Contents
eToro is an outstanding broker for those who want to purchase Tether from Australia
Advantages:
- Allows to replicate investment tactics
- You can short sell
- Really intuitive and straightforward
- eToro offers leverage
- There are tons of possibilities for investments
Homepage: www.etoro.com/tether
If you are interested in purchasing Tether from Australia, eToro may be the best way to do it.
“Social trading”, a relatively new investment method that consists in replicating techniques and strategies from other experienced investors, has become popular thanks to eToro.
eToro has solutions for you, especially if you don't have much experience in trading, because it puts your investment on automatic by repeating strategies from other experienced people with a very long profit history. Additionally, in case you do have experience in investment, eToro pays you for sharing it with others.
Besides, the interface of this site is amazingly intuitive, ideal for users who want to begin in the Tether world, without ending up overwhelmed with tons of diagrams and numbers.
How does eToro work?
As we have referred among the positive aspects of eToro, the best thing about this platform is its extraordinary simplicity: anyone can use it without having to read endless explanatory texts.
If you have used before any of the most popular social networks today, you can perfectly manage eToro's interface.
Now we will walk you through the sign-up process and the different sections of the page that you should know.
When you open your account, you will have to fill in all the information that eToro asks for: first and last name, address…
Additionally, you will see that they ask you some questions about your experience as an investor.
But don't feel intimidated. They only intend to find out how much you know and which instruments to recommend for you.
Let's get to know the fundamental sections of the interface.
In “Set Price Alerts” you can set alerts on the price of certain assets. This is very helpful when you want to purchase an asset that is falling, but perhaps you think that it will decrease even more.
The section “News Feed” allows users to interact and learn from each other by sharing their opinion and experiences.
“Instruments”, “People” and “CopyPortfolios” are within “Discover”. And we discussed previously in this guide the different financial instruments on eToro:
- Cryptocurrencies
- ETFs
- Stocks
- Commodities
- Forex trading
- Index funds
In “People”, you will find the public profiles of eToro users and their performances. This is where the term “social trading” makes sense since you can replicate the movements of the investors that you find most inspiring.
Using the search bar, you can find the investors that you find more interesting: by risk level, types of financial assets, average earnings… Just indicate the amount you want to invest and eToro itself will be in charge of replicating the movements of the selected investor, in proportion. This means that if you put $ 1000 and the investor puts 10% of their capital in Amazon, eToro will invest $ 100 of your balance in the same company.
In this part you will also find the three most popular types of CopyPortfolios, which are Top Trader, Market, and Partner.
Sometimes you might prefer copying to CopyPortfolios than to individuals, since the former offer more diversity. The portfolios are easily identifiable: one about gaming, another about large drone companies, another about pharmacy … You think that a certain industry will prosper anytime soon? Then look, because surely there is a CopyPortfolio about it.
How to deposit funds on eToro
When it comes to payment on eToro, there isn't really much to say, since it is really straightforward. Just click “Deposit funds”, put an amount, and choose your payment method. You can use PayPal (available for some countries), bank transfer, credit card, Skrill, or Neteller.
Of course, keep in mind that for security policies, you need to be the holder of the account or the credit card.
The minimum you can deposit is $ 200 and there is a limit of how much you can deposit if you are not verified. Therefore, if you want to trade with higher amounts, contact Support previously to verify your account.
eToro accepts deposits or transfers in any currency, but charges a commission for making the conversion to USD. So it is better to use USD from the beginning.
ETFs
Have you heard about Exchange-traded funds or ETFs? They are similar to index funds and are known for merging the advantages of stocks and mutual funds: they can be traded regularly at market price, but have much more variety and the rates are significantly lower.
Shares
Stocks are the most common securities. Some companies divide their capital into fractions and have many shareholders. By investing money in them, you can own a portion of a company and obtain returns.
We can categorize stocks into two different kinds: the ones that divide their earnings regularly among the stockholders, and those that don't payout. The former ones are great, obviously, but investing in the latter can also be a good idea since the profit you can make by selling the shares can be even larger.
In the case of eToro, if you invest in equities that give dividends, these will be reflected in your balance, and you can collect them in cash or reinvest them. Our suggestion is, if you don't have financial urgencies, that you benefit from compound interest and reinvest it in the company.
Consider that on eToro you can “dope” your trades with leverage, but in that case, you will not receive interest as the trade would be a contract for difference. For long-term investments, it is not advisable to use leverage: not just because you lose dividends, but you will also have to pay commissions as long as you keep the position open, and these can end up with your profit.
About ETFs
ETFs or Exchange-Traded Funds are similar to index funds. We can say that ETFs are halfway between stocks and funds: they can be traded like regular stocks, but include a wide diversity of assets and the rates are much lower than those of an actively managed fund.
Index Funds
This is the best option for people who can invest in the long term, especially for beginners, because it is inexpensive, diversified, and the risk is lower.
Unlike a lot of people think, benchmark returns are very difficult to beat and very few fund managers have done it, apart from some specific cases, like Warren Buffett's.
If a fund manager brags about having beaten the benchmark, they probably did it for a short time or on a specific occasion, or perhaps the fees are so high that indexing would be a better decision anyway (with minimal commissions).
The good thing about index funds is that they solve those two issues: their commissions are minor and in the long term they almost always beat active managers.
About Contracts for Difference
If you have entered eToro previously, you probably realized that the initials CFD appear all the time. Before we come back to it, we must say that CFDs on eToro are only possible if you are short-selling or choose leverage above x2 (but this is not even an option on the platform).
We will also refer to terms such as short-selling and leverage, in case you are thinking about day trading cryptocurrency or other more advanced operations.
The good thing about eToro is that it lets you bet both “in the black” and “in red”. In a hypothetical case: you have the certitude that the Tether will fall, so probably you think that it is better to refrain from getting in until it actually falls. But if it really falls, it might mean extra money for you.
You can accomplish that by “going short”. More or less, this is how it works:
- You ask someone to lend you, for instance, 100 units of Tether, which cost $ 5,000 at the moment (these numbers aren't real)
- You make $ 5,000 by selling the 100 units
- The Tether devaluates from $ 50 to $ 30
- You get the 100 units again, but at $ 3,000
- You give back the 100 units
- You save the $ 2000 difference!
It is far more simple than it may seem. Just consider that by trading in Tether on eToro, you can make a profit if you foretell downs in the price.
Trading strategies
When trading cryptocurrencies, there are different possible methods or strategies, such as day trading or buying and holding, for naming just a couple.
My recommendation for those who are beginning to invest is something in the middle: placing a dynamic stop-loss (15-20% under the highest price) when you open your operation and wait for it to work its magic.
This means that if, for example, you buy a cryptocurrency at $ 10, it reaches $ 20, and after that it falls to $ 12, your operation will be closed at $ 16-17 and you will have earned a considerable profit.
I know it's tempting to look to sell when the price is at its peak, but unless you're a fortuneteller, that's impossible. The above strategy is much more down-to-earth and, well applied, it can work very well.
Later on, you will be able to apply more complex strategies, such as using leverage or going short to profit from bear markets.