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eToro, our reccomended platform for buying NEO from South Africa
Pros:
- It offers other successful investment strategies so you can replicate them
- Allows you to short sell
- User-friendly and simple
- eToro offers leverage
- You can make investments in tons of other goods
Official main site: www.etoro.com/neo
In case you are considering it, eToro is the best option today to buy NEO from South Africa.
“Social trading”, an innovative investment method that consists in replicating techniques and strategies from other experienced investors, has become trendy thanks to eToro.
If you are still a rookie or do not have much experience in investments, eToro is very useful. You can rest assured that you will be making a smart investment since the site replicates those from subjects with a great deal of expertise. Oppositely, if you are an investor and want to share your knowledge with the community, eToro rewards you with money.
It is also worth mentioning how accessible is the platform, perfect for new traders who are taking their first steps with NEO.
Can you trust eToro?
eToro is very rigorous with the information about past performances from traders, and its integrity has been independently tested several times.
Legally, eToro fulfills all the demanding policies of the European Union. Its head office is in Cyprus, where it is validated by the Cyprus Securities Market Commission or CySEC, which can cover up to € 20,000 of the debts from its clients (those from South Africa included).
eToro responds to the European Financial Instruments Market or MiFID, and to the Financial Conduct Authority or FCA in the United States of America. You should also know that 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 customer service functions perfectly. You can contact them by phone or use their online chat.
How to deposit funds into your eToro account
Within the payment methods available on eToro are: bank transfer, PayPal, credit card (Visa, MasterCard, Diners, Visa Electron and Maestro), Neteller, and Skrill. Depositing funds on eToro is so simple: go to “Deposit funds”, type the amount and select your payment method.
Remember that for security reasons, you need to be the holder of the credit card or the account.
The minimum you can deposit is $ 200 and there is a limited amount if you are not verified. Therefore, if you plan to operate with larger sums, you should verify your account first.
eToro allows deposits or 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.
Futures Vs CFD
How are Futures and CFDs different?
- Who is the counterparty? In the case of Futures, the counterparty is another trader. In CDFs, it’s the broker (eToro)
- Expiration date Futures have a determined expirationdate, while CFDs don’t expire
- Markets available for trading Futures include fewer options to trade. With CFDs you can trade in several different markets.
- Minimum investment amount Being higher numbers, Futures require, proportionally, lower costs. Costs for CFDs are a bit higher, although not too much.
- Leverage With Futures, it isn’t possible; while with CFDs it is.
About ETFs
ETFs or Exchange-Traded Funds are a kind of passively managed fund, similar to index funds. We can say that ETFs are somewhere between stocks and funds: they can be traded like regular stocks, but include a wide diversity of assets and have lower fees.
About ETFs
ETFs or Exchange-Traded Funds are a type of passively managed fund, similar to index funds. They can be described as a merge between stocks and mutual funds, including the best of both. They are publicly traded, that means they can be commercialized at any moment at market price. However, their main benefit is that they offer more alternatives compared to stocks, and their fees are much lower than those of an actively managed fund.
About Index Funds
This is the best option for people who can invest in the long term, especially for beginners, because it is less expensive, diversified, and safer.
Unlike a lot of people think, beating the benchmark is far from being a piece of cake and very few fund managers achieve that, apart from some specific cases, like Warren Buffett's.
If a fund manager brags about having beaten the index, they probably have done it for a chor period or on a specific occasion, or perhaps the rates are so high that indexing would be a better decision anyway (with minimal commissions).
Index funds offer solutions to both concerns: their fees are insignificant and they frequently beat active managers, but in the long term.
Forex trading
Forex or currency trading is the exchange between two currencies.
If you decide to trade the EUR/USD pair, you buy euros at their price in dollars, with the expectation that the euro will rise compared to the dollar. Therefore, if you purchased each euro at 1.15 USD and you sell them back when they are worth 1.20 USD, that margin will be yours.
You may be thinking that this form of trading requires high investments, and you are not wrong, since increases in prices are never that dramatic, and often you will need to use high leverage (which is an important risk). Our recommendation for those starting in the world of trading is to choose another market to begin with, since Forex is risky and complex.
