eToro Review

Is eToro Safe?

Yes. eToro Australia is regulated by ASIC, meaning that the Australian government’s oversight protects all Australian accounts. As of May 2020, the company has over 13 million customers and operates globally from Tel Aviv, London, and Cyprus’s offices. eToro has collected multiple awards for its innovative platform and worldwide recognition as a financial technology industry leader.

eToro’s global presence is confirmed by the multiple regulators who oversee the company group.  In Australia, eToro AUS Capital Pty Ltd has been regulated by ASIC (AFSL 491139) since 2017. European clients will be serviced by eToro Europe which regulated by CySec (Licence Number: 109/10) since 2010. UK clients will be assigned to eToro UK, which has been regulated by the FCA (Reference number 583263) since 2013.

While eToro is a well-regulated broker, clients should read trading advice from the eToro community and the copy trading functionality with caution.

Trading Conditions

Fundamentally, eToro’s trading conditions are broadly similar to other traditional market makers, with a single account type, no commission, and relatively wide spreads. Scalping is not permitted, a maximum leverage is 30:1 will be imposed on Australian clients as of March 2021, and USD is the only accepted base currency.

Account Types

eToro offers a demo account and a single live account – though there are reward tiers available at higher levels of equity via the eToro Club.

Demo Account – After opening an account with eToro, you will automatically receive the unlimited demo account with 100,000 USD – it is highly recommended that you use this extensively until you are comfortable with the platform.

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Live Account – This account gives you access to a free demo account, plus eToro’s exclusive promotions – generally deals and savings sent to users via email. The minimum deposit is 5o USD for Australian clients, down from 200 USD for all other countries in the world.  Professional retail accounts are available for those who pass a knowledge test and wave certain ESMA risk protections.

eToro Club and Tiers – Though there is only a single account type, with higher levels of equity you do gain access to the eToro Club – which operates a tier system: The higher your level of equity the more rewards and advantages you receive. 

Though some of the advantages gained at higher tiers are gift items (such as sports tickets, an eToro debit card or a Financial Times subscription) there are also benefits that will enhance your trading experience, such as free market analysis, access to the Trading Signals platform, free withdrawals and analyst consultations.

The minimum equity needed for access to each tier is as follows:

• Silver: 5,000 USD
• Gold: 10,000 USD
• Platinum: 25,000 USD
• Platinum+: 50,000 USD
• Diamond: 250,000 USD

Spreads and Leverage

eToro spreads on the AUDUSD are generally 1 pip but the spreads on the majority of the other majors are at 3 pips or wider. This is quite wide when compared to the rest of the industry, but it is almost impossible to compare eToro to other brokers. Leverage at eToro is up to 400:1.

Cryptocurrencies

One of the largest attractions to a broker like eToro is the large cryptocurrency CFD offering.  Cryptocurrency is the newest CFD asset market maker brokers are offering clients, and with 17 options for eToro traders, eToro leads the pack.  

eToro for Beginners

eToro’s platform was designed with beginner traders in mind and it is very easy to use.  It was the pioneer of a platform with an integrated social aspect and advice and potential opportunities from other eToro members is always available. Customer support operates 24/5, but chat and phone support are unavailable in lieu of a ticket system that serves their global audience. 

Educational Material

eToro hosts a short course title The Complete Guide to FinTech that teaches traders the basics of trading – especially trading on the eToro platform. This is more of an overview rather than an in-depth course and much of the content covers asset classes other than Forex.

eToro also hosts a blog which is updated daily with various trading tips, though these mainly focus on eToro’s platform. Webinars are held infrequently and tend to be more focused on market conditions than the rest of the educational material.

Analysis Material

Most analytical content comes from the members of the eToro community. The news feed is a central component of eToro’s trading platform – it is an unfiltered list of trading ideas and accompanying graphs. Be aware that this analysis is community-created content and should be viewed with deep scepticism.

Separately, eToro does publish a daily market update on the blog which briefly highlights the main fundamental factors likely to affect the coming trading day. 

Customer Support

Since 2017, eToro’s customer service has used a ticketing system for all client support requests. Be aware that there is no phone or chat support available, and the response times have been known to be painfully long, often exceeding 48 hours. Customers who deposit in excess 25,000 USD will received priority support, which is inexplicably longer than the rest of the trading industry.

eToro hosts a great help section with answers to a large number of frequently asked questions. eToro also operates a Customer Service Wall where you can post questions or help requests while you are waiting for your ticket to be opened.

Trading Platform

Trading at eToro is all based on social trading, traders can see what the most profitable trades are and follow successful traders online.

The eToro platform is browser-based, though a mobile app is available, and is available in Arabic, English, Chinese, French, German, Greek, Italian, Polish, Russian and Spanish.

Trading the AUDUSD pair on the eToro platform

To aid traders who commonly trade the same pairs, eToro’s platform gives traders a customisable dashboard overview of different currency pairs.  This customised layout gives traders a simple dashboard to see where opportunities lie.

My FX watchlist on eToro

Deposits and Withdrawals

eToro accepts the majority of payment options for deposits and withdrawals:

• Bank transfer
• Credit/Debit card
• Paypal
• Skrill
• Neteller
• Webmoney

Be aware that eToro only supports USD accounts and will charge a small conversion fee for non-USD deposits and withdrawals. For EUR to USD conversion this fee is 0.025% of the amount.

eToro charges a 5 USD withdrawal fee regardless of the size of the withdrawal. Withdrawals generally take 1-2 business days but can take up to 7 business days for credit and debit cards.

eToro only returns funds the same way they were deposited, so if you deposited from Neteller, you can only receive your withdrawal through Neteller.  This is to prevent money laundering and is standard in the industry.

Conclusion

eToro has been widely recognised for its innovative approach to trading – especially for its pioneering work in the social trading sphere. The eToro platform is completely unique and will take traders of all experience levels some time to get used to.

eToro focuses on creating a simple, fun and collaborative trading experience. It falls short when it comes to educational material and analysis; spreads are not competitive and fees are much higher than is usual, but obviously many traders are willing to overlook these flaws for the unique experience offered at eToro.