Contents
Why we reccomend eToro for investing in Monero in Thailand?
Why do we recommend it?
- There are tons of goods you can invest in
- You can leverage
- User-friendly and straightforward
- It offers other successful investment strategies so you can emulate them
- Allows short-trading
Main site: www.etoro.com/monero
You should definitely consider eToro in case you are interested in acquiring Monero from Thailand.
“Social trading”, a relatively new way of investing by replicating techniques and moves from other experienced investors, has become trendy because of eToro.
If you are a beginner or do not have much investment experience, eToro is very helpful, because it puts your investment on automatic by replicating moves from those who have been doing it for years and making profits. And for those skilled investors willing to share their techniques with others, eToro rewards your knowledge with money.
Besides, the interface of the website is so uncomplicated, ideal for those who want to begin in the Monero world, without stressing over lots of diagrams and figures.
Is eToro safe for purchasing Monero?
eToro is very meticulous with the data about past performances from users, and its reliability has been tested many times by independent organizations.
Legally, eToro fulfills all the strict regulations requested by the European Union, legislation in which it is found. Its main headquarters is in Cyprus, where it is approved by the CySEC or Cyprus Securities Market Commission, which protects up to € 20,000 of the debts that its clients may have with creditors (those from Thailand included).
eToro is backed by the European Financial Instruments Market or MiFID in Europe, and by the Financial Conduct Authority or FCA in the USA. You should also know that it has a trajectory of fifteen years, with more than 20 million users around the globe. So, you can be sure that your finances are safe.
No less important is their excellent customer service. They have a phone number for assistance, a ticket system to track any claim, and a live chat.
How to deposit funds into your eToro account
Among the payment options that you will find on eToro are: bank transfer, PayPal, credit card, Neteller, and Skrill. Depositing funds on eToro is so simple: click “Deposit funds”, type the amount and choose a payment method from the previous ones.
Remember that for security reasons, you must be the owner of the credit card or the account.
The minimum amount allowed is $ 200, and there is a maximum limit for unverified accounts. Thus, if your intention is to deposit higher amounts, you will need to verify your account previously.
You can make the deposit in any currency and eToro will automatically convert it to USD. However, we suggest depositing directly in USD since the platform charges a commission for the conversion.
Futures Vs CFD
What are the differences between CFDs and Futures?
- Which are the counterparties? In the case of Futures, the counterparty is another trader. In CDFs, it’s the brokerage, in this case eToro
- Date of expiration Futures expire in a variable given date, while CFDs don’t have expiry date
- Markets available for trading Futures include fewer options to trade. With CFDs you can trade in several different markets.
- Minimum deposit Costs for Futures are higher than costs for CFDs.
- Leverage With Futures, it isn’t possible; while with CFDs it is.
In case you still don't know what “leverage” is, we'll describe it briefly: it is, simply, the possibility to use a higher amount than you actually have. That way, if you start with $ 100 and you use x2 leverage, you will be investing $ 200.
Why using leverage and how to do it
Let's pretend that you are confident that Monero will raise its price, and you consider “going long. You have $ 1,000, but you actually can invest more and make more money.
Perhaps you could go to your bank, ask for a loan, put something as collateral, wait for it to be accepted, wait for the money, and then acquire Monero… But maybe once you have made all that, your prediction could've been confirmed a long time ago, and Monero would be already at such a high value that it is not worth investing.
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's wallet. As in the image below, you will see the different options you have:
Within other markets, you can use more leverage. Why? Because cryptocurrencies are a value that is invested in the medium-long term, and leverage is used mostly for short-term operations or day trading. But let's see how leverage works.
If you have the $ 1,000 and use leverage x2, you will be investing $ 2,000, as we mentioned. eToro gives you the remaining amount to reach that figure.
A week later turns out that Monero rises up and now the value of your investment is 20% higher, which means, you have $ 2,400 in Monero. But you don't want to be too greedy, so you decide, wisely, to sell again.
