ETORO REVIEW: Trading and Investing on eToro what is it actually like?

WHAT IS ETORO? HOW DOES IT WORK?

To start this eToro review off lets delve into what etoro is and and how it works so we are all on the same page!

EToro is one of the most popular social trading sites in the UK. The site was established in 2007 as a Fintech start-up in Israel. It is especially known for its social trading feature; users can copy reliable or experienced investors in order to make their investments without much knowledge of the trading market. It also has zero commission stock trading.

A range of global consumers use eToro. In the UK, eToro is regulated by the Financial Conduct Authority (FCA). Likewise, in Australia, the site is regulated by an Australian Securities and Investment Commission (ASIC). All other global customers are served by an entity that is regulated by the Cyprus Securities and Exchange Commission (CySEC). Because it is regulated by UK and Australian authorities, eToro is considered fairly safe. This is because these financial regulators are global leaders in financial security. Furthermore, it is a well-known and widely used platform. The full regulators that eTOro operates under are as follows:

eToro (Europe) Ltd. This body is active in Cyprus and is regulated by CySEC. this is short for the Cyprus Securities and Exchange Commission. CySEC regulates Toro (Europe) Ltd. under license type # 109/10, for servicing states that operate in the European Economic areas, and countries outside of it.

eToro (UK) Ltd. This is active in the United Kingdom, and is regulated by teh FCA. This is the FInancial Conduct Authority, an is responsible for all users in England, Scotland, Wales and Northern Ireland.

eToro (AUS) Capital Pty Ltd. In Australia, this is how eToro is regulated. The Australian regulator is called ASIC, which is an acronym for the Australian Securities and Investments Commission.

eToro (USA) LLC. eToro is not widely available in America as CFD trading is not allowed. This means that eToro is only available for cryptocurrency trading, which is varied, as it is covered by regulators for individual states rather than on a federal level.

The site primarily deals with trading in CFDs and forex, but also includes ETFs, real stocks and cryptocurrencies. The most innovative feature of eToro is its social trading features.

eToro: a brief background

eToro has already survived the 2008 financial crisis (as it was released in 2007). This is promising, as it shows that eToro is a resilient and trustworthy platform. A longer track record normally indicates this, as it shows a broker has survived market turbulence and other issues. eToro is a fintech start-up that is owned privately. Owners and investors span Israel, China and the US. The CEO of eToro is Yoni Assia, who founded the website. These are the current investors:

  • Anthemis Group, UK
  • BRM Capital, Israel
  • CommerzVentures GmbH, Germany (this is the venture capitalist arm of Commerzbank)
  • Cubit Investments, Israel
  • MoneyTime Ventures, USA
  • Ping An, China
  • Spark Capital, USA

Technically, eToro is still a start-up. This is because it is not listed on any stock exchange, whilst also not providing regular financial information to the public. This makes it hard to measure eToro’s financial performance. There is also no parent bank to eToro that could provide capital, which lends doubts to the stability of the company. Despite this, being regulated by important authorities helps to keep eToro secure and safe.

eToro Review Summary Sheet

eToro
Regulated byUK, Cyprus, Australia
FeesLow
Account inactivity chargeYes
Cost of withdrawal$5
Minimum deposit$200
Account opening process1 day
Deposit with credit/debit cardAvailable
Depositing with electronic walletAvailable
Base currencies1
Demo account?Yes
ProductsStock, ETF, Forex, CFD, Crypto

eToro has a lot to offer. The most obvious benefit to an account with eToro is the free trading feature; eToro takes no commission. It also offers a social trading feature, allowing you to copy veteran traders. The process of opening an account is also fast and easy.

If you want to learn more check out my Beginners Guide to trading on eToro.!

On the other hand, eToro charges high forex fees, which may deter investors that specialise in this type of trading. The money withdrawal process is slow in comparison to other trading platforms, and offers only one base currency (USD).

Opening an account on eToro

Opening an account with eToro is a fast, easy process. It is fully digital, with a low minimum deposit compared to other industry giants. This makes an account with eToro more accessible for first-time investors. The process also takes less than a day to complete. There are no obvious downsides to the account opening process with eToro.

The process to opening an account is as follows. The first step is to register with one of the following options: email address, Facebook account, or Google+ account. To access the live account option, you must also verify your identity and residency. This is done by uploading a copy of your passport and a copy of a utility bill or a bank statement with your address on. You then answer a few questions to complete your profile, on topics such as your existing trading knowledge.

