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How to Copy Trade on eToro

Defensive Trading

January 9, 2023

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Learn How to Copy Trade on eToro and follow the world’s best traders, listen to their analysis and start investing while you learn.

Your capital is at risk. Other fees apply.

How to Copy Trade on eToro

When we say that you are able to trade and invest like the best, we aren’t joking. Here we are not only going to explain How to Copy Trade on eToro, but we are going to take it a step further and highlight to you the best and most profitable Copy Traders on eToro for you to copy trade.

Before we begin that, however, we need to make sure we have covered the steps in How to Copy Trade on eToro.

The first thing you need to do is to open an account on eToro.

How to Open an Account on Etoro

Step 1 – Open an Online Trading Account with eToro

You need to start by signing up for an account if you don’t have one yet. Once you visit eToro’s website, you will notice a button for registration. By clicking on it you open the registration window on which you must fill in your email, and account username, and create a password. Next, you need to visit your email to verify your eToro account by providing a link and continue the registration process.

To complete your account you need to provide such personal details as your name, surname, birth date, address, and phone number. After you fill in your phone number you will get a special code on it which you must use to undergo the phone number verification process. In the end, eToro will also ask you some questions about your capital, job, investment goals, etc. 

Step 2 – Complete the Necessary Information and Verify Your Account

eToro is a highly regulated brokerage platform and according to these regulations, each account that wants to trade on the platform must be verified. Hence, after you complete the whole registration process you must go through the KYC process. There are 4 levels of verifications required by the broker. 

1. Verification by email.
2. Verification by phone number.
3. Proof of identity verification.
4. Proof of address verification.

You automatically do the first two verifications when you register for an account, but after that, you must continue with the second two and provide the necessary documents to complete the verifications. Here are the documents you can provide to verify your identity.

• A copy of your passport.
• ID copy.
• A driver’s license. 

As proof of your residential address, eToro accepts the following documents.

• Credit card/bank statement.
• A utility bill (gas, electricity, water, or internet).
• Social insurance statement.
• Government tax letter/council tax.
• Driver’s license, etc. 

Once you provide the required documents correctly, eToro will verify your account in up to 3 business days about which you will be notified. You can easily check whether your profile is verified or not in the “Settings” section. Moreover, a green tick will appear next to your account name once it’s verified. 

Step 3 – Fund Your Account

After you complete the registration and verification of your eToro account, you can eventually fund it to start buying stocks. Clicking on the “Deposit Funds” button a window will spring up where several payment options are listed including bank cards, wire transfer, online banking, rapid transfer, and e-wallets, such as Skrill and Neteller. You need to select one of them which is more appropriate for you and provide the necessary details about your payment methods. 

Afterward, select the currency in the appropriate section and type the amount you want to deposit. Of note, eToro charges a conversion fee for non-USD contracts and a withdrawal fee of $5 but the US clients can enjoy free withdrawal and deposit options irrespective of the payment method. Also, keep in mind that there are speed differences between the payment methods: for example, bank card transactions are conducted faster than the wire transfer options which may take up to 7 business days. 

Once you have completed these steps, you are ready to start looking at the Copy Trading options available on eToro.

Your capital is at risk. Other fees apply.

Start Copy Trading on eToro

Learning How to Copy Trade on eToro is easy when you have the steps to follow.

Once you have followed the above steps to open an account on eToro, the next step is to navigate your way to the Copy Trading portfolios for you to review.

In order to do this, you need to have your dashboard open and navigate to the grey menu area on the left hand side of the page. Here you will see that there are four key options, Home, Watchlist, Portfolio and Discover.

The option that you need to select here is the Discover option. Once you click on that you will arrive on a summary page as shown above which is a hub of all the various options of ways to trade on eToro’s platform.

Find the Copy Traders

Once you have landed on the Discover summary page, you simply have to scroll down the page slightly until you land on the CopyTrader section as displayed in the above image. Here you will see the top five most popular Copy Traders on eToro.

As you can already see, the returns that these professional traders and investors are making are significant. In the above image, you can see that the returns over the last 2 years range from 24.86% to a whopping 73.68%.

Just as quick calculation, that means that if you had invested $10, 000 two years ago, you would have $17, 368 now, for doing absolutely nothing.

This is bearing in mind that 2022 was one of the worst years in the stock market since the Dot.Com crash in the 2000s.

This is the power of Copy Trading. And this is only one example. We have many more, but for now back to the steps.

