DEGIRO Review 2018

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DEGIRO is a Dutch discount broker established in 2012 by a group of former employees at one of the largest online brokers in the Netherlands. It is regulated by the Dutch financial watchdog, AFM. DEGIRO is not listed on any stock exchange, nor has a banking background.

As a plus

DEGIRO has one of the most competitive fee structures among online brokers. Furthermore, has wide market coverage, providing access to the most important international and also to some local European exchanges. Its web and mobile trading platforms are well designed and easy to use.

On the flip side

DEGIRO does not provide any research or education. The technical tools supporting your trading/investment are also limited to the interactive charting. Furthermore, you can deposit or withdraw money almost only through bank transfer.

Recommended for price-sensitive buy and hold investors and traders looking for only execution.

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DEGIRO review
Investor protection and regulation

DEGIRO is a lincesed investment firm regulated by Dutch Central Bank and Netherlands Financial Markets authorities. On the flip side it does not have banking background and it is not listed on any stock exchanges.

Regulation and investor protection amount

DEGIRO is regulated by the Dutch Central Bank (DNB) and The Netherlands Financial Markets Authority (AFM). Regulators of other countries - where DEGIRO offers its services - are also notified by DEGIRO and aware of its operation. For example, in the UK, DEGIRO is registered with the Financial Conduct Authority (FCA).

The Dutch Investor Protection Scheme is applicable, as DEGIRO is a licensed investment firm authorised by the Netherlands Authority for the Financial Markets (AFM). This scheme protects individual clients up to €20,000.  

Furthermore, cash is held in separate cash funds, that are segregated from DEGIRO. These cash funds are managed by Fundshare, a sister company of DEGIRO. The custodian of these cash funds is KAS Bank & Depositary Services B.V. 

Bank/stock exchange background

It’s worth remembering that DEGIRO is a discount buroker, it does not have banking background, and is not listed on a stock exchange.

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DEGIRO review
Account opening

DEGIRO has a very easy and fast account opening process. As a plus you don't need a minimum deposit. On the flip side you can only change your base currency in a tricky way.

Who can open an account with DEGIRO?

You can open an account with DEGIRO if you have a bank account in your name from one of the following countries:

• EU countries except for Bulgaria, Croatia, Cyprus, Estonia, Latvia, Lithuania, Malta, and Romania
• Norway
• Switzerland

For a UK registration, you will need a mainland UK bank account in GBP. DEGIRO does not accept transfers from UK overseas territories or Crown dependencies such as Jersey, Guernsey, Gibraltar, or Isle of Man.

US clients are not accepted if they are considered a person under IRS guidelines.

So at DEGIRO, primarily your bank account matters, not your nationality or residency. On the other hand, you might be also banned based on your residency, but DEGIRO does not provide a banned clear country list. Brokerchooser's advice is to contact the customer service for your eligibility if you are not resident in one of the above-listed countries.

Minimum funding requirements

There is no minimum account balance. This is a big advantage of DEGIRO if you want to invest smaller amounts of money.

Account type

Within the DEGIRO trading platform, you can choose between different account profiles. DEGIRO account types are the following:

• Custody
• Basic
• Active
• Trader
• Day Trader

These profiles differ in sense of the availability of riskier services (e.g. margin trading or short selling). For example, the DEGIRO custody account is the most secure, but the most limited (e.g. you can't trade with leveraged or derivative products). DEGIRO claims the fee structure of the Custody profile is higher, but in reality, we found that only dividend and coupon processing fees are higher. The trading fees are the same for each profile. For profiles summary, take a look at this table: 

Some of the profiles may not be available in some countries. You can read more about DEGIRO profiles here.

At the time of our review, DEGIRO does not provide tax-free account options like DEGIRO ISA or others that apply in other European countries. Two exceptions are Sweden where ISK is provided and the Netherlands where pension account is provided.

Account base currencies

The base currency of your account is always the currency of your home country. This means that you will get a GBP account if you register at www.degiro.co.uk as a UK citizen. This applies to the DEGIRO trading platform language as well: your platform will be in German if you register at www.degiro.de.

However, there is a solution if you want to have an investment account with a different currency. All you have to do is register on the DEGIRO website of the country of whose currency you want to use. In this case, you need to fund this account via a bank account with the same currency. For example, if you open an Irish DEGIRO EUR account as a Polish citizen, you need to fund this account via an EUR bank account. This is not working for each country, so before opening the account in a different country, please contact DEGIRO's customer service.

Also good to know that DEGIRO does not provide demo account, but it is mainly due to not requiring a minimum deposit for account opening.

Account opening process

The account opening process is seamless, fast, and your account will be functioning within 2-3 days. The account opening process is all online and identification is digital.

DEGIRO promises a 10-minute registration process. This holds true for the initial registration, where you have to provide your personal details.

For the initial registration you need:

• a copy of your passport or ID card
• the bank account number from which you will fund the investment account

After the initial registration you will have three additional tasks before your account is activated and you can trade:

1. You need to complete an appropriateness test. By completing this you will be aware of the financial risks of trading.
2. You need to agree to the conditions for real-time prices.
3. You need to transfer money to your investment account.

