The eToro platform is one of the most popular social trading platforms in the world, as it attracts millions of traders of all levels, and it also provides investment solutions in all assets, even crypto.
Unfortunately, the reputation of the platform is exploited by some marketers, by presenting it to the public as a machine for making easy and quick profits.
This trick deceives inexperienced people in trading and investing, but this does not harm the company's credibility in any way. Our article today will try to impartially address the eToro platform with a review of its strengths and weaknesses, and we will also review the most important features that distinguish it from the rest of the competitors .
We will also discuss the most important unethical methods that you use to make profits, in order to provide a clear idea of the mechanism of operation of this company.
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| eToro Explained and Review |
eToro Explained and Review: Is the eToro Trading Platform Reliable or a Scam?
The site team explained and reviewed the eToro platform, identifying the advantages and disadvantages, in order to help beginners achieve profits from trading on the eToro platform and minimize risks.
Explanation of the eToro platform for beginners
eToro is a social trading platform that has been providing its services since 2007 under the name RetailFX, which will later change to eToro, the company's current name.
As of the date of writing this article, eToro has more than 30 million users spread across more than 140 countries, and the company has more than 1,700 employees.
The eToro platform provides the possibility of trading in various financial markets, from stocks to digital currencies , and also supports copy trading strategies to help investors achieve returns with minimal effort.
I would like to point out that eToro is not a trading broker at all, contrary to what is being advertised. eToro is a CFD trading platform that does not send your trades to an exchange like traditional brokers, all trades on eToro are handled OTC.
The eToro platform is a hybrid market maker, or the so-called Hybrid Market Maker Broker, as the platform provides its own liquidity and sets its own prices based on market movements.
When you open a trade on eToro, you are not actually buying or selling an actual asset, but only buying and selling CFDs. This makes the eToro platform suitable for beginners to enter the world of trading and understand the basics, but it remains an unsuitable option for professionals who need advanced features and customizations.
If you have enough experience, it is better to trade with one of the trusted forex brokersTo secure direct access to the currency market in a live manner. This will ensure that you benefit from the huge volume of liquidity and pay lower spreads for trades, thus reducing the cost of fees and commissions.
The most important trading mechanisms on the eToro platform
Let's get to know the most important thing that distinguishes the eToro platform compared to competitors, and how it is possible to make profits from trading on it without risk.
CopyTrader feature
CopyTrader is the most unique mechanism provided by the eToro platform, as it allows the ability to copy the successful strategies of professional traders in exchange for paying them a percentage of the profits.
The CopyTrader interface provides you with all the necessary information to check the credibility of the trader, such as the number of his transactions, the archive of his deals, the traders' assessments of his strategies and the amount of profits achieved during any given period.
All this publicly available information allows you to bet your money with the right person and minimize your risk. To activate the CopyTrader feature, a minimum deposit of $200 is required for individuals, but I advise you to use it in moderation and not rely on it like a fool in search of easy profits.
All successful traders who share their knowledge on social trading platforms go through the same life cycle.
First, achieve some strong deals and maintain the same performance for a certain period in order to build credibility. Secondly, after obtaining the confidence of the community of traders, negotiation is made with the trading platforms to obtain funds under the table in return for persuading the followers to invest large sums and enter their money into losing deals.
The platforms agree to pay generously to these “scammers” , because the majority will lose significant sums from their investment portfolio, and thus the platform will receive good fees from new deposits.
Create smart investment portfolios
If you want to establish an investment portfolio, you are in the right place, because the eToro platform provides a smart portfolio feature that helps build a diversified investment portfolio that includes promising stocks from all economic sectors.
You can also create a virtual investment portfolio with a value of up to $100,000 that includes both stocks and digital currencies, in order to help you test trading strategies and develop your ability to efficiently manage the investment portfolio .
Personally, I like this feature, but it remains a psychological influence that the company uses to raise its credibility with new traders, rather than a way to help traders make a good profit. Remember that the company will make good money keeping you on the platform and innovating on a regular basis, so they will not hesitate to give you a false feeling that you have become a mature investor.
My experience with eToro remains good in any case, especially since it is professional and does not impose an exorbitant minimum deposit. It also helped me to interact more with traders and test new strategies, and it also played a big role in my passion for trading.
The eToro platform remains a good trading platform for beginners to gain the necessary experience, and once you master the field, you will find yourself forced to move to trading directly with major brokers in search of paying lower fees and taking advantage of larger margins on deals.
Features
- A trading platform suitable for beginners
- Support trading different assets
- Copy the strategies of professional traders
- good reputation in the market
- Demo account
Defects
- Trading fees are relatively high
- Not a real broker
- Limited access to assets
- You cannot deposit in digital currencies
- It does not support investing in some assets such as mutual funds and bonds
Is eToro a scam company? How do you avoid losing your money?
