eToro is an online trading platform, known social trading feature, founded in 2007. This broker offers CFDs, cryptocurrencies, stocks, and ETFs. eToro has a large customer base of 11 million investors. eToro operates in more than 140 countries. Company headquarters are in Israel, and it’s entities registered in many tier-1 jurisdictions. These include the US, Australia, and the United Kingdom.
eToro is a safe broker, regulated by many top-tier authorities. We can recommend eToro to traders both beginner and advanced.
One of eToro’s main appeals is a feature known as ‘social trading’. This allows users to interact with each other in a social-media like fashion. The trading platform allows for this sort of engagement between peers by providing a messaging feature, a social feed, and other similar add-ons that we will explain in further detail.
According to the company’s own stats, eToro has facilitated more than 300 million trades. The company is expanding its operations, focusing on entering the Asian markets to provide brokerage services to China and Hong Kong.
The following is a list of eToro’s subsidiaries registered:
- United Kingdom: eToro (UK) Ltd. regulated by Financial Conduct Authority (FCA)
- Australia: eToro AUS Capital Pty Ltd. regulated by Australian Securities and Investments Commission (ASIC)
- Cyprus: eToro (Europe) Ltd. regulated by Cyprus Securities and Exchange Commission (CySEC)
- United States: eToro USA LLC regulated by US FinCEN
Pros and Cons of eToro
Easy Account Opening
CFD and Forex Fees
User-Friendly Website and Mobile Trading App
Withdrawals can Take Longer Than Usual
Best Social Trading Platform
Great for Cryptocurrency Trading
Why should you read this review?
We researched and wrote this comprehensive review. It will help you save time in reviewing what eToro has to offer before you make a decision on which brokerage firm you go with. You can use this, and other similar reviews, to compare certain key features and characteristics of trading platforms. You can short-list them and give them a try through their demo accounts – if available – to choose the one you will use to conduct your trades.
There are many details to consider. It may seem overwhelming as you have to figure out which one provides competitive fees, the best customer service, the best user-friendly trading interface, and, of course, you want to make sure your money is safe.
Trading Platform Overview
eToro is a multi-asset social trading platform. It offers a wide variety of financial products including stocks, forex pairs, commodities, exchange-traded funds, and cryptocurrencies, among others. You can trade some via CFDs and some as assets.
eToro was one of the first brokers to offer a social trading feature. They pioneered the whole trend. These days many rivals are offering similar alternatives. eToro continues to lead the way in this particular field.
Social trading is a combination of a social-media-like environment within a platform. Traders can connect and chat via eToro. Meaning that other traders can follow them and check out see their performance and what instruments they are trading.
They have introduced two innovative products in this field: CopyTrader™ and CopyPortfolios™, both of which I’ll explain in more detail.
eToro platform has gained its reputation as a safe and attractive online broker for both experienced and amateur day traders. This is due to its low trading fees and user-friendly platform.
eToro offers a web-based and a mobile proprietary platform for trading. No desktop platform is available.
This broker’s trading interface features 26 different languages. It looks polished and modern, appealing to a young audience in opposition to the classical trading offered by other brokers.
One downside of eToro’s platforms is that the workspace is not customizable. Traders have to feel comfortable with the interface as is.
Both platforms – web and mobile – offer a two-step login, which increases their level of security for users. Their search functions are predictive and allow the trader to browse through eToro’s large number of available securities.
Both versions include price alerts and notifications and can be sent via push notifications.
Reports are available under the ‘Portfolio’ option. Traders can find a summary of their trades, their market value, and the fees paid. An account statement is available, summarizing the operations made during a certain period.
eToro trading fees are on the low-end of the industry. The platform doesn’t charge fees for trading US-listed stocks and ETFs. eToro CFD trading fees are low and they are built into the spread.
For stock indexes, the S&P 500 CFD trading fee is 0.75 while the Europe 50 CFD trading fee is 3.
Forex pairs are expensive to trade by using the eToro platform, as the cost of trading EURUSD is 3 pips while many other platforms charge between 0.6 and 1 pip per trade.
