- eToro is one of the most popular platforms for investing online
- eToro offers users the ability to trade stocks, commodities, ETFs, cryptocurrencies and more
- This step-by-step guide will show you how to buy Facebook stock on eToro
Thanks to the rise of online brokers, it’s easier than ever to trade the EURO STOXX 50 index and other leading indices. If you’ve been thinking about trading the EURO STOXX 50 index and researching different brokers online, you have most likely already heard of eToro.
eToro was created in 2007 and has since become one of the most popular brokers for trading and investing online. eToro has more than 10 million registered users and is regulated in Cyprus, Australia and the United Kingdom. In addition to giving users the ability to buy and sell commodities, stocks and other instruments, their platform actually provides a diverse suite of other trading products. Let’s quickly run through a list of the defining features of eToro:
- Trade commodities, stocks and other traditional financial instruments
- Trade cryptocurrencies
- Copy the portfolios of successful traders
- Test trading strategies with demo trading
- Trade with leverage
Now, let’s check out the main advantages and disadvantages of trading on eToro:
- Large selection of assets available for trading
- Social trading features
- Demo trading support
- Forex trading fees are relatively high
- Withdrawal and inactivity fees
Trade EURO STOXX 50 (EUSTX50) on eToro
The EURO STOXX 50 is an index that is designed to track the performance of 50 major companies in the Eurozone. The index was initially launched in 1998 and is often used as a benchmark for the performance of European stock markets. The index constituents contain major companies such as Airbus, Volkswagen Group, Siemens and Santander. The operator of the EURO STOXX 50 index is the Switzerland-based STOXX.
Please note that indices such as EURO STOXX 50 are not actual assets that you can invest your money in. What you’re actually doing on eToro is purchasing contracts for differences (CFDs) that track the performance of the underlying index. If you go long on an index using eToro, you’ll make money when the value of the index grows and lose money if its value falls. The reverse applies if you’re going short on the index.
Now, let’s get started with trading EUSTX50 on the eToro platform.
1. Create eToro account
Creating an eToro account is very simple, and you’ll be able to log in to your newly-created eToro account within minutes.
If you just want to take a look at what the eToro platform has to offer, the only information that’s required to create an account is an e-mail and a phone number. However, if you want to deposit money and actually start trading, you will have to provide some additional personal information to verify your identity.
2. Complete your eToro profile
After you’ve created your eToro account, you will have to complete your eToro profile before you can start trading. This information is required so that eToro can comply with the applicable AML and CTF regulations. Click “Complete Profile” under your username and follow the presented steps.
3. Fund your eToro account
After you’ve completed the necessary verification, you can fund your eToro account.
The minimum deposit currently accepted by eToro is $200, or equivalent in other currencies. The platform actually offers seven different deposit methods, so choose the one that suits you best:
- Credit / Debit card
- Wire Transfer
As with any investment, don’t invest more than you’re willing to lose.
TIP: If you don’t feel ready to trade with real money yet, you can use eToro’s virtual portfolio feature to test out some trading strategies risk-free. You can switch from your real portfolio to your virtual portfolio by clicking the icon under your profile name. You will be given $100,000 in virtual money that you can use to trade any instrument that’s offered by eToro.
4. Buy EURO STOXX 50 on eToro
Once your account is funded, you can start with trading commodities on eToro. You can either buy a commodity or short it, depending on how you believe the market is going to behave moving forward. In this guide, we’ll be showing a step-by-step process of buying EUSTX50.
Head over to the search bar on the top of the eToro interface and type in the name or the ticker of the asset you wish to buy, in this case the EURO STOXX 50 index. In addition to the price chart, you will also be able to find other key information about the index.
Click the “Trade” button to place your order for EUSTX50. Now, a window will open where we can tweak all the parameters of our trade. In this example, we’re going to invest $1,000.
By switching between “Trade” and “Order” on the top right, you can either buy EURO STOXX 50 at the current best available price, or specify the exact price at which you want to buy the stock. We’ll keep it at “Trade”, as its the fastest and simplest way.
Under “Amount”, we’ll set the amount that we wish to invest – in this case, $1,000. Below, we can see what percentage of our total equity we are using.
In the section on the bottom, you can set your stop loss, leverage and take profit levels. Stop losses are used to define the maximum loss you’re willing to take in the trade, while take profits are used to realize gains by automatically closing the position once it reaches a specified value above our entry price. As far as the leverage is concerned, we’ll be keeping it at 1x, as higher leverage would introduce additional risks to our trade.
After you click “Open Trade”, your order will be submitted and your trade should be executed shortly.
5. Monitor the performance of your EURO STOXX 50 trade
Once your order is completed, you will be able to follow the status of your trade in the “Portfolio” section. Here, you can also update your stop loss and take profit levels if you’re not happy with the levels set previously.
If you want to exit the trade, click the X icon on the right.
What is copy trading on eToro?
eToro bills itself as a “social trading” platform, and these social features give eToro an unique dimension compared to most other online trading platforms. eToro’s copy trading feature lets you copy the trades made by other eToro users.
You can access this feature by heading over to the “Copy People” section in the navigation bar. The different traders that you can copy are sorted by risk level, so you can choose how risky of a trading strategy you’re comfortable with.
For each trader, you can see detailed statistics on how they have performed in a selected trade period and the changes they’ve made to their portfolio. You can copy up to 100 different traders at once. The minimum amount you can invest in a single trader is $200.
Trading on eToro
Of course, eToro offers plenty of other instruments for trading in addition to EURO STOXX 50. The company offers around 800 different stocks listed on a variety of global stock exchanges. Here’s a few examples of the assets you can buy on eToro:
The bottom line on trading EURO STOXX 50 on eToro
If you want to trade the EURO STOXX 50 index through an online platform, eToro is certainly worth checking out. The platform offers an extensive suite of features while providing an intuitive and beginner-friendly user interface at the same time. Not only does the platform allow you to trade traditional financial instruments like stocks, ETFs and indices, but you can also trade cryptocurrency on eToro.
The copy trading feature is also great for users who would like to invest in a diversified portfolio of stocks, but would rather leave the exact composition of the portfolio to a more experienced investor.