eToro Review 2021
Is eToro a Good Trading Platform?
eToro is a multi-asset broker that encourages you to 'Trade with confidence on the world's leading social trading platform.'
But, is eToro trustworthy, and is eToro good for beginners?
eToro says you can trade and invest in Forex currency pairs, the top stocks and ETFs, and Indices and Commodities via CFDs. eToro promote 0% commission on non-leveraged stocks or ETFs.
EToro has a cryptocurrency trading platform where you can buy and sell an expanding variety of cryptos.
eToro is excellent for cryptocurrency trading and social copy trading, with an overall trust score of 93 out of 99.
eToro is not a publicly-traded company.
The web-based platform is user-friendly, and the mobile app is excellent for on-the-go trading or investing for beginners or experienced users.
In this eToro review, we take an honest look at what makes eToro a good trading platform for beginner traders and more experienced traders.
- Who is eToro?
- Can I Create Investment Portfolios with eToro?
- eToro Regulation
- Where does eToro hold Client Funds?
- What Countries does eToro accept?
- Can I use MetaTrader Platforms with eToro?
- Does eToro have a mobile trading app?
- eToro Auto Copy Trading
- Does eToro Offer Leverage on My Trading Account?
- Does eToro have a Cryptocurrency Wallet?
- Does eToro have Trading Education?
- What Financial Instruments can I Trade with eToro?
- Is eToro Suitable for Professional Traders?
- How do I Open an Account with eToro?
- How do I Deposit Funds into my eToro account?
- How do I Withdraw from my eToro account?
- What are eToro 's Commission Fees?
- Does eToro Offer a Demo Account?
- Recap on eToro Review 2021: Is eToro a good trading platform?
- Frequently asked questions
Who is eToro?
eToro is the world's leading social trading platform.
Established in Israel in January 2007 by three entrepreneurs, the social trading pioneers transformed traditional money management by opening up the financial markets to a global audience.
With over 20 million registered users, eToro had been a leader in the revolution of global Financial technology (Fintech). They have a vast array of trading and investment tools, offering a reliable platform for beginners or experienced investors and traders.
In 2010 eToro launched OpenBook, the world's first social trading platform where clients can copy successful traders with the CopyTrader™ feature.
In 2012, eToro created the eToro app, making WebTrader and OpenBook available for Apple and Android smartphones to use the eToro platform on the go.
In 2016, CopyPortfolios came to the eToro platform, an innovative service allowing clients to copy the portfolios of successful investors.
In 2017, when Bitcoin first rocketed to new heights, eToro added cryptocurrencies to their platform, and they continue to add new cryptos weekly.
In March 2018, eToro raised $100 million from private equity financing led by China Minsheng Financial, the SBI Group, a Korea Investment Partner, and other investors. eToro's estimated value at the time was $800 million.
Can I Create Investment Portfolios with eToro?
Yes. You can create portfolios of your own, or eToro has an Investor Program you can follow. The best, high-performing investors share their portfolios with eToro clients. The theory is that if you copy a successful investor, your investments will replicate their success.
Investors to the program have a strict process to follow before eToro allow them to share their portfolios.
Before you sign up with a broker, find out if the company is authorised and regulated with a governing financial body aligned with your country. For trading or investing protection, this step is essential
eToro is licensed and regulated by several governing bodies, as outlined below.
eToro United Kingdom
eToro has a registered office in London. eToro is regulated by the Financial Conduct Authority (FCA), the governing body for the UK.
eToro has a registered office in Cyprus and is regulated by the Cyprus Securities and Exchange Commission (CySEC).
eToro United States
eToro USA is operated by eToro USA LLC, registered with FinCEN as a Money Services Business.
eToro Australia Pty Ltd is regulated by the Australian Securities & Investments Commission (ASIC) and a Corporate Authorised Representative (CAR) of Gleneagle Asset Management Limited.
eToro AUS Capital Pty Ltd is authorised by the Australian Securities & Investments Commission (ASIC).
As highlighted above, eToro is regulated in two-tier 1 jurisdictions and one tier 2 jurisdiction. This regulation makes eToro a secure broker for trading Forex and CFDs.
