In this eToro review, I take you through the leading social trading and investment platform. eToro allows investors to invest within top markets such as stock, crypto, and CFDs all with zero fees. Plus if you’re a complete beginner to trading you can try eToro’s CopyTrader feature and automatically copy experience traders.
eToro Review: How to use eToro?
What is eToro?
eToro is a popular trading platform where users can trade stocks and ETFs, cryptocurrencies, and CFDs. Founded in 2007 by 3 entrepreneurs, the platform is now trusted by millions of customers worldwide. The aim of eToro was to make trading accessible to anyone, anywhere, and reduce dependency on traditional financial institutions.
There are hundreds of different financial assets to trade on eToro, which can be traded using an array of different investment strategies. Sometimes you will own the underlying assets, such as long (BUY), non-leveraged positions on stocks and cryptos. Other times they will employ CFDs, enabling a variety of options, such as short (SELL) positions, leveraged trades, fractional ownership and more.
Looking for a Mobile Investment App? Check out our Guide on the 9 Best Investing Apps for UK Investors.
One of eToro´s best selling points is the unique features they offer on their trading platform. If you’re an experienced investor or a complete beginner, eToro will have you covered. Making the process of investing simple, fun, and sociable.
Crypto on eToro
After pioneering Bitcoin trading in 2013 via CFDs, eToro expanded its cryptocurrency offering, enabling clients to trade and invest in Ethereum, Litecoin, and other popular cryptocurrencies. CFD crypto trading is not available for users registered under the FCA regulation.
With eToro can buy and sell crypto instantly and own the underlying assets. There are hassle-free deposits and withdrawals, you can track real market data and follow each coin’s trends. To support crypto trades, eToro has 3 platforms available which are eToro Trading Platform, eToroX, and the eToro Wallet.
CopyTrader was brought to the platform in 2010 great for those getting started investing or who don’t have the time to constantly watch the markets. You’ll still have full control over managing your portfolio. You can stop the copy, pause it, and add or remove funds at any time. Essentially, there are 2 parts to CopyTrader which means you can copy people or portfolios.
CopyTrader allows you to view what real traders are doing in real-time and copy their trades automatically. Basically, whenever they make a trade, you do too. You can copy nearly anybody, just find the trader you want to copy and select the copy button on their profile. Plus, you don’t have to just copy 1 trader either, you can choose up to 100 traders simultaneously.
CopyPortfolio is comprised of financial assets which may consist of stocks, cryptos, ETFs, indices, commodities, or currencies. These portfolios operate like multiple traders, all working for you at the same time, therefore there are lots of positions being opened for you. Due to that the minimum amount for investments in CopyPortfolios is $1,000.
Again there are no management fees with investing in CopyPortfolios either. However, transactions initiated by a CopyPortfolio will incur eToro’s spreads.
eToro Virtual Account
eToro’s Virtual account comes with an available balance of $100,000. Meaning you can test the market and try out new features before committing your own funds.
eToro Deposit Methods
You can deposit your funds on eToro using a host of different methods including credit/debit cards, PayPal, Skrill, Neteller or Bank transfers. However, some of these methods will come with their own limitations and terms which can be found here.
There are currently minimum deposits of $500 for bank transfers and $200 for credit/debit cards and Paypal.
When purchasing and trading for cryptocurrencies, the method in which you deposit is very important. If you deposit using a credit or debit card you will be unable to withdraw your crypto from the platform for 180 days. However, if you deposit using a bank transfer this is not an issue.
All eToro trading accounts are in USD. Therefore, when depositing with a different currency, the deposited amount will be converted at the current market rate. Please note that this is subject to a conversion fee.
With eToro, there are no fees to open an account or deposit your funds onto the platform. Withdrawals are charged at a fee of $5 and they state that there are no clearance fees. There is, however, a minimum withdrawal amount of $30.
They also have no management or ticket fees and stock investments have zero commission.
They also have a fee named an “Inactivity fee”. This means that after 12 months with no login activity, a $10 monthly inactivity fee will be charged on any remaining available balance. No open positions will be closed to cover the fee.
Is eToro Safe?
The eToro platform is regulated by the Financial Conduct Authority of the United Kingdom, Cyprus Securities and Exchange Commission (CySEC), the US FinCEN, and the Australian Securities and Investments Commission (ASIC).
They also state that your funds are protected by industry-leading security protocols and that they will never share your private data without your permission.
One of the biggest downfalls is eToro’s support. Customers can contact eToro support via a live chat system or using a web-based ticketing system that will provide a response via email. I personally found the live chat system very hard to find on their website which I eventually found under their customer services page. Just note that this is only available in certain regions.
Not having your issues resolved in a reasonable timeframe can quickly lose the support and trust of a customer, however small that query may be. This is something eToro will need to resolve if they want to become a major player in this market.
I’ve personally had a few issues with eToro whilst making these videos. Depositing Bitcoin took over 2 weeks to resolve. I also sent a bank deposit of £400 which was rejected and I am still waiting for this to be returned 2 months later.
Verdict: Should you Invest with eToro?
eToro does have some cool features like CopyTrader and this will appeal to new and younger investors. I personally would avoid, (if you can) buying Bitcoin and Cryptocurrency with eToro or eToroX. If you want to get involved in the crypto space, have a look at my Binance Exchange or FTX tutorials.
I personally do have some investments held on eToro (not crypto) and the process of buying and selling is very easy. One of their major selling points is their free trading feature, but is it really free, or is it only a sales tactic? I still do use the likes of Hargreaves Lansdown to buy stocks and ETFs and they charge a min 11.95, which will put off the smaller investor.
The major downfall with eToro is their support, it’s really poor. Somehow Trust Pilot gives eToro a generous 2.3 rating. But I have wasted hours trying to resolve issues. Hopefully, their support will improve, if not someone else will come along and take their market share away from them.
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eToro is a multi-asset platform that offers both investing in stocks and crypto assets, as well as trading CFDs. Please note that CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 67% 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.
Past performance is not an indication of future results. Cryptoassets are volatile instruments that can fluctuate widely in a very short timeframe and therefore are not appropriate for all investors. Other than via CFDs, trading crypto assets is unregulated and therefore is not supervised by any EU regulatory framework.