Col Financials and eToro are online brokerage firms that operate in the Philippines. This blog aims to objectively compare and contrast both platforms as honestly as possible to help people choose their platform in achieving financial independence.
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I've been a small investor in the Philippines Stock market since 2016 using the platform of Col Financial. Recently, I used this new platform called eToro so let us compare which between the two is supreme when it comes to investing.
If you are reading this, then you might have an idea about how the stock market works. Congrats, you belong to the elite less than 1% of the Filipino population who knows how to trade online. If you have little knowledge about it, no worries, you need not have Bachelor's Degree, Master's Degree, or Law Degree to learn about it, utilize youtube as many videos are showing how stock market trading is done.
Here is the outline of this article:
- Account Opening
Minimum Investment
Referrer's Code
- Functions and Features
Leverage
Cut loss Feature (An exit price)
The setting of Entry price
Investable Assets
1. Mutual Funds
2. Local Stocks
3. Foreign Stocks
4. Commodities
5. Exchange-Traded Funds (ETFs)
6. Cryptocurrency
7. Foreign Exchanges
Withdrawal
Funding
- Trading strategies -Copy Investor
- Overall Satisfaction
- Pros and Cons Summary Comparison
Before I begin, let me suggest that you attend a free webinaron how to trade in the eToroscheduled every Wednesday and Saturday at 6PM. Register in this link:Click Here
Before investing in any investment platform, make sure that you have knowledge about how it works. Get to know the integrity of the management that runs the business if possible. Check the reviews and check out if the company has existing cases filed on the court.
The basic tenet in investing is that a good investment must be able to return what you originally invested plus an income corresponding to the period of time you committed your capital to it.
Just a reminder: these platforms are self-learned and are self-executed. If you have hard-time then try investments that are managed by Portfolio Managers such as VUL Life Insurance (Hire Me) or Mutual Funds. The good thing about these platforms is that you are not dependent upon your Portfolio Managers, you are your Portfolio Manager.
There are many success stories about successful traders, however, there are also a lot of people who lost a lot of wealth trying to perfect or beat the market. Please take a lot of caution. In these platforms, there are also methodologies where you can avoid exposing your self to too much risk by way of investing in Exchange Traded Funds (ETFs) or copy trade for eToro. Let me show you in our discussions here.
Account Opening
Both investment platforms can be opened online. It takes less than a week to open an account depending on whether you have complete requirements. View the requirements here: colfinancial.com.
For eToro, just download the application using the link below to get $50.00 as an additional fund.
Minimum Investment
The minimum investment in Col Financial can vary depending upon your financial capability. You can start from as low as PhP2,000.00 to as high as millions of pesos. I advise that you enroll your Col Financial in online banking to fund your Col Financial account.
For eToro, you can start by putting in PhP10,000.00 to be able to get $50.00. See the next topic below.
When you want to test the water before making it your pure investing platform, you can start by investing PhP10,000.00 then use that whole fund to buy a single asset or diversify your portfolio, its up to you. Read here some of the learnings I've gathered about trading online.
Referrer's Code
This is only available for eToro accounts, when you open an account with eToro, you will get an additional $50.00 or about PhP2,500.00 in Philippine currency if you use a referrer's code.
This is a marketing strategy so that more people will try out the platform. I got my $50.00 since I shared my referrers' code to friends. Provided, you open an investment platform with eToro with a minimum investment of USD 200.00 about PhP10,000.00 in Philippine currency. All in all, your initial fund for your investing and learning activities is PhP12,500.
After reading my article, click the banner below to claim $50.00, only if you are interested. Read my disclaimer below.
Functions and Features
Leverage
This is only applicable to etoro accounts. If you have already a col financial account, then you probably have experienced trading already. This is how leverage works. For example, suppose you have a 1,000.00 dollars budget in your etoro account. When you buy say "GOLD" at $1,000.00, you can choose to leverage the same by 1 or 2 or 10 or 20 or 30 or 100.
Meaning, if you leverage by "X100" your 1,000.00 dollars to buy "Gold" you are actually buying gold at $1,000.00 (x) 100 hence total budget to buy "Gold" is $100,000.00 while your total exposure is only limited to $1,000.00.
Is that good or bad? Its a double-sided sword, since, when you gain in your trade, the income return is very high, while if your trade sucks, then you will lose money fast.
Example: Following the example above, say for example you bought "Gold" at $1,000.00 leverage at X100 and then after buying the commodity at $2,000.00 per unit, then after 10 minutes, you saw an increase in the value of Gold had a 5% increase. How much now is your income knowing that it is leveraged using an eToro account.
