Contents
eToro is an excellent brokerage platform for those who want to purchase Ripple from Bangladesh
Why do we recommend it?
- Allows to copy investment moves
- You can short sell
- User-friendly and straightforward
- You can leverage
- There are uncountable possibilities for investments
Official main site: www.etoro.com/ripple
You should consider eToro in case you are thinking about acquiring Ripple from Bangladesh.
“Social trading”, an innovative way of investing by replicating techniques and strategies from other experienced investors, has become popular because of eToro.
eToro is very helpful if you don't have much experience in trading, since it automatizes your investment by repeating strategies from other experienced people with a very long profit history. On the other hand, if you are an expert in the field and decide to share your methods with other traders, eToro rewards you with money.
It is also worth mentioning how easy is to manage this platform, excellent for new traders who are taking their first steps with Ripple.
How do Contracts for Difference Work?
It is possible that you have found the acronym CFD now and then if you already accessed eToro. Before we explain this further, we must say that cryptocurrency operations on eToro are only CFDs when you short sell or use leverage above x2 (but this is not even an option on eToro).
In case you want to know about day trading cryptocurrency and other more advanced operations, you will also find information about concepts such as short-selling and leverage.
eToro allows you not only to bet “in the black”, but through CFDs you can also bet “in red”. Let's say that you are sure that the Ripple will fall, so the logical thing is to think “if it is going to depreciate or go down, I'll just wait and bet when it has gone down”. But if it actually falls, you can make some profits out of that.
You can accomplish that by “going short”. More or less, this is how it works:
- You ask someone for a loan of, let's say, 100 units of Ripple, which total value at the moment is $ 5,000 (these numbers are made imaginary)
- Next, you sell them at their price at the moment, $ 5,000
- The Ripple goes from $ 50 to $ 30 (as you thought, it devaluates)
- Again, you buy the 100 units, but now they are worth $ 3,000
- You pay back the 100 units
- The rest is yours, so, you will have earned $ 2000
Take into account that it is much easier than it sounds: we can summarize this whole operation by saying that by trading in Ripple you can also make money if you predict it will fall.
If you still don't know what “leverage” is, we'll describe it briefly. When trading, it's the capacity of multiplying your investment by borrowing money from the broker. For example, you can enter with $ 100, but if you leverage x2, your initial investment will be $ 200.
Leverage, Take Profit and Stop Loss
Let's say now that you are sure that Ripple is going to rise, and you decide “going long”.
You are completely certain that Ripple will go up, and you just have $ 1,000 at that moment, but the fact is, you have the chance of investing more.
You could consider asking for a loan at your bank or other financial company, but it is a process that takes time, and when you receive the money, Ripple might be already so expensive (if your guess was right) that investing wouldn't be convenient anymore.
Leverage is like a credit, but it is only a few clicks away! eToro allows you to operate with 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 operating in different markets you can use more leverage. Why? Because leverage is most common in short-term operations, and cryptocurrencies tend to be a medium or long-term investment. But let's deepen a bit more on how all this works.
If you have the $ 1,000 and use leverage x2, your investment is 2 * $ 1,000, that is to say, $ 2,000. eToro gives you the remaining amount to reach that figure.
A week later turns out that Ripple goes up by 20% and now your investment costs 2,400. So, a wise decision is to sell them back now.
You will have to give back the $ 1,000 of leverage and the net profit would be $ 400 (since the other $ 1,000 was your initial investment).
With $ 1000 you get a profit of $ 400, no less than a profit of 40%. That's not bad at all, right?
But watch out: if all goes as you planned and the asset increases, you will make money. Nevertheless, if the price goes down, you will also lose more money really fast.
For instance: if instead of increasing by 20%, the price falls by 10%, you won't lose $ 10, but $ 20, because of the leverage. Therefore, when trading with leverage it is crucial to be familiar with other two terms: 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 bought Ripple at $ 100, you can ask eToro to close when it reaches $ 120. That way, you make sure you won't be blinded by greed and decide to keep waiting in case it keeps going up, which could be a mistake since the price could go down again.
Stop Loss is even more important, especially if you use leverage, because a reduced loss with leverage can have a significant impact on your wallet. That is why it is vital to establish a Stop Loss lower than that suggested by the platform.
Investment strategies
There are many cryptotrading methods: for example, you can buy and hold, or you can day trade (and benefit from price volatility).
My recommendation for those who are starting to trade is something in the middle: when you open your Ripple position, place a stop-loss order 15-20% below the maximum price, and let the rest happen on its own.
For example, if you purchase a cryptocurrency at $ 15, it increases to $ 25 and decreases back to $17, the stop-loss will close your position at $ 21 or $ 22. Thus, you will obtain a good profit.