While investigating the eToro social trading platform, the site team came across complaints from thousands of Arab clients about losing money or claiming to be subjected to fraudulent operations on the part of the platform.
In conjunction with these complaints, eToro has thousands of good reviews on Trustpilot and professional trading forums. eToro is a licensed and trusted social trading company that manages the trading accounts of millions of people around the world. This matter alone is not sufficient to make the final judgment, but it is natural to investigate the credibility of the platform.
The first question that will come to mind is how does eToro make profits? Simply by charging a commission on all trades within the platform. eToro plays the role of the broker, so it makes profits whether the trader makes profits or losses . The most important commonality of people who lose money quickly on the platform is:
- Lack of trading experience.
- Believing in the illusion of getting rich quick by rushing into deals with the expectation of impossible returns.
- Blind trust in indicator providers.
- Don't put all your eggs in one basket by copying from one trader.
There is a fundamental difference in interests, as the trader seeks to enter into profitable deals only, while the broker eToro aims for the trader to make the maximum possible number of trades in order to accumulate commissions.
This legitimate right to make profits is not enough to call the company a fraud, but it is an incentive to deal with caution with the platform's recommendations. eToro has other strategies to achieve profits in an unethical way, but remains legal, and is not harmed by the ordinary trader who does not have a large capital.
How do I avoid losing money while trading on the eToro platform? In short, don't rely on copy strategies to make quick profits. Most of the professional traders “signal providers” engage in fraud, in order to push traders to enter into losing deals in exchange for commissions paid under the table.
Also, do not trust too much the advice of the account manager, whose first and last concern will be to persuade you to deposit as much money as possible within the platform, and not to help you enter into profitable deals.
Finally, patience, as you should not rush after achieving quick profits, but rather focus on long-term investment. Success in investing is more related to studying the market, patience and setting realistic goals. We invite you to read our article about the most important investment mistakes in the stock market that must be avoided to achieve satisfactory results.
Frequently asked questions:
Now we pass to answer the most important questions that traders have about the platform while providing answers as accurate and concise as possible.
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| Frequently asked questions |
Can I trade cryptocurrency with Etoro?
Yes, you can trade digital currencies using the eToro platform, but I do not advise you to do so, especially when speculating. Crypto trading fees on eToro are high compared to the commissions of other cryptocurrency trading platforms such as Binance and Kraken (the site team has already touched on the subject in a previous article).
It is preferable to trade cryptocurrencies with eToro only in one case, which is when holding cryptocurrencies for a long time. This will help you avoid fees. What distinguishes the eToro platform is that it supports deposits and withdrawals in dollars directly, unlike other exchanges that only support digital currencies and P2P transfers, which complicates withdrawals and makes them high-risk.
Does eToro offer Islamic accounts?
Yes, Etoro offers its clients the option to open an Islamic trading account without interest, as it supports 24-hour trading with immediate currency exchange and without imposing any interest on deals.
The Islamic account on the eToro platform also provides leverage without interest , and does not impose any fees for managing the account, as it suffices to achieve a commission from the margin of the difference between the buying and selling prices.
Does etoro offer deposit bonus?
eToro offers a $250 bonus for deposits of $5,000 or more. Also, consecutive deposits of more than $5,000 will give you access to the eToro Club, which offers additional services such as training and indicators depending on the type of membership.
Is the eToro platform safe and regulated?
eToro is a safe and reliable platform, and it has been licensed by the Securities and Exchange Commission in Cyprus since its establishment in 2007.
Also, eToro has a branch in Britain that is licensed and regulated by the British Financial Conduct Authority. FCA. The eToro platform has not recorded any huge breaches of its customers or its database, as it adopts the latest approved protection standards to serve customers in the best conditions. Currently, eToro is one of the most trusted and popular social trading platforms in all countries of the world.
Is eToro Israeli?
Yes, the platform is 100% Israeli. eToro was established in 2007 by two Israeli partners, Ronen Assia and David Ring. The company's headquarters is located in Tel Aviv, the capital of Israel. Also, eToro is registered and licensed in Cyprus for tax reasons, and has official offices in Cyprus, Australia, the United Kingdom and the United States of America.
Conclusion:
The eToro platform is ideal if you are looking to learn the basics of trading, as it is easy to use and allows you to trade in all different assets from stocks to crypto.
It should be noted that it is still superior for the average and professional, especially if you compare it with reliable forex brokers such as Forex.com .
eToro is suitable for beginners as it provides the CopyTrading feature to copy successful trading strategies, and provides a social space to help interact and learn from professionals. If you are looking to get rich quick, you are in the wrong place, because trading stocks and currencies is not a secret recipe for achieving wealth or becoming a millionaire..
Trading requires learning and practice to gain experience, before having the ability to turn it into a stable and sustainable source of income. Now it is your turn to share your experience with eToro or other social trading platforms, and the site team is ready to answer your questions.