Most traders consider eToro an extremely reliable and secure broker that you can trust. This opinion is based on the broker’s long history of honest work, its emphasis on security, and its insurance features that make sure you won’t lose your money even if something goes wrong. But you should know which assets are insured and which are not to make rational decisions about investing. In this article, we tell you more about these conditions offered by eToro and explain how they work.
Founded in 2007, eToro is widely known as one of the best online brokers. The broker’s most popular feature is its copy trading program that allows you to follow other traders and replicate their positions to make money passively. However, eToro offers attractive trading conditions for active traders, too: it has a decent array of available assets, leverage rates of up to 1:30, and pretty low fees. It’s especially popular in Europe, but the broker actually has several offices all over the world.
The broker is known to be heavily regulated: its operations are closely monitored by FCA, ASIC, and CySEC. That means it has to comply with strict security and transparency requirements, so you can be sure that your money won’t go missing suddenly. However, eToro is also known to have a special insurance program that guarantees refunds to its clients if the broker somehow goes insolvent. This eToro insurance policy also covers some other ways you can lose your assets.
How it works
The insurance offered by eToro is provided in partnership with Lloyd’s of London, a reputable market of insurance services. They cover up to about one million euro, and you become automatically eligible for insurance once you sign up and start using eToro. The program covers many various risks: you will receive your money back if the broker goes bankrupt (that’s very unlikely, however), if the broker or its employees cause financial damage to you, or if your assets get stolen.
However, you must understand that the insurance policy doesn’t cover any losses resulting from your own actions. It should also be noted that not all assets are equally insured: for example, you can get a refund for lost cash (the exact amount may differ, however) or stocks, but any non-CFD assets are not insured. That means your crypto portfolio is also unprotected, so invest at your own risk.