Etoro is great and I’m having loads of fun in social investing. So much so I would totally recommend trying it. Here’s a little link if you’d like to sign up and poke around, http://etoro.tw/YbDXcJ
However, whilst you’re thinking about spending your first free $50, there’s some super massive common pitfalls/mis-understandings that have stung me and I’d love you to know them too!
None of the traders are full time traders and they can sometimes be away from their computer when it really matters. Twice I have had traders not be able to close or extend deals whilst they are away. Once whilst they were travelling on a plane all his deals closed prematurely at a massive loss before a swing. The other time, the Trader was only using their phone app and a “mobile app only” bug stopped them selling the trade when it was peaking and we slid down the other side, going from a ~+60% trade to a ~+35% trade.
Personal issues, because they are lone-wolfs and not in a supported team I have lost 2 whole accounts because a trader had “personal issues” and pretty much disappeared from the virtual trading floor whilst there was lots of money at the table. All the copiers sat around and watched our accounts fly down to a 95% stop-loss and boom, that was it. Obviously, holy crap I hope they / their family are ok with what ever happened and I wish them the best. But this is all for new copiers to realise that it will affect them.
Professional, this is also related to the lone-wolfs. A particular trader was so sure that their deal would “rally” that they blew the account. I imagine if they were part of a team, someone would pop their head round and say… “er… chill out and cut your losses”.
Constant contact, when deals are green (+ve), comments are flying onto their wall saying, “you’re a wizard” and they “own a crystal ball”. When they are in the red (-ve), most followers will be seen on the trader’s wall throwing panicky statements about “don’t f* it up” and “are you sure this is right…?”. If a trader is able to maintain some constant contact on their own wall and say “calm down” and “we’ll be fine” in the good or bad times, then us hoi polloi stay calmer and more trusting.
my gain would be 0% without them
Don’t forget when you’re on eToro, you are mostly following the trades of amateurs. That’s not a bad thing and not meant to sound derogatory, and my gain would be 0% without them. Some of them are absolute whizzes and come back with a +50% increase every now and again which I imagine any stock broking team leader would want to hire. However, they’re not hired. So expect not a couple but more than a few proper and total breakages.
It all boils down to, “don’t forget you are mostly following amateur’s decisions” so only play with money you can really afford to lose.
If you’d like to try it, here’s my referral link to try it out (if you sign up, we both benefit). http://etoro.tw/YbDXcJ
Note: I am totally happy with all the traders I follow and thank them for their efforts, that’s why this is a constructive post not a “name and shame”. It is my choice to copy trade.