Contents
eToro, our favorite platform for investing in Monero in Egypt
Some of its benefits are:
- You can make investments in countless of other goods
- Leverage is allowed
- It is uncomplicated and user-friendly
- It takes strategies from experienced investors so you can copy them
- Admits “shorting” or short-selling
Main site: www.etoro.com/monero
In case you are interested in obtaining Monero from Egypt, eToro may be the best way to do it.
This platform is known for making “social trading” a trend. Social trading is an ingenious way of investing in which users can replicate the techniques of other traders who have been making profits for years.
If you are a novice user or do not have much experience in investments, eToro is very helpful, because it puts your investment on autopilot by repeating strategies from those who have been doing it for years. Oppositely, if you are an investor willing to share your techniques with the community, eToro pays up for it.
Besides, the interface of the platform is so uncomplicated, great for users who want to begin in the Monero world, without ending up overwhelmed with tons of diagrams and numbers.
How to deposit funds on eToro
Within the payment options that you will find on eToro are: credit card, PayPal, bank transfer, Neteller, and Skrill. Making a deposit on eToro is so simple: go to “Deposit funds”, set an amount and choose the payment method you prefer.
Consider that for security reasons, you need to be the owner of the account or the credit card.
The minimum you can deposit is $ 200 and there is a limited amount if you are not verified, so if you plan to operate with larger sums, you should verify your account previously.
eToro allows transfers in any currency, but you will have to pay a fee for the conversion to USD. So it is better to use USD directly.
How are CFDs and futures different?
What are the main differences between CFDs and Futures?
- Counterparties
- Futures: the counterparty is someone else, another trader.
- CFDs: you do not operate with another individual, but the counterparty is the broker.
- Expiry:
- Futures: there is an expiration date. Once the contract expires, it is closed and can't be reopened.
- CFDs: there is no expiration date. As a result, you can wait until you get in a good position before closing.
- Trading markets available:
- Futures: options are much more restricted
- CFDs: you have plenty of options to choose from, there are CFDs of practically anything
- Minimum deposit amount or “trade size”:
- Futures: very high minimum investment
- CFDs: it is very low
- Costs and commissions:
- Futures: as you have to pay more in the first place, fees are lower
- CFDs: higher (although not excessively)
- Leverage:
- Futures: you can't leverage
- CFDs: it is always possible to leverage
Do you know the term “leverage”? Just in case, we'll put it simply:
another advantage of trading is that it lets you invest higher amounts than you can have in a given time. Let's say that you enter with $ 100 and you put them with x2 leverage, the amount of your investment will be $ 200.
Leverage and the importance of “Take Profit” and “Stop Loss”
Assuming that, for example, you are sure that Monero is going up, and that you have $ 1,000 for “going long”, you must know that you have the option of investing more and making more money.
Possibly, you could ask your bank for a credit, wait for it to be accepted, wait for the money, send the money to eToro, confirm that it arrived, and then acquire Monero… But by that moment it is likely that your prediction was confirmed already and Monero is at such a high value that it is not worth trading.
Leverage is like a loan, and you will only have to click a few times! You will be able to invest (and earn) much more than what you have on the platform. You will simply see the different options as in the image below:
With other assets, the leverage you can use is higher. This is because cryptocurrencies regularly represent medium-long term investments. However, leverage is used especially for short-term operations or day trading. But let's see how leverage works:
- If you want to invest $ 1,000 and you use leverage x2, you will be starting with $ 2,000 (remember that$ 1,000 are a “loan” from eToro).
- A few days later, Monero does increases, as you assumed, and now the price of your investment is $ 2,400 (20% more), so you decide to sell back.
- Once the $1,000 from leverage is deducted, you will have $ 1,400 left; which means you've earned $ 400, since the other $1,000 was yours from the beginning.
In conclusion, by investing $ 1000 and obtaining $ 400, your net profit would be 40%. That is quite good.
But there's always a drawback. If everything goes ok and the asset increases, you will make profits. On the other hand, if the price goes down, you will also lose more money really fast.