The minimum deposit on eToro is $200, although this differs for countries outside the UK. For Israeli users, the minimum deposit is significantly higher: $10,000. For users in the USA and Australia, the minimum first-time deposit is just $50, compared to a minimum first-time deposit of $500 for residents of Russia, China, Hong Kong, Taiwan and Macau. For all users wishing to deposit or withdraw on eToro via bank transfer, there is a minimum value of $500.

eToro offers two types of account: live and demo. A live account is real-time trading using real money and real investments, whilst a demo account (also called a virtual account) allows the user to make the same moves and payments, but with virtual play money, which eliminates the risks and allows a trader to learn the basics before they invest with real cash.

The Fees to consider when trading on eToro

Most trading platforms have fees that occur when you trade; they are also for-profit businesses, and these trading fees are where the profit comes from. Although the financial information is not made public by eToro, these fees are likely to be the main source of revenue. There are some basic types of trading fees that are useful to know when you are deciding which brokerage platform you are choosing to use.

Commissions:

A commission is a fee based on the traded volume or a flat fee per trade. Most commissions are based on the traded volume, and are calculated as a percentage of this.

eToro does not take commission on any stock trading, in all countries. Australian clients can only trade US stocks commission free, however. This free feature allows you to buy real stock, not any CFD product; you cannot use leverage for this process.

Spread:

A spread is the disparity between the buy and sell price of a unit. CFD companies like eToro incorporate their costs into this buy or sell price, and quote a final spread that is usually wider than the current market spread. If you set the leverage to higher than one, you can trade stocks and ETFs as CFDs. This product has a low spread compared to other online competitors.

Stock and ETF commission of a $20,000 trade
 eToroIGXTB
US stock$0.0$150.00$100.0
UK stock$0.0$96.00$100.0
German stock$0.0$110.00$88.00

Financing Rates:

These are charged when you hold your leveraged position for more than a day. A leveraged position means that you have borrowed money from the broker to trade, and the financing rate (also called the overnight rate) is the interest charged on this money.

The eToro rate for leveraged positions is generally quite low, and is in the same range as its closest competitors.

eToro CFD fees for a $20,000 long position held for one week
 eToroPlus500MarketsX
fee for S&P 500 index CFD$24.00$21.00$26.00
fee for Europe 50 index CFD$27.00$13.00$25.00

Conversion Fee:

A conversion fee is charged when your trade requires a currency conversion. This can also occur with other transactions, such as depositing and withdrawing money. eToro charges quite high rates on this front, although not the highest rates when compared to MarketsX.

eToro forex benchmark fees of a $2,000 long position held for one week
 eToroPlus500MarketsX
benchmark fee for EURUSD$1.96$1.79$2.45
benchmark fee for GBPUSD$1.62$1.40$2.50
benchmark fee for AUDUSD$1.24$1.26$2.51

Non-trading Fees:

These are charges that are not directly related to trading. This can include deposit fees, withdrawal fees and charges for inactivity. eToro, for example, charges $10 every month after one year of inactivity, and has lowered the withdrawal fee to $5.

eToro non-trading fees
 eToroPlus500MarketsX
Fee for accountNo FeeNo FeeNo fee
Fee for inactivity$10/month after a year$10/month after 3 months$10/month after 3 months
Fee for DepositNo FeeNo FeeNo Fee
Fee for withdrawal$5No FeeNo Fee

Depositing and Withdrawing your money on eToro

eToro’s deposit and withdrawal system have some obvious pros and cons. The benefits are the availability of credit and debit card usage, as well as the ease of use of the whole system. There is also no deposit fee, which is attractive to many investors. The drawbacks are the $5 withdrawal fee and automated conversion to USD, which is the only available base currency for accounts. This means that there is a conversion fee that is automatically applied when any deposits or withdrawals are made to or from a non-USD currency.

As mentioned above, eToro only allows USD as the base currency for an account. This means that, no matter what currency you invest in, it will be converted by eToro to USD. For example, if you deposit GBP into your account, eToro will charge you a small amount (around 0.46% of the deposit amount) to convert this into USD. Then, when you withdraw funds, the same occurs in reverse to revert your funds back into GBP.

