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How to buy
For those who live in Kenya, a great way to invest in Facebook shares is, definitely, this popular broker.
eToro*, one of the main brokers around the world, is registered and licensed, among others, by the Cyprus Securities and Exchange Commission, and therefore complies with all the regulations of the European Union, the most demanding in the world.
We recommend eToro because you can create an account for free with this broker, and its fees for trading online are very low. Besides, eToro is available in our language, accepts users from Kenya, it is really easy to manage, and its friendly interface is ideal for those who are starting to trade with cryptocurrencies and stocks.
How to sign up, step by step
The first thing you need to do is click here and fill in the fields on the right: enter your name, email, and set a password.
Now check your email: you have received an email from eToro, click on the link and your account will be verified.
Once on eToro, you just have to click on “Deposit funds”, in the page menu.
There, you can choose how much money you want to add to your account (the minimum is $ 200) and the payment method:
As you can see in the image, the first deposit can be made by credit card, PayPal, or bank transfer.
How to make your first trade
As soon as eToro has confirmed the receipt of your credit, you just have to search for “Facebook” in the search bar, click on “Invest” and choose the amount in dollars you want to invest.
*67% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money
Cryptoassets are highly volatile unregulated investment products. No EU investor protection. Your capital is at risk.
Is Facebook a buy?
Facebook, beyond the famous social network, is a company that is part of the group of the Big 5 of technology along with Alphabet (Google), Amazon, Apple and Microsoft. And in addition to the social network Facebook, with almost 3 billion users, the company owns Instagram and WhatsApp.
The social network Facebook has long remained the most used social network. And WhatsApp, Facebook Messenger and Instagram are not far behind in the ranking as they are only surpassed by YouTube, which ranks second. So, Facebook (company), there is no one to take it out of the big 5 or dethrone it as the number one social network.
All this is well known and many people invest in the company just for this. But Facebook also has other projects that are little known and that can have a great impact for the company. Among them, the most relevant surely is the cryptocurrency Libra, which became a stablecoin called Diem.
The Facebook cryptocurrency: from Libra to Diem
Initially, Facebook announced in June 2019 its intention to create a cryptocurrency that would be integrated into its products (Facebook, Facebook Messenger, Instagram and WhatsApp). This with the intention that users could have a secure and very cheap form of payment in their accounts. This is how Libra was born.
However, this announcement alarmed many countries because as we know, cryptocurrencies are decentralized and cannot be regulated by governments. So many were directly and openly against the company's initiative. Mainly because of the fear that the cryptocurrency would destabilize economies given the number of Facebook users.
After complying with many legal requirements demanded by some countries (including the United States) in which basically mechanisms were agreed to avoid destabilizing the economy and that the State can maintain control of fiscal and monetary policy, Facebook can bring its cryptocurrency to the market, only now it is called Diem.
In addition to the change from Pound to Diem, it is now a stablecoin backed entirely by circulating money. Its value, unlike other stablecoins such as Tether, does not fluctuate and always maintains a 1 to 1 relationship with the reference currency. And we say reference currency because it not only represents the dollar, but also the euro and the pound sterling, among others.
The best thing is that in addition to being Diem a stablecoin, it is backed by the company Facebook and many others among which Coinbase, Uber, Shopify and Spotify stand out. Undoubtedly, this is one of Facebook's greatest successes as a company and will undoubtedly have positive repercussions on its valuation.
Some of its advantages are:
- It is really simple and manageable
- Allows to imitate other users trading tactics
- Accepts short-selling
- eToro allows leverage
- There are uncountable investment opportunities
Homepage: www.etoro.com *
If you are interested in acquiring Facebook shares from Kenya, eToro is certainly the best way to do it.
eToro is well-known 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 years.
If you are still a rookie or haven't gained much investment experience, eToro is very helpful, since it puts your investment on automatic by emulating moves from those who have been doing it for years. And for those skilled investors willing to share their techniques, eToro pays for it.
It is also very convenient how easy is to manage the platform, excellent for beginners who are starting in the investment world.
Can you rely on eToro?
eToro is very meticulous with the information about past performances from investors, and its reliability has been tested once and again by independent organizations.