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DEGIRO review
Funding and withdrawal

There are only few options to fund/withdraw your money. However, the process of the transfer is fast and the fees of transfer is free of charge.

Funding Options

You can start funding/withdrawing money by using the web trader platform. You can transfer funds to DEGIRO in two ways:

1. Bank transfer: if you transfer funds manually they are normally available in the WebTrader (name of the online platform) in 2-3 working days. DEGIRO has strict rules on acceptance of money transfers. DEGIRO only allows transfers from bank accounts from accepted countries, and that are in your name.
2. SOFORT: it is a third party, instant deposit service provider. The money transfer usually takes around 30 minutes. Please note that some banks may not accept this form of financing. If you want to use this form of funding, make you sure your bank accept it.

Withdrawal Options

You can withdraw only with a bank transfer. SOFORT is not available for withdrawal.

1. Bank transfer: DEGIRO ensures that the withdrawn amount is transferred back to your bank account within 3 working days. We verified this and received the amount within one working day.

As you would expect from our Fee Champion, DEGIRO fees are zero to withdraw or deposit funds via manual money transfer. Please be aware that when using third party transfer services (such as SOFORT) the provider may issue a fee.

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DEGIRO review
Product portfolio

DEGIRO offers a wide product portfolio. It gives access to international markets in multiple asset classes. There are no forex though.

The available asset classes to trade:

• Equities
• ETFs
• Funds
• Bonds
• Options
• Futures
• CFDs
• Cryptos

Forex is the only asset classes missing from the product portfolio.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 65% 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.

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Equities

With DEGIRO you can trade on 32 stock exchanges worldwide. This offering includes the largest international markets and also smaller stock exchanges in Europe. This variety of stocks is less than Interactive Brokers's, but almost the same as Saxo Bank's with 30 stock markets.

Below you can find the available international markets to trade on.

ETFs

You can trade with more than 6,000 ETFs in 20 markets. Just to give a feeling, with Interactive Brokers you can trade with 20,223 ETFs in 25 markets, and Saxo offers only ~650 ETFs. In Europe, you can access all minor markets, but globally only the NYSE Arca and the Hong Kong Stock Exchange are available:

Funds

DEGIRO offers 581 different funds. This proposition includes the biggest funds, like BlackRock or Vanguard. It's a really wide range compared to competitors like Interactive Brokers which supply 189 funds, or Saxo which doesn't provide access to investment funds.

Bonds

You can reach 946 corporate and 56 government bonds in DEGIRO. It's a quite tight coverage comparing to other brokers like Saxo which gives you access to altogether ~5,000 bonds. You can trade with bonds in the following markets:

Options

DEGIRO has a relatively ok proposition regarding available option markets as you can trade on 13 markets compared to Saxo's 6 available markets. This option market coverage falls short of Interactive Broker's 45 markets. You can check the main option markets here:

Futures

DEGIRO has a relatively narrow proposition regarding available future markets as you can trade only 12 markets compared to Interactive Broker's 36 or Saxo's 22 available markets. Please find below the main futures markets:

CFDs

DEGIRO gives you access to 17 markets globally with 898 CFDs. It's a tight offer as Saxo gives you access to 29 markets with more than 8,000 products. The main markets are the following:

Cryptos

You can invest into Bitcoins and Ether through ETN instruments traded on the Swedish stock exchange. If you want to know more about crypto investing,  we recommend our crypto blogpost.

Certificates

You can trade with 3,521 certificates in markets of Euronext Amsterdam and Euronext Paris.

Warrants

The warrant selection depends on your country of residency.

DEGIRO review
Fee structure

DEGIRO provides one of the lowest fee structures in the market. In most asset classes, it is more competitive than Interactive Brokers. It also provides one free ETF trading in a month, a great offer for buy and hold investors.

Trading fees

DEGIRO offers highly competitive trading fees. Its trading fees are more favorable than Interactive Brokers's fee structure.

Stock, ETF and CFD trading fees

DEGIRO is our fee champion for a reason: it is one of the cheapest choices for European and US equity trading. If you are interested in Asian equities, DEGIRO's fees are higher but still competitive in the European landscape.

The trading fee is usually calculated as a percentage of the traded volume, except for the US and Canada, where you are charged based on the number of shares traded. DEGIRO trading fees have a minimum value, but these are also competitive. In case of some exchanges, for example, the UK, there is also a €60 maximum fee (GBP 5 for UK customers) that favors big volume trades.

DEGIRO provides a discount for your domestic equity market. For example, if you open an account from the UK, you can trade on the UK market for 0.0058%+ £1.75 instead of 0.058% + €4.

You also have one free ETF trade every month, which allows you to choose from a list of ETFs. The size of this trade doesn’t matter as long as it does not generate a short position. If you increase the position in the same ETF in the same month you made the trade it will be still free as long as:

• you trade the same direction, buy or sell, as before
• the trade is more than €/$1,000.

For US stock and ETF trading DEGIRO provides one of the best fees among its peers.

A typical trade here means a trade of $2,000, share price is $50.

