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eToro Broker Review | Platform, Fees, Pros, and Cons

Based in the Philippines and thinking about using eToro to trade online? Read our in-depth eToro Philippines review to find out whether it's the right broker for you.
Kane Pepi
Author: Kane Pepi

Last Updated: June 11, 2020

eToro is a popular regulated online broker that hosts a range of asset classes. This covers traditional stock purchasing services on a fee-free basis, as well as thousands of tradable CFDs. You can even buy Bitcoin and other cryptocurrencies! eToro broker is also known for its copy trading feature, which allows you to mirror the trades of other investors. But is eToro right for you? Read our eToro Philippines review to find out.

This eToro review covers everything you need to know about this excellent broker, from the tradable assets and fees to trading tools and payment methods. Let’s take a look at what eToro has to offer Filipino traders.

    eToro: Best Philippines Trading Platform 2020

    Our Rating

    • Huge range of tradable assets
    • 0% commission
    • Social and copy trading
    • Highly regulated
    75% of retail investor accounts lose money when trading CFDs with this provider.

    What is eToro?

    Launched in 2006, eToro is an online broker that offers thousands of financial instruments. This is split between two main asset classes – traditional stocks and CFDs (contracts-for-differences). Regarding the former, you will have access to more than 800 companies across multiple stock exchanges. This includes firms based in the US, UK, Japan, Canada, and more. In terms of its CFD offering, you can buy and sell everything from forex, gold, oil, and interest rates. eToro also offers the users the chance to buy cryptocurrencies or trade them as CFDs.

    One of the main selling points of eToro is that it it’s a social trading platform that allows you to mirror the trades of other investors. To do this, you will need to choose an investor that meets your personal requirements – for example, a trader that has a good track record in buying and selling forex pairs. After that, you can copy the trader’s entire portfolio at the click of a button, which is great if you have little to no knowledge of how investments work or just want to invest in a passive manner.

    If you’re based in the Philippines, you’ll be pleased to know that eToro offers a range of local payment methods. This includes a traditional debit/credit card, bank account, and e-wallets like Paypal and Skrill. We should also note that eToro is heavily regulated. This includes licenses with three tier-one bodies, such as the the FCA (UK), CySEC (Cyprus), and ASIC (Australia). Since the platform was launched, eToro has attracted more than 12 million users to its site.

    Pros and Cons of Using eToro in the Philippines

    Pros

    • A user-friendly platform that has been designed for newbie traders
    • Buy stocks, cryptocurrencies and ETFs on a commission-free basis
    • Trade thousands of CFDs
    • Heavily regulated broker
    • Social trading network with copy trading tools
    • Accepts PH debit/credit cards, bank accounts, and e-wallets
    • Fully-fledged mobile app

    Cons

    • Not suitable for advanced traders
    • Does not offer MT4/MT5

    Tradable Assets 

    eToro is home to thousands of financial instruments across multiple asset classes. This includes:

    Stocks

    You will have access to more than 800 companies at eToro. The vast bulk of this is dominated by the major markets of the US and UK. Across the New York Stock Exchange (NYSE) and NASDAQ you will find popular firms like Apple, IBM, Facebook, Ford Motors, Amazon, and Disney.

    On the London Stock Exchange, you’ll have access to the likes of Barclays, British American Tobacco, HSBC, and AstraZeneca. eToro also lists a good number of companies that are listed on the Tokyo Stock Exchange. Outside of the core markets, eToro also gives you access to less liquid stock exchanges found in:

    • Amsterdam
    • Brussels
    • Copenhagen
    • Frankfurt
    • Helsinki
    • Hong Kong
    • Lisbon
    • Madrid
    • Milan
    • Oslo
    • Paris
    • Saudi Arabia
    • Stockholm
    • Zurich

    All in all, eToro allows you to create a highly diversified portfolio of stocks across multiple economies. You can choose to either buy stocks or trade CFDs on eToro, which is a very unique feature among online brokers and means it suits traders of either preference.