Legally, eToro complies with all the demanding policies required by the European Union, legislation in which it is found. Its main headquarters is in Cyprus, and it is certified by the CySEC or Cyprus Securities Market Commission, which protects up to € 20,000 of the debts from its clients (those from Kenya included).
eToro responds to the European Financial Instruments Market (MiFID) in Europe, and to the Financial Conduct Authority or FCA in the U.S. 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.
It is also worth mentioning the great customer service. You can use the online chat, and they also have a phone number available for assistance.
eToro payment methods
When it comes to depositing money on eToro, there isn't really much to say, since it is pretty simple. You only need to select “Deposit funds”, set an amount, and choose the payment option you prefer. You can use PayPal (available for some countries), bank transfer, credit card, Skrill, or Neteller.
Consider that for security policies, you must be the owner of the account or the credit card.
The minimum first time deposit is $ 200, and there is a maximum limit for unverified accounts. Thus, if you aim to trade with much more, you should contact Support to verify your account.
The platform accepts deposits in any currency, but you will have to pay a fee for the conversion to USD. So it is better to use USD from the beginning.
About Contracts for Difference
If you browsed eToro before, you probably realized that the acronym CFD appears frequently. Before we come back to it, we must say that CFDs on eToro are only possible if you short sell or choose leverage above x2 (although the platform does not even allow this option).
We will also explain concepts such as going short and leverage, in case you are interested in day trading cryptocurrency or other more advanced practices.
Even if you aren't “in the black”, you can still operate on eToro with CFDs. For example: you are sure that the Facebook will go down, so you obviously think “if it is going to depreciate (go down in price), I'll just wait and bet when it has gone down”. Nevertheless, if it actually falls, you can earn some money out of that.
You can do this through what is known known as “going short” which consists in something like this:
- You ask for a loan of, let's say, 100 units of Facebook, which cost $ 5,000 at the moment (obviously, these figures aren't real)
- You make $ 5,000 by selling the 100 units
- The Facebook goes from $ 50 to $ 30 (as you thought, it devaluates)
- You obtain the 100 units again, but their current value is now $ 3,000
- Now you pay back the 100 units to the loaner
- The difference is yours, so, you will have made $ 2000
Keep in mind that it sounds much more tricky than how eToro CFDs actually work: we can summarize this whole operation by saying that by trading in Facebook you can also earn money if you anticipate the downs.
Differences between futures and CFDs
How are Futures and CFDs different?
- Futures: the exchange is made with another trader.
- CFDs: the counterparty is the brokerage, in this case, eToro.
- Expiry date:
- Futures: there is an expiry date. At that moment, your operation is ended even if you are in losses.
- CFDs: on the contrary, they don't expire. It is possible to get back to a good position before closing.
- Trading markets available:
- Futures: there are fewer options
- CFDs: they include lots of different assets, commodities and currencies
- Minimum deposit:
- Futures: very high minimum investment
- CFDs: it is possible to start trading with a low amount
- Trading costs and charges:
- Futures: as you have to pay more in the first place, costs are lower
- CFDs: higher (although not excessively)
- Use of leverage:
- Futures: it isn't possible to trade with leverage
- CFDs: completely available
“Social trading”, an innovative concept
The first platform that thought of trading as a social activity was eToro, and the idea became popular really quick. Other brokers have also adopted this concept, but we have tried them all and eToro is still the leader.
But it wasn't just about creating yet another social network to talk about investment. The main innovation was in allowing users to replicate the moves of advanced investors, who were in turn paid for their ideas.
When you enter eToro you will see in the left menu the options “Copy People” and “Invest in CopyPortfolios”.
“CopyPortfolios” are kinds of exchange-traded funds or thematic index funds, a portfolio that includes several goods of the same market. For example, if you heard that the gaming industry is going to prosper shortly but you don't have enough information (or time) to choose stocks, you just have to pick the CopyPortfolio called “InTheGame”, which includes Google, Microsoft, NVIDIA, Nintendo, Logitech, among others.
CopyPortfolio has generated a 100% return in the last twelve months, and it is as simple as clicking on “Invest”, choose the amount, place the stop-loss and wait.
