2. How does eToro work?
The graphical interface of the website, as well as the eToro mobile application, is quite intuitive. Users can quickly familiarize themselves with the “one-click trading”.
eToro Reference Prices
Reference Prices. The current market prices are visible on the eToro platform.
All purchases and sales made on eToro are done through a CFD – Contract For Difference.
A CFD allows you to buy and sell a financial asset without holding it in your possession. It only trades on the basis of the price of the asset.
In fact, it would be unthinkable to buy commodities such as oil or gold, and have them delivered to your home.
This way, with eToro you can easily profit from the price movements of cryptocurrencies, regardless of the rise or fall of their prices.
📈 If the price of Bitcoin rises from 8,000 USD to 10,000 USD, you can profit from that variation.
📉 If the price of Bitcoin drops from 10,000 USD to 8,000 USD, you can profit from that too!
The advantage of this is that, unlike other exchanges such as Coinbase, it does not depend on a single price direction to benefit from the price fluctuations of a cryptocurrency – and this happens very often!
In the same way, with eToro you are not dependent on a single way of trading. Here are all the options:
Conventional Trading: Like most brokers, you can trade on your own and profit from the price movements of the assets you invest in;
Social Trading: If you don’t have much time available, you can copy the portfolios of successful traders already on the platform. With this option you will have the ease of not worrying about trading by yourself and you will share your profits with the trader you copy your trades from.
2.1 – Social Trading
You can’t talk about eToro without talking about social trading.
Beyond its simplicity, what really sets eToro’s platform apart from others in the market is the fact that it is a social trading network.
Already over 12 million traders worldwide use eToro!
Within their platform you have access to a large trading portfolio of many traders, from which you can copy them to share in their profits. This is known as copy trading or social trading.
With this, this platform solves some problems for beginners, such as:
Too complex trading platforms;
Difficulty in matching financial market movements;
Insufficient access to information.
There are more and more successful traders on eToro. This is relevant for those who appreciate cryptocurrencies, as the number of inclusions of these financial assets in investors’ portfolios has grown exponentially.
The trading history presented is less than 5 years and may not be sufficient to serve as a basis for investment decisions.
In the investor search panel, there are several interesting search filter options, such as:
The market invested in;
The profit earned;
The amount of time in which this profit was earned;
The risk profile of this investor.
It is a valuable tool to find someone with a similar investor profile to yours, who you can trust with their money and investment style.
You can look for example for an investor who trades cryptocurrencies or who has made a profit of at least 10% in the last 3 months.
Jay Edward Smith (jaynemesis) is one of the most recognised cryptocurrency traders on the platform and for his opinion:
“A social trading is a fantastic move in the world of finance as it empowers those who might not normally be able to benefit from global market movements and puts them on par with more experienced traders.”
Jay Edward Nemesis