eToro versus Interactive Brokers
eToro offers 25M+ social traders its popular proprietary CopyTrader and CopyPortfolios services and maintains in-house managed thematic investment portfolios. It caters exceptionally well to its core trader base, and its latest venture is an NFT fund following numerous acquisitions in the cryptocurrency sector. The eToro Academy, eToro plus, and The Bull Club assist beginner traders.
Interactive Brokers presents one of the most competitive core trading environments available globally, with a suite of cutting-edge proprietary solutions developed for advanced traders. It supports third-party developers and algorithmic trading solutions. Beginner traders will benefit from the comprehensive IBKR Campus, one of the highest-quality educational services industry-wide.
We have conducted an in-depth review of eToro and Interactive Brokers to determine which one presents the better overall choice and which traders will benefit the most at either broker.
- Features and Platforms
- Available Markets
- Typical Spreads and Fees
- Security and Trust
- eToro vs. Interactive Brokers - Verdict
Features and Platforms
|Features & Platforms||eToro (visit site)||Interactive Brokers (visit site)|
Retail Loss Rate:
|$10 - $10,000||$0|
|$10 monthly after 12 months||No|
|Yes + Third-Party||Third-Party|
Social / Copy Trading:
Guaranteed Stop Loss:
Negative Balance Protection:
Bonuses and Promotions:
Unique Feature One:
|Large trading community||Broad-asset selection|
Unique Feature Two:
|Copy-trading platform||Excellent trading tools|
|*78% of retail CFD accounts lose money|
eToro has more active traders, but the Interactive Brokers Investor's Marketplace offers 1,500+ services, creating a distinct advantage for traders while passive investors can benefit from Interactive Advisors.
|Available Markets||eToro||Interactive Brokers|
Commodities and Metals:
Options, Futures, and Synthetics:
Maximum Retail Leverage:
Maximum Pro Leverage:
Most retail traders will find eToro’s 2,000+ CFDs focused on equities more than enough to find trading opportunities and achieve cross-asset diversification. Interactive Brokers, a prime brokerage and liquidity provider, presents traders and investors with 135 markets across 33 countries in 23 currencies, resulting in one of the broadest selections of assets available in the industry.
Typical Spreads and Fees
|Typical Spreads & Fees||eToro||Interactive Brokers|
Minimum Raw Spreads:
|Not applicable||0.1 pips|
Minimum Standard Spreads:
|1.0 pips||Not applicable|
Minimum Commission for Forex:
|N/A||$2.00 per round lot|
Commission for Equity CFDs:
|0.09%||0.05% per trade|
|Market Maker||Market Maker|
The pricing environment is notably cheaper at Interactive Brokers. Forex traders pay a minimum trading fee of $10 per 1.0 standard lot, commission-free, versus $3 at Interactive Brokers, including a $2 commission. Equity commissions at eToro are 0.09%, commission-free for unleveraged buy orders, and 0.05% at Interactive Brokers.
Security and Trust
|Country of the Regulator||Name of the Regulator||License Number|
|Cyprus Securities Exchange Commission||109/10|
|Financial Conduct Authority||583263|
|Australian Securities and Investments Commission||491139|
|Financial Services Authority||SD076|
|Country of the Regulator||Name of the Regulator||License Number|
|US Securities and Exchange Commission (SEC)||Undisclosed|
|Investment Industry Regulatory Organization of Canada (IIROC)||Undisclosed|
|Financial Conduct Authority (FCA)||208159|
|Commission de Surveillance du Secteur Financier (CSSF)||Undisclosed|
|Central Bank of Ireland (CBI)||C423427|
|Central Bank of Hungary (MNB)||H-EN-III-623/2020|
|Australian Securities and Investments Commission (ASIC)||453554|
|Hong Kong Securities and Futures Commission (SFC)||Undisclosed|
|Securities and Exchange Board of India (SEBI)||INZ000217730|
|Japan Securities Dealers Association (JSDA)||187|
|Monetary Authority of Singapore (MAS)||CMS100917|
eToro has a $1,000,000 third-party insurance program underwritten by Lloyd's of London, while Interactive Brokers is a NASDAQ-listed company and constituent of the S&P 500. It remains 81.5% privately held, with $6 billion in excess regulatory capital. eToro and Interactive Brokers segregate client deposits from corporate funds, offer negative balance protection, and both rank among the most trusted brokers.