But you can also copy other users of the platform who are successful investors. With “Copy People” you can locate them and replicate their moves easily.
In the profile of each user, you will be able to see their risk profile (how much risk do they take), their performance, and the type of financial instruments they trade..
Besides duplicating other investor's strategies, which is really interesting and helpful, we also suggest that you make the most out of the community by reading other user's comments. You can learn a lot from their experiences and knowledge, particularly if you aim to make a living from trading.
There are several ways to operate cryptocurrencies: from buying and waiting to day trading (and benefit from market volatility).
If you are a beginner in the world of investment, our suggestion is something in between: placing a dynamic stop-loss (15-20% under the highest price) and wait for it to work.
Therefore, if for example you buy a cryptocurrency at $ 10, it reaches $ 20, and after that it falls to $ 12, your position will be closed at $ 16-17 and you will obtain a pretty good profit.
It might sound way better to sell when the cost is at its highest, right before corrections, but that is simply not possible. The above strategy is much more down-to-earth and it can give great results.
Sooner or later, you will be prepared for using advanced investment techniques, such as using leverage or going short to profit from bear markets.
How does eToro work?
As we have referred among the positive aspects of eToro, the best thing about this online broker is its simplicity: anyone can use it without having to read endless explanatory texts.
If you have used any of the most popular social networks today, you can perfectly manage eToro's interface.
We will explain, roughly, the registration process and the different sections that you will find.
When you open your account, you will have to fill in all the information that eToro asks for: first and last name, address…
Additionally, you will see that they ask you some questions about your experience at investing.
But don't worry: it is not an exam. They only intend to know how much knowledge you have and what type of financial instruments they can suggest. For instance, if you have never invested before, they will not suggest that you invest in futures.
When you fill in all your information in your profile, you will stop seeing the “incomplete profile” message.
Let's review the different tabs of the page.
With the “Set Price Alerts” tool, you'll be able to program an alarm when an asset is at a certain price. Just click the tab and you will be able to set it. This is ideal if you want to buy a security and you are waiting for it to decrease.
The section “News Feed” allows users to interact and share their experiences and knowledge.
“Discover” includes the tabs “Instruments”, “People” and “CopyPortfolios”. And we discussed previously in this guide the kinds of assets that are available on eToro:
- Exchange-Traded Funds
- Forex trading
- Index funds
In “People” are all the profiles and historical performances of other users, and you can replicate their strategies with just one click. This is where the “social trading” term is best applied.
In this section, you can find those traders that you find more interesting. You can search by risk level, trading market, or average profits, among other filters. When you choose an investor and indicate the amount you want to invest, eToro will automatically replicate their movements, in proportion. If you invest $ 1000 and the trader puts 20% of their funds in an asset, eToro will also invest 20% of your money in the same asset, in this case, $ 200.
You will also see the three main types of CopyPortfolios, which are “Top Trader”, “Market” and “Partner”.
Sometimes it might be preferable to copy from CopyPortfolios than to particular traders, because you avoid putting all your eggs in one basket, or in other words, risk is more diversified. There are all kinds of portfolios that you can identify easily and are classified by sectors. So, if you think a specific sector, like biotechnology or pharmacy, has good chances to succeed, you should look for that specific portfolio.
How does a demo account work?
If you are beginning as an investor, you can start by practicing with a “demo” option. You just have to make sure that the “Virtual” option is set in the upper left corner and you will be able to operate with an imaginary balance.
A virtual portfolio can be a good way of gaining confidence before starting to operate with real funds. When you create your demo account, you will begin with a virtual amount of $ 100.000, to trade with a variety of assets available on eToro, besides Facebook.
The first attempt is not usually that good. But you can ask eToro to deposit back the virtual $ 100k to your portfolio, and the second time you should do better.
Keep in mind that investing is mostly about being cold-minded, nevertheless, using a virtual account might have the opposite effect. It will never be the same as risking your own money.
And of course, the virtual mode is kind of pointless if you intend to invest in the medium or long-term, since you would be wasting years to see the outcome. Virtual accounts may be ideal for practicing before investing in the short or medium-term.
* Please note that CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. Disclaimer: 67% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.