eToro

eToro is a well-known Israeli social trading broker founded in 2007. eToro is a private fintech startup owned by venture funds such as Commerz Ventures Gmbh, the venture arm of Commerzbank, as well as Israeli, American and Chinese investors.

eToro regulation

eToro broker manages three legal entities and serves clients depending on their place of residence:

1. eToro UK Ltd serves UK customers through an FCA-regulated organization. If eToro becomes insolvent, customers of eToro UK can expect compensation in the amount of the maximum amount of 85,000 pounds guaranteed by the British compensation Fund FSCS.
2. Australian customers are served by eToro Australia, which is regulated by ASIC. However, ASIC does not provide mandatory investor protection for a pre-set amount.
3. Other investors will have their real trading accounts in eToro (Europe) Limited, which is regulated by CySEC. The maximum amount of investment protection in eToro Europe is 20,000 euros.

eToro also provides negative balance protection for spot currency trading and CFDs, but only for retail customers from the EU. Professional clients from non-EU countries are not protected from a negative balance.

Leverage

In accordance with the requirements of the ESMA leverage is above:

• 1: 30 for major currency pairs;
• 1: 20 for non-major currency pairs, gold and indices;
• 1: 10 for commodities other than gold;
• 1: 5 for CFDs on shares;
• 1:2 for CFDs on cryptocurrencies.

Professional traders are allowed to use leverage up to 1:400.

eToro trading accounts

eToro offers two simple types of accounts: a live account and a demo account (virtual). eToro only allows accounts in US dollars. Islamic accounts are available in eToro upon request after completing account verification.

eToro commissions

Starting in may 2023, eToro offers Commission-free stock trading. Please note that you are buying real shares, not a CFD contract, and you cannot use leverage.

eToro has low CFD trading fees compared to its closest competitors. But eToro commissions on Forex are quite high.

eToro also has non-trading commissions. The broker charges $ 10 a month after one year of inactivity, but simply logging in to your account already counts as an action. The withdrawal fee was recently reduced to $ 5.

Trading instrument

On eToro, you can trade CFDs and Forex, as well as real stocks, ETFs, and many cryptocurrencies. In addition, the broker also offers social trading-CopyTrader and CopyPortfolios.

All items for the purchase of shares, ETFs and cryptocurrency without the use of borrowed funds are traded as underlying assets. This means that when you buy stocks, ETFs, or cryptocurrencies without leverage, you will be buying real stocks, ETFs, and cryptocurrencies, not CFDs. All other positions are CFD contracts. Please note that if you open a short position (sell shares that you don't have yet), you are always trading CFDs.

eToro trading platform

eToro offers a convenient and well-designed platform for web trading. Social trading is also available. The eToro mobile trading platform is available for iOS and Android.

Desktop trading platforms such as MetaTrader 4 and MT5 are not available in eToro.

CopyTrader

CopyTrader is a social trading tool that allows you to copy the trades of other traders who also trade on eToro. You can view the profiles of other eToro traders, checking their previous results on an annual and monthly basis. Their portfolio is also public information. For each profile, there are many more statistics, such as trades per week, average retention time, returns, and risks. The minimum amount you can invest in a single trade is $ 200. In addition, you can copy trades of up to 100 traders at a time.

CopyTrader has one drawback: you can't close part of your position, but only its full amount.

CopyPortfolios

CopyPortfolios is practically an investment Fund, but it is essentially a CFD portfolio. While with CopyTrader you subscribed to a single trader, with CopyPortfolios you can invest in an industry or portfolio of leading eToro traders. Investing in an industry means investing in a portfolio of large banks or cryptocurrencies. For example, cryptoperthite consists of the largest cryptocurrencies, weighted by market capitalization.

Minimum deposit

In most cases, the minimum Deposit for eToro is $ 200. This is different for the following countries:

• for residents of Israel, this is $ 10,000;
• for residents of Australia and the United States, the minimum first Deposit is 50 dollars;
• for residents of Algeria, Lebanon, Maldives, and Venezuela, the minimum first Deposit is $ 5,000.

The minimum amount for a Bank transfer is us $ 500.

Conclusions

eToro is still considered a startup. It is not listed on any the stock exchange, and does not provide regular financial statements to the public. Consequently, it is difficult to know anything about its financial performance. At the same time, the regulation of the Forex broker by the FCA, ASIC and CySEC is an excellent sign of eToro's security.

eToro broker offers trading in real stocks (not CFDs) without Commission. Opening an account is quick and easy. It also has services such as social trading and copying trades of successful traders.

However, eToro has some disadvantages. Forex commissions are high, and eToro only allows you to open accounts in US dollars, which means that in some cases, the conversion costs for deposits and withdrawals can be high.

In General, eToro can be recommended for stock trading and social trading. You can also read eToro reviews and share your impressions about this broker.