eToro was established in 2007 as a provider for FX trading and copy trading. The broker offers 47 different currency pairs as well as stocks and cryptocurrencies. Some assets are available as CFDs or through the underlying. The main feature for this broker is to allow users of the platform to copy successful traders. The platform also has a system to rank traders’ performances, by various factors. The information allows users to choose who to copy based on elements other than revenue. Traders that allow themselves to be copied are ranked from cadet to elite. The higher the ranking the larger the benefits, elite status gets you a management fee.
eToro is regulated by the following financial authorities:
eToro is not a publicly traded company, however, it is regulated by 2 top tier authorities. Both regulators guarantee the highest level of transparency, financial accountability and trust.
eToro has a slightly higher than average bid offer spread than the industry standard. However, most users of this platform are probably interested in the services it offers in copy trading, and are willing to cross a wider spread for its features.
The table below shows the minimum spreads for each of the major forex pairs as listed on the eToro website and compares them against the industry average.
Note: Spreads are variable and can change depending on the time of day and market conditions. For information purposes only.
If you are only looking to trade on your own ideas this broker has slightly higher than average bid offer spreads, making it less appealing in this instance compared to some of its peers. Along with CFDs for US shares, this broker offers zero commission trading and fractional shares. For cryptocurrency traders, the fiat to crypto conversion fee is high at 5%.
For accounts with qualifying balances, the VIP account offers varying benefits which include discounted withdrawal and deposit fees, a dedicated account manager or private trade ideas. Your access to these perks depends on the size of your cash balance.
eToro only has its own proprietary trading platform. It clearly stands out that their software was designed with copy trading as the main feature. The platform is fairly straightforward to learn and user friendly. However, it is somewhat limited for a retail trader looking to trade on his personal ideas. Chart features and technical analysis tools seem to be adequate with 67 indicators and 13 drawing tools.
Their proprietary platform has apps for mobile devices, for both Android and iOS. Their mobile apps work smoothly with the desktop version, however, there are only 5 technical indicators on the mobile app compared to 67 for the desktop platform. There are no drawing tools for charts on the mobile app. Having said that, possibly it wouldn't be the most important feature. If you are copy trading you are probably more concerned about being notified in a timely manner of newly opened or closed trades and trade ideas.
Benefits of the eToro app include:
Education is a big theme for eToro, although it doesn’t appear to be very well organized. You can find videos for beginners in its “eToro Academy” section. There are also various videos on its YouTube channel which may be more interesting. Its blog has various articles, which seem to be placed randomly, and also vary a lot from education to research to news. Webinars are available weekly and provide useful information.
eToro relies heavily on the traders that are on the platform sharing their trading ideas. In fact, there are many news feeds of comments from the community throughout various parts of their app. News feeds from major financial outlets are absent while there are some articles from in-house staff under the "News & Analysis" drop-down menu. These articles cover the financial markets news in terms of market insight or event coverage.
Customer support is based on online interactions through the landing page for “Customer Service”. The page has a wide range of articles explaining the basics of eToro such as opening an account with them, copy trading or deposits and withdrawals. Again the type of service offered in this department seem to focus on helping copy traders. For a self-reliant retail trader, more personal and immediate attention might be required.
You can speak to customer support via:
eToro offers a very attractive solution for traders looking to follow successful traders, or for traders looking to earn a bit of extra income by sharing their ideas within the eToro community. The trading platform works very well for its purpose. It allows you to copy other traders, keep track of your portfolio, and to manage your own trades on a relatively user friendly app. However, they lack full customer support, via email and telephone, have a rather watered down version of the trading app for android and iOS, and little to no live news feeds or analysis of market events or sentiment from a main financial news outlet.
We feel these issues are not of great importance if you are on the platform for copy trading. If you are trading on your own ideas then these features may hinder your experience. Ultimately this broker needs to be rated for the mission it was set up for, namely, copy trading. In this field, the broker offers a rewarding experience with all the tools you would need to manage your experience copy trading or sharing your trades with the community.
78% of retail investor accounts lose money when trading CFDs with this provider.