| Recommended Broker 🇵🇭 |  |
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www.etoro.com *
* Your capital is at risk.
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How to buy
For those who live in Philippines, a great way to invest in Coinbase shares is, definitely, this popular broker.
eToro*, one of the main brokers around the world, is registered and licensed, among others, by the Australian Securities and Investments Commission (ASIC).
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 Philippines, 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 “Verify my email” 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.
If you have a choice, we do not recommend bank transfer because it takes longer, and it can be very frustrating to see the price of Coinbase rising while you wait for your transfer to be done.
How to make your first trade
As soon as eToro has confirmed the receipt of your credit, you just have to search for “Coinbase” 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.
Contents
Why we advise to use eToro:
- You are able to replicate trading strategies
- Admits short-selling
- It is uncomplicated and accessible
- eToro allows leverage
- There are uncountable investment options
Official homepage: www.etoro.com *
You should consider eToro in case you are thinking about purchasing Coinbase shares from Philippines.
eToro is famous for making “social trading” a trend, a revolutionary way of investing in which traders can emulate the strategies of other investors who have been making earnings for years.
If you are a beginner or do not have much experience in investments, eToro is great for you, since it puts your investment on autopilot by emulating moves from those who have been doing it for years. Oppositely, if you are an expert in the subject and decide to share your methods with the community, eToro rewards you with money.
Another advantage is how intuitive the interface is, which turns out perfect for new users that are learning all about the trading world.
About Contracts for Difference
You probably have found the acronym CFD all the time if you already registered on eToro. We will come back to it, but you should know first that cryptocurrency trading on eToro is only CFD if you go short.
We will also refer to terms like leverage and “going short”, in case you are considering day trading cryptocurrency or other more advanced operations.
Even if you don't have a positive balance, you can still operate on eToro with CFDs. In a hypothetical case: you have the certitude that the Coinbase will go down, so perhaps you think that it is better to wait until it does and then go in. Nevertheless, if it really falls, it might mean extra money for you.
The practice known as “going short” will allow you to do that. It works, more or less, as it follows:
- They lend you, let's say, 100 units of Coinbase, valued at a total of $ 5,000 (these numbers are imaginary)
- You make $ 5,000 by selling the 100 units
- The price falls, as you guessed, and the unit of Coinbase goes from $ 50 to $ 30
- Again, you purchase the 100 units, but now their value is $ 3,000
- Now you pay back the 100 units to whoever made the loan
- The difference is yours, so, you will have earned $ 2000
Consider that it is much simpler than it sounds: we can just say that by trading in Coinbase you can also make money if you anticipate the downs.
What's the difference between CFDs and futures?
Here is a brief comparison between Futures and CFDs, in case you want to know more:
- Counterparties
- Futures: the counterparty is someone else, another investor.
- CFDs: the counterparty is the brokerage platform (eToro). That means you don't “play” with someone else but with the bank.
- Date of expiration:
- Futures: they expire on a given date. Once the contract expires, it is closed and can't be reopened.
- CFDs: on the contrary, there is no expiration date. It is possible to get back to a good position before you exit.
- Options for trading:
- Futures: there are limited options for investment
- CFDs: you have plenty of options, there are CFDs of practically anything
- Minimum investment:
- Futures: very high minimum investment
- CFDs: you can get in with a small deposit
- Trading costs:
- Futures: as you have to invest more, rates are lower
- CFDs: higher (although not excessively)
- Possibility of leverage:
- Futures: it isn't possible to leverage
- CFDs: fully available
Investment strategies
There are several ways to trade cryptocurrencies: from purchasing and holding to day trading using volatility of the market to your advantage.
My recommendation for those who are beginning to trade is going for a middle point: placing a dynamic stop-loss (15-20% under the highest price) and wait for it to work.
For example, if you buy a cryptocurrency at $ 15, then it increases to $ 25 and falls again to $17, the stop-loss will close your position at $ 21 or $ 22. Hence, you will get a satisfactory income.
It might sound way better to sell when the cost is at its highest, right before corrections, but unless you're clairvoyant, that's impossible. The mentioned method is much more down-to-earth and, well applied, it can work very well.
Later on, you will be able to apply more complex techniques, like short-selling or using leverage.
How to use leverage in trading
Have you heard about “leverage”? We'll put it simply: trading allows you to invest more money than you can have in a given time. That is, if you get in with $ 100 and you put them with x2 leverage, the amount of your investment will be $ 200.
Leverage and the importance of “Take Profit” and “Stop Loss”
Assuming that, for instance, you are certain that Coinbase price is going up, and that you have $ 1,000 for “going long”, you should know that you have the option of investing more and making more money.
There's the possibility of requesting a credit, but you must know that all the process takes time, and by the moment you receive the money, Coinbase might be already so expensive that investing wouldn't be convenient anymore.
Using leverage, you can get that amount just by clicking your mouse. It's exactly like borrowing money, but much easier and quicker, and with the benefit that you will be getting it directly from eToro. Before trading, you will how much leverage to use as in the image:
When operating in different markets you can use higher leverage. The reason is that cryptocurrencies are usually medium-long term investments, and leverage is used especially for day trading or short-term trading. But let's explain how leverage works with the previous example.
You begin with $ 1,000 and pick leverage x2, then you would really invest $ 2,000 (the extra $ 1,000 to reach $ 2,000 are “borrowed” from eToro).
A few days later, as you thought, Coinbase price raises its price by 20% and the value of your investment is now $ 2,400. Ok, don't be greedy, let's sell.
Obviously, the 1k $ from leverage will be deducted, and you'll have $ 1,400 left, of which $ 1000 was yours initially, so the net profit is $ 400.
In conclusion, by investing $ 1000 you can make a profit of 40% (in the case you earn $ 400). That is pretty decent.
But not everything is wonderful. If everything goes ok and the asset increases, you will make profits. However, if the asset decreases, you will also lose more money really fast.
For example: if the price falls by 10%, you won't lose $ 10, but twice that figure, which means $ 20. That is why the concepts of Take Profit and Stop Loss are crucial when operating with leverage.
Take Profit is used as a form of reducing risks when trading. When you enter, you can set a profit limit and ask that your position is automatically closed when the asset reaches a price.
If you purchased Coinbase shares at $ 100, you program eToro to close when it reaches $ 120. That way, you make sure you won't change your mind and decide to keep waiting in case it keeps going up, which could be a mistake.
On the other hand, when using leverage you should always use Stop Loss, because a small fall 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 it is better to set it lower than that.
Virtual portfolio
If you do not have much experience investing, you can start by practicing with a “demo” option. 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 money. The platform will give you an amount of $ 100.000 (“fake” or virtual, of course) to begin with, and you will be able to operate with all the different assets available on eToro, not only with Coinbase.
The first attempt is not usually that good. But don't worry, because you can ask support to deposit back the virtual $ 100k to your portfolio, and the second try you should do better.
But keep in mind that trading is mostly about being cold-minded, and demo account trading can have an adverse effect. It is not the same to risk your real savings than to do operations with virtual funds that you don't mind losing. Also, using fake money can prevent you from learning to control your emotions, something you should be able to do when trading.
As you may suppose, the demo mode is kind of absurd if you want to trade in the medium or long-term, since you would be wasting years to see the outcome. Virtual accounts may be ideal for trying out short or medium-term investments.
Common questions
* 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.