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There’s not much in it! Both are great low cost trading platforms, you can’t go wrong with either. However if we had to choose, we’d pick Trading 212. It’s cheaper overall, has better customer service, and a tax-free ISA. If you’re looking to buy crypto, your only option is eToro.
eToro and Trading 212 are wiping the floor with expensive traditional trading companies. Low cost trading is the future and these guys both do it. But which one is ultimately the best, and which is right for you?
Let’s run through each briefly, just so we’re on the same page.
eToro is a very popular trading platform, not just in the UK but across the world. It’s unique in a sense that you can trade socially. This means you can actually view and interact with other traders and learn from how they’re trading. You can even copy their trades too!
But more than that, it has a huge range of investment options to trade, such as stocks and shares (where you own a tiny part of a company, so a share of a company), ETFs (groups of shares), currencies, commodities and crypto.
It’s a great platform for beginners all the way to experienced professionals.
You can buy stocks and shares directly, but it also offers the ability to trade CFDs (Contract For Differences). This is trading the price of an asset (such as a stock), rather than buying the asset itself. Giving you the ability to trade with leverage (borrowed money), and trade the price going down (short).
Read our eToro review to learn more.
Trading 212 is also commission free, and also very popular in the UK and worldwide. In fact, it’s one of the cheapest investing and trading platforms out there.
Similar to eToro, you can buy assets directly, so you own them (stocks, shares and ETFs), but with Trading 212 you can buy them within a tax-free ISA.
And it also offers CFDs, so you can trade the price direction of an asset, and go short if you want to (price going down). Plus trade with leverage (borrowed money). We did say they were similar!
You can trade almost all investment types, such as stocks, shares, commodities and foreign exchange. However, not crypto.
Overall, it’s a great platform. As you can see there's lots of similarities.
Get a free share worth up to £100 when you sign up with the promo code NUTS. Enjoy!
Let’s start with the most important thing, the fees!
This is where it might get pretty difficult to compare, as they’re both low cost. And there’s not many other fees for either platform. But that’s a nice problem to have, cheap trading!
There’s also no fees to set up your account with either of them, and there’s no fees to hold investments (which is common with stock brokers, such as Hargreaves Lansdown, and AJ Bell, who charge a percentage of your total investments).
Now you might be wondering, how do both companies make money then? Well, when you trade CFDs, which is trading the price of an asset, rather than buying it, they include spread fees. These are small fees hidden within the price of the asset when you buy or sell.
Now here’s where it gets complicated, as the spread varies depending on lots of different things, such as which asset it is (the more popular, the lower the spread fee), and even the time of day.
However the fees are low on both, check the Trading 212 website¹ and eToro website¹ to find out more. Get a free share worth up to £100 with Trading 212. Use code NUTS.
One main difference is that eToro uses Dollars as its currency, everyone has to use Dollars, even if you’re in the UK.
And because of that, you have to convert your Pounds into Dollars. And this costs 0.5% as a conversion fee. It’s still a pretty good rate compared to other platforms (for instance some are 1.5%, such as Interactive Investor).
When you compare to Trading 212 where you don’t need to convert all of your money into Dollars, there’s a bit of a difference.
Your money would be converted when you buy stocks in a foreign currency, for instance, US stocks. This is all done automatically when you purchase, and it’s low, just 0.15% when buying stocks directly, and 0.5% for CFDs.
When you withdraw from eToro, you’ll also have to pay a $5 withdrawal fee, however with Trading 212 it’s free.
Winner: Trading 212
This one’s an easy one. eToro doesn’t provide a Stocks & Shares ISA. It’s solely a trading platform. So the winner is Trading 212, which does!
It’s often a good idea to have some or all of your investments within an ISA, as you can invest tax-free! You won’t have to pay any Capital Gains Tax, Income Tax or Dividend Tax.
You can invest up to £20,000 per tax year (April 6th to April 5th the following year), however you can only pay into one Stocks and Shares ISA per year.
A common strategy is to use an expert-managed ISA, so you can be pretty confident it will grow over the long term, and then use a General Investment Account for your own investments (an account with no tax-free benefits, but you can have as many as you like). These are the standard accounts on eToro and Trading 212.
Winner: Trading 212
Now the interesting bit, what can you actually trade?
With eToro, there’s pretty much everything you can think of! Stocks, shares, ETFs, currencies (foreign exchange), cryptocurrencies and commodities (things like silver and gold). That’s a lot of stuff, and the range of each one is large too – there’s a lot of stocks for instance.
With Trading 212, it’s pretty similar! There’s a huge range of stocks, ETFs, currencies and commodities. There’s no crypto however, so if that’s what you’re after, use eToro¹.
So if you’re just looking to trade most things, there’s not much difference between the two platforms. However crypto is pretty popular, so eToro has to win this one.
Winner: eToro
To get a gauge of the customer service, and how customers are enjoying their service (or not), let’s look at the customer reviews. And the best place for that is Trustpilot, the popular reviews website.
eToro has an excellent score of 4.3 out of 5, and from over 17,000 reviews. That’s very good, well it’s excellent!
A lot of the reviews mention how good the platform is to use, and the social trading aspect, which is a great feature. They also mention the great customer service, and of course, low cost trading!
With Trading 212, it has a better score of 4.6 out of 5! And from over 20,000 reviews. That’s incredible!
Customers mention the outstanding customer service, and how good the platform is to use, plus the low fees.
Winner: Trading 212
And there we have it, eToro vs Trading 212. It’s a pretty tight competition!
We’re going to give it to Trading 212, ever so slightly. Although there’s really not much in it.
This is because of the way currency conversion fees are handled. They’re cheaper with Trading 212, and you just convert your cash when you buy an investment (all done automatically). Whereas with eToro you have to convert all of your cash before you start trading (it’s still a low fee however).
Trading 212 also has a tax-free ISA, which eToro doesn’t have. Which is perfect for long-term investing, and there’s no fees to open and hold investments within one (although bear in mind CFDs won’t be in an ISA).
However, if you want to buy and own crypto eToro¹ is the place for you.
Both options are great in general. They’re very low cost, and both have awesome customer reviews and customer service (the average response time for Trading 212 is just 29 seconds).
And both offer a huge range of investment options and CFD trading, to trade with leverage (borrowed money), and either price direction (up and down). (Please be sensible with leverage trading, it's very high risk.)
We hope that’s given you a bit more insight into both platforms, and here’s where to learn more and get started with Trading 212¹, and eToro¹.
Get a free share worth up to £100 with Trading 212. Use code NUTS.
Good luck 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
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 has been prepared by our partner utilizing publicly available non-entity specific information about eToro
Get a free share worth up to £100 when you sign up with the promo code NUTS. Enjoy!
Get a free share worth up to £100 when you sign up with the promo code NUTS. Enjoy!
Get a free share worth up to £100 when you sign up with the promo code NUTS. Enjoy!
Christopher Dowling combines a communications degree with over 10 years experience in the financial services industry in London – with focus on educating people on a wide range of money topics in an easy to understand way. He writes about savings, investing, pensions, mortgages, insurance, banking, loans, business finance and other money topics.
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Get a free share worth up to £100 when you sign up with the promo code NUTS. Enjoy!