Where does eToro hold Client Funds?
An essential aspect of checking a broker or exchange is to find out where they hold client funds.
eToro states that client funds are held in segregated bank accounts or a segregated account with an authorised firm (which may be an affiliate of eToro), which means that your money is held separately from eToro's funds. These funds can only be used for operational costs. To adhere to licensing bodies is a standard requirement.
What Countries does eToro Accept?
Always check that eToro supports your country for trading and investing. Regulations change all the time. The list below is the current list of countries not supported by eToro.
- Afghanistan - Aland Islands – Albania – Anguilla – Antarctica - Antigua, and Barbuda - Armenia – Aruba
- The Bahamas – Barbados - Belarus -Belize - Benin - Bermuda - Bhutan - Bonaire - Bosnia, and Herzegovina - Botswana - Bouvet Island - Brunei - Burkina Faso – Burundi
- Cambodia - Cameroon - Canada - Cape Verde - Central African Republic -Chad - Chagos Islands - China - Christmas Island - Cocos Islands – Comoros - Congo Republic - Cook Islands - Cote d'Ivoire - Crimea Region - Cuba – Curacao
- The Democratic Republic of the Congo – Djibouti - Dominica
- El Salvador - Equatorial Guinea - Ethiopia -
- Faeroe Islands - Falkland Islands - Fiji
- Gabon - Gambia - Ghana - Greenland - Grenada - Guatemala - Guinea -Guinea-Bissau - Guyana
- Haiti - Heard Island and McDonald Islands – Honduras - Hong Kong
- India – Indonesia – Iran - Iraq
- Jamaica - Japan
- Kiribati – Kosovo - Kyrgyzstan
- Laos – Lebanon – Lesotho – Liberia - Libya
- Macau – Madagascar – Malawi – Maldives – Mali – Marshall Islands Mauritania – Mauritius – Micronesia – Moldova – Mongolia – Montenegro Montserrat – Morocco – Mozambique – Myanmar
- Namibia – Nauru – Nepal – Netherlands Antilles –Nicaragua – Niger – Nigeria – Niue – Norfolk Island – North Korea – North Macedonia – Northern Cyprus
- Pakistan –Palau – Palestinian Territories – Panama – Papua New Guinea – Paraguay – Pitcairn Islands
- Russia – Rwanda
- Saint Helena – Saint Kitts and Nevis – Saint Lucia – Saint Pierre – Saint Vincent and the Grenadines – Samoa – San Marino – Sao Tome – Saudi Arabia – Serbia – Sierra Leone – Sint Maarten (Dutch Part) – Solomon Islands – Somalia – South Africa – South Georgia and the South Sandwich Islands – South Sudan – Sri Lanka – Sudan – Suriname – Svalbard and Jan Mayen – Swaziland – Syria
- Tajikistan – Tanzania – Timor-Leste – Togo – Tokelau – Tonga – Trinidad, and Tobago – Tunisia – Turkey – Turkmenistan – Turks and Caicos Islands –Tuvalu
- Uganda – Uzbekistan
- Vanuatu Vatican City –Venezuela –Virgin Islands (British)
- Zambia – Zimbabwe
The above exception list is extensive, but check eToro's up-to-date list before registering for an account with eToro.
Can I use MetaTrader Platforms with eToro?
eToro currently does not offer Metatrader 4 (MT4) or Metatrader 5 (MT5).
eToro has a proprietary platform, a desktop (windows) platform, a web-based platform and a mobile app.
Does eToro have a Mobile Trading App?
The eToro app is available on Google Playstore and App Store to download WebTrader and OpenBook for Apple and Android smartphones.
The eToro app uses a dark and light theme, which maintains the eToro web version's look and feel.
You can sync your watchlists and unify your charting, which is responsive but with only five indicators available instead of just under seventy indicators on the web version.
There are no drawing tools on the app, but otherwise, it is streamlined, functional, and responsive.
eToro Auto Copy Trading
The popular CopyTrader™ feature allows you to see what experienced traders are doing in real-time. You can select a trader that you like and start copying their trades automatically.
