Etoro fees and spreads at a glance

A crucial question for traders when assessing brokers is what costs are incurred in connection with trading. This is true for both regular securities brokers and more specialized providers such as Forex and CFD brokers. If you want to trade forex pairs or CFDs, you will usually find special cost factors with the corresponding brokers. This is also the case with the broker eToro, which we’d like to take a closer look at in detail regarding their costs.

eToro fees
eToro fees on stocks are 0%

Cost overview with the broker eToro

The broker eToro, known for its social trading, offers both currency pair trading and Contracts For Difference (CFDs). There are a total of four different cost factors for the customer to consider. First of all, it’s worth mentioning that there are no costs for opening the trading account or for using it later. However, this is the case with virtually every CFD and Forex broker, as a custody account fee is usually only charged by ordinary online brokers.

The three cost factors mentioned above are the following elements, but they may not apply to every trader, with the exception of the estimated spreads:

  • Market Spreads
  • Overnight fees
  • Withdrawal fees
  • Inactivity fees

In the following, we would like to explain the costs listed above in more detail and give you tips, among other things, on how you can perhaps reduce or even completely avoid some of these costs.

Spreads as the main cost factor

For virtually every CFD and Forex broker, the spreads quoted by the provider are the main cost factor. Some newcomers who are new to trading currency pairs and CFDs for the first time may not even know what the cost of spreads is. Therefore, we would like to briefly explain the characteristics of spreads, and how most brokers charge for them.

Basically, you can remember that the spread is different. Specifically, the difference between the buying and selling rate of a currency pair, as estimated by the broker, is called the spread. The real-time prices provided by the broker provide you with information on how the current buy price of a currency pair is quoted, among other things. In addition, you are also informed about the selling price, so that you can calculate the spread from the difference. The size of the spread depends primarily on which two currencies are involved in a currency pair.

Most brokers divide the offered currency pairs into the following three groups:

  • Majors
  • Minors
  • Exotics

Spreads also move in this order, so that you will find relatively small differences between buying and selling prices, especially for the majors. These are often in the range between below 1.0 and up to 5.0 pips. The Minors are slightly more expensive. Particularly with the more exotic currency pairs, you can expect spreads in the range between ten and more than 20 pips.

eToro CFD trading
eToro CFD trading

Broker eToro also has this spread breakdown by currency pairs. A customer-friendly feature is that the provider provides a complete list of tradable currency pairs on their website with the corresponding spreads, which are of course given in pips. So below are just a few of the most commonly traded currency pairs with their corresponding spreads that eToro estimates.

eToro spreads per currency in an overview:

CurrencySymbolTypical Spread
Euro/US DollarEUR/USD1 Pips
Australian Dollar/Swiss FrancAUD/CHF4 Pips
Australian Dollar/Canadian DollarAUD/CAD4 Pips
Australian Dollar/New Zealand DollarAUD/NZD4 Pips
British Pound/US DollarGBP/USD2 Pips
New Zealand Dollar/US DollarNZD/USD2.5 Pips
US Dollar/Canadian DollarUSD/CAD3 Pips
US Dollar/Japanese YenUSD/JPY1 Pips
US Dollar/Swiss FrancUSD/CHF1.5 Pips
Australian Dollar/US DollarAUD/USD1 Pips
Euro/British PoundEUR/GBP1.5 Pips
Euro/Swiss FrancEUR/CHF5 Pips
Euro/Japanese YenEUR/JPY2 Pips
British Pound/Japanese YenGBP/JPY3 Pips
Euro/Australian DollarEUR/AUD7 Pips
Euro/Canadian DollarEUR/CAD7 Pips
Australian Dollar/Japanese YenAUD/JPY2 Pips
New Zealand Dollar/Canadian DollarNZD/CAD4 Pips
New Zealand Dollar/Swiss FrancNZD/CHF4 Pips
New Zealand Dollar/Japanese YenNZD/JPY4 Pips
Canadian Dollar/Swiss FrancCAD/CHF14 Pips
Canadian Dollar/Japanese YenCAD/JPY6 Pips
Swiss Franc/Japanese YenCHF/JPY6 Pips
US Dollar/Hong Kong DollarUSD/HKD5 Pips
US Dollar/RubleUSD/RUB*3 Pips
US Dollar/YuanUSD/CNH*10 Pips
Euro/New Zealand DollarEUR/NZD4 Pips
British Pound/Australian DollarGBP/AUD4 Pips
British Pound/Swiss FrancGBP/CHF4 Pips
British Pound/New Zealand DollarGBP/NZD4 Pips
BitcoinBTC0.75%

With a spread of three pips, the broker is already among the providers with the highest spreads on the most frequently traded currency pair, the euro / US dollar pair. This may still be okay for traders who mostly hold their positions for the medium to long term. For traders who tend to trade short-term and open and close several positions daily, this is definitely too expensive and makes lucrative trading almost impossible. Here there are much cheaper alternatives such as GKFX or IG.

Spreads at eToro are based on the currency pair

With the broker eToro, the size of the spreads is primarily determined by which currency pair you trade. So from the so-called majors to the more exotic currency pairs there are sometimes spread differences of more than 20 pips. Especially with larger trading volumes, these costs can be a deciding factor in whether you choose eToro or another provider.