As for other types of fees, eToro charges a $10 monthly inactivity fee if the user fails to log into the account for 12 months. For overnight rollover fees it depends based on current market conditions.
eToro has four types of orders available:
- Market: a market order is executed at the price quoted at the moment the order is placed.
- Limit: this order sets a maximum or minimum price at which the financial asset should be bought or sold.
- Stop-loss: this order is executed once the price of the security reaches a certain level.
- Trailing stop-loss: an order that allows the trader to lock in gains as it executes the sale of the asset only if the price goes down (or up for a short-position) to a certain point, while it remains inactive while the price keeps moving in favor of the trade.
Markets & Products
eToro offers hundreds of financial assets to trade. These include currencies, indicies, ETFs and cryptocurrency trading. Each asset class is traded with different investment strategies. eToro’s portfolio of available financial products is not the biggest. It is diverse to be considered decent and satisfying for most traders.
One upside of eToro compared to CFD brokers is that you can trade real stocks, ETFs, and cryptos. You can hold these assets directly and not via CFDs.
eToro is one of the best brokers for cryptocurrency trading, offering a large portfolio of available cryptos for traders who want to focus on this particular market.
eToro offers CFDs for other financial assets including commodities and stock indexes along with certain asset management solutions that come with its social trading approach, such as eToro’s Copy Portfolios™ and Copy Traders™ solution.
The Copy Portfolio™ alternative allows traders to copy a pre-designed portfolio offered within the platform, either by eToro’s team or by other traders, to mimic their performance by taking the exact same holdings. The platform takes charge of the account and modifies the user’s portfolio based on the changes that the copied portfolio makes over time.
Copy Trader™ solution allows traders to browse through a list of traders within the platform to pick the best performing traders to copy their portfolios.
Both of these features are attractive for passive traders and for inexperienced traders. Traders that are starting out can get insights from successful traders.
eToro offers technical analysis tools along with some recommendations by analysts, but lacks on the fundamental data.
Each financial asset has its own market sentiment tracker. It indicates the percentage of traders inclined to buy or sell the security. You can find comments from analysts for certain popular assets.
Charting tools are alright, as the platform features more than 70 technical indicators and charts. The longest time span permitted by the charting tool is 6 months, which is disappointing.
The news feed is limited to tweets and comments from traders within the platform. No major media outlet such as Reuters or Bloomberg is included.
The fundamental data provided for individual stocks consists of basic financial ratios. No historical record of balance sheets, income statements, price targets, or earnings estimates included.
eToro main strength is its social trading feature. This allows the eToro community to share trading ideas. No relevant third-party analysis is offered within the platform’s interface.
Education is not the strongest suit of eToro. The educational material offered by this broker is limited to platform tutorials and frequently asked questions. These intend to address matters regarding the platform’s functionalities, the financial assets available, trading fees, and similar topics.
The demo account helps beginners in their process of learning without having to invest real money.
eToro customer service is decent, though it lacks in a few areas. There’s a live chat feature but it is a bit hidden within the FAQ section. Traders have reported that representatives are busy and no attention is available during the weekends. There’s no e-mail or phone support, as this broker relies on support tickets sent through the trading interface. The customer service response to these tickets is sent to the e-mail inbox of each user. The response time is fast – 24 hours or less. eToro customer service is not the best, but it is sufficient to deal with basic issues.
Withdrawing money from eToro is easy. eToro charges a $5 withdrawal fee. It requires a minimum amount of $30 per withdrawal. Users can withdraw to a debit or credit card, electronic wallet, or bank account. Withdrawing money to a method that has a base currency different than the US dollar will result in an extra conversion fee.
For cyptocurrencies, the eToro wallet is available (eToroX), which is a multi-currency crypto wallet.
Credit, debit card, and electronic wallet withdrawals are instant, while bank transfers take up to 2 business days.
How to Open an Account with eToro?
Opening an account with eToro is simple and fast and it can be done 100% online. It will take a few minutes to go through the registration. You can take a look at the web platform if you have not yet registered.
eToro’s trading services are available for most countries. There’s a sizable list of countries that are banned from opening an account with eToro. These countries inclued Albania, Canada, Cuba, Iran, Iraq, Jamaica, Japan, Nicaragua, Pakistan, Syria, and Serbia. US citizens outside the US territory cannot open an account with eToro.