All copy traders on the eToro system are trading manually. Fully automated trading systems are not allowed with eToro. Other social trading platforms offering an auto copy trade system do not discriminate between manual and auto trading (where software algorithms place a trade)
With the rise and popularity of auto trading systems, it's good for beginners to know that with eToro, they follow a discretionary system whereby the trader is placing a trade manually.
CopyTrader™ is ideal for beginners to trading. We all have to start somewhere. But the service is also suitable for the time-strapped trader who doesn't have the time to analyse or watch trades.
On the website, the average yearly profit percentage for 2020 is 83.7% for 50 of the most copied traders on eToro.
As eToro is a social trading platform, you can learn from a collaborative group of traders and investors where the data is transparent.
You can view stats, risk scores, portfolios, and much more and chat with others to gain more knowledge about trading and investing.
There are no fees for copying the traders, but you may pay fees on spreads and a small fee for overnight trades.
Does eToro Offer Leverage on My Trading Account?
The eToro website states that leverage is available to retail clients, except for the United States.
ESMA (European Securities and Markets Authority) and ASIC (Australian Securities and Investments Commission) define the maximum leverage amounts.
- Major currency pairs (i.e. EUR/USD) = x 30
- Minor currency pairs (i.e. EURNZD) = x 20
- CFD stocks (securities) and ETFs = x 5
- CFD cryptocurrencies = x 2
eToro has disabled the ability to open leveraged crypto positions because of the volatile nature of trading cryptocurrencies. Navigating massive price swings with cryptocurrencies is high-risk, so removing leverage is a sensible decision by eToro
The details for leverage seem a little vague, and eToro could improve this information on the website.
Before using leverage, we recommend you get clarification for your country off the eToro website list.
Does eToro have a Cryptocurrency Wallet?
Yes. The eToro Money crypto wallet is a secure, user-friendly digital wallet.
It's one of the safest crypto wallets available. The eToro Money crypto wallet has standardisation protocols and several high-level security features. For example, the eToro Money crypto wallet has multi-signature facilities and DDoS (Distributed Denial of Service, which helps prevent an attack on the network infrastructure).
The eToro crypto wallet is free to download, and it's easy to buy and store multiple cryptocurrencies. You can receive and transfer over 120 cryptocurrencies, and you can change one crypto to another with no need to transfer.
The eToro Money crypto wallet comes with a private security key that you can use to recover access to your crypto wallet when needed. You can receive, store or transfer your cryptocurrencies anywhere on the blockchain with your own private on-chain address.
You can download the eToro Money crypto wallet app from Google Playstore or on the App store.
Does eToro have Trading Education?
eToro promotes online courses, weekly webinars, and podcasts.
Due to the Covid-19 pandemic, there are no physical classroom meetings planned for the foreseeable future.
Before Covid, the 10 am to 5 pm eToro crash course in trading was a one-day live training course at London's Canary Wharf.
Subjects covered are :
- The financial markets
- Types of trader – learn what type of trader YOU are
- Key terms – understand terms with simple examples
- Trading – explore the essentials of crypto, stock, and currency trading
- Q&A – your chance to ask our trader anything
The eToro podcasts cover such topics as below:
- How to buy stocks
- How to buy Bitcoin
- How to CopyTrade
For such a large client base, eToro could improve its base of podcast subjects
The eToro Trading Academy – otherwise known as the Trading School - appears to be under development.
Currently, there are only five videos available online:
- How do I know what to trade?
- How do I verify my eToro account?
- What is the watchlist, and how do I use it?
- Why am I losing when the price is going up?
- How do I use charts on eToro?
On the eToro Trading Academy page, the Trading for beginners and Pro Trading sections have no videos as yet. eToro states, 'coming soon.'
What Financial Instruments can I Trade with eToro?
eToro offers the following financial instruments:
Cryptocurrencies are growing in popularity and are becoming the go-to investment option for many traders.
Crypto's are volatile, so considered high-risk, and subsequently, crypto trades on eToro are unleveraged.
When you buy cryptocurrencies on eToro, you are investing in the underlying assets, and, as such, they are unregulated, so you have no investor protection. This is standard practice for cryptocurrencies.