One way to circumvent this is to use your credit card and deposit straight in USD, meaning that your bank is responsible for the conversion. The best way of doing this is to open an account that offers multiple currencies at a digital bank such as Revolut or Transferwise. These accounts offer cheap and easy international transfers, great exchange rates, and can be opened in minutes using the mobile phone applications. Unfortunately for Revolut, eToro does not support payments in USD, meaning that this particular account does not save on the USD conversion fee.

Compared to other similar brokers, this is a poor selection. Close competitor Plus500 offers 10 base currencies, whilst MarketsX offers a total of 9. This removes the issue of conversion fees for many popular currencies, whether this be for trading or for withdrawing and depositing funds.

There are lots of options for depositing on eToro. These options are: bank transfer, debit or credit card, PayPal, Skrill, Neteller, China UnionPay, Klarna and Sofort Banking. This is fairly standard for the industry:

For the first deposit, eToro may require the use of bank transfer or debit/credit card. This is dependent on the country from which you are making the first deposit. After this, subsequent deposits can be made using any of the methods mentioned above.

Depending on the urgency of your deposit, different methods offer different benefits. A bank transfer takes a little longer (4-7 business days) but there is no maximum deposit. Credit or Debit payments, or electric wallets are instant, but there are transaction limits. The limit on credit or debit payments is $40,000, and most electronic wallets have a limit of $10,000. The notable exception to this is Klarna, which has a limit of $30,000. eToro also requires all deposited money to be from funding sources that are registered in your name, to prevent fraud.

Although eToro does not charge a flat deposit fee, it does charge for currency conversion. Given that there is only one base currency on eToro, this applies to many users. The charge is around 50 pip, which is a variable percentage depending on the currency. Here are the complete conversion fees:

Etoro’s deposit & withdrawal currency conversion fees
 USD EURGBP AUD
Using bank transferNone50 pip, approximately 0.46% of the deposit amount50 pip, approximately 0.4% of the deposit amount50 pip, approximately 0.77% of the deposit amount
Using other methodsnone, your bank will charge for conversion, if your card is not in USD250 pip, approximately 2.4% of the deposit amount50 pip, approximately 0.4% of the deposit amount100 pip, approximately 1.56% of the deposit amount

eToro also has a $5 withdrawal fee; most other CFD brokers do not charge any withdrawal fee. This makes eToro more expensive than its industry counterparts in this respect. Furthermore, eToro has a minimum withdrawal amount, which is $30.

The options for withdrawing money are the same as the options for depositing. Users can withdraw money using bank transfers, debit or credit cards, or electric wallets. The options are similar to other CFD brokers, although eToro is the only provider to charge a withdrawal fee. You can see this below:

Withdrawal fees and options
 eToroPlus500MarketsX
Using Bank TransferAvailableAvailableAvailable
Using Credit/Debit cardAvailableAvailableAvailable
Using Electronic walletsAvailableAvailableAvailable
Withdrawal cost$5NoneNone

How do you withdraw money from eToro?

 The process for withdrawing funds from eToro is extremely simple. First, on the left-hand menu, click on the ‘Withdraw Funds’ tab. Then, in USD, enter the amount that you wish to withdraw. The next step is to fill in the form that eToro provides online, before clicking submit to complete the process.

Payment TypeDays taken to receive funds
Bank Transfer4-7 days (working)
China Union Pay1-2 days (working)
Credit or Debit Card3-8 days (working)
Neteller1-2 days (working)
PayPal1-2 days (working)
Skrill Limited UK1-2 days (working)
WebMoney1-2 days (working)
Wire Transfer3-8 days (working)

The eToro platform Interface

At first glance, there is little wrong with eToro’s interface. It is user friendly and shows all of the fees in a clear and accessible way. It behaves exactly as any modern trading platform should, and to a high standard. The platform also features a two-step login, which is far more secure for users; security is paramount when trading in large sums of money, as some investors are, and eToro clearly prioritises this. However, this means that the login process is somewhat more complex; the feature is optional, so it is up to the user whether they wish to prioritise ease of use or security.  The only issue with eToro is a limit on customisability, for example in charts and workspaces. The platform is available for a traditional desktop internet interface, or as a mobile-friendly version.

eToro is available in many languages, making it globally accessible. The platform is available in these languages:

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

This means that eToro is available to a global market, despite only using USD as a base currency.

