A lot of people are asking me if the social trading platform Etoro is a scam. The word “Etoro scam” is mentioned quite a lot on the internet so I wanted to give you guys my input.
Is Etoro a scam?
First of all : Etoro is not a scam. I’ve been through the claims from these people that are claiming it is and most of the cases where people called etoro scam were simply because they had problems verifying their contact details. Etoro is a regulated Broker and needs up to date information to accept the customer. As simple as that.
Every real broker needs to know the customer ( called KYC, Know Your Customer) and that is just the way any regulated broker has to operate. Calling etoro scam for following the law is just ridiculous.
Etoro couldn’t operate for almost 10 years all over the globe if it would be a scam. So what is etoro and why is this platform trustworthy?
What is etoro?
First of all let me explain what kind of people are on Etoro. Etoro is a social trading platform and there are two types of traders on eToro.
Active Investors (including a lot of professionals with great track records) and copytraders (users that copy the investment styles of the professional investors). Active Investors are the people who actually make the trades (such as investing in bitcoin or oder currencies) . Anyone can manually open a trade like this and if you are successful its also likely that other users will follow and copy you ( you will get paid for that).
Then there are the CopyTraders. These people don’t know that much about forex or stocks (or prefer the convenience of copying) and are relying on the Professional traders to make the actual trading analysis and trades (such as going through annual reports and financial statements) .
As a copytrader you “copy” other traders using a portion of your account funds. When a trader then makes a trade, that trade is copied in your account. Trades are done proportionally. So for example if you have $100 allocated to a trader, and that trader then makes a trade with 10% of their balance, a similar trade will be opened under your account with just $10.
Why is etoro trustworthy?
etoro is fully Regulated in the European Union. Furthermore your funds are kept safe in tier 1 European banks. Etoro will never share your private data without your permission and every transaction on the website is secured.
Furthermore etoro has millions of users on their platform and lots of them are happy. If you do your research and find the right people to copy you can be quite successful on the platform yourself and earn! And if you’re knowledgeable about investing you could start your own account and gain followers. If you attract a lot of people to follow your investments you could earn money with that as well.
I hope i was able to clear up some of the etoro scam rumors out there. I’ve been using the platform myself and couldn’t be happier with the simple interface and options. If you like to give etoro a try yourself sign up for a etoro account here. You can also use their virtual money account first before depositing any funds so you can get comfortable with their platform. Good luck with your first trades on etoro!