If you sell cryptocurrencies on eToro, your trades are executed using CFDs which fall under the FCA and CySEC regulation
eToro has a vast range of available cryptocurrencies, and they continue to add new cryptos.
Commodities have a real-world physical representation, such as gold, silver, oil, rice, etc.
You trade commodities on eToro as CFDs, so you don't purchase the underlying asset.
You can sell (short) positions and leveraged trades. And you have fractional ownership. For example, you can invest small amounts such as $100 in gold or silver, even if the single unit costs $1500
Forex (foreign exchange) is a highly liquid financial market, trading over $6.6 trillion 24/5. Forex is a popular trading platform on eToro where you can use leverage to grow your Forex account.
On eToro, currencies are traded as CFDs, meaning you are trading currencies and not buying the currency.
When you invest in ETFs on eToro, you buy a non-leveraged position, which means you are investing in the underlying asset.
There are additional functions where you can use ETF trading. You can sell CFDs with leverage and buy fractional shares in the same way you can short sell commodities.
Is eToro Suitable for Professional Traders?
eToro offers retail and professional accounts.
A retail client is a trader that isn't trading professionally.
Retail clients have access to all trading assets, but leverage may be restricted.
EToro retail clients have protection with the Investor Compensation Fund, which means you have recourse to the Financial Ombudsman Service.
eToro offers margin close-out restrictions and negative balance protection for retail traders.
Professional trading clients have to pass a test to assess suitability for professional trading status on eToro.
Unlike retail clients, there is no protection for professional traders from ESMA and no recourse to the Financial Ombudsman Service, but there is negative balance protection. Professional eToro clients may have higher leverage offered by eToro where appropriate.
To apply for professional status, you fill in an application form, and if you meet eToro's criteria, your application will be approved.
How do I Open an Account with eToro?
It's easy to join eToro.
- Click on the join now on the eToro home page
- Complete the electronic form with your personal details
- Tick the relevant boxes to confirm the agreement
- Submit the information
You will be required to provide a copy of a valid utility bill for confirmation of residence and proof of identity, such as a driving licence or passport.
You will also complete a questionnaire to assess your knowledge of trading and investing so that eToro can tailor your experience to suit your skills or lack thereof.
How do I Deposit Funds into my eToro account?
It's fast, easy, and secure to deposit funds into your eToro account.
Simply log in and click on Deposit Funds. Enter the amount and your chosen currency and then select from the drop-down list for your preferred deposit method
- Credit/Debit cards
- Rapid Transfer
- Klarna / Sofort Banking
- Bank transfer
How do I Withdraw from my eToro account?
To withdraw from eToro, click on the Withdraw Funds tab in the left-hand menu and enter the total you wish to withdraw funds. Complete the form and submit
Wire transfers and credit or debit cards can take up to 8 business days from withdrawal. Most other withdrawal options are 1-2 business days.
All withdrawal requests are subject to a $5 fee.
There is also a currency conversion fee if you withdraw currency that isn't the dollar. These fees vary, but the fees are pips rather than fiat currency.
What are eToro's Commission Fees?
Crypto fees are from 0.75% to 2.90%.
Stocks and ETFs (CFDs) are from 0.09%.
Indices are from 100 pips, and commodities are from 2 pips
Does eToro Offer a Demo Account?
Yes, as standard practice, when you open an eToro account, you have access to a free $100,000 demo account.
Recap on eToro Review 2021
eToro is slightly pricier than most of its competitors for trading Forex and CFDs.
Recently though, eToro has cut the spreads and has introduced 0% commissions for U.S. stock trading.
The range of eToro's traditional research tools could be improved and is currently a little limited.
eToro's website would benefit from some navigational improvement and expanding information on trading and investing. For instance, the eToro website trading education is somewhat basic and confusing.
There are more eToro videos on YouTube, but it would better serve clients if the videos were on the eToro website.
Overall, it's easy to find the information you need and start smooth trading or investing. eToro tries to make sure that ease of use by clients is the priority.
In conclusion, eToro is an excellent platform for novice retail traders that want to learn from others with the copy trading service.