Aesthetically, eToro is a well-designed platform that is easy on the eye. The design is simple but effective, using contrasting shades to make everything clear and obvious. This, combined with a well-structured layout where all functions are easy to find very quickly, means that the eToro platform has successfully struck the balance between functionality and ease of use and visual attractiveness. The only drawback is that the panels are all fixed. The only exception to this is the watchlist, which is easy to configure depending on users’ interests and investments.

The search function on eToro continues the trend of high functionality and user-friendliness. This function is easy to use and predictive, meaning that if you type in any company or product name, you can view the results instantly. There is also the option to search using tickers, which are abbreviated symbols to represent stocks on the market.

Placing orders on eToro is self-explanatory. On eToro, there are several order types:

Limit order:

This type of order allows you to set a price at which you want to buy or sell any given asset. The set price is called the limit price. Once your asset reached or passes the limit price that you have set, it will be bought or sold. There are two types of limit order. When buying, a limit order means that the asset will be bought at or below the specified price. When selling, a limit order means that the asset will be sold at or above the specified price that you have set.

Market Order:

This is the most basic order option, and is the default unless you specify otherwise. Your trade will be bought or sold at whatever the current best price is, and will be executed immediately.

Stop Order:

Once you have bought assets and you have an open position, you most likely want to secure your profits and minimize your losses, which can be done using stop orders.

etoro order interface

In order to secure your profit, you will most likely use a take-profit order. An example of a take-profit order is the best way to understand this type of transaction. If you buy an asset at $400 and decide a $100 profit is optimal, you set the take-profit level to $500. Once the asset reaches this, your position is automatically closed and you receive your profit.

Another type of stop order is a stop-loss order, which is self-explanatory. If you buy the same $400 asset and decided you cannot lose more than $50 on it, you set the stop-loss order at $350. If the price ever decreases to this, your position is closed and you escape with minimal loss.

Sometimes, stop-loss orders can be factored into the asset, so that no matter how low the price of the asset goes, the broker will provide you with an agreed minimum. For example, if your $400 asset drops suddenly to $300, a guaranteed stop of $350 will mean that your broker still gives you this amount, no matter how low the price drops. Brokers do charge a fee to include a guaranteed stop.

Stop Limit Order:

An asset can sometimes experience a huge jump in price that very quickly reverses. This huge price jump may trigger your limit order. So that this doesn’t happen, a stop-limit order triggers a limit order once the stop price is reached. With a stop limit order, you have two prices. The stop price triggers closing your position. The limit price is the price below which you do not wish your position to be closed. With our earlier example, as if the $400 investment has a stop price of $350 and a limit price at $340. If the price drops below $350, the system starts selling units. If it then retreats to below $340, the system stops selling again.

 This is all controlled by the eToro order platform.

ALERTS AND NOTIFICATIONS

Setting alerts for prices is easy, and notifications are available. The alert function on eToro tells you as soon as an asset reaches a price target, and like with many other interfaces you receive a notification when your order is fulfilled. On a computer, there is an icon update on the relevant section, or you can receive a browser notification. With the mobile format, eToro uses standard push notifications.

Portfolio and fee reports are a key component to any investment portfolio. They allow you to see how your portfolio is performing, and any fees you have paid. eToro gives you the option to decide how you see these reports, and you can choose a basic list of assets or a pie chart to see it in a more visual form.

It can be a struggle to find your fee report at first, which is one of eToro’s negative features. Click on the ‘Portfolio’ tab, and find ‘History’. Under the gear icon in the top right, you can find your account statement, which includes all of the relevant information. The file itself is well structured, and allows you to see all of your cash movements, including fees and withdrawals. Fees are not added up, but listed individually per fee deduction.   

ETORO MOBILE TRADING APPLICATION

Like the website, the trading platform that is available for mobile use is well designed and easy to use for consumers. It has the same intuitive search function and two-step login that is native to the website, and is lacking only a FaceID or TouchID login feature. Like the website, it is available in 21 languages.

The mobile platform works in a similar way to the computer platform, and has been adapted to be more user-friendly on a touchscreen system. For example, accessing a new trade or value charts is as easy as swiping left or right from your portfolio.