Minimum trading fee for smaller and Asian markets are definitely higher.

Mutual fund trading fees

DEGIRO's mutual fund fees are average if you buy exchange-listed funds. The non-listed fund fees are extremely high.

You will be charged for both buying and selling mutual funds.

Bond trading fees

If you want to buy European bonds DEGIRO offers one of the most competitive bond trading fees on the market.

Option trading fees

Index option fees are also among the best. For US and European indexes, it is much better than Interactive Brokers ($1 / contract, €2 / contract).

Futures trading fees

Futures fees are highly competitive as well.

Crypto fees

At DEGIRO you can buy cryptos only through ETNs (exchange-traded notes). At the time of the review, two bitcoin (EUR and SEK) and two ether ETNs (EUR and SEK) were available on the Stockholm Stock Exchange. DEGIRO's trading cost here is 0.058% + €4, but maximum €60. If you want to understand what is a crypto ETN check out our crypto blogpost.

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Non-trading fees

In terms of non-trading fees, DEGIRO is very competitive. No inactivity, withdrawal fees, plus very competitive financing rates.

On the flip side, there is an unusual fee category, "setting up trade possibilities". This is an annual €2.5 for each stock you want to trade on. Also pay attention on the manual currency conversion, it is costly.

Financing fees are also highly competitive compared to peers.

The financing rate formulas for different currencies:

You can compare DEGIRO's trading fees with other broker's fees in our comparison table.

DEGIRO review
Web trading platform

DEGIRO’s web platform is simple and easy to use. Even beginners will find it easy to conduct simple transactions like share dealing. On the flip side, price alert function is missing and customization is limited,

You can choose between a one-step or two-step login. We recommend the latter as it is more secure.

On the front page, you have

• an overview of your portfolio
• announcements, open and last transactions
• information about the financial markets, price data, chart
• a basic news panel with brief news

This platform has very limited customization features. You can hide the portfolio and transaction panels, but the market information panel cannot be personalized.

The menu structure is logical and you’ll find everything quickly and easily. The search console provides the result in different asset class categories: for example, if you search for Apple, the result will show Apple stocks, CFDs and warrants as well.

The interactive chart is easy to use and comes with several technical indicators, but unfortunately, the charts cannot be saved.

You can place your order online, by phone or by email. If you do it by phone you’ll find that it’s more expensive.

Order types

You can select from several order types and three order terms, although not all of them are available for every tradable instrument. You can check the availability of the order type and term of the specific instrument in the order panel.

Available order types:

• Limit order
• Market order
• Stop loss order
• Stop limit order

Order terms:

• Day order
• Good-till-date order
• Good-till-cancel

Order execution

Some questions and negative comments have arisen in the past regarding DEGIRO’s execution policy, with particular problems surrounding internal matching. DEGIRO no longer does any internal matching, however, you also could opt out from it in the past if you worried about it.

We haven’t had any negative experiences with DEGIRO’s execution. After the execution, you can receive an order confirmation by email but text message notification is not available.

Currency conversion

DEGIRO provides both automated (AutoFX) and manual conversion.

AutoFX automatically converts the exact amount you need for the trade, while with the manual option, big surprise, you have to do it manually. Be advised that the manual conversion has a pretty high fixed EUR 10 conversion fee, plus the 0.02% variable cost. The AutoFX cost is only 0.1% and no fixed fee is applied here.

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DEGIRO review
Mobile trading platform

DEGIRO's mobile platform has a basic but good design and it’s pretty straightforward to use.

It has all the most important functionalities:

• Market overview
• News
• Charts
• Portfolio information
• Transaction and account history
• Security order
• Money transfer order

The weakest link of the DEGIRO app is the product search console, which doesn’t allow you to search by asset class category and the asset class of a specific instrument cannot be identified. This part needs to be further developed

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DEGIRO review
Desktop trading platform

DEGIRO does not provide a desktop platform.

DEGIRO review
Research

DEGIRO does not provide any research, although this is absolutely normal for a discount broker.

Within the web and mobile platform you have a basic news panel with short, but informative market news.

Technical analysis lovers have some interactive charting tools but don’t expect anything special.

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DEGIRO review
Education

Education is not provided.

DEGIRO review
Customer service

DEGIRO customer service is helpful, reliable and most of the time they answer your questions well. We asked tons of difficult questions and almost always received very relevant answer.

Phone and email support are available, but live chat is missing.

A big advantage is you can contact the customer service in the language of your country, if you come from one of the 18 countries that are supported.

If you insist meeting the DEGIRO team or talking to customer service in person, you’ll have to travel to the Amsterdam or Sofia offices.

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DEGIRO review
Bottom line

DEGIRO is a good choice if you want a simple platform for execution and don’t want to spend a fortune on fees. It is far cheaper than its big European competitors and only Interactive Brokers can compete with DEGIRO fees. DEGIRO also has outstanding access to international markets.

However, cheapness comes with some shortfalls. These are mainly the lack of education and research materials, the limited platform tools, and funding options.

All in all, it is a good provider. As there is no minimum funding requirements and no inactivity fee, feel free to try it out.

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