eToro is an investment platform that allows investors to trade stocks, ETFs, cryptocurrencies, commodities and more. In the US, only stocks and crypto assets are available.
As a “social trading” platform, eToro enables investors to easily copy trades of other top traders on the platform.
Whether you want to get involved with Bitcoin investing or learn strategies from experienced traders, eToro is a great way to diversify your investments and expand your knowledge.
- More than 70 cryptocurrencies available for trading
- Trade Fractional Shares of Stocks and ETFs Commission-Free
- Users can copy top traders’ trades or traders’ portfolios.
- 0% commission on stocks and 1% commission on cryptocurrencies
Who is eToro?
eToro (eToro USA Ltd.) is a cryptocurrency social trading platform. Its co-founder and CEO is Yoni Assia. The company was founded in 2007 and is located in Hoboken, NJ. It has registered offices in Cyprus, Israel and the United Kingdom. eToro is a private company. Its last funding round was a $50 million Series E.
What do they offer?
We will be reviewing eToro’s US platform. Until recently, U.S. clients were limited to trading cryptocurrencies on eToro, but the company recently announced that it has expanded its U.S. offering to include stocks and ETFs.
Before you can start using eToro, you must verify your account. Verification requires uploading a Proof of Identity (POI) and Proof of Address (POA). You can upload files using the eToro mobile app.
copy trader
A big draw of eToro is its ability to copy trades in real time. CopyTrader allows you to select a specific trader and copy all their trades. This means that the platform will automatically trade the same trades as the traders you copied.
You can set the amount of funds allocated to each CopyTrader. In addition, you can also set a stop loss to control the drawdown. Any position opened with CopyTrader will be opened for you instantly.
investment portfolio
Investment Portfolio works much like CopyTrader, except you can copy entire trader portfolios instead of just one at a time. eToro allows traders to invest in two different types of portfolios:
Top Trader Portfolios: Copy the portfolios of the top performing and most sustainable traders
Market Portfolio: Invest in a portfolio that bundles various investments together.
These portfolios are managed through periodic rebalancing. They can be an effective way to diversify your cryptocurrency investments.
risk score
When viewing traders to copy on eToro, you can see how they are performing. This includes monthly historical performance and drawdown information.
Another component of their performance is eToro’s Risk Score. Each trader is assigned a risk score from 1-10 – 1 being minimal risk and 10 being likely to blow up an account.
Supported cryptocurrencies
Over time, eToro has been continuously adding to its list of assets. It now supports over 70 cryptocurrencies, including 17 of the most popular coins. You can check out the full list of its supported coins here.
You can choose to sell your assets within a few months, but this feature will eventually disappear as well. So the bottom line is, if you’re looking to invest or trade Cardano or TRON, you’ll probably want to choose a different cryptocurrency exchange.
Partial stock investing in stocks and ETFs
While eToro’s EU clients have been able to trade stocks and ETFs for quite some time, until recently this feature was not available in the US.
U.S. clients can now get commission-free investing in stocks and ETFs, and can invest in fractions as low as $10. Start here.
eToro Currency Crypto Wallet
eToro’s crypto wallet supports over 120 cryptocurrencies and allows users to change over 500 cryptocurrency pairs. In addition, it includes an “unlost private key” feature that can help you recover lost funds.
In the US, this is limited to just over 70 cryptocurrencies.
Deposits and Withdrawals
eToro places a 7-day freeze on deposits, which means that funds cannot be used for 7 days. Withdrawals have one day. After a pause, transfers may take an additional 3 days.
Oddly enough, it can take up to 7 days for incoming funds to be received, making it more cost-effective to simply transfer via ACH. There is a minimum withdrawal of $50 and your account must be in good standing (i.e. not under review) to complete a withdrawal.
Is there any fee?
Yes. While eToro does not charge a fixed commission on trades, they do charge commissions through the spread.
All cryptocurrencies now have a 1.00% spread. You can check the spreads for each cryptocurrency here.
Customers who need to convert from another currency to U.S. dollars may be charged more than listed for U.S. customers. This is because eToro’s base currency is the USD. After depositing, it converts any other currency to USD. Conversion fees start from 50 points.
If you transfer cryptocurrencies from eToro’s investment platform to your eToro crypto wallet, you will be charged a 0.50% cryptocurrency transfer fee. Non-U.S. dollar withdrawals will incur a $5 fee with a minimum withdrawal of $30.
eToro Bonuses and Promotions
Now, until December 31, 2023, eToro is offering a $10 credit if you deposit and trade $100 worth of crypto assets. This offer is only available to US users.
How do I open an account?
You can open an account at https://www.etoro.com. After opening an account, you will need to verify your identity and proof of address before you can start trading. eToro accepts the following types of identification:
- Valid (not expired) U.S. passport
- A valid (not expired) driver’s license
- A valid (not expired) state ID
Is my money safe?
Cash deposits into eToro are FDIC insured up to $250,000, but cryptocurrency deposits are not insured. Thankfully, eToro is a secure website and app that has never been successfully hacked at the time of writing. They also offer two-factor authentication for users who want to add an extra layer of security to their accounts.
Is it worth it?
If you’re interested in investing in cryptocurrencies, eToro has a unique approach that lets you invest through your interactions with other people. Being able to follow top (on eToro platform) traders and have the platform automatically trade the same trades is an interesting concept.
Remember, just because a trader has performed well in the past doesn’t mean they will continue to do so in the future. However, you can set withdrawal limits and the amount of risk you are willing to take. Using the CopyPortfolio feature is another way to spread risk.
Additionally, you can connect eToro with their own tracker Delta and manage all your accounts in one place.
If you are unsure about eToro, take it for a test drive. Every user gets $100,000 in virtual currency that you can use to try out CopyTrader. Be sure to compare eToro’s options and fees with other cryptocurrency exchanges like Coinbase, Binance, and Robinhood.
eToro FAQs
Here are some common questions we hear about eToro:
Does eToro support Shiba?
Yes, eToro has added support for Shiba Inu in July 2021.
Can you invest in stocks on eToro?
Yes, you can invest in fractional stocks and ETFs starting at $10.
Can you trade options on eToro?
No, the eToro platform does not currently support options trading.
Can you trade CFDs on eToro?
Yes, the company’s CFD platform is regulated and offers up to 30x leverage. However, this does not apply to US users.
Disclaimers
University Investors will be compensated if you access products or services offered by eToro USA LLC and/or eToro USA Securities Inc., as applicable. eToro USA LLC does not offer CFDs and makes no representations and assumes no responsibility for the accuracy or completeness of the content of this publication, which has been compiled by our partners using publicly available non-entity specific information about eToro.
eToro USA LLC; investments are subject to market risk, including possible loss of principal. This is not meant to be tax advice or financial advice of any kind. The above information is collected from online tax forums. If you have questions about filing your tax return, the forms to use, or what is/isn’t taxable, consult a CPA or attorney. eToro is not a tax advisor.
This content promotes virtual cryptocurrency investments in the EU (by eToro Europe Ltd. and eToro UK Ltd.) and the United States (by eToro USA LLC); it is highly volatile, unregulated in most EU countries, has no EU protection and Not regulated by the EU regulatory framework. Investments are subject to market risk, including loss of principal. This is not meant to be tax advice or financial advice of any kind. If you have questions about filing your tax return, the forms to use, or what is/isn’t taxable, consult a CPA or attorney. eToro is not a tax advisor.