MARKETS AND PRODUCTS

At eToro, there is a wide range of products available to trade and invest in. These are CFDs, Forex, real stocks, ETFs and many of the major cryptocurrencies. Unlike other brokerage giants, eToro also offers social trading features, and the ability to copy veteran traders (called CopyPortfolio). If you yourself are an experienced trader, you may want to consider allowing people to copy your trades in order to make extra money.

On eToro, all non-leveraged buying positions for equities, ETFs and cryptocurrencies are real assets. This means that when you buy or sell stocks, ETFs and cryptocurrencies with no leverage, you have bought real assets instead of buying CFDs. This is an unusual feature for a CFD trading broker; compared to other CFD platforms, the offering of 17 real trading markets is an extensive range. When compared to actual stockbrokers such as Saxo Bank (which offers 35 markets) or Interactive Brokers (which offers access to 80 markets) the range offered up by eToro pales in comparison. Despite this, eToro’s range makes it attractive, as it has the option to trade outside of these traditional trading markets. Here is how eToro compares to its competitors in terms of offering real markets:

 eToroPlus500MarketsX
Available stock markets (numerical value)17NoneNone
Available ETFs (numerical value)145NoneNone

The stock exchanges that are accessible via eToro are as follows:

  • Amsterdam
  • NYSE
  • NASDAQ
  • Euronext Brussels
  • Euronext Lisbon
  • Frankfurt
  • London
  • Paris
  • Madrid
  • Milan
  • Zurich
  • Oslo
  • Stockholm
  • Copenhagen
  • Helsinki
  • Hong Kong
  • Saudi Arabia

On these exchanges, you are only allowed to trade the larger, more popular stocks. For example, only 10% of the stocks available on NASDAQ are offered by eToro. This makes a difference, as the best time to buy stocks and assets can often be at the beginning of their trading, when prices are historically lowest before the company begins to grow. This can mean that profits are somewhat limited. One great example of this is Zoom, which has obviously grown in popularity and value greatly with the onset of the coronavirus crisis and global quarantines. Despite this, Zoom Technologies was not added to eToro until March 30th, as part of a batch of 185 different stocks, meaning that many investors using just eToro missed the early investment period before price began to increase dramatically.

All other positions on eToro are CFDs. A CFD is short for Contract for Difference; you are speculating on rising or falling prices without actually buying the asset and taking ownership. This can be used to trade a range of items and markets, including shares and forex.

These positions include:

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

Like with traditional trading, CFD trading allows you to copy and recreate other peoples’ investments (called Copy People or social trading) and investing in CFD portfolios that have been compiled by experts and veteran traders, which is called CopyPortfolio.

Compared to its closest competitors, eToro offers fewer stock index CFDs, as well as fewer currency pairs and commodities. On the other hand, eToro offers a wider and more extensive range of ETF CFDs than other platforms, and a greater number of cryptocurrencies. Here is how eToro’s closest competitors, Plus 500 and MarketsX, measure up:

 eToroPlus500MarketsX
Number of Currency pairs available477055
Number of Stock index CFDs available133311
Number of Stock CFDs available2,0421,8002,000
Number of ETF CFDs available1459242
Number of Commodity CFDs available142217
Number of Bond CFDs availableNoneNone4
Number of Cryptocurrencies available16145

eToro also allows you to change the leverage of a trade to lower the risk. This can however cause issues with forex and CFD trading, as the pre-set leverage levels are high.

There is clearly a wide range of cryptocurrencies available on eToro. These may not be the most appropriate investment as the prices can vary widely, and are not regulated by any centralised governing body. This means that investors will not benefit from investor protection. Despite this, as the use of cryptocurrencies becomes more and more pervasive, investing in them can present a lucrative opportunity. The following currencies are available on eToro:

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

Tehcnically, when investing in any cryptocurrency, you own the real coin. The only exception to this is if you go short, which means you have invested in a CFD.

COPY TRADER AND COPY PORTFOLIO

One of the most innovative draws of eToro is its CopyTrader and CopyPortfolio functions. These are not present in other competitors, and is the standout feature of trading with eToro, particularly for novices to trading.

This feature allows users to scroll through other traders on eToro, and much like with Facebook, or Instagram, allow them to find out about their thoughts on investing and other comments. eToro also provides statistics on their monthly and annual performance, risk scores, and countless other pieces of data to allow users to make an educated and well-informed decision on whose investments they would like to mirror.  The minimum amount to invest in this style is $200 (for one trade), and the maximum is $500,000. There is a limit on the number of traders that one investor can copy: 100 is the upper limit.

