Contents
eToro, recommended online trading platform for those in Ireland who want to purchase NEO
Some of its advantages are:
- There are lots of investment options
- eToro offers leverage
- Very user-friendly and simple
- Allows to learn from other investment strategies
- Accepts short-selling
Main site: www.etoro.com/neo
You should absolutely consider eToro in case you are thinking about buying NEO from Ireland.
eToro is popular for making “social trading” a trend. Social trading is a revolutionary form of investing in which traders can repeat the strategies of other investors who have been generating income for a long time.
eToro has solutions for you, even if you are still a beginner in trading. You can rest assured that you will be doing a smart investment move when replicating those from subjects with a long profit record. And for those skilled investors willing to share their techniques, eToro rewards your knowledge with money.
Besides, the interface of this site is amazingly manageable, ideal for users who want to start learning about NEO and trading, without getting crazy with tons of graphs and figures.
ETFs
ETFs or Exchange-Traded Funds are a kind of passively managed fund, 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 their commissions are much lower than those of an actively managed fund.
ETFs
Have you heard about Exchange-traded funds? They are similar to index funds and are known for combining the benefits of stocks and mutual funds, because they can be exchanged at any moment in the market, but have much more diversity and the fees are significantly lower.
Commodity market
Most people invest in raw materials due to their stability. While other assets tend to fluctuate more, raw materials prices vary less and offer security against inflation or market volatility. Nevertheless, prices do depend on supply and demand in the market, so if the fear of possible inflation provokes higher demand for a certain good, the price will also increase.
Take into account that raw materials don't pay dividends. Therefore, by investing in them you will only have a further income by selling them back.
Commodities can be divided into two main categories: hard raw materials and soft raw materials. The former include precious metals (such as gold, silver, copper, and platinum), industrial metals, and oil; while the latter are agricultural resources as cocoa, soybeans, rice, or sugar, among many others.
In case you are not familiar with the term “leverage”, we'll describe it briefly: it is the ability to use a higher amount than you actually have. For example, you can enter with $ 100, but if you leverage x2, your initial investment will be $ 200.
Why using leverage and how to do it
Let's say now that you know that the price of NEO is about to raise its price, thus you decide “going long”.
You are positive that NEO will go up, but you only have $ 1,000 available. Despite that, why miss the opportunity to make more money?
You could go to your bank, ask for a loan, put something as a guarantee, wait for it to be accepted, wait for the money, and then purchase NEO… But by that moment it is likely that your prediction was confirmed already and NEO is at such a high value that it is not worth trading.
With leverage, you can get that amount of money really easily. It's exactly like borrowing money, but much better: from eToro itself. You will be able to operate with much more money than you actually have on the eToro Wallet. As in the image below, you will see the different options you have:
With other assets, the leverage you can choose is higher. Why? Because cryptocurrencies are a value that is invested in the medium-long term, and leverage is used primarily for day trading or short-selling. Let's talk a bit more about how leverage works.
You start with $ 1,000 and decide to use leverage x2, which means you would really invest $ 2,000, since eToro would put the other $ 1,000.
A couple of days pass and turns out that you were right: NEO increases by 20% and your money has appreciated reaching $ 2,400. Ok, don't be greedy, let's sell.
Obviously, the 1k $ from leverage will be deducted, and you'll 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 you can make a profit of 40% (in the case you earn $ 400). That is pretty decent.
But not everything is wonderful. If everything goes ok and the price rises, you will make money. On the other hand, if the asset decreases, you will also lose more money than you invested.
Supposing that the asset didn't increase by 20%, but it decreased also by 20%, you won't lose $ 20 but $ 40, because of the leverage. That is why to operate with leverage it is crucial to know about 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 NEO at $ 100, you program eToro to close your operation 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 rising, which could be a mistake.
Stop Loss is even more necessary, particularly when trading with leverage, since a small loss could have a significant impact. Always remember to establish a Stop Loss lower than that suggested by the broker.
eToro Interface
We mentioned previously that eToro is very easy to manage. Anyone can start investing without having to read endless explanations.
Everyone who has previously used social networks like Twitter or Pinterest, knows enough to use eToro.
Let's talk about the sign-up process and the different sections of eToro that you should know.
When you open your account, you will have to enter your personal data.
They will also ask you about your previous trade experience.
But don't feel like you are taking an exam. The only intention is to know more about you and determine which financial instruments they should suggest according to your knowledge and experience.
Let's get to know the different sections of the platform.
With the “Set Price Alerts” tool, you'll be able to program an alert when an asset is at a certain price. This is perfect if you want to purchase a security that is falling but you believe it will decrease even more.
“News Feed” is the more “social” section. There, users can interact and share their knowledge.
“Instruments”, “People” and “CopyPortfolios” are within “Discover”. And we discussed previously in this guide the different financial instruments that are available on eToro:
- Cryptocurrencies
- ETFs
- Shares
- Commodities
- Currencies
- Index funds
The term “social trading” comes to life within “People”: that is where you can replicate the strategies of any investor you choose with just one click. You'll be able to see all their profiles and performances.
You can search for those traders that you find more interesting. You can search by risk level, trading market, profits or country, among other filters. When you choose an investor and indicate the amount you want to invest, eToro will automatically replicate their movements, proportionally. If you have $ 1000 and the trader puts 20% of their funds in an asset, the platform will invest $ 200 of your funds in the same asset as well.
You will also see the three main types of CopyPortfolios, which are classified into “Top Trader”, “Market” and “Partner”.
The benefit of using CopyPortfolios instead of copying people is that this way the risk will be more diversified. There are all kinds of portfolios that you can find easily and are divided by sectors. So, if you suspect a specific industry, like fashion or pharmacy, has good chances to succeed, you should look for that specific portfolio.
Investment strategies
There are different methods or ways for crypto trading, like day trading or buying and holding, for naming just a couple.
In case you don't have much experience trading, our suggestion is something in the middle: when you open your position, place a stop-loss order 15-20% under the top price, and let the rest happen on its own.
This means that if, for instance, you buy a cryptocurrency at $ 10, it reaches $ 20, and after that it falls to $ 12, your stop loss will close your position at $ 16-17 and you will have made a considerable profit.
I know it might sound more appealing to sell when the cost is at its highest, but that is simply not possible. The above strategy is much more realistic and, well applied, it can work very well.
Eventually, you will be ready for applying more advanced trading strategies, like using leverage or going short to profit from bear markets.