eToro has been around for more than 15 years, but only started offering stock and option trading to U.S. customers in 2022 after previously only offering cryptocurrencies. The platform has some unique features, such as commission-free options trading and the ability to copy the trades of top investors, and could be worth a look for active traders looking for an easy-to-use platform. Read our full review to find out if it's right for you.
Ratings Methodology
eToro Brokerage
Bottom Line
A cryptocurrency-focused brokerage designed for traders.
Fees:
$0 for stocks, ETFs, and options; 1% for cryptocurrency trades
Account Minimum:
$0 ($10 to trade)
Full eToro review
This stock broker is a good fit for: Active traders, especially those interested in options and/or cryptocurrencies.
ProsLike many app-focused brokerage platforms, eToro allows investors to buy and sell fractional shares of stocks. For example, if a particular stock is trading for $100 per share, fractional share investing can allow you to buy a portion of a share, such as 0.50 shares, for $50.
One of the biggest differences between eToro and other stock brokers is the community-focused nature of its platform. It offers a collaborative community of traders, and even allows customers to automatically copy the trades of top traders on the platform with whatever dollar amount they are comfortable with.
No-commission options tradingCommission-free stock trading has become the industry standard, but most brokers still charge per-contract fees for options trading, often ranging from $0.50 to $1.00 per contract, which can add up quickly for frequent option traders. eToro is one of the few that offers completely commission-free options trading.
Cryptocurrency investingeToro is one of the few brokers that allows customers to trade stocks, options, and cryptocurrencies in the same place. As of February 2023, eToro allows customers to trade in 24 different cryptocurrencies.
Easy-to-use appIn addition to its web-based trading platform, eToro offers a mobile app designed to allow investors of every experience level to trade cryptocurrencies, stocks, and options from wherever they are. The app currently has ratings of 4.1 and 4.3 on the Google Play store and Apple App Store, respectively.
What could be improved Some stocks and ETFs aren't availableBetween the Nasdaq and NYSE, there are about 6,200 publicly traded companies. There are another 3,700 or so that trade over the counter (OTC). There are also more than 3,140 ETFs that trade on the public markets, as of February 2023.
However, there are only 2,095 stocks and 263 ETFs available on eToro's platform. Now, eToro certainly offers the most popular investment options in both categories, but it's important to note that if you have specific stocks you want to buy, eToro might not offer everything you're looking for.
Mutual funds and other investment typesAs of February 2023, eToro doesn't offer mutual fund investing, nor does it offer bonds, commodities, foreign currencies, or other investment types to U.S. customers. To be fair, eToro is clearly oriented to traders, not long-term passive investors, but it's important to realize that you won't be able to own certain types of investments through eToro.
Only one type of accounteToro only offers one type of account -- a standard, individual brokerage account. It doesn't offer joint accounts or custodial accounts, and there are no retirement accounts such as IRAs offered on the platform. While most people use platforms like eToro to trade, not invest for retirement, this is a major drawback compared to even some of the other tech-focused brokerage apps.
Lack of educational and trading resourcesLike most app-based trading platforms, eToro is light on educational resources and functionality. It offers a web-based and app-based platform, but both lack the features available through many rivals.
Commissions
eToro doesn't charge any commissions on stock trades, which is the industry standard these days. It also has no-commission option trading, which is more of a rarity. Customers can trade options with no per-contract fees.
For cryptocurrencies, there is a 1% fee charged by eToro, which is reflected in the prices you pay when you buy and receive when you sell. This is fairly common in the cryptocurrency industry, and is a less complex pricing structure than many other crypto exchanges use.
Stocks and ETFs Options Mutual Funds Cryptocurrencies $0 $0 + $0 contract fee N/A 1% for buys and sellsData source: eToro.
Buying mutual funds and ETFs
eToro currently does not offer mutual funds on its platform, and while it does offer ETFs, there are only 263 of them available to U.S. investors. If mutual funds are a big part of your investment strategy, you'd probably be better off choosing a different broker, and if ETFs are a part of your plan, it's important to make sure eToro's selection will meet your needs.
Fees
eToro is a generally low-fee platform, but it does charge fees for certain things. Just to name some of the more common ones:
In addition, while eToro doesn't charge trading commissions, SEC and FINRA regulatory fees apply to each transaction. These are rather small and are a standard practice in the brokerage industry, and for most investors will amount to pennies.
Trading platform
eToro offers a web-based trading platform as well as an easy-to-use app. Both platforms are designed to allow easy cryptocurrency, stock, and options trading. The mobile app holds ratings of 4.1 on the Google Play store and 4.3 on the Apple App Store as of February 2023.
The key advantage of eToro's trading platform is its simplicity. It doesn't offer too many features other than the ability to select a dollar amount or number of shares you want to buy or sell. However, for people who want the ability to easily buy and sell investments, it can be quite sufficient.
Margin rates
eToro doesn't offer a traditional margin account to U.S. users, although it can be available for options trading to certain eligible customers.
Research offerings
Earlier, we mentioned that eToro was lacking in educational and other resources, and this is a perfect example. Many brokers (especially the larger and more traditional ones) offer clients access to third-party stock research, but eToro does not.
Alternatives to consider
If you're looking for an easy-to-use app to trade stocks, options, and cryptocurrencies, Robinhood could be an alternative worth a look. The Robinhood platform offers several of the key perks of eToro, such as commission-free options trading and fractional shares, but also has free cryptocurrency trading, margin investing, a high-yield cash management account, and offers IRA accounts for retirement investors. The biggest drawback is the lack of the community element of eToro, especially when it comes to following the trades of other investors.
On the other hand, if you're looking for a full-featured brokerage platform (and don't really care about cryptocurrency trading), Charles Schwab could be worth considering. It offers fractional share trading, as well as a full range of stocks, bonds, mutual funds, and much more. Schwab also has a feature-packed trading platform, tons of educational resources, excellent customer support, and more.
This brokerage is right for you if:
eToro is a solid choice for people who want a place to actively buy and sell stocks, options, and cryptocurrencies in the same place, especially for those who want to be able to follow the trades of top experts. However, it is important to realize eToro is designed for traders, and therefore lacks some of the features and capabilities that long-term investors often want.