Forbes Advisor has provided this content for educational reasons only and not to help you decide whether or not to invest in cryptocurrency. Should you decide to invest in cryptocurrency or in any other investment, you should always obtain appropriate financial advice and only invest what you can afford to lose.
Our Verdict
Through eToro, users can buy and sell a range of assets including cryptocurrencies. Many assets can be bought and sold with a 0% commission fee, but if you want to trade cryptocurrencies you may incur higher fees than other platforms. As with other investment platforms, eToro has built-in educational resources, but users can also learn from one another through a news feed and other social features.
Pros
- User friendly
- multiple asset class investing, including crypto
- social and educational features
Cons
- Withdrawal fees apply
- Inactivity fees kick in after 12 months
- Cryptocurrency fees
On eToro's Website
4.0
Our ratings take into account a product's rewards, fees, rates and other category-specific attributes. All ratings are determined solely by our editorial team.
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Table of Contents
- Who should consider eToro?
- eToro offerings and features
- eToro commissions and fees
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Who should consider eToro?
If you’re new to investing, eToro could be a good point of entry. The platform is considered easy to navigate, and available through a browser or mobile app.
eToro allows users to invest in a selection of over 3,000 stocks and shares, but if you don’t feel confident picking out your own portfolio, you can choose a ready-made option based on your interests and priorities.
It could be a cost-effective starting point, since you won’t be charged any commission or management fees on the stocks and ETFs you buy and sell. Rather than relying on income from share investing fees, eToro makes its money through charges like its flat £3.85 ($5) withdrawal fee, inactivity fees, currency conversion fees, and crypto investing fees.
eToro could equally be a good choice if you are looking to connect with other investors, since the platform incorporates social elements that let users share their thoughts and ideas.
To get the most out of these features, it could be useful to better understand investment terminology. But eToro offers its own education resources, which could help you get up to speed.
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Copy Trading does not amount to investment advice.
eToro offerings and features
As a multi-asset investing platform, eToro gives users the option to invest in cryptocassets, stocks and ETFs all in one place, as well as offering a few extra functions.
Invest in stocks
eToro users can invest in over 3,000 stocks as well as a range of ETFs, investing with as little as £7.70 ($10). You can choose your own collection of assets, or also choose to invest in a ready-made ‘Smart Portfolio’. Just bear in mind that the minimum investment for Smart Portfolios is £385 ($500).
In the UK, eToro users can also choose to trade contracts for differences (CFDs). CFDs are complex and extremely risky. If the trade goes wrong, you can end up owing money as well as losing your initial investment because contracts involve borrowing capital – 81% of retail investor accounts lose money when trading CFDs with eToro.
In March 2023, eToro announced it’s teaming up with robo-advisor, Moneyfarm, to offer customers a stocks and shares ISA. Moneyfarm provides a range of ready-made investment portfolios in a number of categories, and provides a recommendation based on your stated preferences.
EToro customers will be able to open a Moneyfarm ISA and view their balance through the eToro’s platform. Any money held in the ISA will also count towards eToro’s Club programme (more on this below).
Investing in cryptoassets
eToro says it lets users to buy and sell 85 cryptoassets, including:
- Bitcoin (BTC)
- Bitcoin Cash (BCH)
- Dogecoin(DOGE)
- EOS
- Ethereum (ETH)
- Ethereum Classic (ETC)
- Litecoin (LTC)
- NEO
- Stellar Lumens (XLM)
- Uniswap
eToro offers its own crypto wallet for users to store their tokens.
Smart Portfolios
Through Smart Portfolios, users can invest in a pre-selected collection of assets, which aim to diversify their holdings.
Some portfolios focus on a specific theme, these can be industries such as technology or crypto, and others are composed with a type of investment strategy in mind.
There are also CopyPortfolios which allow you to automatically replicate the portfolios of successful investors on the platform. If these ‘popular investors’ gain enough copiers, they can earn additional income on top of their investment profits.
