Stock broker comparison: eToro, Degiro, Lynx, Fio

Here we will discuss pros and cons of several stock brokers that are popular mainly in Europe.

This article is written from the point of view of small investors.

This is not investment advice

eToro.com

Pros:

  • no transaction fees, just spreads
  • minimum buy amount 50$ with no fees
  • ideal for slowly scaling into position in small increments
  • small positions make it easier to control risk
  • 15% dividend tax/fee for global stocks with exception of dividends from USA

Cons:

  • 10$ monthly inactivity fee after 1 year of not logging in to the portal. They just take cash until it is gone, they will not liquidate any of your stock positions because of this
  • 25$ withdrawal fee
  • eToro takes 30% from dividends originating from USA

When we use no leverage on eToro we are buying the actual stock. Leveraged positions are CFDs - Contracts for difference, hence you have no real stock ownership with leveraged trades.

Due to high fee for USA dividends eToro is highly suboptimal to hold USA dividend stocks long term.
On the other hand it is perfect for buying dividend stocks from Europe and China. Of course non dividend paying USA stocks are ideal as well.

Degiro.com

Pros:

  • 0.5 Euro transaction fee for USA stock exchanges + very small fee per each share, it is more convenient to buy more expensive shares
  • relatively large choice of ETFs that can be bought without a fee once a month
  • good variety of stock exchanges

Cons:

  • 2,5 Euro yearly fee per each stock exchange used

Degiro has very reasonable transaction fees for USA exchanges. Also optimal for building ETF portfolio in small increments each month without a fee.

Note: there are differences between trading versus holding account

Lynxbroker.cz via Interactive Brokers

Pros:

  • access to great amount of stock exchanges

Cons:

  • 4-5$ fee for currency conversion
  • 5$ transaction fee for stocks and ETFs is still rather high
  • monthly ~8$ fee when your account is woth less than around 1000$

Due to high total fees the minimum reasonable position per trade is around 2000$. Around 10$ total fees per 2000$ trade makes the fee around 0.5% of the position. In my opinion such percentage is still rather high and over the long term can significantly cut from returns.

Lynx is good for large positions of dividend ETFs that we want to hold over the long term/forever.

Fio.cz Fio bank

Pros:

  • it is actual bank
  • safe to hold funds long term
  • connected to the Fio bank account, no need to wait one or two days for wire transfer

Cons:

  • very high transaction fees, around 8$ per trade

good for long term holding of larger positions of ETFs. Absolutely unsuitable for trading of individual stocks.

Summary:
For small accounts eToro and Degiro are the best option so far.