    Forex

    Our eToro Philippines review found that the platform is home to 47 currency pairs that can be traded at the click of a button. You will find most major and minors pairs listed, with a small number of exotics. Unfortunately, eToro’s forex trading offering doesn’t include the Philippines peso.

    Cryptocurrencies

    eToro stands out in the cryptocurrency department as it is one of the few brokers in the space that allows you to make a purchase on a fee-free basis. This covers 16 major digital currencies – including Bitcoin, Ethereum, Ripple, Bitcoin Cash, and EOS.

    The broker also allows you to trade cryptocurrency cross-pairs. This includes BTC/EOS, BTC/ETH, and ETH/XLM. You can choose to either buy and sell cryptocurrencies, which you can securely store in the eToro cryptocurrency wallet, or trade them as CFDs.

    Commodities

    With just 14 commodities on offer, eToro is a bit thin on the ground in comparison to other Philippines CFD brokers. With that said, the platform does cover the most commonly traded commodities in the space. This includes the likes of oil, natural gas, platinum, copper, gold, silver, and sugar.

    Indices

    eToro gives you access to 13 stock market indices. This includes the S&P 500, NASDAQ 100, Dow Jones 30, FTSE 100, and China 50. You will be trading these indices as CFDs, meaning that you will attract a small overnight financing fee.

    As a result, it might be worth investing in an ETF that tracks your desired stock market index, as you will be able to do this on a commission-free basis. For example, instead of trading the S&P 500 as an index at eToro, you might want to consider the Vanguard S&P 500 ETF.

    ETFs

    When it comes to ETFs, our eToro review found that the platform offers access to 145 instruments without paying any dealing charges. Much of this is dominated by leading ETF providers iShares, SPDR, and Vanguard. Although you have the option of short-selling an ETF and applying leverage, you will need to pay overnight financing fees on this.

    Fees

    eToro bills itself as a low-cost alternative to conventional brokerage accounts. At the forefront of this is the ability to deposit funds without any fees, and buy stocks, cryptocurrencies and ETFs without paying any commission. Let’s take a closer look at eToro’s fees.

    Trading fees

    When it comes to trading fees, this will ultimately depend on the type of asset you are looking to access. Let’s start with assets that you can buy, hold, and own in the traditional sense.

    Stocks, ETFs, and Cryptocurrencies

    If you are simply looking to buy stocks and shares with the view of holding on to them for a number of months or years, eToro allows you to do this on a commission-free basis. This means that you are not required to pay any share dealing charges. Ordinarily, this would come in the form of a flat-fee (for example, $10 per trade), or a variable commission that is based on the size of your trade(for example, 0.5%).

    This is also the case with ETFs (exchange-traded funds). Most importantly, you will own the underlying asset, meaning that you will be entitled to income-generating revenue like dividends. On the flip side, you will still need to take the spread into account as this is an indirect fee that cannot be avoided.

    You can also purchase and own cryptocurrencies without paying any share dealing charges, although you still need to keep an eye out for the spread. During standard market hours this average 0.75% at eToro – and more over the weekend.

    CFDs

    If you are looking to trade CFDs at eToro, things work slightly differently. Firstly, you will be trading CFDs if you buy or sell an asset outside of the stocks, ETF, and cryptocurrency spectrum. This includes everything from oil, natural gas, gold, silver, and currencies. You will, however, be trading CFDs on stocks, ETFs, and cryptocurrencies if you decide to apply leverage or short-sell an asset.

    For example:

    • If you buy 10 shares in Apple without applying leverage, you won’t pay any commissions
    • If you short-sell 10 shares in Apple, you will pay a fee
    • If you buy 10 shares in Apple at leverage of 2x, you will pay a fee

    It is important to note that the fee isn’t classed as a ‘trading commission’ by eToro. Instead, it is marked as an overnight financing fee. This is standard practice in the online CFD space. For those unaware, you will pay a small amount of interest for each day that you keep your CFD position open.