The main drawback to using CopyTrader is that you annot partially close your position; it is all or nothing.

CopyPortfolio shares many similar features with a traditional investment fund, but utilises CFDs instead. With CopyPortfolio, instead of following the investment of a singular trader, you now invest in an entire portfolio or theme that reflects eToro’s top traders.

Investing in a them is far simpler than it sounds; it just means that your portfolio has a common thread. For example, you may invest in a portfolio of big banks, or in cryptocurrencies. These investments would then be weighted by current market capitalisation.

The other way that CopyPortfolio can be used is by investing in a mixed portfolio that combines multiple top traders to create the best portfolio available.

eToro clearly indicates the proportion of CFDs in these portfolios. You can investigate further into these portfolios by checking average performance and asset distribution, and reading the strategy written by the creators of the portfolios. The themed portfolios are created by eToro algorithms or by external sources and partners. Despite the complexities, this is a great way to invest. eToro checks your suitability and financial knowledge to determine whether CopyPortfolio is the right investment for you, as the minimum investment is $5000.

RESEARCH TOOLS

Data

The research capabilities of eToro are mixed. There are good technical analysis tools, with interactive charts and analyst recommendations, but little comprehensive data and a poor data flow in real time. The research tools are, however, user friendly, and offer trading ideas and suggestions, which are all available in the full 21 languages that eToro runs in.

Most of the information on eToro is recommendations, for popular stocks. This includes analyst consensus on whether investors should buy, hold or sell units, as well as average price target. There is also some data on sentiments held by hedge funds and insider traders. These features are not available for the majority of assets on eToro, and are confined to a limited number of popular stocks.

In terms of fundamental data, only some is available and is quite limited. It includes basic indicators and ratios such as P/E, EPS, dividend yield and beta. It also includes a basic profile of the company. For assets that aren’t stocks, this information is not available.

News

You can sign up for a newsletter that gives you an insight into daily market analysis, as well as a useful list of market highlights.

On top of this, eToro has a ‘News Feed’ feature, but instead of showing any official news, it is more like a Facebook feed with a market theme, as analysts and eToro users are the main voices present. There are hashtags and themes much like with any other social media, which definitely helps to promote the social trading aspect of eToro. The posts by analysts and users also allows novice traders to investigate the general sentiment on the website before they invest.

Charts

eToro uses a charting tool that allows you to measure up 70 different technical indicators. The tool automatically saves the indicators that you want to measure against, and charts are also automatically saved. The only limit to this tool is that it only shows data from the last six months, with no option for measuring a longer time span.

CUSTOMER SERVICE

Like its research features, the customer service centre on eToro has its flaws, but also positive features. For example, although there is a Live Chat function, this is not 24/7, is not accessible on weekends, and is quite often offline. There is also no phone support. When it is online however, the answers provided are relevant, and the responses came quickly. There is also an email system that is available, which is quick and reliable.

According to eToro, customer service assistance is available in all 21 languages that serve the website, making it accessible for global users.

EDUCATIONAL TOOLS AND SERVICES

eToro has the option to have a demo account. This feature allows users to practice making trades and investments using fake money in order to learn more about investing and speculation. The demo account feature seems like a great hands-on educational tool without the real-life consequences of actually investing cash.

Other than this feature, there is very little educational content provided by eToro. There are a few tutorials on how to use the site, and some basic educational videos about investing and finance. There is nothing of much substance available on the website.

However the eToro academy is slowly becoming better!

SAFETY AND SECURITY

eToro is a massively well-known investment and trading platform. This means that it must be reliable and somewhat safe, or it would not be trusted by so many investors. Furthermore, the majority of eToro clients are members of top-tier financial authorities; eToro is regulated by the Cyprus Securities and Exchange Commission (CySEC), the UK Financial Conduct Authority (FCA) and the Australian Securities and Investment Commission (ASIC). This means it is held to a high standard of safety.

There are limitations to this though. eToro is not listed on the stock exchange, nor is the financial information pertaining to the company publicly available. This means that the company may be far more precariously financed than it would have users know, although this is not necessarily the case. eToro is also not a holder of a banking license.

