eToro Review: Pros and Cons You Need to Know

eToro is a multifaceted trading platform that specializes in offering more than 30 types of cryptocurrencies, along with a limited array of stocks and ETFs. If you’re someone who enjoys a social trading experience, you’ll find eToro’s community features and active user base quite appealing. In this article, we will talk about the unique features and cost considerations of using eToro for your trading needs.

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eToro Broker: Overview

eToro offers a unique social trading experience, allowing users to emulate the investment strategies of experts in crypto, stocks, and ETFs. The platform’s user-friendly design makes it easy to find traders to follow and execute trades quickly. While eToro is accessible in over 140 countries, it lacks some advanced trading tools, limiting its appeal to more seasoned investors. If you’re looking for a platform with a focus on social interaction and crypto trading, other online brokers might better suit your needs.

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Regulation and Registration

eToro, a global social investing platform, is regulated and licensed across multiple jurisdictions. In the UK, it’s authorized by the Financial Conduct Authority for financial and cryptocurrency services. In Europe, it’s regulated by the Cyprus Securities Exchange Commission and registered with various other European financial authorities for crypto and digital asset services.

eToro also operates in Malta, the Middle East, Australia, Seychelles, the USA, and Gibraltar, with relevant local financial authorities’ licenses and registrations. The company adheres to the Markets in Financial Instruments Directive, categorizing clients as Retail, Professional, or Eligible Counter Parties, each with varying levels of protection and criteria.

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Account Types of eToro

eToro provides a diverse range of account options, designed to accommodate the varied needs and strategies of traders and investors worldwide. From individuals seeking personal trading experiences to professional traders and corporate entities.

eToro Standard Account

• Minimum Deposit: $10 to $10,000 (varies by country)
• Spread: From 1 pip
• Commission: Low on stocks/ETFs; rollover fee for overnight CFDs
• Maximum Leverage: Up to 1:30
• Instruments: Forex, commodities, stocks, ETFs, indices, cryptocurrencies (1000+ assets)

eToro Islamic Account

• Minimum Deposit: $1000
• Spread: From 1 pip
• Commission: No swap fees
• Maximum Leverage: Up to 1:30
• Instruments: Forex, commodities, stocks, ETFs, indices (1000+ assets)

eToro Professional Account

• Minimum Deposit: $10 to $10,000 (varies by country)
• Spread: From 1 pip
• Commission: Floating spreads
• Maximum Leverage: Up to 1:400
• Instruments: Forex, commodities, stocks, ETFs, indices, cryptocurrencies (1000+ assets)

eToro Corporate Account

• Minimum Deposit: $10,000
• Spread: From 1 pip
• Commission: Floating spreads
• Maximum Leverage: Up to 1:30
• Instruments: Forex, commodities, stocks, ETFs, indices, cryptocurrencies (1000+ assets)

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Deposit and Withdrawal

eToro offers a variety of payment methods for deposits, including eToro Money, credit/debit cards, PayPal, NETELLER, SKRILL, Rapid Transfer, iDEAL, Klarna/Sofort Banking, bank transfer, Trustly, and Przelewy 24. The availability of these methods varies by country, and the maximum single deposit amount ranges from $5,500 to $250,000 (or unlimited for Black Card holders in the case of eToro Money). Most methods offer instant deposit times, except for bank transfers, which can take 4-7 days.

Withdrawal requests on eToro are confirmed within 2 business days. The time to receive funds varies by method: eToro Money offers instant withdrawal, while credit/debit cards and bank transfers take up to 10 business days, and PayPal, Neteller, Skrill, Trustly, and iDEAL take up to 2 business days. A $5 fee applies to withdrawals over $30, and additional charges may be incurred for currency conversions and by intermediaries like banks or credit card providers. The exact fee can be viewed in the Cashier section before completing the withdrawal.

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Products in eToro

At eToro, they offer you over 5,000 instruments from a wide range of asset classes:

• Stocks
• Indices
• ETFs
• Currencies
• Commodities
• Cryptoassets 

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Trading Platform of eToro

eToro utilises its own proprietary trading platform, which prioritizes user-friendliness. This platform does not support APIs (plugins for backend access) or third-party platforms like MetaTrader 4 (MT4) and MetaTrader 5 (MT5).

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Fees of eToro

eToro offers commission-free stock investments starting at $10, with no management, rollover, ticket, or additional broker fees, but FX fees apply for non-USD transactions and a $5 withdrawal fee. For cryptocurrencies, eToro charges a 1% transaction fee plus an additional 0.1% for Terra’s LUNC. Crypto prices are based on bid-ask spreads from internal and external sources. 

CFD trading involves spreads and overnight fees without actual asset acquisition. These fees vary and are country-specific, with certain exceptions in Germany, Australia, and France. Overnight fees are charged for CFD positions held overnight, reflecting market forces.

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eToro Promotions

eToro is offering a limited-time bonus where new account holders can receive a $10 bonus after depositing $100 into their eToro account. To qualify, one needs to sign up for an eToro account, deposit $100, and explore the available stocks, ETFs, and crypto options. The $10 bonus will be automatically added to the account balance.

The offer is valid only for new eToro investment accounts opened during the promotional period, which lasts until December 31st, 2023. Deposited funds must remain in the account for a minimum of 90 days following the deposit to be eligible for the bonus.

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Customer Support

• Email: [email protected]
• Live Chat: eToro automated chatbot is available 24/7
• Phone: +1-888-271-8365

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Pros & Cons

Pros Explained

• eToro’s global platform draws millions, offering a product that caters to a diverse customer base, even though the U.S. version is more limited.
• The platform’s innovative social trading features allow investors to quickly leverage the expertise of other traders. Users can evaluate traders based on ratings and performance metrics to align with their trading goals.
• Fractional share support allows investors to engage with pricier assets without tying up too much capital. You can buy fractional shares with any amount above the $10 minimum deposit.
• eToro Money offers a cash management solution that centralizes your financial activities. It allows you to hold crypto, make deposits and withdrawals, and easily send and receive funds.

Cons Explained

• eToro is available in 46 U.S. states and is gradually expanding its reach. However, residents of New York, Nevada, Hawaii, and Minnesota can’t access the platform, although the demo account is open to all.
• The limited range of ETFs and stocks makes the platform less appealing to advanced traders. With fewer than 2,000 stocks and 220 ETFs, some investors may find it challenging to execute their trading strategies.
• The platform’s limited account options and lack of portfolio margining and options trading mean that investors seeking more advanced features will need to look elsewhere. Only brokerage accounts are available; retirement and other account types are not.
• The absence of advanced trading tools and research options limits the platform’s utility for experienced investors, making it less likely to be their go-to trading service.

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Is eToro Worth Considering?

eToro sets itself apart with a focus on social trading, enriched by features like CopyTrade and the Popular Investor Program. The platform has expanded its appeal by adding stock and ETF trading, eToro Money for cash management, and Smart Portfolios. It also attracts socially conscious investors with its ESG filters.

The absence of financial calculators, research utilities, and trading facilities limits its versatility for diverse investment strategies. The restricted range of stocks and ETFs, along with the lack of support for leverage accounts and options trading, further narrows its appeal, as revealed in this forex trading broker review of eToro. These drawbacks may deter many from making it their go-to option.

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FAQs

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