    This will vary depending on the asset class you are trading, and the amount of leverage you apply. The good news is that you can clearly see how much you will be charged in dollars and cents before you place the order.

    Forex trading fees

    If you are based in the Philippines and looking to trade forex, you will need to take extra care to assess the spread. We find that currency spreads at eToro are reasonable in the major and minor department, but more expensive when trading exotic pairs. You will also need to pay an overnight financing fee for each day that you keep your forex position open.

    Non-trading fees

    There are a few non-trading fees in particular that you need to be made aware of – an inactivity fee, a withdrawal fee, and a currency conversion fee.

    Firstly, the broker charges an inactivity fee of $10. This only kicks in if you do not log into your account for a period of 12 months. If you don’t, then the $10 fee will be debited from your account balance every month until you log back in, or your balance goes to zero.

    This is important to recognize, as lots of traders from the Philippines use eToro to buy and hold traditional stocks. As such, just make sure you log into your account at least once per year to avoid the fee!

    The withdrawal fee is a flat $5 charge, which is lower than some other brokers which charge percentages and therefore charge more for larger withdrawals. There is also a currency converision fee, as all eToro accounts are denominated in US dollars.

    Although you can deposit funds with Philippine pesos, the amount will be converted to USD when you deposit, and then again when you make a withdrawal. The specific fee will vary depending on market conditions, albeit, eToro notes that this averages 0.5%.

    Platform Features

    So now that you know the basics of how eToro in the Philippines works, we are now going to explore some of its core platform features.

    CopyTrader System

    Without a doubt, one of the most attractive features found at eToro is its Copy Trading offering. In a nutshell, this allows you to copy the trades of other eToro users like-for-like. This is highly beneficial if you have little to no experience of how investments work, or if you simply want to trade and invest passively.

    Here’s an example of how the CopyTrader system works at eToro.

    1. You browse through the Copy Trader section to find an investor that meets your requirements
    2. You decide you like the look of a forex trader that has been making consistent profits for three years
    3. You invest a total of $500
    4. Each and every asset that the trader has in their portfolio will now be added to your eToro basket
    5. Each asset will be weighted at an amount proportionate to what you invested
    6. Moving forward, any buy or sell orders that the trader places will also be reflected in your Copy Trading portfolio.

    Once you have copied a trader at eToro, you can exit your position at any given time. You will need to invest at least $200 per portfolio, and you can add more funds whenever you see fit. In order to mitigate your risks, it might be worth backing several traders at eToro. In doing so, you stand the chance of staying in the green even if a single trader has a bad month.

    eToro Copy Trading feature

    What we also like about the eToro CopyTrader system is that it promotes communication between the trader and investors. For example, some of the best traders at the site will host monthly webinar events. This gives the trader the opportunity to outline their vision and explain what types of investments they are planning to make in the coming quarter.

    This also allows investors to post questions to the trader. This is something that you will not get with a traditional, old-school brokerage firm!

    Social Newsfeed

    On top of its CopyTrader feature, eToro also offers a social newsfeed. This operates in a similar way to Facebook, insofar that you can post a new thread, which can then be commented on by other users. For example, let’s say that you have just purchase shares in Apple.

    You can then create a public post that explains the reasoning behind the trade. After that, other investors can comment on your viewpoints, which adds a social aspect to trading. Much like Facebook, people can also choose to ‘Like’ your posts.

    Research and Education

    When it comes to core research tools, eToro is a bit thin of the ground. For example, although you will have access to a number of technical indicators, the charting analysis area is slightly basic. Once again, this highlights that eToro is best suited for the newbie investor.

    This is also the case with fundamental research. For example, you won’t have access to real-time news events or earnings reports, so you’ll need to find this externally. On the flip side, experienced copy traders that use eToro will ensure that investors are kept abreast of any key developments.