For the experienced trader subject to meeting eToro's criteria, they can receive rewards for sharing their trades.
For the true beginner to trading, the eToro user-friendly platform is a benefit. Some traders bemoan that eToro doesn't have the Metatrader platforms, but MT4 and MT5 can be clunky and not user-friendly for beginners.
Please note that the above information is not providing advice on tax, investment, or financial services. We provide the above information without consideration for risk tolerance and a specific investor's financial circumstances.
Trading or investing in Forex, stocks, CFDs, and cryptocurrencies may not be suitable for all investors. It does involve risk and the possibility of a loss of capital.
eToro – Best Trading Platform For Traders and Investors
eToro have proven themselves trustworthy within the industry over many years – we recommend you try them out.
67% of retail investor accounts lose money when trading CFDs with this provider.
Is eToro trustworthy?
Finding a broker you can trust is the first step in your trading journey.
On 8th March 2021, eToro proudly announced they have 20 million users registered globally.
By Q3 2021, eToro plans to be listed on the NASDAQ.
eToro adheres to licensing regulations. They ensure solvency with adequate capital and a track record of customer service, with 20 million users that prove eToro is a trustworthy broker.
Is eToro really free?
The copy trading service is free, but be aware that there may be overnight fees and small costs factored into eToro's spreads (the difference between the bid and the ask price).
Like any business, eToro has to profit to stay in business, making their money in these two areas, as do most online brokers.
Do eToro offer Analysis Tools?
eToro incorporates fundamental analysis into the platform for shares trading. eToro uses the trades of their professional traders to calculate sentiment data.
eToro also has a wall feed, similar to Twitter, that shares the collective comments for a financial instrument.
You can see a stream of updates and learn what other traders are thinking or doing regarding a trade you may be considering.
Though the feed may not always be top quality content, it can assist in estimating market sentiment.
Content from in-house staff or professional traders is of higher quality and will likely bring better rewards if you follow their suggestions. But you'll soon work out who is best for trade analysis.
Can you make money with eToro?
It's possible to make money with eToro, but there are no guarantees. Trading has a 95% failure rate, with any broker, and even professional traders lose occasionally.
eToro has an immense database of pro traders, and the copy trades are real-time.
But, to succeed long-term, it's less about blindly copying trades and more about learning to do your own analysis, manage your risk, make good decisions, and keeping your losses small and under control.
Some pro traders may trade with higher risks, and others take fewer low-risk trades. Only you can decide which trader to copy.
The key to making money with eToro as a trader or investor is about making the right trading choices. Focus on risk-management decisions, keeping average losses small relative to average profits over time (whether you are trading manually or copy trading).
Know when to quit, perhaps after three consecutive losses, and don't trade late to the party. If a trader called a copy trade 30-minutes earlier, you might have missed the opportunity. Wait for another trade.
What type of broker is eToro?
eToro wears a couple of different trading hats.
They can either be a market-maker or agency broker, depending on several factors.
Market-maker brokers act in opposition to your trade, so if you buy, they will sell.
Agency brokers direct your order to other market-makers. Agency brokers may get rebates or commissions in return, profit-sharing, or wider spreads.
For instance, eToro Europe and eToro U.K. act as market-makers. But they can hedge their client's trades and act as an agency broker if needed. It's all part of the internal risk management process.
What matters to you and all eToro clients is that they adhere to the best execution regulations, which eToro must do mandated by law.
Is eToro good for beginners?
eToro is great for beginners, far more so than many other trading platforms.
eToro's platform is not complex, and so it is easy to learn. The tools and features for the web-based platform and the mobile app are user-friendly.
If you are new to trading and investing, you'll have a learning curve, and it's essential to remember that just because the platform is simple to use, that doesn't mean you'll find it easy to make money long-term.
It takes time to figure out effective ways to analyse and trade.
Most new traders over-trade, and you may over-think your trading too.
You may wish to consider the risk score and the average number of trades placed weekly by eToro copy traders. One good trade is better than the stress of multiple trades that may or may not end up in profit.
Trading can be stressful. So choose a copy trader with a relaxed style with a high success rate.