Let's imagine that the price didn't increase by 20%, but it decreased also by 20%, you won't lose $ 20 but $ 40, because of the leverage. For that reason, the concepts of Take Profit and Stop Loss are fundamental when trading with leverage.
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 when it reaches $ 120. That way, you make sure you won't be blinded by greed and decide to wait a bit longer in case it keeps going up, which could make you lose it all.
Stop Loss is even more necessary, mostly when trading with leverage, since a small loss could be tragic for your wallet. Consider that eToro will recommend a limit for Stop Loss, but it is better to set it lower than the platform suggests.
What are Contracts for Difference?
You probably have seen the acronym CFD all the time if you entered eToro before. Before we come back to it, we must say that CFDs on eToro are only possible if you short sell.
In case you want to try at some point day trading cryptocurrency or other advanced trading practices, you will also find out about concepts such as short-selling and leverage.
Even if you aren't “in the black”, you can still bet on eToro with CFDs. For instance, you are sure that the Monero will go down, so perhaps you consider that it is better to wait until it does and then go in. However, if it really falls, it might mean extra money for you.
You can do that by “going short”. Here's how it works:
- They lend you, let's say, 100 units of Monero, valued at a total of $ 5,000 (these numbers are entirely made up)
- You make $ 5,000 by selling the 100 units
- The Monero goes from $ 50 to $ 30 (as you calculated, the value decreases)
- You obtain the 100 units again, but at $ 3,000
- You return the 100 units to the loaner
- The difference is yours, so, you will have earned $ 2000
It all seems more tricky than it really is. Just take into account that by trading in Monero on eToro, with CFDs you can make a profit if you foretell downs in the price.
eToro Interface
We mentioned previously that eToro is very friendly and intuitive. Anyone can start investing without previous experience or long explanations.
You won't have any problems with the interface if you are familiar with any other social network.
Now we will detail the sign-up process and the different sections of the page that you should know.
You will have to provide some personal data when registering.
During the sign-up process, you will also have to answer some questions about your previous investment activities.
But don't feel like you are taking an exam. They only intend to find out about your previous experience and knowledge to determine which assets to recommend for you.
Let's get to know the fundamental sections of the page.
With the “Set Price Alerts” tool, you'll be able to program an alarm when a security is at a certain price. This is helpful if you want to purchase a security and you are waiting for its price to fall.
In the “News Feed” tab is the most social part of eToro: where users are interacting all day and sharing opinions, tips, and other valuable information.
In “Discover” you will find: “Instruments”, “People” and “CopyPortfolios”. As we discussed previously, the six types of instruments on eToro are:
- Cryptocurrencies
- Exchange-Traded Funds
- Shares
- Raw materials
- Forex
- Index funds
The concept “social trading” makes sense in the section “People”: there, you can duplicate the movements of any user you choose with just one click.
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 will replicate the movements made by the investor you selected, in proportion. “In proportion” means that if you have $ 1000 and the investor puts 10% of his or her balance in an asset, the platform will invest also 10% of your funds (in this case $ 100) in that same asset.
In this section you will also see the three main types of CopyPortfolios, which are Top Trader, Market, and Partner.
In some cases, you might prefer copying to CopyPortfolios than to individuals, since you avoid putting all your eggs in one basket. There are all kinds of portfolios that you can identify easily and are divided by sectors. Therefore, if you think a specific sector, such as e-commerce or oil, has good chances to succeed, you can look for that specific portfolio and invest.
Trading strategies
When trading cryptocurrencies, there are different possible methods or strategies, such as buying and holding or day trading (and using price fluctuation in your favor), for naming just a couple.
In case you don't have much experience trading, I recommend 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.
Therefore, if for example you acquire a cryptocurrency at $ 10, it reaches $ 20 and then falls to $ 12, your operation will be closed at $ 16-17 and you will make a pretty good profit.
Perhaps you are wondering: why not selling when the price is at its maximum? But unless you are a psychic, that is just not possible. The mentioned strategy can work perfectly and give good results.
Sooner or later, you will be ready for using more advanced investment strategies, such as short-selling or using leverage.