eToro vs Interactive Brokers – Verdict
|Copy-trading with a community numbering almost 25 million traders||Higher minimum deposit requirement but within a reasonable range|
|User-friendly web-based trading platform and mobile app||Absence of MT4 and no algorithmic trading|
|Quality educational offering for beginner traders via videos|
|Balanced asset selection with a focus on equity CFDs and ETFs|
|Cutting-edge proprietary trading platforms with support for algorithmic trading||Limited deposit and withdrawal options|
|Industry-leading asset selection and trading costs|
|Superior trading tools consisting of 1,500+ services|
|Low-cost passive investments from as little as $100|
Interactive Brokers remains a global powerhouse with algorithmic trading support. Its clients receive cutting-edge trading platforms, a broad-based asset selection, and among the lowest cost structures industry wide. Its huge overall product and services portfolio may overwhelm many retail traders, making eToro a better choice for millennial and GenZ traders who prefer mobile social trading.
What is the downside to eToro?
eToro does not support algorithmic trading and maintains an above-average cost structure.
Is eToro good for investing or trading?
The commission-free direct share dealing makes eToro a better choice for long-term investors or low-frequency traders.
What happens if eToro goes bust?
eToro has a $1,000,000 third-party insurance program underwritten by Lloyd's of London. The UK, Cyprus, and US subsidiaries also have an investor compensation fund.
Is it worth copying on eToro?
eToro caters to retail traders, where approximately 80% operate at losses. Therefore, many traders will copy losing portfolios. The compensation for signal providers is not large.
Is my money safe in eToro?
eToro ensures client deposit safety by segregating deposits from corporate funds at tier 1 banks. It also has a $1,000,000 third-party insurance program underwritten by Lloyd's of London and complies with five regulators, three of which offer an investor compensation fund.
Is eToro good for the long term?
eToro provides long-term investors with a competitive product with commission-free direct share dealing, ETFs, and in-house managed thematic investment portfolios.
How much is the eToro withdrawal fee?
eToro charges $5 per withdrawal internally, and traders must also consider third-party payment processor fees.
Is eToro tax-free?
eToro does not offer tax-free accounts, and all clients must ensure they comply with local tax laws. It is best to consult a licensed professional for individual advice.
Is eToro really free?
eToro is not free and lists all applicable costs transparently on its website.
Are Interactive Brokers safe?
Interactive Brokers ranks among the safest and most trusted brokers globally compliant with eleven regulators and has a clean track record.
Is Interactive Brokers good for beginners?
While the overall product and services portfolio may overwhelm many retail traders, the educational content at Interactive Brokers ranks among the best available in the industry.
Does Interactive Brokers charge a monthly fee?
Interactive Brokers does not charge a monthly fee, except for advisory fees, where extra costs may apply.
Is Interactive Brokers good for day trading?
Interactive Brokers maintains a highly competitive infrastructure for day trading, including low costs, deep liquidity, fast order execution, and choice of trading instruments. However, market orders can be filled at extremely wide spreads.
How much money do you need to open an Interactive Brokers account?
Interactive Brokers does not have a minimum deposit requirement, ensuring clients maintain complete flexibility to manage their accounts.
What happens if Interactive Brokers goes bust?
It depends on the geographic location of the operating subsidiary. Interactive Brokers has $6 billion in excess regulatory capital and is a publicly listed company that complies with strict financial requirements, making default extremely unlikely.