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eToro fees explained

May 2019
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Overview of eToro fees and charges

eToro logo

It's safe to say that eToro's fees are low in general. They either don't charge a brokerage fee for things other brokers do charge for, or they only charge a small amount. This means that you can use eToro even in case you trade frequently like multiple times a week or daily.

Here's a high level overview of eToro's fees

eToro Fees snapshot
Assets Fee level Fee terms
US stock fee Low Free stock and ETF trading in Europe, 0.09% spread cost per side for non-EU clients
EURUSD fee Average The fees are built into spread, 3 pips is the spread cost
US tech fund fee - Not available
Inactivity fee Average $10 per month after one year inactivity

eToro fees
eToro fees explained

Online brokerages in general charge much lower brokerage fees than traditional brokerages do - this is largely due to the fact that online brokerages' businesses can be much better scaled: From a purely technical standpoint it doesn't make that much of a difference for them if they have 100 or 5000 clients.

This is not to say however that they don't have any fees at all. They make money by charging you at various events for various rates. Usually you need to keep an eye on these 3 types of fees:

  • Trading fees - these are brokerage fees that you pay when you actually do a trade, i.e. buying an Apple stock or an ETF. What you pay is either a commission, a spread or financing rate. Some brokers apply all of these.
    • A commission is either based on the traded volume or it is fixed.
    • A spread is the difference between the buy price and the sell price
    • Financing rate or overnight rate is charged when you hold your leveraged positions for more than one day.
  • Non-trading fees. These occur related to some operations you make in your account, i.e. depositing money to your account, withdrawing money from it or not trading for an extended amount of time.

We compare eToro fees with its closest competitors, Plus500 and Markets.com.

eToro fees
eToro trading fees

eToro's trading fees are low which makes it suitable for you even if you trade often (i.e. multiple times a week).

Let's break down the trading fees into the different asset classes available at eToro.

Trading fees

eToro's trading fees are low.

It is super hard to compare trading fees for CFD brokers. What we did at Brokerchooser? Instead of quoting long fee tables, we compare brokers by calculating all fees of a typical trade for three assets.

For the assets we chose cleverly and arbitrarily:

  • Apple, a large US stock
  • Vodafone, a large European stock
  • EURUSD, a popular currency pair

The typical trade means buying a position, holding for one week, and selling it. For the volume we chose a $2,000 position for the stocks and $20,000 for the EURUSD.

This super catch-all benchmark includes spreads, commissions and financing costs for all brokers.

Here is the verdict.

eToro fees benchmarked
eToro Plus500 Markets.com
Apple benchmark fee $0.0 $8.9 $5.6
Vodafone benchmark fee $0.0 $7.6 $6.8
EURUSD benchmark fee $19.1 $17.6 $28.6

Financing rates

eToro financing rates are high.

If you want to trade on margin and prefer to hold your positions long, financing costs can be significant.

eToro yearly financing rates
eToro Plus500 Markets.com
Apple financing rate 8.9% 13.9% 7.9%
Vodafone financing rate 8.9% 12.1% 6.0%
EURUSD financing rate 3.7% 4.5% 6.6%
EURGBP financing rate 2.5% 3.0% 5.0%

eToro fees
eToro non-trading fees

When it comes to looking at all the non-trading fees eToro is an expensive broker. This means that they tend to charge you a lot for non-trading related activities on your trading account, like withdrawal fee.

Non-trading fees include various brokerage fees and charges at eToro that you pay not related to buying and selling assets. Among some others, typical non trading fees are withdrawal fee, deposit fee, inactivity fee and account fee.

A high level overview of how eToro stacks up in non-trading fees
eToro Plus500 Markets.com
Withdrawal fee $25 $0 $0
Deposit fee 0 0 0
Inactivity fee Yes Yes Yes
Account fee No No No

eToro fees
eToro deposit fee

Deposit fees are applied when you send money to your trading account from your bank account. Usually brokers don't charge money for that and eToro is not different: you will see the exact same amount on your brokerage account that you sent by any of the deposit methods eToro offers.

eToro deposit methods
eToro Plus500 Markets.com
Bank transfer Yes Yes Yes
Credit/Debit card Yes Yes Yes
Electronic wallets Yes Yes Yes
Deposit fee 0 0 0

eToro fees
eToro withdrawal fee

Unfortunately, quite like the majority of the online brokers we have reviewed eToro does charge a withdrawal fee of $25 for the bank transfer. This means that you need to pay this amount of money when you transfer your money back to your bank account. It's up to you to decide whether this is a high amount or not as it's dependent mostly on the size of the transferred amount.

eToro withdrawal fees and options compared
eToro Plus500 Markets.com
Bank transfer Yes Yes Yes
Credit/Debit card Yes Yes Yes
Electronic wallets Yes Yes Yes
Withdrawal fee with bank transfer $25 $0 $0

eToro fees
eToro inactivity fee

eToro does apply an inactivity fee and it is $10 per month after one year inactivity. This means that you need to be strategic about your trading activity to avoid getting charged after a longer time of no trade. The fact that eToro charges an inactivity fee makes it less ideal for you if you are a buy and hold investor.

eToro has average inactivity fee.

eToro Plus500 Markets.com
Inactivity fee Yes Yes Yes
Inactivity fee $10 per month after one year inactivity $10 per quarter after 3 months of inactivity $10 per month after 3 month of inactivity

Read more about eToro inactivity fee on their own site.

AUTHOR

Gergely Korpos
Gergely Korpos
Co-founder, CPO
Gergely's aim is to bring more clarity into personal investing. He has 10 years of experience in financial markets with GE Money, KPMG and MOL. He concluded thousands of trades as a commodity trader and financial portfolio manager
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