Why we reccomend eToro for investing in Monero from Bangladesh?
Some of its advantages are:
- It takes other successful investment strategies so you can replicate them
- You can go short
- It's uncomplicated and user-friendly
- eToro allows leverage
- Lets you invest in thousands of other goods
Go to the official page in English: www.etoro.com/monero
You should certainly consider eToro if you are thinking about purchasing Monero from Bangladesh.
eToro is famous for making “social trading” a trend. Social trading is a revolutionary form of investing in which users can replicate the movements of other traders who have been generating earnings for years.
If you are a novice user or do not have much investment experience, eToro is great for you. You can rest assured that you are making a smart investment since the site emulates those from subjects with a long profit record. Additionally, in case you do have experience in investment, eToro pays you for sharing it.
Besides, this platform is completely manageable, great for those who want to begin in the Monero world, without ending up overwhelmed with tons of numbers and information.
How to deposit funds on eToro
When it comes to depositing money on eToro, there isn't really much to say, since it is really straightforward. Just click “Deposit funds”, type an amount, and choose the payment option you prefer. You can pay with PayPal, bank transfer, credit card, Skrill, or Neteller.
(Consider that you should be the account or credit card holder, for security reasons).
You can start with a $ 200 deposit, and there is a limited maximum for unverified accounts. So, if your intention is to deposit larger sums, you should contact Support to verify your account.
Additionally, remember that you can make the transfer in any currency because eToro defaults all deposits to USD, although it charges a fee, so it is preferable to make the transfer directly in USD.
In case you haven't heard about “leverage”, we'll put it short. When trading, it's the capacity of enlarging your investment by borrowing money from the broker. For example, you can enter with $ 100, but if you use x2 leverage, you will be investing $ 200.
About leverage, Take Profit and Stop Loss
Let's say that you are confident that Monero will rise, and you want to “go long”. You have $ 1,000, but you actually can invest more and make more money.
There's the possibility of asking for a credit, but you must know that all the process takes time, and when you receive the money, Monero might be already at a much higher price, so you wouldn't be able to invest the way you planned.
Leverage is like a credit, but it is only a few clicks away! eToro allows you to invest (and earn) much higher amounts than what you actually have on the platform's wallet. Before trading, you will find the leverage options as in the screenshot:
When trading in different markets you can use more leverage. This is because leverage is most common in short-term operations or day trading, and cryptocurrencies tend to be a medium or long-term investment. Let's talk a bit more about how leverage works.
You enter with $ 1,000 and pick leverage x2, which means you would have $ 2,000 to invest (the extra $ 1,000 to reach $ 2,000 are “borrowed” from eToro).
A week after that, Monero rises up by 20% and now your investment costs 2,400. So, a wise decision is to sell them back now.
First of all, the 1k $ of the leverage will be deducted. You have $ 1,400 left, of which $ 1000 is the money you put in yourself, so the net profit is $ 400.
In conclusion, by investing $ 1000 and obtaining $ 400, your net profit would be 40%. That is pretty decent.
It may sound too good to be true. The thing is, it can also play against you. If everything goes according to plan and the price goes up, you will make more money in less time; but if the value of the asset goes in the opposite direction, you will also lose more in less time.
For example: if instead of increasing by 20%, the price falls by 10%, you do not lose $ 10, but twice (the leverage) that figure, that would be $ 20. Therefore, when using leverage it is very important to take into account Take Profit and Stop Loss.
Take Profit is used as a form of reducing risks when trading. When you enter, you can set a profit limit and ask that your position is automatically closed when the asset reaches a price.
If you purchased Monero at $ 100, you program eToro to close once it reaches $ 120. That way, you make sure you won't be blinded by greed and decide to keep waiting in case it keeps rising, which could be a mistake.
On the other hand, when operating with leverage you also have to use Stop Loss, because a small decrease in the price of an asset can lead to a substantial loss. You always need to set a Stop Loss lower than that suggested by the broker.
Exchange-Traded Funds
Exchange-Traded Funds or ETFs are a kind of passively managed fund, similar to index funds. They can be described as a combination of stocks and mutual funds. They can be traded like regular stocks, but include a wide diversity of assets and have lower fees.
Stocks
Stocks are the most popular securities. Some publicly traded companies decide to split into fractions and have many shareholders. By investing money in them, you can own a portion of a company and obtain returns.
We can classify stocks into two different kinds: those of companies that distribute their earnings among the shareholders and those that don't pay regularly. Does that mean that you should only consider the former? No, of course not: if a company does not pay out dividends but has a lot of potential, you should not give it up just because it does not pay you every year, since selling the shares in the future could pay a lot more.
In the case of eToro, if you invest in equities that distribute dividends, these will be reflected in your balance, and you can collect them in cash or reinvest them. We suggest, if you don't have financial urgencies, that you benefit from compound interest and reinvest it in the company itself.
If you trade with stocks on eToro, you will be able to use leverage. However, it is not advisable, since it would be a CFD and you would not get dividends. On top of that, equities are usually long-term investments, and you have to pay commissions.
Index Funds
If you want to invest in the long term, and you won't need to withdraw your money in at least five years, index funds can be the best alternative. This kind of investment is also great for beginners since it is safer. Besides, they offer more variety.
You may have a different idea, but very few investors can beat the benchmark (although you have probably heard of managers who obtain huge returns).
But besides Warren Buffett and a couple more, all that glitters is not gold: if you hear of someone who has beaten the market, it was probably for a limited time, or their fees are really high. Besides, if something happened once, it doesn't necessarily represent a regular behavior.
With index funds, you won't be concerned about that: they usually beat active managers in the long term, and the rates are so much lower.
eToro Interface
We mentioned previously that eToro is very friendly and intuitive. Anyone can start using it without having to read endless explanations.
If you have used before any of the most common social networks, you can perfectly manage eToro's interface.
Now we are going to walk you through the registration process and the sections of the page that you should know.
When you open your account, you will have to fill in your personal data, like first name, last name or address.
Additionally, you will have to answer some questions about your experience as an investor.
But don't feel intimidated. The only intention is to know more about you and determine which financial instruments they should recommend according to your knowledge and experience.
As soon as you are registered and have completed your profile, you will stop seeing the “incomplete profile” message.
Let's review the different functions of the interface.
With the “Set Price Alerts” tool, you'll be able to program an alarm when an asset is at a certain price. Just click the tab and you will be able to set it. This is helpful in case you want to purchase an asset that is falling but you believe 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 already discussed the kinds of assets on eToro:
- Cryptocurrencies
- Exchange-Traded Funds
- Stocks
- Raw materials
- Currencies
- Index funds
The term “social trading” makes sense within “People”: there, you can duplicate the movements of the investors you find most inspiring. You'll be able to see all their profiles and historical performances.
You can search for those users that you find more interesting: by risk level, types of instruments, average earnings… Just indicate the amount of your investment and eToro itself will be in charge of replicating the movements of the selected investor, in proportion. “In proportion” 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.
Also, here you will see CopyPortfolios classified into three categories, Top Trader, Market, and Partner.
The benefit of copying to CopyPortfolios instead of specific traders is that this way the risk will be more diversified. There are all kinds of portfolios that you can recognize easily and are divided by sectors. Thus, in case you think a specific industry, like biotechnology or pharmacy, has a good chance of prospering, you can look for that specific portfolio and do your investment.