Once you see this section on the Discover page, you need to click the button on the top right hand side of the CoptTrader section which reads, View All.

Go ahead and click it and it will take you to the summary page for all the Copy Traders available on eToro. as below.

Refine the Copy Trader Results

This is one of the most important steps in the process to learn How to Copy Trade on eToro. This is due to the sheer volume of professional traders active on the eToro CopyTrade system from whom to choose.

Here are a few tips and tricks from Defensive Trading on how and who to search for and therefore copy.

Don’t Just Focus on Returns

While it may be tempting to simply look for the return on investment that the CopyTrader has generated, you need to remember that as a long-term trader there is always more to the story. And that more is called Risk.

Risk grading is one of the metrics that you should always take into consideration when looking for Copy Trading options on eToro. Especially as a new trader who is trying to learn a long term and sustainable approach to your trading and investing.

So here, let’s take a look at the various way that you can refine the Copy Traders on eToro.

Refine by Location

The first metric that you can search by on eToro CopyTrader is the location of the trader. This may seem like something that doesn’t really matter when what we are looking to do is simply make profits, however, if you are also looking to learn from that trader it would be very useful if a) they operated in a market that you are also familiar with. For example, if you are familiar with the Latin American market though having worked there or lived there then it would be great to follow a CopyTrader who is also familiar with this economy.

Furthermore, which seems quite obvious, but you may be reading this in English when your native language could be something else, like Spanish. If this is the case and you are wanting to follow Copy Traders who are also native Spanish speakers then refining the search results by location will usually correlate to the language spoken by that trader.

Refine by Investment Area

Understandably, with so many assets available to trade on eToro it is going to be hard to find two Copy Traders who are alike. This is a huge advantage to you, as you can copy as many as you like at one time, though we wouldn’t recommend too many. The reason for this is that you want to be able to maintain a diversified portfolio.

Trading tip: Imagine for a moment that you had heavy exposure to one market, such as Crypto. Then imagine that there was some kind of unforseen disruption to the crypto market, such as a regulatory change for example. This would mean that your entire trading portfolio would be negatively affected which is very undesirable. It is better to have exposure to other markets as well, even if you want most of your interest in Crypto, it is preferable to have Stocks, Forex and Commodities in your basket of assets as well.  

However, the question then becomes, how to you determine what assets the CopyTrader’s are trading and investing in? This can be easily done by refining the search results by sector.

The options available for you to select from are found under the Market tab on the CopyTrade summary screen and includes options like Currencies (Forex), Crypto, Commodities, Indices, Stocks and ETFs.

This would mean, if we took our above example a little further, we could select a trader who is based in Spain or any spanish speaking Latin American country and refine their trading by Stocks.

In that case the results would have generated 25 different professional Traders from whom I could Copy Trade as per the below image.

Refine by Gains over Period

The final step in How to Copy Trade on eToro is to be able to refine the Copy Traders by the percentage their portfolio has gained over which period. For this metric specifically the default setting is that the CopyTrader has made a minimum of 10% gain over the last 12 months.

However, as we said earlier, there is more to Copy Trading than just gains. A few of the other metrics you need to be familiar with is Risk, Trader Status (are they verified?), Number of Copiers, Active Weeks, Average Position Size and Profitable Trades.

Some of these additional metrics seem fairly self explanatory however, we will give a quick rundown of them all just to be sure.

Take into Consideration Risk

As we mentioned earlier, there is more to Copy Trading than just looking for returns. What we really need to see from our CopyTrader is consistency. You have heard the phrase, consistency is key? Well it is no different in trading and investing.

eToro uses a 1 to 10 risk scoring system with 1 being the safest possible and 10 being the highest risk possible. We would advise that it is going to be virtually impossible to find Traders who have a 1 risk and a high level of returns because the markets require a certain appetite for risk in order to be a player in them. However, we would advise to seek out the lowest possible risk score once you have refined by other metrics such as number of copiers, profitable trades etc.

We would advise that realistically looking for traders with decent returns over 1 or 2 years with a risk score of 4 – 6 would be desirable.

Trader Status

In How to Copy Trade on eToro, this metric refers to weather the CopyTrader has been verified by eToro. Much in the same way as some accounts receive verification on Instagram or Twitter as being users who have been deemed as more significant on the platform than others, the same applies to CopyTrading on eToro.