There are two types of accounts available. eToro traders can open a retail account and a professional account.
A demo account is available if you want to test eToro’s platform before depositing money. This practice account comes with an available balance of $100,000.
Before you deposit money into the account you will have to go through an ID verification process. It will require proof of identity and proof of residency. The process takes less than a day to be completed when they recieve all the required documents. You’ll have to take a quick survey intended to assess your trading knowledge and experience.
Funding your eToro Account
Depositing money into an eToro account is easy and there are no deposit fees.
You can deposit money by using a credit or debit card or an electronic wallet such as PayPal or Skrill and it is credited in real time. Bank transfers take up to 7 days to clear.
The minimum deposit to open a retail account is $200. Except for the following:
- Minimum deposit for clients in Israel is $10,000.
- Minimum deposit for clients in the US and Australia is $50.
- Minimum deposit for clients in Russia, China, Hong Kong, Taiwan, and Macau is $500.
- For bank transfers, the minimum deposit is $500.
The professional account requires the same minimum deposit. It allows the user to take on more leverage for transactions. The trader has to meet certain criteria to qualify as a professional client. eToro may require that the first deposit is made via a credit or debit card. Subsequent deposits can be made using other methods accepted by the platform. One downside of this broker is that eToro offers one single currency base for its accounts, the US dollar. Other online brokers offer five or more different currencies for their accounts.
Traders must pay a conversion fee if they deposit funds on their eToro account by using a payment method that features a currency different than the US dollar. Conversion costs start at 50 pips, which is around 0.46% of the amount deposited into the account. You can only deposit money from accounts in your name.
Is eToro Safe?
eToro is safe and regulated by the top financial authorities. eToro is overseen by tier-1 financial regulators. These include the Financial Conduct Authority of the United Kingdom, the Cyprus Securities and Exchange Commission (CySEC), the US FinCEN, and the Australian Securities and Investments Commission (ASIC).
UK investors are protected by the Financial Services Compensation Scheme (FSCS). European investors are protected by the Investor Compensation Fund designed for Customers of Cypriots Investment Firms.
eToro is not a publicly-traded company.
What’s best about this trading platform?
There are many good things to say about eToro .In my view, those positive elements put this broker at the top of the list of the best brokers you can consider if you starting out as a trader.
eToro offers zero-fee stock and ETF trading for US-listed securities. This is a great advantage and puts the platform on top of many of its rivals.
eToro’s fees for CFDs are below the market average, even though its forex broker fees are higher compared to other brokers.
eToro’s social platform has an incredible design and it is a captivating alternative for those who are starting out their journey. Traders can connect with more experienced peers or seek potential trading ideas to start off by using the social feed.
You should be aware that CFDs are complex instruments and come with a high risk of losing money due to leverage. 75% of retail investor accounts lose money trading CFDs. You should understand how CFDs work and whether you can afford to take the high risk of losing your money.
Summary and Conclusion
eToro is an online broker founded in Israel in 2007 and is a safe, zero-commission stock broker. The platform offers a wide variety of CFDs and forex pairs along with the possibility of trading US-listed ETFs and stocks for free. This online broker operates in more than 140 countries and has over 11 million clients. One of biggest benefits of eToro is the social trading/copy trading feature. Account opening is done online and the registration is simple. You have to complete ID verification, before depositing money into the account.
There are 30 countries that are banned to open an account. The minimum deposit to open an account with eToro is $200. This amount varies for residents of Israel, Russia, China, Hong Kong, Taiwan, Macau, Australia, and the United States. For bank transfers, the minimum deposit is $500. There are no deposit fees.
Users can sign up for a demo account before depositing money into eToro.. The demo account comes with a balance of $100,000.
eToro is a multi-asset platform that offers a decent selection of US-listed stocks, ETFs, forex pairs, cryptocurrencies, and CFDs. The trading platform comes in 26 different languages. Charting tools include more than 70 technical indicators.
To summarize, we can recommend eToro as the best social trading platform and their zero-commission stock trading.
Our Score: 4.8/5
- Best Social Trading Platform
- Zero-Commission stock Trading
- Regulated by top-tier Authorities
- Easy to Use
- Great Variety of Investments