eToro Scam Guide: How to tell fiction from reality
Like any online financial trading service provider, eToro has had its share of scam accusations. The term “scam” nowadays is used very loosely and covers a wide variety of incidents including: traders losing money on unsuccessful positions, neglecting to place stop loss and take profit orders, not paying attention to spreads, attempting to withdraw eToro credits as real money immediately upon receiving it, and generally having a bad day. This is not to say that there aren’t real Forex scams out there; there certainly are and one should take precautions not to fall into one. Needless to say that eToro with its licensed and regulated brokers, its almost two million strong community, and its extremely high standards of practice is not one of them, but let’s take a look at a few tell tale signs of the Forex scams lurking out there.
Why eToro is not a scam?
Sign #1: License and regulation information
The first thing you encounter when checking out a potential new broker is their website, and the first thing you should look for on the website is the license and regulation page. Here’s a link to eToro’s license and regulation page. Notice how the page displays not only the names of the brokers, the countries they’re licensed in, and their respective regulatory bodies, but also provides links to the actual licenses on these bodies’ websites. If the broker you are looking at does not present all of this information, mark that as a red flag and try to find the information yourself. If you can’t, the broker is liable to be a scam.
Sign #2: Support
A broker cannot function properly without a support team to assist its traders, and a real broker will have its team at your beck and call at all times. The eToro support team, for example, is ready to take your questions by live chat, email or phone 24/7. Whenever you’re considering a new broker, get in touch with support to see if they’re actually there.
Sign #3: Quality of technology and design
You have to assume that a scam broker is out to make easy money and doesn’t have the time, the money or the expertise to invest in quality software or design. At eToro, we’ve spent years developing our signature trading platform and social trading application (the eToro WebTrader and OpenBook), and have kept improving them and redesigning them for a better user experience year after year. We’ve even developed mobile trading and signals applications for Android which you can download for free at the Android market. If you see that your broker provides you only with a standard Meta Trader platform and has a shoddily designed website, investigate further or look for another broker for safety’s sake.
Sign #4: Social Buzz
As we’ve said earlier, forums can be misleading about whether a broker is a scam or not, because all brokers get same accusations at some point or other. A more reliable source would be the broker’s own trading community. eToro now has almost two million members in its OpenBook social trading network, who can not only discuss the latest trading trends and follow each other’s activities, but even copy each other’s trades automatically! All you have to do is head to the OpenBook web applicationand check out the latest trader discussions. Or better yet, sign up for a free demo account and start your own discussion asking for traders’ opinions about eToro. This way you are guaranteed to get a more balanced variety of opinions from traders who assuredly have experience trading with eToro. If the broker you’re looking at doesn’t even have a social trading network, you best look elsewhere for a broker that can provide you with this important new mode of financial investment.