Choosing a trustworthy broker is fundamental to an excellent online trading experience. eToro is a leading provider of social trading services, and it has licenses from the Financial Conduct Authority (FCA) and the Australian Securities and Investments Commission (ASIC). It has secure platforms and account authentication methods.
|Broker listed on stock exchange||No||Yes||No|
|Annual financial statements on website||No||Yes||No|
|Mobile two-step authentication||Yes||No||Yes|
|Broker ownership transparency||No||Yes||No|
|Broker management transparency||Yes||Yes||No|
|Broker is audited by the Big Four||No||Yes||No|
Each broker has strengths and weaknesses. This article answers the question, “Is eToro legit?”
Regulation & Investor Protection
The foundation of a broker’s trustworthiness is the top-tier regulation and investor protection programs. eToro is regulated in the UK, Cyprus, and Australia. It has licenses from the FCA and ASIC.
|Country of regulation:||UK, Cyprus, Australia|
|Investor protection amount:||£85,000 for UK residents, €20,000 for non-UK residents|
The FCA in the UK offers the Financial Services Compensation Scheme (FSCS) with protection for £85,000 for each covered account. The investor protection amount for non-UK residents is €20,000.
Additional areas that support the trustworthiness of a broker are banking background, stock exchange presence, transparent financial statements, two-step authentication (2fA), ownership transparency, and auditors.
A banking history adds to the safety of an online broker. eToro doesn’t have a banking background.
Stock Exchange Presence
A brokerage firm listed on a stock exchange is trustworthy and versatile. Presence on a stock exchange tells traders that a broker follows strict reporting requirements. No stock exchange lists eToro.
Transparent Financial Statements
Financial statements reveal insights about a brokerage firm’s practices. eToro doesn’t publish annual financial statements.
An online trading account must benefit from the best safety measures. eToro offers two-step authentication on all its platforms.
Ownership & Management Transparency
eToro displays the basics of its management structure on etoro.com. eToro doesn’t publicly share details about its ownership structure.
Big Four Auditors
The Big Four audit trustworthy online brokers. These auditors are KPMG, PWC, Deloitte, and EY. The Big Four do not audit eToro.
eToro is a leading social trading broker with excellent services and platforms. It is a trustworthy broker with top-tier licenses. You should read our in-depth reviews to learn more about brokerage firms and safety features.
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