Forex on eToro is expensive but can be less risky than other platforms because of their leverage controls.
eToro Forex Trading Platform Review
Product Name: eToro Forex Trading
Product Description: There are two aspects to eToro’s forex trading offering that makes it stand out. Social trading where you can copy other forex traders trades and the ability to set your own leverage. As forex trading is notoriously difficult, and I would say that the majority of eToro’s client are early-stage traders, the ability to reduce the amount of leverage is a very useful.
51% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money
Is eToro a good forex broker?
You can trade forex on eToro, but to be honest it is quite expensive and more of an investment/stock trading platform. If you are solely a forex trader there are more specialist FOREX trading platforms available.
Forex Leverage Control
When you reduce your leverage it means you reduce your risk, by putting up more margin when trading forex. So, for example, when you open a forex dealing ticket, your leverage is set at 30x, but you can reduce this to 1x. Meaning that if you want to speculate on $1,000 of GBPUSD, on 30x leverage, you would only have to put up $41 in initial margin, meaning you are potentially risking $959 that you don’t have. But, if you set your leverage to 1X yo have to put up the whole, $1,000 which reduces the temptation to take on excessive risk, with money you do not have.
Forex Copy Trading
The other feature that is unique to eToro is the ability to follow other forex traders through copy trading. However, it should be noted, though that if you are planning to trade forex by copying what other traders do it can be as hard as choosing your own trades. Just because a trader has done well in the past or if you think their trading ideas look good it does not mean they will be profitable in the future. Social trading is really only good for idea generation, which means you ultimately have to decide if you agree or disagree with another traders outlook.
Pros
- Social and copy forex trading
- Easy-to-use forex platform
- Can change your FX leverage
Cons
- Accounts must be in USD
- High FX conversion charges
- Limited FX market range
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Pricing
(3)
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Market Access
(4)
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App & Platform
(5)
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Customer Service
(4)
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Research & Analysis
(4)
Overall
4
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