Not only for currency pairs but also for CFDs the spread is used as a cost factor. This is true for the index, commodity, and stock CFDs provided by the broker. In this regard, we would just like to briefly note that the provider’s website also provides a detailed list in this area.

eToro currencies
eToro currencies

Financing costs as a further cost factor – Overnight fees

In addition to spreads, there is another cost factor that affects you, but only if you leave a position open with the broker eToro overnight. These are the so-called financing costs which are basically simply the interest you have to pay at a bank for a loan you have taken out. With financing costs, the interest rate is usually based on a certain key interest rate, such as EURIBOR or sometimes the ECB key interest rate.

Of course, the broker usually charges a small surcharge, so that the financing costs are currently often between three and five percent. These financing costs only apply to a long position because only then have you borrowed money from the broker through the leverage.

Financing costs (swaps) with eToro in a glance:

CurrencySymbolOvernight charges
(per 10,000 units)
ShortLong
Euro/US DollarEUR/USD0.03-0.6
Australian Dollar/Swiss FrancAUD/CHF-0.720.52
Australian Dollar/Canadian DollarAUD/CAD-0.450.27
Australian Dollar/New Zealand DollarAUD/NZD0.08-0.18
British Pound/US DollarGBP/USD-0.3-0.15
New Zealand Dollar/US DollarNZD/USD-1.350.15
US Dollar/Canadian DollarUSD/CAD-0.2-0.2
US Dollar/Japanese YenUSD/JPY-0.280.01
US Dollar/Swiss FrancUSD/CHF-1.40.09
Australian Dollar/US DollarAUD/USD-1.000.12
Euro/British PoundEUR/GBP0.03-0.52
Euro/Swiss FrancEUR/CHF-0.90.02
Euro/Japanese YenEUR/JPY0.03-0.36
British Pound/Japanese YenGBP/JPY-10.03
Euro/Australian DollarEUR/AUD0.23-1.51
Euro/Canadian DollarEUR/CAD0.08-0.72
Australian Dollar/Japanese YenAUD/JPY-1.80.16
New Zealand Dollar/Canadian DollarNZD/CAD-0.550.34
New Zealand Dollar/Swiss FrancNZD/CHF-0.820.53
New Zealand Dollar/Japanese YenNZD/JPY-0.650.42
Canadian Dollar/Swiss FrancCAD/CHF-0.360.2
Canadian Dollar/Japanese YenCAD/JPY-0.510
Swiss Franc/Japanese YenCHF/JPY0.04-0.7
US Dollar/Hong Kong DollarUSD/HKD-0.98-0.5
US Dollar/RubleUSD/RUB*1.5-7.4
US Dollar/YuanUSD/CNH*0.1-2.74
Euro/New Zealand DollarEUR/NZD0.75-1.17
British Pound/Australian DollarGBP/AUD0.52-0.83
British Pound/Swiss FrancGBP/CHF-0.630.43
British Pound/New Zealand DollarGBP/NZD0.76-1.1
BitcoinBTC-0.001-0.072

This fee factor is not insignificant, because the interest costs are naturally calculated from the total trading volume of the position and not only from your own share. However, for most traders, financing costs are not a significant factor because the position is rarely held for a long period of time.

eToro overnight fee
eToro overnight fee

For example, if you have to pay three percent interest on a trading volume or position equivalent of $100,000 US dollars, the calculation is of course only based on a whole year. In this case, financing costs of EUR 3,000 would initially be incurred once a year. However, if you now calculate this down to a holding period for the position of, say, three days, the financing costs would only amount to around 30 euros. These costs are therefore not very significant if you make a profit of several thousand euros.

Withdrawal fees – Note fees for payouts!

A third cost factor that we at the broker eToro do not want to leave unmentioned is the possible fees for withdrawals from your trading account. These costs, as well as the funding costs, do not automatically apply to all traders but depend on the frequency of withdrawals you choose to make and the amount of the withdrawal. Unfortunately with the broker eToro, all available payout methods are subject to fees. The fee for making a payout is $5.

eToro cards

A third cost factor that we at the broker eToro do not want to leave unmentioned is the possible fees for withdrawals from your trading account. These costs, as well as the funding costs, do not automatically apply to all traders but depend on the frequency of withdrawals you choose to make and the amount of the withdrawal. Unfortunately with the broker eToro, all available payout methods are subject to fees. The fee for making a payout is $5.

Inactivity fees occur

When trading with a broker, fees for being inactive can occur. Depending on the broker, the inactive time for when fees are charged differ as well as the amount charged. For trading with eToro inactivity fees occur as well. If a trader is absent over a year, a monthly charge of $10 is funded from the trader’s account automatically. As soon as the trader is active again, the inactivity fee charges are stopped.

Conclusion on costs with the broker eToro

At broker eToro, you will find the cost factors typical for forex and CFD brokers. This is especially true for the spreads, which are mainly based on the currency pair being traded. Unfortunately, eToro’s spreads are far too high compared to many other forex brokers, for example, 3 pips in EUR/USD. For casual or long term oriented traders this may still be too much to bear. For multi-traders or short-term oriented investors, such a high spread in the majors is normally a KO criterion.

The situation is similar to financing costs. While these are normal for forex and CFD brokers if you want to hold your position overnight, here too the size of the spread is critical and we think eToro is a bit too much for some currency pairs. The payout fees are also a bit out of the ordinary as eToro unfortunately does not provide a free payout method yet.

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