Most currencies are available on eToro. Nevertheless, consider that this market functions through CFDs, therefore the underlying asset won't be yours.
Commodity market
Most investors trade with raw materials due to their stability. While other assets present higher fluctuation, commodity prices vary less and offer security against inflation or market volatility. However, prices do depend on supply and demand in the market, so if the fear of possible inflation produces greater demand for a certain good, its cost will also rise.
Note that the only intended profit from the investment in raw materials will come from their further sale because these kinds of assets don't give returns or pay interest.
Commodities are generally categorized into two kinds: first, we have hard raw materials, which are precious metals (gold, silver, copper, and platinum), industrial metals, and oil; in second place are soft raw materials, which are agricultural goods such as coffee, rice, soy, or sugar.
How to use eToro
We mentioned previously that eToro is very friendly and intuitive. Anyone can start using it without previous experience or long explanations.
You won't have any issues with the interface if you have used any other social network, like Instagram or Linkedin.
Now we will walk you through the sign-up process and the sections of the page that you should familiarize yourself with.
First, you will have to fill in all the information that eToro asks for: first and last name, address…
They will also ask you about your previous trade experience.
But don't feel intimidated, there is no right or wrong answer. The objective is to know more about you and determine which financial instruments they should suggest according to your knowledge and experience.
When you fill in all your information in your profile, the annoying “incomplete profile” bar will disappear.
Let's get to know the fundamental sections of the platform.
With the “Set Price Alerts” tool, you'll be able to program an alert when a security is at a certain price. This is ideal if you want to buy an asset and you are waiting for it to decrease.
“News Feed” is for social purposes and interaction. This is the section where users can share opinions and information.
“Instruments”, “People” and “CopyPortfolios” are within “Discover”. And we already talked about the different financial instruments that are available on eToro:
- Cryptocurrencies
- ETFs
- Shares
- Raw materials
- Currencies
- 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” concept is best applied.
You can search for those users that you find more interesting: by average earnings, types of instruments or risk level, for instance. Just indicate the amount you want to invest and eToro itself 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, eToro will invest also 10% of your money (in this case $ 100) in that same asset.
Also, here you will see CopyPortfolios classified into: Top Trader, Market, and Partner.
Remember that in some cases, it might be better to copy from 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 classified by sectors. Therefore, in case you suspect a specific sector, such as e-commerce or oil, will prosper in the future, you can find that specific portfolio and do your investment.
Investment strategies
When trading cryptocurrencies, there are different possible methods or strategies, such as buying and holding or day trading (and using price volatility in your favor), for naming just a few.
In case you don't have much experience trading, our suggestion is something in between: when you open your position, place a dynamic stop loss 15-20% below the top price, and let the magic happen.
For instance, if you purchase a cryptocurrency at $ 15, it rises up to $ 25 and falls back to $17, the stop-loss will allow your operation to be closed, perhaps at $ 21 or $ 22. Thus, you will obtain a good profit.
I know it's tempting to look to sell when the cost is at its peak, right before corrections, but that is simply not possible. The mentioned strategy is much more realistic and, well applied, it can work very well.
Later on, you will be able to apply more complex strategies, like short-selling or using leverage.
Virtual portfolio
If you are taking your first steps as an investor, the option to operate in “demo” mode will be helpful. Setting a virtual account and trading with fictional funds is very simple.
A virtual portfolio can help you to practice and gain experience before starting to trade with real funds. When you create your demo account, you will begin with a virtual amount of $ 100.000, to operate with a variety of assets available on the platform, besides NEO.
If your performance is not that good and you go back to zero, there is always a possibility to replenish your virtual funds. Probably the second time will be much better.
Keep in mind that investing is mostly about being cold-minded, and perhaps a demo account can prevent you from controlling your impulses. It will never be the same as risking your own money.
And of course, if you are going to invest in the medium or long-term, with earnings almost assured just by replicating a strategy, it is absurd that you waste years investing in virtual mode. On the contrary, you may be interested in the virtual mode if you want to experiment with short and medium-term operations.