    In terms of education, however, eToro excels. Firstly, you will find lots of handy guides and how-to explainers of key financial terms. This includes everything from short-selling, CFDs, and the spread. eToro also runs regular webinars. If you decide to take part, you will get to listen to an in-house analyst talk about market conditions, cycles, and important economic events. You will also have the opportunity to direct questions to the host.

    Risk Management Tools

    Whether you’re a newbie trader or seasoned investor, it’s crucial that you have a firm grasp of how risk management tools work in the online investment space. At eToro, you will have access to a couple of market orders that will allow you to mitigate your trading risks.

    This includes:

    • Stop-Loss Orders – Each and every asset hosted by eToro can be traded with a stop-loss order. This will close your order automatically when a pre-defined price is hit. To make things easier for you, eToro allows you to set your stop-loss price by a percentage. For example, if you want to limit your losses to 5%, eToro will close the trade when this is triggered.
    • Trailing Stop-Loss Orders – eToro recently introduced trailing stop-loss orders.  For those unaware, this will constantly update your stop-loss price when the value of your trade goes up. For example, let’s say that you place a buy order on IBM stocks, with the position now in the green by 10%. You think that the price will continue to rise, but you don’t want to give away your profits in the event the trend is reversed. As such, you can set up a trailing stop-loss order at 2%. In theory, this means that the position will only be closed when the price of IBM stocks goes down by 2% against the peak of your order. In other words, while you stand the chance to make further gains, the worse that can happen is you lose 2% from the current price.

    Unfortunately, our eToro review that the broker does not offer ‘guaranteed’ stop-loss orders. This means that there’s no guarantee that your stop-loss order will be matched. This can happen if the asset in question enters volatile market conditions.

    Free Demo Account

    Our eToro review found that all account holders can utilize its $100,000 demo trading facility. The free demo account works exactly the same way as a real money account, albeit, you will be buying and selling assets with ‘paper money’. This is a great way to improve your knowledge of the investment space without risking your own funds.

    It also gives you the opportunity to get to grips with the eToro trading platform. Crucially, the demo account comes with all of the same features and tools as found in the real-money section of the site, and asset prices mirror that of actual market conditions.

    eToroX Crypto Exchange and Wallet

    eToroX is a subsidiary of eToro, with the platform offering conventional cryptocurrency exchange services. Although it facilitates fiat-to-crypto and crypto-to-crypto pairs, you won’t be able to deposit funds with fiat currency. Instead, the platform only supports digital currencies.

    You can sign up to eToroX directly through your regular eToro account. eToroX is regulated by the Gibraltar Financial Services Commission. Trading commissions are very competitive at the platform, with ‘market maker’ fees starting at 0.10%.

    eToro also offers its own proprietary cryptocurrency wallet, available as a mobile app on iOS and Android devices. This is an excellent way to safely store, send and receive cryptocurrencies.

    Investor Program

    If you’re a newbie trader that is just starting out, then you likely won’t be suitable for the eToro Investor Program. In a nutshell, the program is aimed at experienced investors that are looking to take part in the CopyTrader system. In other words, if you have a long-standing track record of making money at the platform – and other eToro users decide to copy you, the Investor Program allows you to earn a percentage of your assets under management (AUM).

    This stands at a maximum of 2%, which is huge. For example, let’s say that you have 1,000 users copying your trades, who have collectively invested $500,000. This means that the Investor Program can pay up to $10,000 per year. This is in addition to any profits that you make.

    Payment Methods and Banking

    You can fund your account in a variety of ways, including a debit or credit card. Deposits are usually processed instantly, so you can get trading right away. You can also deposit money by bank transfer or by using an e-wallet like PayPal, Skrill or Neteller. eToro does accept wire transfers, but there is a fee for this method and your funds may take up to a week to appear in your account.

    Be mindful that eToro only operates in US dollars across the platform. So if you deposit money in another supported currency, it will be exchanged for dollars at the current exchange rate.

    Withdrawals incur a fee of 251 peso ($5). You need to request a withdrawal, and once your withdrawal request has been approved and processed, you’ll receive an email stating that you can now withdraw your funds.

