You should seek advice from an independent and suitably licensed financial advisor and ensure that you have the risk appetite, relevant experience and knowledge before you decide to trade. Cryptocurrencies markets are unregulated services which are not governed by any specific European regulatory framework (including MiFID). Past performance of an eToro Community Member is not a reliable indicator of his future performance. Content on eToro’s social trading platform is generated by members of its community and does not contain advice or recommendations by or on behalf of eToro – Your Social Investment Network.
And based on your experience do trading firms require or prefer people with college degrees? First off thank you for this article as well as the other articles you’ve written on this site!
Is eToro legit?
eToro is monitored and regulated by FCA and CySEC. So, in short, no, it is not a scam. eToro is legit. With that said, trading platforms like this do have some pitfalls for less experienced investors.
eToro withdrawal fees and options
Your broker will net your trades and you get the profit or loss on the trades added/subtracted from your capital (this is all tracked in real-time in your trading account/software). As long as your positions are closed before the closing bell, no need to worry about settlement too much.
Or practice in a demo trading stocks for 8-12 months. Once consistently profitable in the demo with stocks seek a trading firm that can lend me their capital to trade stocks.
This article was definitely informative and well put together. I’m a business owner and a mother of two who’s looking to learn about the forex market in order to become a bit more financially independent and have more time with my family. My husband already day trades futures, but not forex.
I would also recommend starting with more than 250. Start with at least 1000 (assuming it is forex, for other markets–stocks, futures–you need way more) and keep risk on each trade low…only risk 1% or less of capital on each trade. Diversification is a key principle of successful investing. All traders have bad days, weeks and even months.
Day trading most of these markets since 2005, the forex market has by far been the most lucrative for me (in terms of % returns). There is so much money passing back and forth that based on my strategies it seems to be the easiest to day trade.
Assuming that after the 8-12 month practice I am able to see a 10% maybe 15% monthly return on whichever market I select. Are these percentage returns possible within this time frame of practice? Are better percentage returns possible within this time frame of practice?
Everyone is different…even if they are trading the same strategy. Some people are more aggressive, some people are more conservative, some people can trade all day, some people can trade for an hour.
- Cryptocurrencies markets are unregulated services which are not governed by any specific European regulatory framework (including MiFID).
- Past performance of an eToro Community Member is not a reliable indicator of his future performance.
- You should seek advice from an independent and suitably licensed financial advisor and ensure that you have the risk appetite, relevant experience and knowledge before you decide to trade.
To answer your question though, yes I believe there is more profit potential in the forex and futures markets than in the stock market. This is largely attributed to the use of leverage in the forex and futures markets which can magnify returns (and losses). But I disagree on steering traders away from futures and FX.
If you know what you are looking for, these are more lucrative markets, because much less capital can be utilized effectively. So with pretty much everything being equal, I choose forex or futures because they are more accessible to the person starting out with a smaller bankroll. If my objective was to make/net anywhere between $3,000-$5,000 a month day trading what would be the fastest route to do so of the following? Practice in a demo for 8-12 months logging in the 800 plus hours you have mentioned that it takes for a person to start seeing some profit. After successfully seeing consistent profit in the demo trade futures or forex with $5,000 starting out.
eToro gives traders a risk score based on the markets they trade, the leverage they use and the % of their account capital they use for each trade. I like to copy traders with a risk score of 4 or lower.
Most day traders use all, or most of, their capital in a day…or even WAY more, if you add up the value of many trades which could be taken in a day. As long as you have capital (and margin) to cover all your trades, you are fine.
Can you open an account?
Past performance is not an indication of future results. Cryptoassets are volatile instruments which can fluctuate widely in a very short timeframe and therefore are not appropriate for all investors. Other than via CFDs, trading cryptoassets is unregulated and therefore is not supervised by any EU regulatory framework.
eToro pros and cons
So in order to protect your account, I recommend copytrading multiple traders. I like to copy a mix of stock, and forex traders. Personally I like to copy 80% stock traders and 20% forex traders. I find that stocks are less volatile and these traders perform best over a long period of time. This is just my personal approach and I encourage you to do your own research.
BUT AGAIN…check with your broker so you are in full compliance with any day trading rules they may specifically have (some brokers impose additional restrictions, etc). But I personally don’t like to think in dollar amounts. Most traders find a return they are comfortable with and that is what they make (it MAY be a dollar amount, or a percentage amount, or a certain number of pips in the forex market). So until you start learning some strategies and making some trades yourself, it’s hard to tell what kind of return you will make.
Stocks I also like, but the lack of leverage can SOMETIMES make ideal position sizing impossible (as I always risk 1% of my capital per trade). Futures are also good, and another market I really like because of the inherent leverage in them. Day traders often make MANY trades in the same (and different) stocks each day. As long as those trades are closed at or before the closing bell, there shouldn’t be an issue.
With practice, experience, and a little bit of luck, they find high probability trades that allow them to make excellent money in day trading. If you put in time and money necessary to build experience, you may become one of them. It is not something where you can deposit some money and hope to make a consistent profit. Also, the advice of a broker will likely never make you money. They are brokers/sales people, not traders (at least the people you would be talking to).
Please note that CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.
Non-trading fees
Expect to work hard for at least 6 months to a year before you start to see income. Several months will be spent in a demo account trading fake money and making sure you can actually make a profit. If can’t make money in a fake account (following the exact strategy you will use for real $) then there is no point trading real money. eToro is a multi-asset platform which offers both investing in stocks and cryptoassets, as well as trading CFDs.