eToro is one of the top social trading and multi-asset brokerages. Its platform offers a variety of assets, including stocks, exchange-traded funds (ETFs), and cryptocurrencies.
eToro is a social trading platform that aims to educate users about risk management. It also stores client funds in Tier 1 banks for safety.
What is etoro?
eToro is a social investing platform that allows you to copy the trades of other investors. Its unique feature, CopyTrader, automatically mirrors other traders’ movements, with the option to set a stop-loss order. You can choose from a list of famous investors or follow a user’s trading history to determine which trader to copy. Unlike other social investing platforms, eToro doesn’t charge fees or commissions when copying another trader.
You can buy crypto assets with eToro, although direct crypto-to-crypto trading isn’t available for U.S. residents. In addition to stocks and ETFs, eToro offers 25 different cryptocurrencies to trade, including Bitcoin, Ethereum, Litecoin, and more. eToro also provides a digital wallet to store your coins, available on iOS and Android. However, eToro notes that crypto transfers are one-way, which means you can’t transfer funds from your eToro account to your wallet. You can also convert crypto to other cryptocurrencies through the eToro Money app, but there’s a 1% fee.
How does etoro work?
The best way to describe eToro is to say it’s like an online social network for investors. You can browse and engage with a community of traders with varying experience and expertise. For example, you can join a private trading group called the eToro Club and receive support from a dedicated team. Various educational offerings are available to help you get started and stay on top of your game. Among these are webinars, workshops, and an extensive library of trading articles and resources. For example, eToro has a dedicated crypto section in the learning center, which includes a comprehensive tutorial section and a glossary of terms.
Is Etoro safe?
As a social trading platform, eToro is regulated by FINRA and the SEC, and your assets are protected through SIPC. However, crypto and forex trading have a high degree of risk. You should always read the fine print when investing and use leverage responsibly.
eToro’s CopyTrader feature allows you to follow a top-rated trader and have the platform automatically mirror their moves, with a limit on drawdowns and risk. But it’s important to research any eToro trader you plan to copy and verify their annual return.
Crypto trading has some risks, including the possibility of losses due to high volatility and a broker’s decision to shut down its operations. It would be best if you also were careful about staking products offered by centralized businesses, as regulators can scrutinize them. Finally, have a backup strategy for your cryptocurrency investments if an exchange or eToro decides to un-stake them.