    Trading Platform and User Experience

    eToro trading takes place on its own proprietary platform, rather than the likes of MetaTrader 4 or 5. The eToro platform is one of the most impressive on the market and is especially notable for how beginner-friendly it is.

    The platform is very well designed and laid out, so it’s both visually appealing and easy to navigate. After logging in, you’ll see your customizable watch list all the financial instruments you’re interested in. There are clear links for trade markets, copy trading, depositing, and so on on the left sidebar.

    You can explore the markets on offer by clicking the ‘trade markets’ link, which will take you to a new screen where you can browse asset classes and market movers. When you select an instrument, you’re able to view stats, a price chart, and a social feed with posts from fellow traders.

    Overall, eToro’s desktop trading platform is certainly one of the best we’ve seen.

    Mobile Trading

    If you have a tendency to buy and sell assets on the move, eToro offers a fully-fledged mobile trading app. The application can be downloaded free of charge on both iOS and Android devices. You will find all of the same features as available on the main desktop website, meaning that you can place orders, check your portfolio, and deposit/withdraw funds.

    eToro mobile trading app - available on iOS and Android

    The eToro mobile app is also useful if you want to receive notifications. For example, you can set up pricing alerts that will notify you when your chosen asset hits a specific target. If you don’t have an iOS or Android device, you still access your eToro account via your standard mobile web browser. The platform has been fully optimized for smaller screens, so you shouldn’t encounter any issues.

    Customer Support

    The eToro customer service team can be reached via a number of channels. The easiest way to make contact is through live chat, although you will need to have an account to gain access.

    Alternatively, eToro also offers email and ticket support. There is no telephone support line, which is unusual for a brokerage firm of eToro’s size. The customer service team operates on a 24/5 basis, so weekend inquiries will need to wait until Monday morning.

    Regulation

    Our eToro Philippines review found that the broker is licensed on three fronts. This includes:

    • Financial Conduct Authority (FCA): United Kingdom
    • Australian Securities and Investments Commission (ASIC): Australia
    • Cyprus Securities and Exchange Commission (CySEC): Cyprus

    These are all highly respected regulatory bodies that ensure that you are able to trade in a safe and secure environment. For example, all three licensing bodies require eToro to keep client funds in segregated bank accounts, which will safeguard your investment in the event eToro ceased to exist.

    All three regulatory bodies also require eToro to identity each and every user that signs up to the platform. This is why you are asked to upload a copy of your ID and proof of residency. eToro also users industry standard encryption technology to keep your account and personal information secure.

    Getting Started with eToro in the Philippines

    If you like the sound of eToro but you’re not too sure where to get started, we are now going to give you a step-by-step guide. This includes the end-to-end process of opening an account, verifying your identity, depositing funds, and placing your first trade.

    Step 1: Open an Account

    Open an account at eToro

    Your first port of call will be to visit the eToro website and click on the ‘OPEN ACCOUNT’ button. You will then be asked to enter some personal information.

    This includes your:

    • Full Name
    • Home Address
    • Date of Birth
    • Tax Number
    • Mobile Number
    • Email Address

    You will also need to choose a username and a strong password, as well as confirm your mobile number via an SMS code.

    Once you have entered the basics, eToro will ask you a range of questions about your historical trading experience. This is to gauge your knowledge of the financial markets and crucially – whether to not you understand the risks of trading online. Don’t worry, you won’t be denied an account for having little to no knowledge of how investments work. Instead, it’s to ensure the broker remains compliant with its licensing bodies

    Step 2: Verify Your Identity

    As is the case with all online brokers that are licensed by tier-one bodies such as the FCA and ASIC, you will need to verify your identity. You don’t need to do this straight away, as eToro will still allow you to deposit up to €2,000 (about 112,000 PHP) without uploading the documents. But, you won’t be able to request a withdrawal until this is done. As such, we would suggest doing it straight away so that you can remove all account limitations!

