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DEGIRO vs eToro

Which one of the two online brokers should you invest with?

Alfredo de Cristofaro   March 08, 2022

Author of the review
Alfredo de Cristofaro Autore
Alfredo de Cristofaro
Co Founder

Graduated in Economics of Financial Intermediaries, after having worked for several years at one of the main financial brokers in Europe, he decided to make available to investors the knowledge gained over the years. On QualeBroker.com he's responsible of reviewing the stockbrokers, making sure that the highest standards of safety and transparency are guaranteed.

Which broker to choose: DEGIRO or eToro?

Based on our valuation methodology, DEGIRO (click here for the official review) and eToro (click here for the official review) are two online brokers with the highest scores on QualeBroker.com.

DEGIRO obtained an aggregate score of 95/100; eToro achieved an aggregate score of 94/100.

However, this should not be interpreted as an unconditional approval for both brokers.

One is not equal to the other and in this comparison we will see why.

Although similar, these two online brokers have characteristics that make them more suitable for specific categories of traders.

In this ‘DEGIRO vs eToro’ comparison we will outline the main differences, the strengths and weaknesses, of each. This way you will be able to decide which online broker to use for investing in the stock market.

❓ Is DEGIRO or eToro better for new investors?

Both DEGIRO and eToro offer easy-to-use trading accounts and platforms for beginners.

DEGIRO offers a web platform and app that are easy to use and with few advanced features. On the other hand, the interface for placing orders is a bit complex. Note that there is no virtual account available (however, the minimum deposit is £0.01).

Keep in mind that DEGIRO is an "execution only" broker, which means that you will be the one to choose how, where and when to invest. You will not be offered any advice from the broker.

eToro, on the other hand, offers not only a user-friendly and easy-to-use platform/app (even through a virtual account, but among the services offered, you will find copy-trading and copy-portfolios, which you can easily copy the strategies and portfolios of other investors.

 

We recently made our own investment portfolio on eToro public for our users. We invest in stocks and ETFs, choosing the securities in which to invest with the principle of Value Investing: we buy when we believe a stock has excellent potential and that its price is undervalued. To achieve a good level of diversification, we invest in different sectors and countries and hold no less than 8-10 products in the portfolio.
The time horizon is medium to long term (1-5 years) and we suggest copying the portfolio with at least $500. Our Profit Target is 25-30% per annum.
Click here to see past performance of our profile and to start copying the QualeBroker portfolio.

To do copy-trading we will only have to choose the trader or portfolio to copy passively (among the many Popular Investors available on the platform). After that we will not have to worry about anything else, as we will have delegated the investment process to a third party.

During copy trading, every inexperienced investor can learn the various dynamics that govern trading activities from the copied trader. This way, it will be possible to avoid classic mistakes that can occur at the beginning of trading and which often result in monetary losses.

Therefore, for those starting from scratch, eToro has the necessary tools to allow the user to successfully approach the world of online trading. Pertinent tools include a demo account, copy trading and an extremely simple to use platform.

❓ Which securities and markets can you trade with the two brokers?

DEGIRO can be defined as a pure Direct Market Access (DMA) broker, which means that it does not act as a Market Maker, but merely allows access to various global markets. DEGIRO is a pure intermediary and will not act as a counterparty in transactions.

With DEGIRO, therefore, you will not be able to trade CFDs, Forex, cryptocurrencies or 

any other product not listed on regulated markets. Instead, you will find stocks, ETFs, options, futures, warrants, bonds (although the LSE bonds are unavailable).

DEGIRO offers access to over 65 global stock exchanges and thus is one of the online brokers to guarantee the most wide range of options.

In addition to the London Stock Exchange, with DEGIRO you will have access to the US markets (Nasdaq and NYSE), most of the European markets (Milan, Xetra, Euronext etc.) and numerous foreign markets (Japan, Australia, Canada, Hong Kong etc.)

eToro, on the other hand, is a hybrid broker. It acts as both a DMA broker and a Market Maker. In fact, if you trade without financial leverage on stocks, ETFs and cryptocurrencies, eToro allows you to trade the real underlying (and with zero commissions). If, on the other hand, you use financial leverage, eToro acts as a Market Maker and offers CFD trading.

