When you trade CFDs (Contracts for Difference) on eToro, you’ve got two core strategies at your disposal: going long or going short. Going long means you’re betting the asset will rise. Going short indicates that you’re taking the opposite side and expecting it to fall.
Going long is the traditional move. You expect the asset’s price to rise, so you open a Buy position. If you’re right, and the price goes up, you sell at a higher price and take the profit.
Going short is how traders profit from a price drop. You open a Sell position and aiming to buy back at a lower price.
If the asset tumbles, you pocket the difference.
| Aspect | Going Long | Going Short |
| Market Expectation | Price of asset will rise | Price of asset will fall |
| Position Type | Buy | Sell |
| Profit Scenario | Price of asset increases | Price of asset decreases |
| Risk Scenario | Price of asset decreases | Price of asset increases |
| Opening Price | Buy (ask) price | Sell (bid) price |
| Closing Price | Sell (bid) price | Buy (ask) price |
| Leverage | Available; amplifies gains/losses | Available; amplifies gains/losses |
| Overnight Fees | May incur interest charges | May incur fees or receive interest |
Whether you go long or short, make sure that it's matched with your market view and risk appetite. Learn the mechanics and keep an eye on fees. When I was just starting out, I used to do test trades with a demo account. After I learned the basics and gained confidence, then I started with live trading.
eToro is a multi-asset platform which offers both investing in stocks and cryptoassets, as well as trading CFDs.
Please note that CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 51% 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.
This communication is intended for information and educational purposes only and should not be considered investment advice or investment recommendation. Past performance is not an indication of future results.
Copy Trading does not amount to investment advice. The value of your investments may go up or down. Your capital is at risk.
Don’t invest unless you’re prepared to lose all the money you invest. This is a high-risk investment and you should not expect to be protected if something goes wrong. Take 2 mins to learn more.
Cryptoasset investing is highly volatile and unregulated in some EU countries. No consumer protection. Tax on profits may apply.
eToro USA LLC does not offer CFDs and makes no representation and assumes no liability as to the accuracy or completeness of the content of this publication, which hasbeen prepared by our partner utilizing publicly available non-entity specific information about eToro.
About Mike Druttman
