eToro vs Hargreaves Lansdown: Fees
eToro aims to provide a hassle-free fee structure. The platform is transparent about its fees, which includes a 0% commission when you trade stocks and ETFs. The only complex fee issue occurs when you buy or trade crypto.
Unlike many other platforms, eToro does not have a fee each time that you buy or sell a cryptocurrency. Instead, there is a flat 1% fee, which is technically the bid-ask spread for each of your trades.
This can be a little confusing since the fees for crypto trading are front-loaded. Instead of incurring a fee when you buy and then again when you sell, here is a “round trip” fee structure. So, you will pay 1% purchase fee and 1% sale fee in advance.
Besides these, eToro also has an inactivity fee of $10 per month. The eToro withdrawal fees are $5 per withdrawal.
Still, eToro is considered to be one of the lowest-cost platforms right now if you want to invest directly in the stock market.
The Hargreaves Lansdown fee structure is far more complex. As we touched on above, it is far more costly compared to eToro, but we’ll break it down in more detail.
Firstly, there are no initial charges, so you can open an account for free, but once you begin investing, you’ll need to pay an annual fee. This is 0.45% of your investment fund per year, but it can vary depending on whether you buy exchange-listed or non-listed assets.
Hargreaves Lansdown also imposes a spread fee, which is approximately 0.07%, and there are dealing fees to buy and sell investments.
These are set on a sliding scale, so the more trades you perform, the lower the cost.
Currently, you can expect to pay between £11.95 and £5.95. These dealing fees are not something that you will encounter with eToro. Likewise, while eToro covers your stamp duty, you’ll need to pay it yourself with Hargreaves Lansdown.
Finally, if you want to phone trade, there is a 1% fee, with a minimum charge of £20.