eToro.com Review

Editor’s Rating: 4.9/5
reviewed June 13, 2015

eToro is a great choice for those interested in forex trading. It benefits both beginners and experts alike. It’s a great way to learn about forex trading from more advanced investing experts.

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When it comes to forex and commodities trading, you have a lot of great options to choose from. But few, if any, online forex brokers are anything like eToro.

Indeed, eToro.com is one of the first companies of its kind. Founded by a Cyprus-based forex and commodities trading company, the social trading website now has over 2 million social users in countries around the world. eToro itself claims to have revolutionized the way that social trading is performed. What they have done in this field has been compared to what Facebook and Twitter have done in social media.

eToro.com - World's largest social trading and investment network

Not only has eToro managed to attract a very large number of active users from around the globe, it has also received critical acclaim for its social networking and trader communication features. So what’s the deal? Is eToro.com worth the type?

Below we break down the details behind this new social trading website for those that are interested in learning more or signing up.

What is Social Trading?

A quick note on social trading is necessary before our in-depth review of eToro.com.

One of the newest, most exciting ways to access financial markets, social trading links traders from around the world into one big network. In fact, this is the key to its success. Traders link up with each other, using each other’s skills to make smarter trades. This deep base of collected knowledge helps you take your trading to all new levels, even if you’re a forex beginner.

eToro has taken this idea to heart, expanding it and fine-tuning it. The end product is one of the most innovative social trading platforms around. The ability to copy the strategy’s of other traders as well as the wealth of educational content provided is what helps set eToro.com apart from the rest.

About eToro.com

Founded in 2006 as RetailFX by brothers Yoni and Ronen Assia along with David Ring, eToro’s original mission was to make the world of financial assessment accessible to everyone, including newcomers.

Available as a download-only product, the original financial trading platform incorporated graphic trading visualizations to make trading more entertaining and easier to understand. The platform conceptualized the process of trading as a race between currencies.

Soon after, eToro expanded its product line with the launch of a professional trading application. Known as “Expert Mode,” this platform was aimed at more experienced traders. Another product, a web based trading platform known as “WebTrader,” was launched simultaneously.

eToro.com - World's largest social trading and investment network

However, the eToro.com as we know it today didn’t begin to show its true colors until 2010. At this time, the company launched their eToro OpenBook social investment platform. The OpenBook, which is still in use today, gives traders the ability to view, follow, and copy the actions of other traders using the network. A “Copy-Trading” feature was launched at the same time to make such trades even easier to perform. The mobile version of the application was launched later that year.

The headquarters for eToro.com are currently located in Tel Aviv, Israel. They are also present in one form of another in the United Kingdom, Cyprus, and Australia. Though not yet available in every country, eToro is quickly expanding.

eToro.com - World's largest social trading and investment network

eToro.com Platforms

eToro currently offers three primary trading platforms. These include their eToro WebTrader, eToro OpenBook, and eToro Mobile Trading Platform. Each of these three platforms is discussed in greater detail below.

eToro WebTrader
eToro.com - World's largest social trading and investment network

The eToro WebTrader is the most popular trading platform offered by eToro.com. It gives traders the ability to trade from anywhere in the world that there is Internet access. The platform is also designed to enhance the user’s trading experience, making it as simple and as straightforward a process as possible.

The WebTrader interface is likewise simple and straightforward. Its clean and sleek design makes it very intuitive to use. It doesn’t take long to learn your way around the eToro WebTrader.

One key feature to note about the WebTrader platform is its chat function. This small feature sets eToro apart from most other forex broker trading platforms. It allows you to interact with other traders in real time. You can also choose to remain “invisible” if you do not want other traders to contact you.

eToro OpenBook
eToro.com - World's largest social trading and investment network

The eToro OpenBook is perhaps the company’s greatest effort to incorporate social media into the forex trading environment so far. The platform allows you to see exactly what other traders are doing in real time. This then allows you to see what specific strategies and techniques are currently working.

Perhaps the biggest benefit of OpenBook is its use as an educational tool for new traders. Beginners are able to get insights into trading strategies by observing the actions of other traders. The ability to see how and why these moves are made considerably shortens the learning curve.

OpenBook uses many of the same actions as Facebook to make the trading experience more effective and accessible. For instance, you can “follow” other traders that you are interested in. You can also “copy” trades made by others. As “copy” implies, this function essentially allows you to make the same exact trade with just the click of a button.

eToro Mobile Trading App

The eToro Mobile Trading App is the last of the three forex trading platforms offered by eToro.com. It gives you the ability to stay up to date and connected on your smartphone or tablet.

eToro.com - World's largest social trading and investment network

The Mobile Trader allows you to access both the WebTrader and OpenBook networks. It does not come with a different network of its own. The eToro Mobile Trader app is available on both Android and iOS devices.

eToro.com - World's largest social trading and investment network

eToro.com Accounts

eToro offers four main account types that span their three trading platforms. These include the Bronze Trading Account (Basic Level), Silver Trading Account (Intermediate Level), Gold trading Account (Advance Level), and VIP Trading Account (Professional Level).

eToro.com - World's largest social trading and investment network

Each account type caters to a different type of client. Most beginners choose the Bronze account. This account is for those depositing under $1,000, though it does require a $250 minimum deposit. The Bronze account also has no annual fees and trading starts at just 3 pips for EUR/USD trading.

While the Bronze account is for those that want to deposit under $1,000, each additional level is for traders wishing to deposit increasing amounts. At the highest end of the scale is the VIP account, which requires a deposit of at least $20,000.

eToro.com also offers an additional type of trading account alongside the four mentioned above. It is a special Islamic trading account for Muslim traders that want to trade Forex while abiding by the no Riba principle.