To use eToro’s Smart Portfolios, you’ll need to invest at least £385 ($500). For CopyPortfolios, the minimum investment is £154 ($200). You can only cash out by closing the whole portfolio.
Social investing community
eToro lets investors connect with one another through a social media-like news feed, where news and strategies are discussed. Regular blogs and personalised alerts are another way users can keep track of the market.
Education
Anyone, even non-users, can visit eToro and gain access to lessons on investment terms, interpreting the markets, and different types of assets through the eToro Academy. Topics range in complexity from beginner to expert level.
However, no content should be relied upon as constituting personal advice or a personal recommendation. If you require any personal advice or recommendations, please speak to an independent qualified financial adviser.
When you first join and create an account with eToro, you can access a ‘practice account’ that allows you to invest a virtual fund of $100,000 so you can get to grips with the platform before real money changes hands.
eToro club
eToro users who have at least £3,850 ($5,000) in their trading account (including invested cash), are granted automatic membership to the eToro Club.
The club offers perks including investment guidance, free webinars, and access to subscription services like The Wall Street Journal.
Since the club is tiered, which benefits you receive will depend on your balance.
Mobile apps
It’s possible to invest from an Android or iOS device with eToro’s investing app. If you purchased cryptoassets through the platform, there’s also the eToro Money wallet app, which allows you to store or transfer your coins.
Security
While users’ money is not protected by the Financial Services Compensation Scheme, the platform does safeguard funds in a regulated bank account, which is separate from company money and held in trust.
This means if eToro went bankrupt, no third party would be able to claim this money — it would be returned to customers.
The platform also secures customers’ personal information using SSL encryption — an internet security protocol that encrypts data before it’s transmitted between computers. Anyone who tries to intercept the data will only see an illegible mix of characters.
You can also select two-factor authentication to log in for an added layer of security. When two-factor authentication is set up, you’ll need to enter a verification code sent to your mobile phone via SMS to access your account.
eToro commissions and fees
One of the main advantages of eToro is that users can invest in stocks and ETFs without paying commission or management fees.
Although there’s a flat withdrawal fee of £3.85 ($5), it’s possible to buy and sell on the platform without fees eating into your profits. This could be a particular bonus for new investors, since there’s no financial barrier to entry.
However, investing in cryptoassets does incur a fixed fee of 1%, whether you’re buying or selling.
EToro also charges a monthly inactivity fee of £7.70 ($10) if you don’t log into your account for 12 months.
Freqently Asked Questions
Is eToro safe?
In terms of security, eToro offers a two-factor authentication (2FA) option to secure customer accounts. This means a fraudster would need access to both your log in details and either your email account or mobile phone to pass as you.
Is eToro good for beginners?
eToro’s website and app are considered easy to navigate, which could be particularly helpful for those new to investing. If you’re not yet ready to choose your own investment portfolio, there are ready-made options to select based on your interests. There are no fees and no commission to pay on the trades you make, plusbthe website has a good grounding of educational content.
Can you actually make money from eToro?
Many people can and do make money investing with eToro. Many others also lose money. Wherever you invest, you should expect the values of your investments to go down as well as up. You are not guaranteed to see a return on your investment, or to break even.
Is eToro really free?
Although eToro charges zero commission, other fees can apply.
There’s a flat fee of £3.85 ($5) on withdrawals – so taking out funds will cost you. However, this sum is fixed, regardless of how much you withdraw.
There are also currency conversion fees for non-US deposits, ‘spread’ fees – the difference between the buy and sell prices of certain assets – and ‘overnight’ fees if you are trading in CFDs (Contract For Differences) and want to hold their position from one day to the next.
There are also inactivity fees of £7.70 ($10) per month if you have not used your account for a year.
Cryptocurrency is unregulated in the UK. The UK regulator, the Financial Conduct Authority, has repeatedly warned investors that they risk losing all their money if they buy cryptocurrency, with no possibility of compensation.