With CFDs you will be able to trade commodities, currencies, indices, crypto, investing even small amounts, taking advantage of the leverage effect. On eToro platform you will not find bonds, futures and options.

So, if you are a medium to long term investor, both DEGIRO and eToro will be a smart choice to invest in stocks, ETFs and crypto (the latter only available with eToro).

If, on the other hand, you intend to do speculative trading, based on short-term leveraged operations on both real shares and leveraged products, then eToro is more suitable for this type of operation.

❓ Is DEGIRO or eToro more convenient regarding costs and commissions?

Both DEGIRO and eToro apply convenience fees and almost free account maintenance costs. They are probably the most cost-effective online brokers.

But even here you must pay attention to the type of transactions you are interested in, since in some circumstances these two brokers may not be convenient. Let's go see when.

DEGIRO offers an account that does not have opening, maintaining and closing costs. Deposits and withdrawals are always free. There are no hidden costs and the only aspect to be taken into consideration is the commissions applied on transactions. DEGIRO applies a fixed fee on almost all securities.

Let's take US equities as an example. With DEGIRO you pay a flat fee of £0.42, regardless of the US shares traded. The more stocks you buy, the lower the commission impact. So, for example, if you buy 5 Amazon shares (share price approximately $2,600), you will have purchased shares for an equivalent value of approximately $13,000 and you will have paid a commission of approximately £0.42.

eToro likewise offers an account with no maintenance or securities custody fees. Unlike DEGIRO there is a $5 fee for withdrawals and if you deposit British pounds you have to make a currency conversion from GBP to USD (if you want to avoid these conversion costs contact us and we will explain how to do it). Analyzing the commission structure of eToro, we will notice that this is a broker that offers trading without commissions. You will therefore be able to buy and sell real shares, ETFs and crypto without paying any commission.

In the previous DEGIRO example, you would have paid £0.42 in commissions, with eToro you would have paid $0. You would have thus obtained a net savings of £0.42. Let's try to multiply this unit savings by the number of transactions over a year. You can easily realize how to save hundreds or thousands of pounds in commissions with eToro.

 

Use the fee simulator to calculate trading fees →

 

Beware of trading CFDs with eToro. CFDs should only be used for short-term transactions (maximum one week). The reason? If you are not already aware, CFDs, being derivative instruments, have implicit costs. A CFD position therefore accrues an interest expense on a daily basis, which is interest that can negatively impact your investment in the long run.

In conclusion, when it comes to commissions, eToro is cheaper than DEGIRO due to the option of trading without commissions. However, DEGIRO offers a 100% free trading account, where eToro charges fees for withdrawals and currency conversions.

❓ Is DEGIRO or eToro Safer?

Although established in two different countries (DEGIRO is Dutch while eToro is Israeli), both are investment firms authorized in Europe (eToro serves European clients through a branch based in the UK) and regulated by European Community regulations.

Both brokers, therefore, adopt the transparency and security safeguards imposed by the European legislator. Among these we have:

  • The segregation of client funds from the broker's assets (the latter cannot use client liquidity in any case).
  • The investor compensation scheme, insures each eToro client up to £85,000, while for DEGIRO it is up to €100,000.
  • Protection against negative balance (the client cannot lose more than what he has deposited in the account).

If you have more than £2,000 cash in your account, you have to accept negative returns with DEGIRO that currently are around 0.5% per annum. The solution would be to keep the liquidity on the DEGIRO account to a minimum and to use the liquidity only to purchase financial instruments on the platform.

With eToro, on the other hand, deposits do not accrue either negative or positive interest. Regardless of what happens to the broker, client funds are insured by the Financial Services Compensation Scheme (FSCS).

In light of what has been described, we can establish that both DEGIRO and eToro are two transparent brokers and well supervised by European bodies.