You need to pay back the $ 1,000. You have $ 1,400 left, of which $ 1000 is the money you put in yourself, so you'll have earned $ 400.
In conclusion, by investing $ 1000 you can make a profit of 40% (in the case you earn $ 400). That is quite good.
But watch out: if everything goes ok and the asset increases, you will make profits. Nevertheless, if the asset decreases, you will also lose more money in the blink of an eye.
Supposing that the asset didn't increase by 20%, but it decreased also by 20%, you won't lose $ 20 but double, $ 40. For that reason, the terms “Take Profit” and “Stop Loss” are so important when using leverage.
Take Profit is a limit you can set when trading: you set the platform to sell your assets once they get to a point above the entry price. For instance, you can buy Monero at $ 100 and request that your position is closed automatically when it goes up to $ 120. It is very helpful to avoid being blinded by enthusiasm: a 20% profit is usually very good, but once you see it goes up, you might want to gain a bit more and decide to wait, but this could be a mistake. So, Take Profit helps you reduce risks when trading.
On the other hand, when using leverage you also have to use Stop Loss, because a small decrease in the price of an asset can have a big impact on your wallet. Consider that eToro will recommend a limit for Stop Loss, but you should set it lower than that.
What is an ETF?
ETFs or Exchange-Traded Funds are a type of passively managed fund, similar to index funds. They can be described as a combination of stocks and mutual funds, including the best features of both. They can be traded like regular stocks, but include a wide diversity of assets and have lower fees.
Equities
Stocks are the most common financial instruments. Some publicly traded enterprises divide their capital into fractions: you can be one of those shareholders, but first, you should know where and how to make your investment.
We can classify stocks into two main types: those of companies that distribute their earnings among the shareholders and those that don't pay regularly. But that doesn't mean that the latter have less to offer. If a company does not pay every year but has a lot of potential, you should not discard that alternative, since the capital gain you will get from the sale of the shares can be much greater than what you would earn through dividends.
In the case of eToro, if you choose a company that pay out dividends, you will receive them in your account, and you can withdraw your money or reinvest it. We suggest, if you don't have financial urgencies, that you don't renounce the magic of compound interest and reinvest it in the company itself.
If you invest in stocks on eToro, you can use leverage. However, we don't recommend that, since it would be a CFD and you would not receive dividends. Also, shares are regularly long-term investments, and you have to pay commissions during the time your position is open.
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 regularly at market price, but offer much more variety and the fees are significantly lower.
Index Funds
In case you are interested in long-term investments, and you won't need to withdraw your money in five or ten years, index funds can be the best choice. This type of investment is also suitable for beginners since the risks are lower. Besides, the variety is wider.
Perhaps you have a different idea, but it is very hard to beat the market (although you have probably heard of investors who achieve huge profits).
But putting aside some remarkable cases, not everything is as good as it sounds: if you hear of someone who has beaten the benchmark, it was probably for a limited time, or their fees are really high. Besides, take into account that past performances do not ensure a future one.
Index funds offer solutions for that: most of the time, they beat active managers in the long term, and the charges are lower than you imagine.
Commodity market
The major advantage of trading with raw materials is that their price varies less than that of other assets. Actually, their intrinsic security is what makes people often invest in raw materials, to take refuge from economic adversities or fears of inflation. However, the prices of commodities are defined by their demand. Therefore, if a generalized fear of inflation provokes higher demand, the prices will also be higher.
Consider that commodities don't pay dividends. Thus, by investing in them you will only have a further profit by selling them back.
There are two main kinds of commodities: hard raw materials and soft raw materials. The former include precious metals (such as gold, silver, copper, and platinum), industrial metals, and oil; and the latter are agricultural goods, such as sugar, coffee, corn, soy.
How do Contracts for Difference Function?
