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eToro fees: what they are and how they work

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When you start investing, you’ll quickly find that there are a variety of fees associated with different types of investments.  eToro is no exception, and investors need to be aware of the specific fees they’re charged when trading on the platform. In this article, we’ll break down what eToro fees are and how they work. We will also discuss the different types of eToro fees and what causes them. We’ll also provide some tips on how to reduce your costs when trading on eToro.

What are eToro fees and how do they work?

eToro is a social trading and investing platform that allows users to trade a variety of assets, including stocks, crypto assets, ETFs, and forex. One of the key features of eToro is that it offers zero-commission trading. This means that users can buy and sell assets without having to pay any fees. However, eToro does charge a small overnight fee for certain positions. This fee is known as a rollover fee, and it is charged when a position is held overnight. The rollover fee is calculated as a percentage of the total value of the position. 

For example, if you buy $100 worth of shares in a company and hold the position overnight, you will be charged a rollover fee of $0.50. eToro also charges a withdrawal fee when you transfer funds out of your account. The withdrawal fee is currently $5 for bank transfers and $25 for wire transfers. Overall, eToro is a very competitively priced platform with low fees relative to other brokers.

The different types of eToro fees

eToro offers several different types of fees, each designed to suit different trading styles.

If you’re a occasional or beginner trader, the commissions and spreads on eToro’s standard accounts may be the most suitable for you. For more active traders, however, the ECN account with its lower spreads can offer better value. Here is a breakdown of the different types of eToro fees:

Commissions: 

Commission fees are charged on both buy and sell orders placed on eToro’s standard accounts. The commission rate is pegged at a flat rate of $25 per trade.

Spreads: 

Spreads are the difference between the bid and ask prices of an asset on eToro’s platform. The spread is variable and depends on the asset being traded as well as market conditions.

ECN account: 

The ECN account has lower spreads than eToro’s standard account but a commission fee is charged on each trade. The commission rate is $25 per trade.

Inactivity fees: 

If you don’t log in to your eToro account for 12 months, you will be charged a monthly inactivity fee of $5.

Withdrawal fees: 

Withdrawals from your eToro account are free of charge if made via bank transfer. If you choose to withdraw via PayPal or credit/debit card, however, a fee of 2% will be charged.

Deposit fees: 

Deposits into your eToro account are free of charge.

As you can see, there are a range of different fees associated with trading on eToro. The best way to find out which account type and fee structure is right for you is to experiment with a demo account first. This will allow you to test out the different features and get a feel for how the platform works before committing any real money.

How to reduce your costs when trading on eToro?

If you’re looking to trade on eToro but want to reduce your costs, there are a few things you can do.

First, consider using a broker that offers lower commissions. There are plenty of options out there, so be sure to shop around and compare rates. See this for more information.

Second, think about using a limit order rather than a market order when placing your trades. A limit order allows you to specify the price at which you’re willing to buy or sell, so you’ll only incur costs if your trade is executed at that price.

Finally, remember that eToro charges an overnight fee for positions held overnight. If you’re planning on holding a position for more than one day, be sure to factor this fee into your calculations.

By following these tips, you can help reduce your costs when trading on eToro.

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