Your income is 5% x ($1,000 x 100) or $5,000.00 in a single trade at 10 minutes period. That is hayahay!
So let us reverse the situation, after 10 minutes of investing $1,000.00 leveraged at X100 buying $2,000.00 per unit, the price of gold decreased by 5% decline. How much is your loss from this transaction?
Your lose from your sale is $1,000.00 - (1,000 x 5%)= $50.00. Your exposure is only limited to the total amount of investment i.e. $1,000.00.
This only means, that your income potential is high, while your losses are only limited up to the amount you invest. Meaning, you can start will small investment, then grow it through leverage.
No Leverage Trading: Col Financial
This is how it looks like when you trade in the colfinancials platform.
Using the same transaction above with the same income/lose potential:
A. 5% Gain in your trade from Gold's price from $2,000.00
Your income is only $1,000.00 x 5% = $50.00
B. 5% Lose in your trade from Gold's price from $2,000.00
Your lose is only $1,000.00 x 5% = -$50.00
No leverage trading is how colfinancial do their work. In other words, you need to put a huge amount of cash in your trading account to gain more from your investment.
My personal opinion: in effect, this feature makes etoro better than col financial.
The Setting of Entry price
In colfinancial, you can set your entry price. On the other hand, in etoro, you can also set your entry price.
Cut loss Feature (An exit price)
In colfinancial, you can set your exit price by putting in your desired exit price. It can be for the end of the day or good for the month.
In eToro, you can set your exit price and there is also what you call a trailing cut loss where your exit price adjusts as the price of your investment increases and will dispose of your investment if there is a sudden price redirection.
If you are to analyze both features, etoro has a higher chance to maximize the rate of return because the exit price follows the market price. Hence a higher chance to gain from your transaction.
Here are the investable assets of Colfinancial and etoro Col Financials etoro As you can see, both brokerage firms cater to their respective niches. Colfinancials cater to Filipino local investors while etoro caters to multi-national nations. On the other hand, if you open an etoro account, you can trade many assets. Discussion for the different investment assets will be discussed in another blog post. As mentioned earlier, if you invest in ETF, you enjoy diversification in your investment. Diversification minimizes the risk of incurring losses from your erroneous transactions. Personally, I love ETFs. There is only one ETF in the Philippines that can be brought from the colfinancial platform which is the FMETF. Trading Strategies The trading strategies in trading different assets in the etoro are essentially the same. The basic technical indicators that I used are the following: MACD, Moving Average, Stochastic, and RSI. Another blog will be made discussing in detail the following. In etoro you can copy the trades of other successful investors via "Invest in CopyPortfolios". This is not available in colfinancials. Withdrawal Both platforms have easy methods of cashing out the desired amount of withdrawal from the fund. Funding Both platforms have easy methods of cashing into your investing account. you can link your online banking to your trading platform. Pros and Cons: Summary Comparison Pros Overall Satisfaction I am satisfied with both investment platforms. In trading local stocks, I used Col Financials. On the other hand, I use etoro in trading my favorite global stocks, commodities, ETFs, and cryptocurrencies. My Fiancee is a Registered Nurse and has been working as a frontliner for more than 7 years. She has no background in how the financial market operates. She literally has no idea how things work. As a Finance Professional, I taught my Fiancee how to trade using eToro.eToro is a social trading and investment marketplace that allows users to trade currencies, commodities, indices, and stocks. The image below shows my Fiancee's income for the past 9 days of trading. Despite having no knowledge, she still managed to earn passive income amounting to $54.97. How did she do that? Read my Full Article Here!Investable Assets
Col Financials
Etoro
Trading Strategies for Non-Finance People
Book my services as Financial Advisor.
If you think that the contents of this article helped you in any way. I would appreciate it if you can comment and share my blog with your social media pages especially to your friends, family, and colleagues. Thank you. You can reach me out in the following social media: Linked-in: Efraim Osingat, CPA, MBA, RFP FB Page: Financial Literacy Evolution Website: efprimefinancials.com Youtube: EfPrime Financials
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Disclaimer
The Author is advising readers to consult with your respective Financial Advisors before venturing in any investments. Investing your money is dependent to your goals and your risk tolerance. You should know the risks and rewards of investing before you actually do the same. The illustrations above are for educational purposes only and any risks or losses that you may incur are imputable to your respective decisions.
The author does not in any way provide a guaranty as to the effectiveness and quality of the products and services that are featured in this blog.The products and services were advertised based on personal experience and product and service reviews that the product/service received.
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