Originally founded in 2006 as RetailFX, eToro came to be in 2007 and was brought into this world as a social platform for online transactions in stocks, currencies, indices, and commodities. Thanks to eToro’s intuitive OpenBook trading platform, traders can conduct transactions with various financial instruments such as stocks, commodities, precious metals, currency pairs, and market indices. eToro’s CopyTrading feature allows rookie and veteran traders alike to copy trades from their experienced colleagues.
In terms of regulatory oversight, eToro is regulated in two different countries: The United Kingdom, and Cyprus. eToro is regulated by the British Financial Supervision Authority (FCA) in the UK, and the Cyprus Securities and Exchange Commission (CySEC) in Cyprus. Additionally, because both the FCA and CySEC follow the Financial Instrument Market Directive (MiFID), eToro has all the requirements necessary to operate and conduct financial activities in the Eurozone.
At eToro, they try not to complicate simple things. You can choose among two trading account types: a standard trading account and a demo account. To open a standard trading account, a mandatory deposit must be provided in the amount of $500. By choosing a demo eToro trading account, traders will have access to $100,000 in virtual currency. Therefore, the platform allows traders to test various trading strategies without any financial risk. This is also a great opportunity for potential eToro traders to check the broker’s services and trading platform functions before transferring real funds. Also available are Islamic accounts.
One of eToro’s distinguishing features in the industry has been and remains their trading platform – OpenBook. Launched in 2010, OpenBook was one of the first of its class on the market. Unlike traditional online platforms, eToro’s platform managed to mobilize the wisdom of the masses in order to maximize the income of traders. Social trading platforms allow traders to see each other’s statistics: open positions, profitability levels, and real-time trading strategies that are being used.
One of eToro’s attractions is the ability to copy other traders’ transactions. You can search among the registered traders based on some of the following criteria:
You also have access to some advanced filters, which have many more parameters, but the best course of action is to avoid using a lot of criteria because arguably the most important thing is the trader’s profit and level of experience. These are the two key points that characterize whether a trader has stability.
One of the advantages of eToro’s platform is the ability to communicate with other traders. You have the luxury of observing other people’s transactions in real time, copying them, or, on the contrary, letting others use your transactions in exchange for a commission. All private information, of course, is shared with no one.
The CopyTrader function is a real opportunity to form an investment portfolio consisting entirely out of other traders’ transactions. All you have to do is subscribe to the traders whose activities seem promising to you. You can even communicate with them if you want to. To find out who is currently most successful, the Popular Investors option will help immensely. The system determines the leaders automatically according to a number of criteria, ranging from the number of successful transactions to the total amount of investments for a certain period.
Ability to search traders through filters and Communication with other traders.
eToro provides its customers with the opportunity to trade a wide variety of assets, ranging from stocks and currencies to CFD’s. To get started, you will need to register via a special link and deposit a certain amount into your account. You can transfer money using a credit card, electronic payment systems like PayPal and WebMoney, or via a bank transfer. All transactions are as secure as possible, as they are protected by SSL technology.
The account must be verified within 5 days after making the first deposit. After verification, it is possible to replenish your account with large sums. The maximum replenishment with a single payment is limited to $50,000. Customers who have more than $20,000 in assets are classified as Premium. This gives them various privileges, ranging from bonuses when depositing to the account and ending with their own personal manager and access to exclusive materials.
eToro certainly brings a lot to the table with its innovative platform. Being able to see other traders’ transactions, copy them, learn from them, and even communicate with them, definitely earns eToro some major points. However, other areas don’t shine as bright as we would like. There is no consistency with withdrawals, with a surprising amount of people experiencing complications, and when there is a need for assistance, the customer support team isn’t always there to help. The ridiculous entry sum of $500 is already enough to scare away newcomers. While eToro’s main attraction of copying others is quite intriguing, especially for rookies, you have to understand that the majority of the time simply copying others won’t be a strategy you should rely on, since the moment a trade is done, seconds after the market conditions are already different.