In our eToro Australia review, we look at one of the largest social trading platforms you can find. While being in operation for a decade and a half, it is not that eToro is gaining a lot of attention in the trading world, especially in Australia.
It offers lots of scope, low fees, and many features to make trading easier for the average person.
While increasingly popular, it doesn’t mean it is a safe bet using eToro for copy trading and expecting to make money easily. Investor accounts lose money easier than they can make money.
Our eToro review aims to dive under the surface and find out if eToro is a high risk, or it can be a way to make investments that are somewhat safeguarded, and you won’t find yourself losing money rapidly.
By the end of our review, you’ll see if eToro offers what you want from a trading platform.
Is eToro Legal in Australia?
eToro financial services were established in 2006. Since then, offices have opened in Sydney NSW, London, Cyprus, Tel Aviv, and others.
The goal was to come up with a trading platform appealing to most traders.
Currently, eToro is among the top shares and forex trading brokers and accepts traders from Australia and other countries.
Part of eToro’s positive reviews is their licensing and regulation falling under various government authorities like CySEC, FCA, and MiFID.
The eToro trading platform offers trading opportunities to more than 5 million users across 170 countries.
eToro holds a holds an Australian Financial Services License (AFSL), and valid Australian Securities and Investment Commission (ASIC) license, and as being Asic regulated, it allows them to legally operate in Australia. As the company is regulated by ASIC, they have strict guidelines to follow, and thus seen as safe to use, even if you have a high risk of losing money.
Is eToro Trustworthy?
If you ask is eToro safe to use, you can run through these items to see if they are among the best online broker Australia investors can use or avoid.
- eToro Aus Capital PTY Ltd is regulated: Not every platform is regulated. Regulations are there for investors’ protection. Only trade using regulated platforms.
- eToro is safe and secure: Check security signals browsers before making a trade. clients’ funds are secured in Tier 1 banks, while personal information is held under SSL encryption.
- eToro has 24-hour customer support: Customer service is available 24 hours a day on trading days.
- eToro serves real investors: eToro encourages users to share their real name and photo. It helps with transparency on the trading platform. Also, depositing clients need to follow a strict verification process.
- eToro makes risks obvious: Any form of trading, whether with traditional stockbroker trading or Contract for Difference (CFD) trading, has risk. eToro encourages safety measures to ensure all new users are aware they can lose money when trading CFDs with this provider, or any other.
Is eToro Good for Beginners?
eToro’s platform was designed to cater for beginners’ and is easy to use. It was the pioneer platform using the social aspect and advice with potential opportunities from other eToro members.
eToro offers a short course ‘The Complete Guide to FinTech’ and teaches traders basics of trading, and particularly using an account with eToro. It is more overview than an in-depth and covers asset classes other than Forex.
eToro also hosts a blog with various trading tips, with this are regular webinars, which are focused on market conditions than most of the other educational material.
Most analytical content is from the eToro community. The news feed is central on the eToro trading tools platform and has unfiltered lists of trading ideas with support information.
Customer service uses a ticketing system for all client support requests. You have no live chat or phone number to call.
Trading is based on social trading tools; traders see the most profitable trades and can follow these successful traders online.
The eToro platform is browser-based, although you can use a mobile app with numerous languages such as Arabic, English, Chinese, French, German, Greek, Italian, Polish, Russian and Spanish.
To aid traders trading same pairs, eToro offers a customisable dashboard overview of different currency pairs. This custom layout presents an easy-to-read dashboard to see potential opportunities.
Deposits and Withdrawals
eToro accepts numerous payment options for deposits or withdrawals:
- Bank transfer, Credit card or Debit card
- PayPal, Skrill, Neteller and Webmoney
Note: eToro only supports USD accounts, thus charging a nominal conversion fee for non-USD deposits and withdrawals.
Besides conversion, eToro charges a $5 USD withdrawal fee no matter on the size of your withdrawal. Withdrawals typically take 1-2 business days although if on credit or debit cards, they can take up to 7 business days.
eToro will return funds in the manner of the initial deposit. So, for example, your initial deposit was from PayPal, you will only receive withdrawals via PayPal. It may appear cumbersome, yet it helps prevent money laundering and is an industry-standard.
Trading conditions are like others, with a single account type, no commission, and relatively wide spreads. eToro doesn’t allow scalping, and the maximum leverage is 400:1. An eToro account will also use the base currency of USD.
eToro offers a demo account and a single live account. You can however go through reward tiers once you have higher levels of equity via the eToro Club.
Demo Account: once you open an account on eToro. You automatically receive an unlimited demo account containing 100,000 USD to practice with. The recommendation is to use this extensively to learn all the ins and outs of the platform.
Live Account: With this, you have access to the demo, plus eToro’s exclusive promotions such as sent via email. An initial deposit is $200 USD.
Club and Tiers: You only have one account, yet with higher equity, you gain access to the eToro Club and the tier system: The higher the equity, the more rewards, and advantages are on offer.
Can You Actually Make Money on eToro?
Before looking at more about your trading account, you need to know the following:
eToro is a multi-asset platform and offers investors the chance to invest in stocks and crypto assets, with these is CFD trading.
CFD trading is complex, and offers a high risk of losing money rapidly because of leverage. Figures show around 75% of retail investor accounts lose money should they trade CFDs with this provider. Before committing, check if you fully understand the high risk of losing money with CFDs.
In certain scenarios, you can set stop loss values on your trading account for a particular investment to protect your money.
Create Your Account
Before trading, you need to sign up for an account. It’s free to sign up, and you receive a confirmation email. Click the link and account is verified.
If you wish to trade right away, click “Deposit Funds” and input your initial deposit.
Once you do this, you can begin trading. Click the “Trade Markets” and you can choose trading markets from the trading platform.
As a social trading platform, eToro provides necessary information on trades (Bitcoin in this example), and chat rooms where users can discuss trades.
If you wish to trade, click the blue “Trade” button in the top right corner.
You’ll see options to Buy or Sell BTC. It also lets you decide to trade in USD or BTC directly.
- Standard Brokerage Fee: $0 USD
- No Management Fees
- No Rollover Fees
- No Ticket Fees
- Inactivity Fee: $10 per month if there’s been no login for 12 months
- Conversion Fees from 50 Pips
Trading Crypto Pairs
Trading pairs will be much the same with any online Forex broker, and much the same as this example for crypto pairs on USD based markets. .
On the crypto dashboard, you’ll see two drop-down menus on your navigation bar.
If you want to engage in a crypto-crypto trade, you’d have to select the “Crypto Crosses” option. This will take you to the available cryptocurrency trading pairs. At the time of writing this, they are:
Social Trading & Copy Trading
Social trading is ideal for users who lack trading experience. You can copy trades of more experienced online brokers in a quick and easy way.
On the right-side, you have “Copy People”. You see a list of traders appear, and showing 12-month returns. eToro displays the most successful online brokers and traders first.
You can see their current portfolio, and recommendations should you wish to copy them. Click the blue “Copy” button, and you’re set.
When you copy, each trade they make is simultaneously opened inside your account as well. It also closes when the online brokers close their trading accounts on that investment.
Trades are proportional to the percentage (%) of your account’s funds that you allocate, yet you receive the same rate of return.
Finding reliable traders on eToro may not be as straightforward as it appears, and you do need to know what to look for and what to stay away from.