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The UK-based social trading and multi-asset brokerage company has hit 13 million global registered users, and it noted a 427% spike in new users making their primary deposit in the first four months of 2020, compared with the same period last year, per Finextra.
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Similarly, eToro also recorded stock trading tripling so far in 2020. Through eToro’s platform, users can replicate other traders’ financial trading activity or manually trade stocks, cryptocurrencies, and ETFs, among other assets. eToro was founded in 2007 as a Visual FX trading platform, has since iterated its supported assets and scaled its market presence, and boasts users in over 100 countries. It has outlined expansion plans to roll out commission-free investing for stocks to the Asia Pacific and the US in the near future.
eToro’s surge in new users is likely thanks to its recent launch of commission-free investing for stocks in Europe as well as market volatility. Global stock markets have been extremely volatile throughout the coronavirus pandemic, and trading platforms have emerged as clear winners of this turbulence, with global consumers increasingly participating in financial markets and trading on their platforms to minimize losses in falling markets and to profit from the volatility.
Digital investment platforms Freetrade and Robinhood have both reported spikes in new users flocking to their commission-free platforms during the pandemic, for instance. eToro has also benefited from this, and the rollout of its commission-free stock investing across Europe last May seems all the more timely and impactful given this current trend.
eToro is on a clear growth path and it should promote the benefits of its membership club to further monetize users and drive engagement. Users have to deposit a minimum amount to qualify for membership, and then as deposit amounts increase, they can access different tiers of membership and unlock further benefits, such as access to webinars and prestigious member events.
We think this strategy likely plays a part in eToro’s success, as the gamification of the membership rewards encourages users to deposit more equity in their accounts, while also driving further engagement on its platform. eToro should focus on publicizing those benefits to the slew of new users it recently acquired, as this could help it retain these customers once market volatility subsides — otherwise, it may see reduced trading volumes and new user attrition.
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