If you are going to invest or trade with eToro read this review first. Do you know the commissions and investor opinions about this broker? Do you know if it’s a scam or if it’s legit? Are you clear about its conditions? Do you know how social trading works? As you probably have a lot of questions and doubts about eToro, we’re going to do this review to try and clarify everything. In any case, if you want our opinion, eToro is one of the leading brokers in the market in 2020. Even so, we’re going to analyse it to give you more information (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).
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Is eToro a scam? Is it safe? Is it reliable?
This is the most important question in the review. It may not be the most fun, but this point is key, because before we know how to invest or the level of fees, we must be clear about whether we are going to work with a serious broker or whether we are facing a possible scam.
In the case of CFD brokers, they are usually regulated in Cyprus and are therefore usually regulated by the CySEC. This is also the case with eToro (Europe) Ltd., but it also has offices in London, so its UK branch, eToro (UK) Ltd. is regulated by the UK supervisor, FCA.
What does all this mean? We value eToro’s regulation very highly, so although you can never say 100% that a broker can be trusted, our opinion is that it is a serious company. Therefore everything seems to indicate that eToro is not a scam, but rather the opposite, i.e. it is a reliable broker.
Social trading platform and conditions
Probably the most remarkable thing about eToro is the possibility of social trading, i.e. being able to copy the trades made by other investors automatically. The ease of copying other investors and the large number of traders are the main advantages of the eToro trading platform.
The eToro trading platform is really easy to use, whether you want to trade on your own or copy what other traders are doing. We won’t explain the self-trading part of it, as it’s so simple that it’s not worth going into in depth. In any case, as a minimum note, it should be said that you can give buy and sell orders for CFDs on assets of any kind, whether they are shares of listed companies, Forex currencies or many other types of assets.
Going back to social trading and how to copy other users, in the image you can see the profitability of some investors you can copy. Something quite positive in our opinion, is that you can classify and filter users according to the characteristics you are looking for. For example, if you want to invest by copying someone with risk and low volatility, you can do so without any problem.
As you can see, if you click on any of the available traders you will see more information about their results and the trades they have made. In this way, you can make the decision to copy their decisions knowing what trades they usually make, what assets they usually trade with etc. Therefore, if you are sure you want to replicate a trader, you only have to select them and choose the amount of money you want to use.
Finally, to close this section where we also talk about conditions, we think it makes sense to highlight that eToro’s minimum deposit is £/€/$200. That is, if you sign up with the broker (you can do this by clicking here) (75% of retail investor accounts lose money when they trade 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) and you want to start trading with real money, the minimum amount you need to deposit is at least £/€/$200
Simulator and demo
If you want to try out a simulator to learn the basics without risk, before moving on to real money investing, eToro offers a demo account that you can use to do as many tests as you like. The usefulness of this demo account is obvious, and you can use it to trade in markets where you don’t have much knowledge to see how it works. For example, if you’ve never traded before, you can use it to implement a technical analysis strategy, buying CFDs on stocks when they’re in a support zone, and selling when they reach their resistance.
The same thing you can do for stock trading, you can apply it to Forex trading, with commodities or an index. In this way you can understand how financial news affects the price of different assets and learn the best strategies for your trading style. If you want to know more about the demo click on the button below (75% of retail investor accounts lose money when trading CFDs with this provider).
Commissions and spreads
Fees are another basic aspect of a broker’s analysis. High fees are very detrimental to the investor as they will force them to pay large amounts of money just for trading. Luckily, some modern online brokers like eToro have reasonable fees, where there are no trading commissions, and the broker simply charges a small spread on the price of the asset being traded.
As you probably know, the spread for each individual asset is different, so we cannot make an overall analysis of all the underlying details. For example, Trading212 or Hanseatic Brokerhouse may be much more expensive than eToro on a number of them, and cheaper on others. In any event, we can make a general statement that eToro does seem to be a cheap broker. For example, in the picture you can see the spreads for trading currencies.
The classic currency pair that is usually taken to see if a broker is cheap is the Euro/Dollar. In this case, we can see that the spread is only 3 pips, so it seems a pretty reasonable price to us, especially considering that eToro’s services are of high quality. So, if you want more information about eToro’s rates click here (75% of retail investor accounts lose money when trading CFDs with this provider).
eToro’s opinions in forums and reviews
If you want to know what clients think of a particular broker, it is probably best to read their comments in forums and social networks in order to draw a conclusion. The problem is that there are dozens of forums and reviews about investment in English, and you can find a huge number of opinions on them. So what we have done is read many of them to summarise in a few lines what we believe are the most repeated opinions of eToro users. You can see it below.
The most repeated opinion is about the social trading platform. Being an innovator and pioneer in this type of investment, as well as the market leader, is a clear advantage for all users and is therefore highly valued. It is also possible to see very good comments about the platform, as it is easy to use and completely available in English.
To end the favourable reviews we would like to mention something that we have seen in several comments, and that is the issue of safety. eToro is regulated by reputable supervisors, so many people value it positively.
You can always find people complaining about any company. Obviously eToro is no exception, and there are also bad comments on the internet. For example, on the eToro website there is an online help chat. However, some customers complain that it´s only available 5 days a week.
The time has come to put an end to the review, but first we want to make a brief summary so that in less than a minute you can see the most important issues of this broker that we have been mentioning throughout the review. To do this, we are going to make a short list of things we like and things we think need to be improved.
- Leader in social trading
- Very easy to use platform
- Regulation according to our requirements
- Reasonable rates
- Wide range of assets
We do not like
- The customer service chat sometimes takes a while to be answered
Open a Live Account
Now that we’ve seen everything we think we need to know before opening a trading account with a broker, we can move on to how to register with eToro. The process is simple, and all you have to do is visit their official website and register by giving your personal details (name, surname, email address). Opening an account is free, and you don’t need to enter anything to do so. However, when you want to start investing with real money you must make an initial deposit of at least £/€/$200. If you want to open a real account or have more information click on the button below 75% of retail investor accounts lose money when trading CFDs with this provider.