In the UK, Etoro is one of the most popular apps out there when it comes to finance and investments. Though you don’t have to be a UK resident to use the platform, it has become particularly popular here in Britain, with millions of users across the country.
Much of this is down to how easy it is to use, as most novice investors can have difficult getting to grips with stocks and funds. Fortunately, Etoro makes it all pretty easy to do, and within a few clicks on your device, you can put your money into a variety of different investments.
But, Etoro isn’t perfect, and there are some things you’ll want to think about if you plan of using the app yourself. So, I’m going to give you a quick rundown of the Etoro app, and how I’ve got on with using it over the past 6 months or so.
eToro App review
All in all, the eToro app is one of the easiest investment apps that you can use, so in terms of usability it’s definitely a good choice. It’ll allow you to easily invest in all of the big name publicly listed stocks, which is what the majority of people will be looking for when it comes to making investments online.
You’ll also get access to different asset classes to invest in too, with the ability to invest in commodities like gold and silver quite easily. For those with a higher risk threshold, you can also invest in cryptocurrencies using the eToro platform too; though this can give you better returns, it potentially comes with a higher probability to losing money too. There are a few things that stand out about eToro.
- Out of all the investment apps available, eToro is amongst the easiest for a beginner to get to grips with.
- No management fees for using the platform (which some other similar apps are now charging).
- Easy access to crypto and other investment opportunities.
- The copy trader feature is great, but it can be difficult to understand exactly where your money’s going at first.
- Although the withdrawal fee is pretty small at $5, it does mean that you’ll probably only want to withdraw larger balances.
Much of eToro is very similar to any other investing app out there, but there are a few things that separate it from the competition and may make it the right choice for your future finance plans.
One of the better features that you can take advantage of when using the Etoro app is their Copytrader feature. This essentially allows you to copy the exact trades of an expert trader without actually having to have any knowledge in day to day trading yourself. It’s perfect if you’re looking to get started with online stocks and trading but have literally no idea where to start, but you’ll have to do your due diligence to find the right trader for you.
Traders are graded by their risk level on a weekly basis, with a 1 meaning that the trader is extremely safe and risk avoiding. At the other end of the spectrum, if you’re more open to taking risks, then you could look at a trader with a risk level of 5 or above (with a maximum of 10), as the gains over the course of a year could be much greater. The traders have an incentive to gain more followers, as they’ll get a small commission when they have enough people copying their trades.
Most traders will have a minimum amount you can invest in them if you want to follow all of their trades, and it’s definitely worth reading through all of the different traders and their histories before you decide to go with one. You can usually see a traders history dating back several years, which will allow you to see their profit and loss percentages on a monthly basis across this time. For beginners, copying a trader is probably going to be less risky than trying to trade yourself (in my opinion!).
What can you invest in?
Etoro actually has a wide array of different things that you can invest in; it’s not just stocks. You’ll obviously want to do a little bit of research about the different investments you can make, but I’ll break down the most used options here briefly so you can get an idea.
If you’re looking to invest in any of the big companies globally, then Etoro will allow you to do so by buying stocks through their service. From Tesla to Tesco, you’ll have access to companies around the globe, and doing your own research here is very important if you want to ensure your asset is safe. You can see the historical performance of each stock and place an order instantly, which will then get added to your portfolio.
Most people are at least aware of cryptocurrencies and Bitcoin now, and actually, they’re easier to invest in than they’ve ever been. Whilst many people opt to use Coinbase or Binance if they want to invest in smaller cryptocurrencies, you can invest in all of the larger ones easily through the Etoro app. That means Bitcoin, Ethereum, Litecoin and most other major coins are available through the platform without having to worry about getting your own hard wallet.
One of the better choices if you’re not familiar with the stock market in general is to opt to invest in an entire index. Here, instead of investing in just one company, you’ll be investing in multiple different ones, which generally makes it a much safer move. In the UK we have the FTSE 100, which is an index of the top 100 companies in the country. Though the price of this doesn’t go up 10x like some stocks have over recent years, it has remained stable enough for the past few decades. You’ll likely also heard of the Dow Jones and the Nasdaq from the US too.
Like an index, investing in an ETF can be a way to reduce the risk you take by investing in just one stock alone. An ETF, which stands for Exchange Traded Fund, can be made up of different investments like stocks, commodities and market indexes. They differ from mutual funds in that an ETF is traded on the exchange, much like a stock, and can be bought and sold multiple times throughout a day (in comparison to a mutual fund, which is only traded once per day).
Commodities generally refers to products that can be bought, sold and traded in the commerce sector. This may sound confusing, but the reality is that you probably know many of the most popular commodities that people invest in; gold, silver and oil are some of the highest traded commodities that eToro will allow you to invest in.
Common Questions about eToro
What are the eToro fees?
There are no fees for setting up an eToro account and depositing your cash. However, there are a few other fees along the way you’ll need to think about – eToro charges a $5 fee for withdrawing to your bank account, and for European users, you’ll pay a fee to convert your currency in dollars, as the platform operates in USD.
How does eToro make money?
As well as the minimal fees above, eToro also makes money through their spread fees. Explained simply, there’s a minimal difference when you place an order to buy or sell using eToro on all investments. Usually this is pretty minimal and it’s factored into the price you see on the screen, but you’ll pay for example 0.1% more for the stock when buying, or sell it for 0.1% less when selling (it’s not always 0.1%, just an example!).
How long does an eToro withdrawal take?
From when you make your withdrawal, it can take anywhere between 4-10 days for it to come into your bank account. It’s usually processed within a day, though there’s an extra 3+ day period that you’ll need to wait until the funds actually appear in your account.
Is eToro safe?
eToro is as safe as any other regulated broker, as they have pretty strict requirements to meet. For the UK, this means they have to meet the FCA (Financial Services Register) requirements, and all of the deposited money in eToro is held in secure banks, so there’s really not too much to worry about.
In conclusion, eToro is still one of the best ways for beginners to get started with investing their money, and the eToro app is a big reason why this is the case. It’s very easy to navigate through, which is essential for any finance app on the market. If you combine this with a straightforward deposit and withdrawal process, there’s really no reason not to download the eToro app and get your investment portfolio started.