To determine whether or not you are safe using eToro, consider how you and your money is protected if something goes wrong, and what the background of the broker is.

eToro operates three legal entities to protect consumers and serve customers based on their residency. This is important; the entity you belong to determines how well protected you and your investment are. Citizens of the UK receive the best protection through the FCA. If eToro collapses, they are likely to be compensated, up to a maximum amount of £85,000. This is guaranteed by the Financial Services Compensation Scheme (FSCS). Their Australian counterparts are less lucky; should eToro become insolvent, Australian investors are not entitled to any obligatory protection. Other investors are all served by CySEC, with a maximum compensation amount of €20,000, which is set by the Cypriot Investors Compensation Fund. Refer to the table to see this information in a more visual way:

It is important to note that when investing in cryptocurrencies, there is no investor protection from any of the above authorities. This is because there is no regulation on cryptocurrencies.

eToro also provides negative balance protection for forex spot and CFD trading for European clients only. This means that you cannot lose more than your deposited money, and you cannot owe money to the broker.

If you’d like to find out more, click here to go to eToro’s licensing and regulation page.

GLOBAL ACCESSIBILITY

Outside of Europe, accessing eToro for trading is limited. In the USA, investors cannot use eToro as it is not regulated by any US entities, and current regulation does not allow CFD brokers to be used by American citizens. Cryptocurrency trading only is available to US clients. It is unsure when CFD law will change in America, meaning that there is no update on when eToro will be available in the USA. Currently, citizens of the following countries cannot use eToro:

  • United States of America* (residents and citizens, including its incorporated and unincorporated territories)
  • Afghanistan
  • Albania
  • Bahamas
  • Barbados
  • Belarus
  • Bosnia and Herzegovina
  • Botswana
  • Brunei
  • Burundi
  • Cambodia
  • Canada
  • Chad
  • Congo Republic
  • Crimea Region
  • Cuba
  • Democratic Republic of the Congo
  • Ethiopia
  • Fiji
  • Ghana
  • Guinea
  • Guinea-Bissau
  • Guyana
  • Iran
  • Iraq
  • Jamaica
  • Japan
  • Laos
  • Libya
  • Mali
  • Mauritius
  • Mongolia
  • Montenegro
  • Myanmar
  • Namibia
  • Nicaragua
  • North Korea
  • North Macedonia
  • Pakistan
  • Palau
  • Samoa
  • Serbia
  • Somalia
  • Sri Lanka
  • Sudan
  • Syria
  • Trinidad and Tobago
  • Tunisia
  • Turkey
  • Uganda
  • Vanuatu
  • Yemen
  • Zimbabwe
  • *Except for crypto trading.

FINAL THOUGHTS

eToro is a great investment website for novice and veteran investors alike. Although there are some educational drawbacks, these can easily be remedied by a quick search of the internet. Similarly, any safety and security concerns can be offset by the top-tier regulation that eToro is covered by, which offers protection for all but Australian clients.

With a zero-commission investment and the opportunity to copy expert traders, it seems that eToro has something to offer for everyone. The website is accessible and aesthetically pleasing without sacrificing functionality, and the same could be said for the mobile app. The only drawbacks to investing with eToro are the withdrawal fee and pricy forex trading, as the base currency is limited.

Overall, eToro is one of the better investment sites on the internet, with a wealth of positive features to help every investor on their way to success. The negative features of eToro are few and far between, and can easily be avoided or circumvented, meaning that now has never been a better time to invest!

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Thinking of Investing or Trading? Why not just copy professional traders!

My name is Joseph Moricca, I run Velox Investments and I am an Investor on eToro and have been for a number of years.

Do you want to get involved in trading but don’t know where to start?

Do you want to Diversify your income or simply Make more money?

I have used eToro for a number of years but did not realise the potential to make a solid return consistently until I started copy trading!

If you want to find out how to make money online then read my Beginners Guide to trading on eToro.

To start RIGHT NOW, Sign up to eToro through the link below and take advantage of the free demo account! I mean really what do you have to lose from following my very simple strategy on a demo account! Literally nothing and you might find that you actual find a hidden GEM!

Other Useful Links for learning

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

Please note that 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.

This guide is intended for educational purposes only and should not be considered as investment advice. The author and publisher are not liable for any losses or damages you may incur as a result of you following the advice given on this page. The etoro.com layout and content may change since this content was published.

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