We would recommend that you seek our a verified trader where possible, however, if you are particularly interested in a CopyTrader who isn’t verified we would recommend adding them to your watchlist so that you can follow their trades and investments for a little while before thinking about investing in them.

Number of Copy Traders

This metric in How to Copy Trade on eToro seems quite obvious. It is all about herd mentality. The more people like you who are copying a given CopyTrader, the more likely it is that they have performed well and are doing a great job of communicating with their followers.

As we mentioned at the beginning, Copy Trading isn’t just about making profits, it is also about providing your followers with regular updates about which positions you have opened, which you have closed and what your views are on the markets that you are trading and investing in for the future.

Active Weeks

As the name would indicate, this metric relates to the amount of weeks the Copy Trader is active on the eToro trading platform. This may not seem that important, but when you think about it it kind of is. You wouldn’t want to copy a trader who had some initial success in the markets and then completely lost interest in trading or left the platform for some personal reason only to have their trades run unmonitored for weeks at a time.

As we mentioned, previously, consistency is key with all things, especially trading. That’s why we would advise when learning How to Copy Trade on eToro you take into consideration a trader who has had not just weeks but years of consistency and growth through a variety of market conditions.

Average Position Size

When learning How to Copy Trade on eToro it is important to consider the professional Copy Trader’s position size. Why? Because when assessing the successfulness of individual trades, not just overall profit this is very significant.

Consider that the trader you are thinking of copying has made significant profits in one or two very large trades, but then was less successful on balance in a range of the other trades that they had taken. While this strategy isn’t necessarily a bad one and in fact forms part of a widely used approach to trading – whereby the trader aims not to have a lot of successful trades, but aims to have the successful trades be very successful – notwithstanding, this is the type of information you need to know as a potential investor so that you can make sure you are making informed decisions regarding your trading.

Profitable Trades

Continuing on from the above point, when it comes to How to Copy Trade on eToro, it is important to understand how man of the traders positions end up being profitable. If you look at these two metrics together then you can form a more complete picture of this traders approach to trading.

Your capital is at risk. Other fees apply.

The Pros and Cons of CopyTrading on eToro

eToro Copy Trading Pros

✅ eToro supports thousands of stocks and ETFs listed on such stock exchanges as NASDAQ, NYSE, etc. 

✅ Not only US companies but also companies based in Germany, France, the UK, Canada, Spain, and several other countries, are listed on eToro.

✅ The platform is extremely versatile and you can buy multiple other assets along with stocks, including cryptocurrencies, forex, commodities, and indices which are also available through contracts for differences. 

✅ The broker offers a competitive pricing structure – you can buy stocks with zero commissions and spreads are below market rates. 

✅ eToro supports a social trading platform where users can have discussions with other traders, ask questions to experts and follow the news.

✅ eToro offers other free social trading tools in addition to CopyTrader and CopyPortfolios which can be used to mirror the trades of any trader with a click of a button.

✅ The broker is very safe and uses top-notch safety mechanisms to protect your account from fraud and malicious logins.

✅ eToro is a highly regulated platform and is registered with such reputable institutions as ASIC in Australia, CySEC in Cyprus, FCA in the UK, and FinCEN in the United States. 

✅ The platform is very beginner-friendly: it has a simple-to-use interface and educational content for newbies.

✅ eToro supports multiple payment methods – credit and debit cards, bank transfers, rapid transfers, Neteller, Skrill, etc. 

eToro Copy Trading Cons

❌ The platform is not available in many US states.

❌ Customer service by the Copy Trader is not guaranteed.

❌ The broker does not impose minimum level requirements for CopyTraders.

❌ The charting software is limiting on the platform, however, this can be overcome by using the advanced charting options at Trading View. 

Conclusion to How to Copy Trade on eToro

The Copy Trader on eToro is by far one of the best solutions available for a new trader who wants to gain some exposure to the market while they learn the ropes of how to trade the markets. Likewise, by following this guide on How to Copy Trade on eToro even more advanced traders are able to improve their profitability by following the most successful traders and investors on eToro and duplicating their trades themselves.

Furthermore, there is an invaluable amount of information shared each day by all of the CopyTraders on eToro so that no matter who you choose to follow, you will definitely gain insight into the current market conditions that you simply would not have had the opportunity to anywhere else.

As always, if you have any questions, we would love to hear from you. Please contact us. Happy trading!

Your capital is at risk. Other fees apply.

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