You may be wondering: why not selling back when the cost is at its highest? But unless you are a psychic, that is just impossible. The mentioned strategy can work perfectly and give good results.
Later on, you will be able to apply more sophisticated techniques, like short-selling or using leverage.
eToro payment methods
When it comes to depositing funds on eToro, there isn't really much to say, since it is pretty simple. Just click “Deposit funds”, type an amount, and choose the payment option you prefer. You can pay with PayPal, bank transfer, credit card (Visa, MasterCard, Diners, Visa Electron and Maestro), Skrill, or Neteller.
Of course, take into consideration that for security policies, you should be the account or credit card holder.
The minimum first time deposit is $ 200, and there is a maximum limit for unverified accounts. Thus, if your intention is to deposit higher amounts, you should contact Support to verify your account.
Finally, know that you can make the transfer in any currency because eToro defaults all deposits to USD, but charges a commission for it, so it is better to make the transfer directly in USD.
Can you trust eToro?
eToro is very meticulous with the information about past performances from investors, and its reliability has been tested many times by independent organizations.
The main office of eToro is located in Cyprus, and the platform is approved by the Cyprus Securities Market Commission (known as CySEC), which covers debts up to € 20,000 from its clients. Furthermore, eToro follows all the strict policies of the European Union.
eToro responds to the European Financial Instruments Market (MiFID), and to the Financial Conduct Authority (FCA) in the USA. Apart from the above, it has a trajectory of fifteen years, with more than 20 million users around the world. So, you can be sure that your finances are safe.
Finally, their excellent customer service is also worth mentioning. They have a phone number for assistance, a ticketing system to track any claim, and a live chat.
Virtual portfolio: How does it work?
Are you taking your first steps in trading? Using a demo account can be useful. Just make sure the virtual mode is set and you can start operating with “fake” funds.
A virtual account can help you to practice and gain experience before starting to trade with real money. When you create your demo account, you will begin with a virtual balance of $ 100.000, to operate with a variety of financial instruments available on the platform, besides Ripple.
Don't worry, since if you lose all your virtual funds, you can contact support so they can add them back to your demo account and you can make a second attempt.
However, remember that investing is mainly about being cold-minded, and demo account trading can have an adverse effect. It is completely different to risk your real savings than to operate with virtual funds that you don't mind losing. Also, using fake money can prevent you from learning to control your emotions, as a true investor should.
Finally, the virtual mode is kind of absurd if you want to trade in the medium or long-term, since you would be wasting years to see the results. Virtual accounts may be useful for practicing before trading in the short or medium-term.
eToro Interface
As we have mentioned among the positive aspects of eToro, the best thing about this platform is its extraordinary simplicity: anyone can trade without having to read endless explanations.
If you have used before any of the most popular social networks today, like Whatsapp or Pinterest, you can perfectly use eToro's interface.
Let's talk about the registration process and the different tabs you will find on the page.
You will have to provide some personal data when registering.
They will also ask you about your previous trading activities.
However, it's not like they're testing you or anything. They are only measures to know how much knowledge you have and what type of financial instruments they can suggest. For instance, if you have never invested before, they will not suggest that you invest in futures.
Let's see what the different sections of the page are.
In the “Set Price Alerts” tab, you have, as its name indicates, the possibility to put alerts on the price of certain securities. You only need to click on the three points at the end of the line and you will be able to program a price alert. This is very helpful when you are after an asset which price is decreasing, but perhaps you think that it has not finished falling yet.
The section “News Feed” allows users to interact and learn from each other by sharing their opinion and experiences.
“Discover” includes the tabs “Instruments”, “People” and “CopyPortfolios”. And we already talked about the kinds of assets on eToro:
- Cryptocurrencies
- Exchange-Traded Funds
- Stocks
- Raw materials
- Forex
- Index funds
In “People” are all the profiles and historical performances of other users, and you can replicate their movements with just one click. This is where the “social trading” term is best applied.
In this section, you can find those traders that you find more interesting. When you select an investor and indicate how much money you want to invest, eToro will automatically replicate their movements, proportionally. For example, if you have $ 1000 and the user puts 20% of their funds in an asset, the platform will also invest 20% of your money in the same asset, in this case, $ 200.
You will also see the three main types of CopyPortfolios, which are classified into “Top Trader”, “Market” and “Partner”.
Sometimes you might prefer copying to CopyPortfolios than to particular traders, because you avoid putting all your eggs in one basket, or in other words, risk is more diversified. The portfolios are identified so you can recognize them easily: one about gaming, another about large drone companies, another about pharmacy … Do you suspect that a certain sector is going to succeed anytime soon? Then look, because surely there is a CopyPortfolio about it.