When it comes to brokers, there are arguably no two intermediaries with more media coverage than eToro and Plus500. In this article, we shall delve into a comprehensive comparison between eToro and Plus500.
Without further ado, let us commence an analysis of the key features offered by each broker.
Features: eToro vs Plus500
|🌎 Regulation||CySEC and FCA||CySEC and FCA|
|💰 Minimum deposit||$50||£100|
|💰 Inactivity cost||$10/month (after 12 months of inactivity)||£10/month (from the third month)|
|📈 Products||Real stocks, ETFs and crypto, CFDs on stocks, ETFs, indices, forex, commodities||CFDs on stocks, ETFs, indices, options, commodities, forex|
|🕹️ Demo account||Yes||Yes|
History: eToro vs Plus500
eToro is an online trading and investment platform with over 20 million registered users from more than 140 countries. The company, established in 2007 by brothers Yoni and Ronen Assia, has emerged as a prominent name in online investing and trading.
It presently provides a diverse array of financial instruments, including stocks, ETFs, cryptocurrencies, commodities, and indices. The platform’s notable strength lies in its social trading function, which employs copy trading technology to enable users to replicate the trades of successful master traders on the platform.
On the other hand, Plus500 is an online trading platform founded in 2008 and operates as a CFD provider, with its headquarters in Israel, just like eToro. Additionally, Plus500 is also a market maker, offering clients the ability to trade various assets, including but not limited to currencies, commodities, indices, stocks, options, and ETFs.
It operates under the regulation of the UK’s Financial Conduct Authority (FCA), the Cyprus Securities and Exchange Commission (CySEC), and the Australian Securities and Investments Commission (ASIC). In July 2015, it went public on the AIM market of the London Stock Exchange, trading under the ticker PLUS. In March 2020, the company announced its acquisition by Playtech PLC, completed in May 2020, for a total enterprise value of £460 million.
In this comparison, we shall analyse the primary similarities and differences between the two brokers, encompassing aspects such as regulation, commissions, access to products and markets, and customer service. We will conclude by presenting a comparison of the advantages and disadvantages of each.
eToro vs Plus500: security
Regulation and supervision of eToro
Firstly, regarding regulation, eToro stands as one of the widely recognised investment and social trading platforms globally. The company operates under the oversight of several financial authorities, including the Cyprus Securities and Exchange Commission (CySEC), and the Financial Conduct Authority (FCA).
Extra security features provided by eToro to its users include negative balance protection and keeping clients’ funds in segregated accounts.
Regulation and supervision of Plus500
Regarding regulation, Plus500 holds authorisation and regulation from the Financial Conduct Authority (FCA) in London, the Cyprus Securities and Exchange Commission (CySEC), and the Australian Securities and Investments Commission (ASIC). However, it does not currently offer its products and services to residents of the United States. Also, in case of default, the Financial Services Compensation Scheme covers up to £85,000.
Access to products and markets: eToro Vs Plus500
Financial instruments and markets with eToro
With eToro, you have the flexibility to open an account from 140 countries worldwide. Furthermore, you can explore investment opportunities across 20 diverse markets, including access to over 250 ETFs, 50 currency pairs, and up to 75 cryptocurrencies. eToro provides a wide range of financial assets, allowing you to access practically any type of instrument, including:
- Investment funds
Stocks, ETFs, and cryptocurrencies are available as real assets. Also, apart from cryptocurrencies, all assets can be traded via CFDs.
Financial instruments and markets with Plus500
Plus500 is also a comprehensive broker in terms of financial instruments; however, it should be noted that it exclusively trades Contract for Difference (CFDs) on these instruments. Despite this limitation, Plus500 grants you access to a wide array of asset types:
- Currencies or Forex
Types of accounts: eToro vs Plus500
Types of eToro accounts
Retail investors have access to a demo account and a standard account. Both are the same, but the demo account allows you to trade with virtual funds instead of real cash. The standard account has a minimum deposit requirement of $50.
Types of Plus500 accounts
Plus500 offers three different types of accounts: demo, standard, and professional.
- The demo account is perfect for new traders or those who want to try the Plus500 platform without risking any capital.
- The standard account is ideal for those who want to trade with real money but don’t have large capital.
- Plus500 Pro comes with some additional features, such as higher financial leverage and access to exclusive market analysis.
However, it is important to remember that all Plus500 account types carry their own risks and benefits. Before choosing an account type, make sure to carefully consider your trading goals and your level of experience.
Opening an account and minimum deposit: Plus500 vs eToro
eToro is a platform specifically tailored to beginners, offering an easy and intuitive 100% digital account opening process. The minimum deposit requirement for eToro is typically $50.
On the other hand, opening an account with Plus500 is a quick and straightforward process overall. The minimum deposit for Plus500 accounts is £100.
Therefore, the different deposit methods are as follows:
- Bank transfer (min. $500 for eToro)
- Electronic wallet (Paypal or Skrill)
- Debit or credit cards (Visa or Mastercard)
eToro vs Plus500: commissions and costs
Now we approach what is perhaps the most crucial aspect, particularly for inexperienced users, when it comes to evaluating the best brokers: cost structure.
However, before delving into the specifics of the costs charged by eToro in comparison to those of Plus500, it is important to remember that this should not be the sole or even the most significant factor in deciding which broker to invest with. Therefore, without any further delay, let us examine the fee structures of both brokers.