You probably have seen the term CFD more than once if you entered eToro before. Before we come back to it, we must say that CFDs on eToro are only possible when you short sell.
In case you are interested in day trading cryptocurrency and other advanced operations, later on you will also find information about terms like leverage and “going short”.
The good thing about eToro is that it allows you not only to bet if you are “in the black”, but through CFDs you can also bet “in red”. Let's say that you are sure that the Monero will fall, so perhaps you consider that it is better to refrain from getting in until it actually falls. Nevertheless, if you are pretty sure that it is going down, why not making some profits?
You can accomplish that by “going short”. Basically, this is how it works:
- Someone lends you, for example, 100 units of Monero, with a total value of $ 5,000 (these numbers are fictional)
- Then, you sell them at their current price, $ 5,000
- The Monero goes from $ 50 to $ 30 (as you predicted, it devaluates)
- You obtain the 100 units again, but at their current price, $ 3,000
- You return the 100 units to the loaner
- The $ 2000 difference is yours
It all seems more complex than it really is. Just keep in mind that by trading in Monero on eToro, with CFDs you can make a profit if you foretell downs in the price.
eToro Interface
As we have referred among the positive aspects of eToro, the best thing about this platform is its simplicity: anyone can use it without having to read endless explanations.
You won't have any issues with the interface if you are familiar with any other social network.
Now we are going to walk you through the registration process and the sections of the eToro interface that you should familiarize yourself with.
First of all, you will have to enter your personal data.
Before you end up with the sign-up process, you will also have to answer some questions about your previous trade experience.
However, it's not like they're testing you or anything. It is only a way of finding out how much knowledge you have and what type of assets they can suggest. For example, if it is your first experience in the investment world, they will not recommend that you invest in futures.
Now we will explain the fundamental sections of the interface.
In the “Set Price Alerts” tab, you have, as its name indicates, the option to put alerts on the price of certain assets. This is very helpful when you want to purchase an asset which price is decreasing, but it seems to you that it will decrease even more.
In the “News Feed” tab is the most social part of eToro: where users are interacting all day and sharing valuable information.
“Instruments”, “People” and “CopyPortfolios” are within “Discover”. And we discussed previously in this guide the kinds of assets that are available on eToro:
- Cryptocurrencies
- Exchange-Traded Funds
- Shares
- Raw materials
- Forex
- Index funds
In the section “People” are all the profiles and historical performances of other investors, and you can replicate their strategies with just one click. This is where the “social trading” concept is best applied.
You can find those users that you find more interesting. When you select an investor and indicate the amount you want to invest, eToro will automatically replicate their movements, in proportion. If you have $ 1000 and the trader puts 20% of their funds in an asset, the platform will put $ 200 of your funds in the same asset or company as well.
You will also see the CopyPortfolios divided into three main categories: “Top Trader”, “Market” and “Partner”.
Sometimes you might prefer copying to CopyPortfolios than to individuals, because the former offer more diversity. There are all kinds of portfolios that you can find easily and are divided by sectors. Thus, in case you think a specific sector, like fashion or pharmacy, will have good incomes in the future, you can look for that specific portfolio and invest.
How does a virtual account work?
In case you do not have much experience investing, the possibility to operate in “demo” mode may be useful. Setting a virtual account and operating with fictional funds is very easy.
This can be a great way of practicing before starting to trade with real funds. You will have an amount of $ 100.000 (“fake” or virtual, of course) to begin with, and you will be able to operate with all the different instruments available on eToro, not just with Monero.
If your first attempts don't go well and you go back to zero, you can always ask eToro support to replenish $ 100k of virtual balance. Possibly the second time will be much better.
Keep in mind that investing is mainly about being cold-minded, and perhaps a practice account can make you a bit impulsive. It will never be the same as risking your own money.
Finally, if you are interested in investing in the long or medium-term, there is no point in using the virtual mode and having to wait for years. On the other hand, it can be ideal if you want to practice short and medium-term investment.