If you’re weighing up your options between competing investing apps, you will have come across eToro before. With over 30m global clients, eToro is one of the largest stockbrokers in the world and even has more clients than the first app that most associate with stock trading, Robinhood, which reported having only 22 million users in 2022.
In this guide, we’ll assess how good eToro is for trading. We won’t focus on the ‘buy and hold’ long-term investing approach. Instead, we’ll look at trade execution, fees, interface, data and other factors that will make the difference for day traders, swing traders or other frequent traders.
Let’s dive straight into the core offering of the eToro app: stock and ETF trading.
eToro trades are confirmed in less than a second, and while eToro has not publicly confirmed settlement periods for UK investors, its US firm follows a ‘T+2’ settlement period, meaning that a stock trade is fully settled within two days of execution.
Your portfolio will experience the financial rewards or losses of holding a stock from the point of trade confirmation, not the later settlement date. This means that you can trade on news or other fast-moving events and capture price movements in an instant from placing a trade.
eToro has grown quickly through a very competitive offering for retail traders of all sizes. They charge no fees to open an account and levy no annual or quarterly’ management fee’, also known as a platform fee, which is commonly charged by large traditional stockbrokers in the UK.
Marketing for eToro usually focuses on the industry-breaking headline that eToro charges a 0% commission on real stocks. This means that no fee is directly charged when you buy or sell a stock.
You will still pay the market bid/ask spread, being the unfavourable price gap between the buy and sell price, but this is an unavoidable aspect of trading on a live market. This spread may create some revenue for eToro as a business.
Other fees that might apply in certain circumstances include FX conversion fees (which would be incurred when buying USD-denominated securities with a GBP cash balance). Withdrawal fees have changed recently and are $0 for UK users at the time of writing. Other fees may apply.
Please note: Fees and features referred to in this article apply to the eToro offering for UK retail investors. Fees and investments offered may vary in other locations. eToro does not operate in every country.
Trading on eToro as a beginner isn’t as daunting as you might be expecting because eToro’s interface loosely resembles a social media platform.
When you open the app, you’ll see the latest news and posts from other users alongside colourful portfolio information.
eToro differentiates itself from other apps with the label’ social trading platform’, which refers to the online community of traders sharing analysis, tips and trade information alongside a robust way to actually show each trader’s financial return.
While this can lend too much credibility to a handful of lucky traders who just happened to be in the right place at the right time, it’s very empowering to be able to see the real returns of users to validate their opinions and to decide whether their opinions should carry weight. If a trader - down 48% over the last 12 months - discusses their new “low-risk stock pick”, you’ll have the context to conclude that they probably don’t know the meaning of “low risk”.
eToro is available on a mobile app or PC via a web browser. On the page of an individual asset, such as a stock, the straightforward interface displays some basic financial information, such as:
However, other useful information is included, such as:
But even more telling is what’s available beyond this front sheet. Advanced analysis with charts and data from TradingView, which is only available to funded account holders, provides a wealth of financial information.
Likewise, the simple price charts can be swapped for ‘ProCharts’, a free option (despite the name) that on PC provides a full-screen pricing chart with all the features a technical analyst could ask for, such as candlesticks, trend lines and more.
eToro is good for trading when you consider the careful balance it has struck between keeping the initial interface simple and user-friendly while also providing many of the features that experienced traders crave.
Overall, we conclude that eToro is a good app for trading. Its simple user interface is quick to get to grips with, while its full list of features provides depth to explore as you advance.
The speedy and virtually free trade execution is industry-leading and gives users little reason to shop around any further. Unlike some of its competitors, eToro hasn’t made trades free and then upped the annual charge, nor has it waived the annual fee but clawed back commission from trading. It has cut both stock trading commissions and account fees to zero, creating a good environment for traders looking to hold onto as much of their hard-earned profits as possible.
Visit eToro UK to learn more about trading. Capital at risk.
eToro is a multi-asset platform which offers both investing in stocks and cryptoassets, as well as trading CFDs.
Please note that CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 80 - 90% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Past performance is not an indication of future results.
Copy trading is a portfolio management service provided by eToro (Europe) Ltd., which is authorised and regulated by the Cyprus Securities and Exchange Commission.
Do not invest in cryptoassets unless you are prepared to lose all the money you invest. This is a high-risk investment, and you should not expect to be protected if something goes wrong. Take two minutes to learn more.
eToro USA LLC does not offer CFDs, makes no representation and assumes no liability as to the accuracy or completeness of the content of this publication, which has been prepared by our partner utilising publicly available non-entity-specific information about eToro.
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