Top Features of eToro.com

eToro offers a number of different features to enhance the trading experience and make trading on their platform easier and more effective. A handful of the most important top features to make note of are outlined below.

Account and Portfolio Features

eToro.com provides account history reports, downloadable account statements, and gain/loss reporting to help you with bookkeeping and tax planning. Real-time updates on your current trading positions, open orders, and account balance help you track exactly what you’re doing at all times.

Cross Currency Pairs

eToro.com allows you to trade in several cross currency pairs. These include the following:

    eToro.com - World's largest social trading and investment network
  • AUD/JPY (Australian Dollar vs. Japanese Yen)
  • CAD/JPY (Canadian Dollar vs. Japanese Yen)
  • CHF/JPY (Swiss Franc vs. Japanese Yen)
  • EUR/AUD (Euro vs. Australian Dollar)
  • EUR/CHF (Euro vs. Swiss Franc)
  • EUR/GBP (Euro vs. British Pound)
  • EUR/JPY (Euro vs. Japanese Yen)
Major Currency Pairs

eToro.com also allows you to trade in several major currency pairs. These include the following:

  • AUD/USD (Australian Dollar vs. US Dollar)
  • EUR/USD (Euro vs. US Dollar)
  • GBP/USD (British Pound vs. US Dollar)
  • NZD/USD (New Zealand Dollar vs. US Dollar)
  • USD/CAD (US Dollar vs. Canadian Dollar)
  • USD/CHF (US Dollar vs. Swiss Franc)
  • USD/JPY (US Dollar vs. Japanese Yen)
Trading Technology

A number of the features provided by eToro.com relate to the network’s trading technology. These include personalized alerts, automated trading, and real-time price quotes.

Trading Education

It is often said that the “e” in eToro stands for “easy,” and if the number of trading resources they provide is any indication, then this definitely could be correct. eToro.com provides charts for you to conduct research on investment products, market commentary from outside experts, and daily market news and updates from third party services.

eToro.com also offers a number of educational resources, many specifically aimed at beginning traders. These include trading and investment courses, training videos, and webinars. A glossary of important investment terms and the online trader community also make learning forex trading with eToro easy.

eToro.com - World's largest social trading and investment network

eToro.com Pricing

The services offered by eToro are reasonably priced. Joining is free and commissions are not charged on fees or trades. Indeed, the company’s only revenue comes from the spreads. A spread is the difference between the Ask and Bid price on what you’re trading.

In June of 2014, eToro began to charge overnight rollover fees/credits. Before this date, their only additional charges were their carryover and weekend fees. The eToro website provides a comprehensive, up-to-date list of all their spreads as well as their overnight rollover fees and credits.

eToro.com - World's largest social trading and investment network

Looking at this list on eToro.com, you might note that eToro charges slightly higher on the spreads than other online brokers. However, with this slightly elevated price comes increased performance.

For instance, slippage is extremely low when you copy the trade of another investor. This means that the difference between the price the investor traded at and the price you get when you trade is extremely small. Around 90% or more of copied trades were executed at the same price. As for those that weren’t, slippage only amounted to a maximum of 1 pip.

You’ll likely also notice that eToro’s overnight rollover fees are slightly higher on average than most other online brokers. If you are using eToro.com, this is something to keep in mind, especially because many traders leave their trades open for weeks and months at a time. It is essential to monitor open trades closely to avoid racking up rollover fees.

Pros of Using eToro.com

Now that yo+u have a solid understanding of the various platforms, account types, and features of eToro, as well as basic pricing information, it is time to discuss just how well all of these factors perform overall. Below are the top benefits of using eToro.com broken down in detail.

[+] Innovative

[+] Uncomplicated

eToro.com - World's largest social trading and investment network

[+] Free Practice Accounts

[+] Copy Trader Function

[+] 24/7 Support

[+] Educational Resources

[+] Built-In Risk Management

[+] Introductory Offers

[+] Well-Funded

Cons of Using eToro.com

There is no such thing as perfection. And despite all of its great benefits, eToro.com also comes with its fair share of negatives. These include the following.

[+] High Trading Spreads

[+] Limited Currency Pairs

[+] Lack of High-Powered Tools

[+] Non-Customizable Platform

[+] Unavailable in the United States

eToro.com Customer Support

eToro.com - World's largest social trading and investment network

When using eToro.com as your forex trading home base, you have immediate access to some of the best customer service in the business. Indeed, eToro possibly has the absolute best live customer support of any online forex broker around.

For starters, eToro offers 24/7 live customer support. You can contact company representatives through live chat, email, or on the phone. All of their customer service representatives are friendly, professional, and incredibly knowledgeable. If you have a question or concern, they’ll be able to help you out in a jiffy.

Since eToro serves so many different areas of the world, they have a number of support lines dedicated to their international customers. Better yet, they employ a diverse customer service staff that can provide assistance in a number of different languages.

Finally, it is important to point out that most eToro traders never need to seek out live customer support. The eToro Gurus along with the company’s vast and easily accessible database of information makes finding the answer to your questions on your own very easy. The eToroPedia section of the website is particularly helpful.

Final Thoughts on eToro.com

eToro.com - World's largest social trading and investment network

eToro is a great choice for those interested in forex trading. It benefits both beginners and experts alike. However, much of the company’s focus is placed on beginning traders as well as those that are interested in social networking while trading. That’s not to say that experienced traders won’t love the service though.

Simply put, anyone that genuinely enjoys both social networking and the investing process will love eToro. It’s a great way to learn about forex trading from more advanced investing experts. eToro gives you the tools that you need to become a successful forex trader yourself or to take your current forex trading to the next level.

eToro.com - World's largest social trading and investment network
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