    The two documents that eToro needs are:

    • Government-issued ID: This can be a Philippines passport, driver’s license, or national ID card
    • Proof of Residency: This can be a recently issued utility bill or bank account statements

    Once you have uploaded the above documents, eToro should be able to validate them within the hour.

    Step 3: Deposit Funds

    Deposit funds at eToro

    Unless you are planning to use the eToro demo account facility, you will now be asked to deposit some funds. Supported payment methods include:

    • Debit card
    • Credit card
    • Paypal
    • Skrill
    • Neteller
    • Bank account transfer

    eToro has a minimum deposit amount of $200, which equates to about 10,000 PHP. There are no fees to deposit other than the previously mentioned 0.5% currency conversion charge. Finally, all deposits at eToro are instantly credited apart from a bank transfer.

    Step 4: Place a Trade

    So now that you have opened an account, verified your identity and deposited funds – you can place your first-ever trade!

    Firstly, click on the ‘TRADE MARKETS’ button on the left-hand side of the page. This will then display the main asset classes that you can trade at the platform.  In our example, we are going to be trading stocks. Although we can browse the shares department by the specific exchange, we are looking to buy IBM stock, so we enter ‘IBM’ into the search box and click on ‘TRADE’.

    eToro commission-free trades

    Once you have found an asset that you wish to trade, you will then be presented with an order box. This is where you need to state the amount that you wish to invest.

    Buy IBM stock at eToro

    In our example, we are buying $75 worth of IBM stocks. As you will see from the screenshot above, the ‘set rate’ box is listed as a ‘market order’. This means that we are looking to take the next available market price. If you want to enter the market at a specific price, change this to a ‘limit order’.

    Finally, you need to click on ‘OPEN TRADE’ to complete your investment.

    Conclusion

    eToro has grown exponentially over the past few years – with more than 12 million traders using the platform as of 2020 – and it’s easy to see why it’s so popular with traders in the Philippines. With a fantastic range of asset classes, competitive fees, and fantastic social and copy trading features, eToro delivers a premier online trading experience.

    If you like the sound of eToro, you can get started in just a few minutes. Simply click the link below to register an account and begin trading today!

    eToro: Best Philippines Trading Platform 2020

    Our Rating

    • Huge range of tradable assets
    • 0% commission
    • Social and copy trading
    • Highly regulated
    75% of retail investor accounts lose money when trading CFDs with this provider.

    FAQs

    Does eToro really offer commission-free trades?

    Yes, but only on certain financial instruments. Crucially, as long as you are going long on stocks, ETFs, or cryptocurrencies - and you avoid applying leverage - you will be purchasing the underlying asset without paying any fees or dealing charges.

    Does eToro accept traders from the Philippines?

    Yes, eToro is a global broker that is hugely popular with traders in the Philippines.

    Can I deposit PHP into eToro?

    eToro allows you to use several local payment methods, such as a debit/credit card, bank account, or e-wallet. The funds will be taken from your payment method in PHP, and then instantly converted to USD. This is because eToro denominates its platform in US dollars.

    Does eToro offer leverage?

    Yes, eToro offers leverage on each and every financial instrument that it offers. If you are a retail client, you will be capped by the limits imposed by ESMA. This starts at 2x on cryptocurrencies, and goes up to 30x on major forex pairs.

    What risks are there when using eToro in the Philippines?

    The risks of using eToro are the same as using any other broker - loss of capital from unsuccessful trades and risk of liquidation if you trade with leverage. The is also a risk that the PHP/USD exchange rate can change and affect your funds. However, these are more just risks of trading. As a regulated broker, eToro is one of the safest platforms around.

    All trading carries risk. Views expressed are those of the writers only. Past performance is no guarantee of future results. The opinions expressed in this Site do not constitute investment advice and independent financial advice should be sought where appropriate. This website is free for you to use but we may receive commission from the companies we feature on this site.
    Kane Pepi

    Kane holds academic qualifications in the finance and financial investigation fields. With a passion for all-things finance, he currently writes for a number of online publications.