information that matters.

The upside to CopyTrades is that you can copy simultaneously, the strategies of up to 100 traders. The downside is that the minimum amount you can invest in a trade is $200. Furthermore, you cannot close part of your position, only the full amount.

CopyPortfolio

CopyPortfolio is quite different from CopyTrades. While in CopyTrades you copy the trading strategies of other traders, in CopyPortfolio, you copy and invest in an eToro trader’s portfolio or theme. A theme in this case refers to investing in a portfolio of big banks or established digital assets for instance. The other option is to invest in a number of “star” traders in a parallel manner.

For those interested in cryptocurrencies solely, there is a Crypto CopyPortfolio option as well. With CopyPortfolio, everything is well-described such as the performance, asset distribution, and the investment strategy. CopyPortfolios are built around a theme by eToro’s algorithms or by their external partners. The minimum investment amount to invest in a CopyPortfolio is $5,000.

How it Compares to Other Exchanges

Compared to other exchanges, eToro is unique in that it offers a multitude of investment and trading options. Using the same platform, traders and investors are able to take advantage of cryptocurrency investments along with investments in other traditional assets such as stock.

The social trading aspect of eToro makes it unique too. For instance, with CopyTrading, users can copy the investment strategies of other successful traders on the same platform. Such an aspect allows beginner traders to start making profit even without necessarily having a hands-on approach to trading.

Is eToro Reliable?

For most people, eToro is a joy to use. It has a responsive, intuitive, and features-packed interface that blends well with any beginner user. Furthermore, the platform offers a decent selection of digital assets to invest in such as Bitcoin and Ethereum. Additionally, it helps its traders make better decisions by offering a number of tools for all experience levels.

Nevertheless, just like any other exchange, eToro has its own sets of drawbacks. For instance, you don’t actually own any of the assets that you invest in. For those who prefer to hold the digital assets that they purchase, we recommend that you check out eToroX. Furthermore, the prices on digital assets are a bit overpriced, which is a big turn-off for most users.

Conclusion

While eToro isn’t ideal for investors who want to invest in lesser-known digital assets, it’s an excellent choice for those who wish to trade only the major ones. Furthermore, it offers support for other investment assets such as currencies and stocks. Beginners are also in luck as eToro’s intuitive and user-friendly interface appeals to everyone. Additional features further give eToro an edge over its competitors and solidify it as a trustworthy player in the industry. If you are interested, we recommend that you check them out.

BROKER INFORMATION

Website URL:
https://www.etoro.com/

Languages:
English, Spanish, French, German, Turkish, Polish, Portuguese, Italian, Dutch, Chinese, Arabic

PAYMENT OPTIONS

  • PayPal,
  • Skrill,
  • Credit/ Debit Card,
  • Wire Transfer,
  • Neteller,
  • Webmoney,
  • Giropay,
  • China Union Pay,
  • Yandex