Types of accounts on eToro, and how to choose the best account type for you

TutorialsJune 26, 2022

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Before trading and investing in any exchange, you first need to learn about the different account types. And choose for yourself the most suitable account type.

With the eToro trading platform, account types are classified according to different criteria. Those criteria are regulations of ESMA, amount of investment capital, and country and territory. The article details these types of accounts.

Demo Account and Real Account

Demo Account

Before going into the classification of account types on eToro, you need to know about Demo accounts.

When you open an eToro account and the real account, there is always a conversion to a Demo account built into the account.

eToro gives you 100,000usd virtual in Demo account.

The demo account is where you get acquainted and trade on eToro. You can practice opening real-time buy/sell orders of the market. The chart in the demo account is the same as in the real account. So you can learn to observe the market and put the theory you have learned into practice until you are confident and ready to trade without worrying about losing real money.

The only difference is that you cannot withdraw profits/amounts to your bank account because this is just virtual currency.

Real account

It is your real trading account. And it is classified according to different criteria detailed below.

Types of eToro accounts by ESMA

ESMA is the European Securities and Markets Authority. It is an independent EU body that contributes to the stability of the European Union’s financial system as a regulator. In doing so, the ESMA enhances investor protection and promotes stable and orderly financial markets.

According to ESMA regulations, eToro divides into two different account types:

  • Retail Account
  • Professional Account

Retail Account

When you sign up for an eToro account, your account is a retail account. For Retail Account:

  • Protection: the account type that receives the highest level of protection from eToro (such as Investor Compensation Fund, etc.)

In addition, Retail customers also benefit from negative balance protection* and limited margin payments.

  • Investment Assets: With this account, investors can access all types of assets on eToro. You can choose to trade yourself or copy trades from professional investors and investment funds (Copy Trading).
  • Leverage: However, for this account, leverage is limited. The maximum leverage for each asset class is: x30 for major currency pairs (such as EUR/USD); x20 for other currency pairs (such as EUR/NZD), Gold, and major indices; x10 for commodities (except Gold) and other indices; x5 for share CFDs (stocks) and ETFs; x2 for Cryptocurrency CFDs (due to the high volatility of the crypto market and the risk that for investors, eToro is currently disabling leverage on crypto positions)
  • In general, limits on leverage ratio are one of eToro’s policies to protect customers – inexperienced and inexperienced investors from the possibility of losing their capital.
  • Minimum deposit required: $200 for amateur accounts and $50 for later.

* Negative Balance Protection – In cases where your account goes negative, eToro will cover that loss and set your equity to zero.

Professional Account

This account type is intended for professional traders and investors, about primary benefits like amateur accounts. But there are the following differences.

  • Protection: You have the same negative balance protection as a Retail account. However, a limitation for professional clients is that they not be protected by the Investor Compensation Fund (such as amateur accounts) and the Financial Ombudsman Service. 
  • Leverage: The main benefit of a pro account is high leverage (1:400). In addition, it has lower transaction fees and spreads.

To upgrade an account from a retail account to a pro account, you need to meet the following criteria:

  • Minimum $500,000 portfolio and excluding cash.
  • Make at least ten trades with a total value of at least $500,000 in recent times.
  • At least one year of working experience in the financial sector.

Types of accounts by amount of invested capital

Retail accounts continue to be classified by the amount of invested capital. It’s called eToro Club.

eToro Club membership is determined based on the user’s actual net worth at midnight GMT each day. If you meet the property value requirement, the account is automatically accepted, and the club class changes the following day:

  • Silver: $5,000
  • Gold: $10,000
  • Platinum: $25,000
  • Platinum+: $50,000
  • Diamond: $250,000

Benefits of each account level

With each member level, you will have different benefits: having your account manager, receiving exclusive analysis news for members, free withdrawals from the Platinum level, and higher benefits from the eToro Money program (currently available for UK customers), benefits from staking crypto…

See details of benefits of account type by investment capital here.

Account types by country and region

Finally, the account type is divided by country and territory. It is a particular case.

eToro is a global investment platform. However, in some countries and territories, there are separate financial regulations for that country or region. So the accounts of the citizens of that country are different. Here are those exceptional cases.

Islamic eToro account

Islamic accounts are open exclusively for Muslim investors. Under Sharia law, these accounts receive unique benefits such as:

  • Don’t pay any transaction fees, such as commissions or swaps.
  • Use leverage with no interest.
  • The only expense to be paid is the spread (the difference between the buying and selling prices).

To open an Islamic account, you are in a regular eToro account. Next, you need to deposit a minimum of $1,000. Finally, you open a ticket to contact support, requesting to switch to an Islamic account.

eToro USA account

In 2018, eToro launched in the US market, allowing investors to open trading accounts on the platform. Each state has its laws, so some states may not be available. Update the list of states directly here

Initially, eToro only offered crypto products for eToro USA accounts. Currently, the eToro USA account can trade some types of stocks.

Conclusion

Above is an article about the accounts available on the eToro trading platform. If you are about to invest in eToro, choose the appropriate account type for yourself. If you have traded on eToro, please determine the type of account you are using to ensure benefits.

In the future, eToro may update more account types (if any).

Read more: etoro

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