Here are the key aspects regarding eToro’s cost structure:
- 0% commission policy
- Spreads are built into the prices of assets shown on the platform (thus, less transparent fees)
- Currency conversion fee applies (the account can only be opened in USD)
- 1% fee for buying and selling cryptocurrency
- $5 withdrawal fee (min. $30)
- $10 inactivity fee after 12 months of inactivity
Plus500 also offers zero trading commissions. Hence, it generates income through the bid-ask spread, which is the difference between the highest price a buyer is willing to pay and the lowest price a seller is willing to accept. It’s important to note that the spread offered by Plus500 is not particularly low.
In terms of other costs, Plus500 charges an inactivity fee (10$ per month, starting from the third month) and guarantees stop loss fees.
How Does eToro’s trading platform compare to Plus500’s?
eToro is a social trading and investment platform that facilitates user connections with other investors to trade a wide range of assets. The eToro platform is user-friendly and encompasses various features such as real-time market data, simple charting tools and company data, and social trading capabilities.
Moreover, eToro provides its own demo account where users can track stocks of interest without risking real money. Overall, the platform is specifically tailored for social trading, making it effortless to discover top-performing traders on eToro, examine their portfolios, follow their strategies, and even enable the copy-trading option. Additionally, eToro offers a mobile application, allowing users to trade on the go.
On the other hand, Plus500 serves as an online CFD broker, offering a user-friendly proprietary trading platform. The Plus500 platform is accessible in 32 languages and can be accessed through a web browser or the Plus500 mobile application.
The platform is designed to be intuitive and provides traders with a range of tools and features to facilitate informed decision-making. Plus500 also offers a demo account equipped with virtual money, enabling traders to practice their trading strategies before risking real funds.
Overall, the Plus500 trading platform is a suitable choice for those seeking an easy-to-use CFD trading experience with a plethora of features.
Deposit and withdrawal: eToro vs Plus500
Deposit and withdrawal: eToro
eToro has a fairly easy and intuitive deposit policy. All you have to do is sign up to start depositing money via:
- Credit/debit card
- Bank transfer
The eToro account will always be in US dollars, so there are no deposit fees, but if you will be charged an exchange fee if you deposit GBP or another currency.
eToro requires a minimum withdrawal of $30 plus a withdrawal fee of $5. If the withdrawal is in another currency, an exchange fee will also be charged.
Withdrawals from eToro can be made with the same variety of methods as deposits. eToro’s withdrawal times vary depending on the method used, but usually take 1 to 10 business days to process.
Deposit and withdrawal: Plus500
There are no deposit fees and deposits can be made via three different methods:
- Credit/debit card
- Bank transfer
The waiting time for the deposit of money in the Plus500 wallet may vary depending on the third party.
Even in the case of a Plus500 withdrawal, no commission is charged for withdrawing funds from your account, provided that a minimum amount of funds is withdrawn; if a lower amount is withdrawn, a commission may be charged. The minimum withdrawal is £100 for bank transfers or cards, and £50 for e-payment methods.
eToro vs Plus500: customer service
The customer service of eToro has the following features:
- 24/7 customer service in 14 languages, including English
- Efficient response, especially through live chat.
- Our customer service team can be contacted by support ticket or live chat.
eToro also has a wide section of FAQs on its website covering a range of topics, from setting up the account to withdrawals.
As for the Plus500 customer service, we highlight the following:
- It is efficient, with assistance available 24 hours a day via live chat, WhatsApp and email. In addition, the Plus500 customer service team responds quickly.
- Plus500 also has an extensive FAQ section on its website covering a wide range of topics, from opening an account to basic trading concepts.
- In addition, the broker provides traders with news and market analysis, as well as a handy economic calendar.
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Plus500 vs eToro: summary
Both eToro and Plus500 are well-regulated brokers under the supervision of various regulatory bodies in the EU, ensuring a certain level of fund protection for investors. eToro initially focused on derivative financial instruments like CFDs but has expanded to offer both CFDs and real stocks, ETFs, and crypto. It particularly stands out for its social trading and copytrading platform.
On the other hand, Plus500 specialises primarily in CFDs but offers a wide range of underlying products such as stocks, ETFs, and commodities.
|👍 Advantages of eToro||👍 Advantages of Plus500|
|Platform is intuitive and easy to use||Competitive spreads|
|Real stocks and ETFs with zero commissions||Intuitive online platform|
|Social trading platform||Access CFD trading on many assets|
|👎 Disadvantages eToro||👎 Disadvantages Plus500|
|Slightly higher spreads than average.||No real assets available|
|Charts lack some useful analysis tools||Platform is quite simplistic|
|Account only in USD||No educational tools|
In terms of costs, both brokers offer competitive rates. However, Plus500 tends to have the lowest costs, while eToro provides additional value through its social trading function.
The customer service provided by both brokers is generally reliable and prompt.
In summary, these two brokers cater to different investor or trader profiles. eToro targets beginners who want to invest or trade with minimum effort via copy trading, offering a user-friendly platform that requires less market knowledge, thanks to its social trading feature.
On the other hand, Plus500, which specialises in derivative products (CFDs), is better suited for experienced investors with market expertise who can leverage its low rates to their advantage.
FAQ: eToro vs Plus500
What makes eToro and Plus500 stand out from other brokers?
Both eToro and Plus500 offer unique features that set them apart. eToro stands out for its social trading and copytrading platform, allowing users to follow and even automatically replicate the trades of successful master traders. On the other hand, Plus500 excels in offering a wide range of underlying products such as stocks, ETFs, and commodities, making it a versatile choice for traders.
Are my funds secure with eToro and Plus500?
Yes, both eToro and Plus500 are well-regulated and take measures to ensure the security of funds.
Which broker is more suitable for beginners?
For beginners, eToro may be a more suitable choice due to its user-friendly interface and social trading features. eToro’s platform is designed to be intuitive, allowing users to easily connect with successful traders, learn from their strategies, and even automatically copy their trades.