Have you decided which of the two online brokers to trade with? Great! Use one of the buttons below to open a free online account with eToro or DEGIRO in a few minutes.

Overall Rating DEGIRO: 95/100

How do we assign rates?

» Check out our methodology

Safety: 96/100
Fees and Costs: 97/100
Products and markets offering: 95/100
Platform and Research: 84/100
Mobile trading: 84/100
Ease of use: 92/100
Tax regime: 95/100
Customer support: 96/100
Education: 35/100
Banking services: 20/100

Overall Rating eToro: 94/100

How do we assign rates?

» Check out our methodology

Safety: 91/100
Fees and Costs: 94/100
Products and markets offering: 97/100
Platform and Research: 90/100
Mobile trading: 98/100
Ease of use: 100/100
Tax regime: 70/100
Customer support: 65/100
Education: 72/100
Banking services: 25/100
Compare Brokers

  degiro eToro
  Read the review Read the review
OVERALL RATING
COMMISSIONS
PLATFORM
PRODUCTS AND MARKETS
RESEARCH
TAX REGIME
SAFETY
BANKING SERVICES
EDUCATION
CUSTOMER SERVICE
COMMISSIONS    
STOCKS    
American stocks € 0,50 commission free
European stocks € 4,40 commission free
OPTIONS    
US options $ 0,75 + € 0,50
Euronext options € 1,25
FUTURES    
US futures $ 0,75 + € 0,50
Futures Euronext € 1,25
ETF    
European ETFs € 0,50 commission free
Commission-free ETFs (200) (145)
BONDS    
MOT-EuroTLX (commissione variabile)
Xetra - Francoforte € 2,50
OTC € 35,50
OTHER PRODUCTS    
Investment funds € 4,40 + 0,2%
Forex 0,09%
CFD 0,09%
OTHER COSTS    
Costs for real-time data    € 5 - 21 Free
Annual financing rate    3% - 4% 6,4%
Short margin    1% - 2% 2,9%
Inactivity costs    $10 / month from the thirteenth month of inactivity
Currency exchange cost    0,25% 0,5%
Proprietary platform    Free Free
Account closure Free Free
Minimum deposit required € 0,01 $ 50
Deposit and custody of securities Free Free
PLATFORM    
Two-factor authentication (2FA)   
Web   
Desktop   
App   
External software
Demo   
Book depth    5 levels Euronext; 1 level other markets 1 level
Financial leverage    Up to 18x intraday; up to 6x overnight Stocks/ETFs 1x; CFDs up to 30x
Naked options sale   
Intraday futures margin    5%
Overnight futures margin     15%
ORDER TYPES    
Limit order
Market order
Stop-loss
Stop-limit order
Trailing Stop
Bracket Order
One-Cancels-the-Other Order
Combination of orders (options) (Euronext only)
PRODUCTS AND MARKETS    
Total global markets available 50 80
EUROPEAN MARKETS
US MARKETS
EXOTIC MARKETS
Covered warrants
Warrants
Certificates
OTC USA
Pink sheets
Forex (CFD)
Options on shares (CME)
Trading after hours (TAH)
RESEARCH AND ANALYSIS    
Fundamental analysis tools
Technical analysis tools
Market news
Watchlist
Screener
Trading alerts
BANKING SERVICES AND SAFETY    
Multicurrency account
Financial advisory services
Deposit guarantee German Investor Protection Scheme (€100,000) Cypriot Investor Compensation Fund (€ 20,000)
Regulation / Supervision The Dutch AFM; the Dutch Central Bank (DNB) CySEC (Cyprus); FCA (United Kingdom)
EDUCATION    
Video tutorials
Webinars and trainings
Seminars / Live Events
CUSTOMER CARE    
Telephone / email support quality
Speed of responses
Toll free number
Online/live chat service
  Visit DEGIRO → Visit eTORO →

Risk disclosure: Investing involves risk of loss

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CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. Between 74-89% of retail investor accounts lose money when trading CFDs. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.