eToro is a trading platform that is available in Australia. You can trade stocks, currencies, cryptocurrencies, commodities and ETFs. But is it a good option for investing and trading? We break down the pros and cons.
What is eToro
eToro is an online trading platform. You can buy and sell shares (both real shares and CFDs), forex (currency like the AUD), cryptos (like bitcoin) and commodities (such as Gold and Oil). It’s also a “copy trading platform”. This means you can copy trades made by more experienced traders. Whenever they make a trade, your account also makes a trade.
What are you trading on eToro?
In Australia you can trade both real stocks and CFDs on eToro. For most people, I would recommend sticking with investing in real stocks. CFDs are a more complex financial instrument and are meant to be traded by more advanced traders.
On eToro you can buy and invest in shares like Apple, Alphabet (google), Netflix, Tesla and hundreds more.
Here are some of the advantages of investing through eToro
- Start investing with $50 – you can buy fractional shares on eToro. This means you can own just a fraction of a share (such as 0.01). You don’t need to buy a full share.
- Near Instant Settlement – you don’t need to wait for funds to clear before you can open more trades on eToro. When you close a position you can open another one right away.
- Zero commissions – There are no commissions on real share trades. You’ll save a fortune in fees compared to using a broker like commsec.
- No ongoing fees – Some platforms such as IG charge you a quarterly fee for holding shares. On eToro there are no ongoing fees. So you can buy shares and hold them for long term profits.
I use eToro to invest in shares like Apple, Nio and Tesla. These are companies that align with my values and where I see the world going. Being able to invest in these shares from Australia – without having to pay any fees, is the reason why I use eToro.
What is eToro Copy Trading
eToro Copy Trading is where you copy a trader. When you copy a trader, you allocate funds that will automatically be used to copy all the trades made by the copied trader. Whenever they make a trade, your account will make a similar trade. When they close a trade, your account will close the trade too.
If you have limited trading experience then this could be a good way to see how trading works.
Should you trade on eToro
If you want to have more control over your investments, then eToro could be a good option. If you’re new to trading you can sign up for free and trade with a virtual practice account.
If you’ve already had experience with other forex or stock trading platforms then eToro might be a good option for you. It’s got a great range of assets and a pretty good trading interface.
Pros and Cons of eToro
- Access stocks and assets from all over the world
- Trade partial shares
- Invest with as little as $50
- Deposit using PayPal, bank transfer, credit card
- Mobile app could be better designed.
- Withdrawal fee of $5 (although this isn’t charged depending on how much you invest).
- Fees for short positions and holding over weekends etc.