eToro is a well-known platform for European traders, our eToro review covers the pros and cons as a trading platform for those just starting to trade.
eToro was founded in 2007 and is currently considered as the world’s leading social trading network, that aims to make trading accessible to anyone, anywhere.
If you are considering trading in eToro or if you’re only researching your options, this article might give you some light on whether to choose eToro or not.
I’ve talked a little about eToro in this article, but the following is a detailed review of the pros and cons of trading in eToro’s platform.
eToro Review Pros
The FCA regulates it
In the UK, eToro has a top tier regulator: the Financial Conduct Authority (FCA). The FCA ensures you money in case eToro turns to be insolvent. In this case, the eToro UK clients can be compensated by the maximum amount of £85,000, from the Financial Services Compensation Scheme.
This is excellent news for those ladies who have a hard time trusting companies with their hard-earned money. If you trade and profit up to the maximum amount, you’ll get your money back no matter what.
eToro is the best for social traders. Social trading is when you copy other people’s trades, making them your own – for example, you probably follow some people on Instagram and is sometimes influenced by their taste, right? Social trading works the same way.
eToro’s broker has many tools for social trading, and you can benefit from them, especially if you are learning how to trade.
Free stock and ETF trading in the EU
Some brokers charge to trade stocks or exchange-traded funds in the UK, but eToro doesn’t. This is amazing for beginners who want to start trading these types of assets.
We discussed a lot about demo accounts in this article – I think it’s essential that you start with one! The good news is that eToro offers a demo account for those who want to simulate trading until they feel ready.
If you choose to fund your trades with eToro later, you’ll already know the platform and won’t struggle to learn everything again in another platform.
To open an account at eToro‘s website is easier than watching a romcom. It’s fully digital, enjoyable, and fast.
You can open an account from almost every country of the world, and in the UK, you’ll only need a minimum first-time deposit of $200.
It’s required a Facebook or Google account (or email) to register in eToro’s demo account. To trade real money, you’ll also need a copy of your passport or personal ID and a copy of your utility bill or bank statement.
To deposit money in eToro’s platform, you can choose between credit and debit cards, bank transfer, Paypal, Skrill, Neteller, and Webmoney. Also, there is no deposit fee.
The platform is intuitive and extremely user-friendly – you probably won’t struggle, even if you are not that into technology.
Popular Articles On Learning To Trade:
eToro Review Cons
CFDs are the most available type of trade
This multi-asset platform offers investments in stocks and crypto-assets. However, eToro provides more CDFs than other types of assets. If you don’t know what CDFs are, take a look at this article. The problem with the CDF is that it is way riskier than the other assets – so don’t trade it unless you’re familiar with it.
Although the creation of the account is super fast, the customer service is disappointing. You would expect that an all-online trading platform would have a live chat or telephone support – eToro hasn’t.
Yeah, I know they have a demo account and that it’s inherently educational. The thing is, you have to learn how to navigate the broker by yourself.
The website doesn’t provide any tutoring videos on how to use the platform. However, they offer some educational videos on the fundamental aspects of the financial market and investing in general. Nothing we can’t find on YouTube.
eToro charges a $25 withdrawal fee. This means that, if you want to withdraw a profit of $100 you had in a trade, you’ll only get $75. If you are willing to accumulate some money before withdrawing, that might make some sense, though.
eToro has a $50 minimum withdrawal amount.
eToro Trading Platform Summary
With the pros and cons in mind, now you can choose whether eToro fits in your parameters or not.
This chart might help you revisit the points discussed in the article:
|eToro Pros||eToro Cons|
|● The FCA regulates it;
● It’s the best in social trading;
● No fees for stock and ETF trading in the EU;
● Offers demo account;
● Easy account opening;
● Easy and user-friendly deposit page.
|● CFDs are the most available type of trade;
● Limited customer service for an all-online company;
● Limited educational tools on how to navigate the broker;
● $25 withdrawal fee.
Disclaimer: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. Between 74-89% of retail investor accounts lose money when trading CFDs. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Do you want to practice social trading? Then this is probably the right broker for you.
Join eToro through this link if you’re interested!