eToro is an Israeli based broker founded in 2006. It is headquartered in Cyprus, but also has offices in the UK, Australia and the USA. It is considered to be the world leader in social trading in terms of both user volume and service performance. This broker currently manages a total of 8.4 billion dollars.
Social Trading is a relatively new way of investing in the financial markets, combining traditional broker technology with the characteristics of social networks. It allows users to interact with each other and even allows them to replicate the orders of the best traders on the network.
A milestone in eToro’s trajectory was the announcement of its IPO, published in mid-March 2021. In doing so, the company will join a SPAC called Fintech Acquisition V, which aims to raise up to $10.4 billion from investors.
eToro operates via web and app, which allows it to have customers from a multitude of different countries. Its business is optimised for remote service through help chats, telephone enquiries and email contact.
Additionally, eToro is introducing artificial intelligence into its platform through portfolios, which allows any trader who chooses to use the Copy Portfolio option (see below) to improve their user experience and, above all, their final profitability. All eToro reviews point to the enormous usefulness of this tool.
Getting Started with eToro
Have you been interested in this broker, have you seen advertisements or heard reviews about it? If this is your first time with eToro you should know that the broker is optimized to make trading simple and intuitive.
As simple as it may seem, this simplicity is a feature that is much applauded by users as there are other platforms where both registration and execution of trades is a little unclear. Any customer wishing to trade with eToro will follow the same initial procedure:
User registration, either through its website or through an associate who directs us to it.
Reporting of personal data. As eToro is regulated, you must comply with customer identification rules. This involves providing data such as name and surname, ID card number, physical address, etc. In addition, we will be asked about our financial knowledge in order to draw up our profile.
Deposit of funds, the account is opened without a balance (obvious) so we have to deposit the money we are going to trade with. At eToro we trade with dollars, but if we want we can transfer euros and they will do the currency exchange. However, we have to take into account that the EUR/USD conversion is costly, as we will see later on.
Search and selection of investments. We have already seen the enormous amount of securities in which we can invest, we can search directly in the search bar or discover new options on our own. We advise investors to dive from time to time through the infinite possibilities offered by the platform and discover new companies or assets that they may not have counted on.
Follow-up of investments. After executing the order, we must monitor the investment. In this way we will sell the share or cryptocurrency when we see that it has reached the desired profitability. It can also be used at any given time to place additional orders or even to go short if for any reason the asset in which we are investing starts to fall.
Of course the eToro platform has many more possibilities, here we have simply condensed what would be a simple buy trade. In the next sections we will discuss other features such as CopyTrade, which allows us to replicate the exact portfolios of the best traders on the platform.
Of course the cost of our investments is something we need to be aware of from the very beginning. In this regard, eToro’s reviews on commissions are very positive.
eToro has a 0% commission policy on a large part of its assets. This means that for example we don’t pay eToro brokerage fees on stocks or ETFs as long as we make a simple purchase (no leverage or short positions).
There is also no commission for opening the account, for using the analysis tools or for depositing money into the account. There are also no fees for using the CopyTrade and CopyPortfolio tools.
CopyTrade and CopyPortfolio are two different replication tools. The former focuses on copying a trader’s orders while the latter invests in an entire pre-designed strategy.
You will find a fixed commission of $5 for withdrawing the money (i.e. taking it to your bank account) and a
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