FOREX trading is complex. There is a huge learning curve and can look daunting for a beginner. eToro excels at simplifying the process and makes it possible for even a complete beginner to start trading right away. In this eToro review, I will cover its features in detail but specifically talk about beginner-friendly features.
Is eToro Regulated? Is it a Scam?
Many people lose money from FOREX trading. So it is understandable some claim them to be scams. But if you’re careful and not greedy you can definitely make a decent income from FOREX trading.
eToro has its head office in Cyprus and regulated by different authorities in different countries. In the UK its registered as eToro (UK) Ltd and regulated by the FCA or the Financial Conducts Authority. For other European countries, it’s registered as eToro (Europe) Limited and regulated by the FCA.
In Australia and New Zealand, it’s offered as part of International Capital Markets financial trading suite. IC Markets is regulated by the Australian Securities and Investments Commission.
eToro was founded in 2006 and have maintained a good reputation in the online trading community.
eToro Features and What Makes them Standout
The standout feature of eToro is its copy trading option. This is what makes it attractive for even novice traders or anyone who’s looking for a good investment opportunity.
Once you join eToro you can start copying trades of other successful traders. You can filter them by location, market type, gain percentage and many other factors. You can use those trades to fine tune your trading strategy as well. Use the below widget to see the top traders in the last month, 3 months, 6 months or year(use the drop down at the top).
Simple and Visual Interface
Another feature of eToro is it’s intuitive, easy to use interface. If you have used a FOREX trading platform before you will know that it can be hard to figure out all the controls. eToro simplified this by beautiful visuals and a phenomenal user experience.
You can quickly view your portfolio, create custom watch lists, get alerts about price movements and a whole lot more. The simple interface is visible in their web app as well giving you a seamless trading experience across devices.
Copy funds are also similar to copy trading, but instead of copying individual traders you are investing in funds. This is designed with investors in mind as the minimum amount to copy a fund is $5000. There are many fund types which include big banks, big tech, cryptocurrencies and much more.
Each shows their risk score and their gain in the last 12 months so you can easily make a decision. Below screenshot shows two of the most popular copy funds and their gains in the last twelve months.
ActiveTraders include traders who trade often while the TrendingR7 shows traders who have profited significantly in the last few months.
Positive Stop Losses
If you want to minimize losses setting a stop loss is critical. This helps you to minimize the losses if the market moved against you. But if the market moves in your favor and shows a significant profit you might want to protect some of the profits. In such a case you can set a positive stop loss. So even if the market moves against you later you will still retain some profits.
Confused? Let me explain with an example.
- You open a buy position at 1.7200.
- Take profit is 100 pips at 1.7300 and stop loss 50 pips at 1.7150.
- The price moves up by 60 pips to 1.7260 and the trade is profitable now.
- You set a new positive stop loss at 1.7250.
- This way you’re guaranteed a minimum profit of 50 pips even if the market direction changes.
Trailing Stop Loss
If a positive stop loss is not enough, you can enable the trailing stop loss feature to further maximize your profits. Let’s continue the same example above.
The prices are at 1.7260 and you set a positive stop loss of 1.7250. But when you enable the trailing stop loss feature the stop loss moves up if the market moves in your favor.
So once you enable trailing stop loss if the price goes to 1.7275 ( an increase of 15 pips) your stop loss also increase by 15 pips and goes to 1.7265. But if the market moves against you the stop loss doesn’t change and will close the trade at when it reaches 1.7265, which means your profits are maximized.
Ability to Trade Many Things
With eToro you can trade many currencies, commodities, indices, stocks, and cryptocurrencies. I have talked about how to trade US stocks in another article. But I do trade currencies as well.
Deposits and Withdrawals in eToro
eToro Deposit Options
Unsurprisingly eToro provides many deposit options. You can use online payment services like PayPal, Skrill, Neteller or WebMoney. Other than online services you can use credit cards, wire transfers and few other payment methods depending on your country. Each service has maximum deposit limits. For most online services it’s $10,000.
Minimum Deposit Amount
The minimum amount varies from $50 to $1000 depending on the country. For example here in Sri Lanka, it’s $50. To find our your countries amount go to the deposit page and add an amount. If it’s below the minimum amount it will give an error message with the minimum amount.
Even if the minimum amount is $50 I would encourage you to deposit at least $500. This way you can trade with low leverage and minimize the risk.
Withdrawing Money from eToro
eToro provides quite a few withdrawing options as well. But to withdraw the money you need to have a verified account. For the account to be verified you need to do the following things.
- Provide proof of identity (passport, drivers license, national identity card)
- Proof of address (any utility bill in your name)
- Phone number verification
If the documents are in order your account will be verified quickly.
Your Thoughts on this eToro Review
I’m an active trader in eToro and firmly believe this is one of the best trading platforms for beginners. Even if you’re not trading you can do FOREX trading through copy trading and CopyFunding. I’ve managed to cover all the standout features of eToro, but if I have missed any don’t forget to mention them in the comments section.
If you have any more questions about this eToro review you can ask them in the comments section as well. I will try my best to answer them all.