Quick Takeaways
• A brokerage account can be opened at Robinhood or eToro.
• Both firms offer self-directed trading in equities, options, ETF’s, and cryptocurrencies.
• Only Robinhood has a web-browser platform.
Robinhood vs. eToro Introduction
For self-directed trading, there are Robinhood and eToro. To help you decide which one to pick, take a
look at our investigation.
eToro and Robinhood: Cost
| Broker Fees |
Stock/ETF
Commission |
Mutual Fund
Commission |
Options
Commission |
Maintenance
Fee |
Annual IRA
Fee |
|
Robinhood
|
$0
|
na
|
$0 per contract
|
$0
|
$0
|
|
Etoro
|
$0
|
na
|
$0.65 per contract
|
$0
|
$0
|
Services
| Broker Review |
Cost |
Investment Products |
Trading Tools |
Customer Service |
Research |
Overall Rating |
|
Robinhood
|
|
|
|
|
|
|
|
Etoro
|
|
|
|
|
|
|
Promotions
Robinhood: 1% IRA match and up to $200 FREE stock at Robinhood.
eToro: none right now.
Trading and Investing
Both brokerage firms in this contest offer self-directed accounts. These accounts get access to the
following list of asset classes:
- Stocks
- Options
- Exchange Traded Funds (ETF’s)
- Cryptocurrencies
- Real Estate Investment Trusts (REIT’s)
- American Depository Receipts (ADR’s)
Neither Robinhood nor eToro offers over-the-counter (OTC) stocks or foreign stocks. Other products like bonds and mutual funds are off limits.
Neither firm offers investment advice, financial planning, or managed accounts. For their brokerage services, both firms offer individual and joint accounts. Robinhood also has retirement accounts.
Winner: Robinhood
Website Tech
Trading begins with basic websites. We say “basic,” although there are some really useful tools in both cases. Over at eToro, traders get stock profiles with ESG ratings, news articles with thumbnails, price alerts, full-screen charts with many gadgets, financial statements, paper trading, and analysts’ price targets.
Robinhood’s website has many of the same tools that eToro’s site delivers (minus simulated trading). It does replace full-blown financial statements with only earnings, another weakness. But Robinhood’s profiles have Trading Trends, which is a collection of trading activity on a stock. Hedge funds and company insiders are included.
When we get to actual trading, Robinhood excels again. Its trade ticket has several order types, including limit, trailing, and recurring. eToro’s equity ticket, by comparison, only has market orders (at least that’s the case for the U.S. division of eToro). eToro US does provide limit orders for cryptos and options.
Speaking of options, both broker-dealers have derivative tools on their websites to trade contracts. Only Robinhood’s site has P/L diagrams, which are super helpful for visual learners.
Then there is Robinhood Legend, a new browser-based trading platform. Although this program delivers some nice highlights, such as more plot styles for charting, other features, such as P/L diagrams on the options ticket, are lost.
Winner: Robinhood
Mobile Apps
The eToro mobile app replicates its website cousin with the same tools and layout. During our test drive of the software, we found watchlists that sync with the website. Also available is a wallet that allows for currency switching. Charts can only be displayed in vertical mode on the app, a notable weakness. The same basic order ticket from the website makes an appearance on the app.
On Robinhood’s app, we get a much more advanced ticket (for options, too). Charts, however, are available only in vertical mode, so there’s not much advantage over eToro for chartists. In fact, eToro’s app has many more technical studies. And eToro’s mobile platform offers practice trading with zero risk, a big benefit for newbies. There’s also an economic calendar on the eToro app, which can be useful for both novices and seasoned pros alike.
Winner: eToro
Trading on Margin
The American branch of eToro offers limited margin for its brokerage customers so that they can trade
option spreads. Full margin is not available to buy with leverage or to short securities.
Robinhood also doesn’t permit shorting, although it does offer full margin to buy equities with
borrowed money. Right now, its margin schedule starts at 6% and drops to 4.95%, a great deal by any standard.
Winner: Robinhood
Ancillary Services
Fractional-share Trading: Available at both brokerage houses.
Dividend Reinvesting: Robinhood has a DRIP. eToro does not.
Extended Hours: Traders at Robinhood can buy and sell equities in pre-market, post-market, and overnight sessions. Cryptocurrencies can be traded at both firms around the clock.
Fully-Paid Stock Lending: Robinhood has it.
Initial Public Offerings: Primary stock releases are available at both firms.
Autopilot Mutual Fund Purchases: Robinhood’s trade ticket offers systematic purchases of stocks and ETF’s. Look for “recurring investments.”
IRAs: Robinhood, but not eToro, offers Individual Retirement Accounts.
Winner: Robinhood
Our Recommendations
Beginning Investors: Robinhood was built for beginner investors.
Frequent Stock Trading: Robinhood with its Legend platform, which has right-click trading, would be a good idea.
Retirement Planning & Long-Term Investing: An IRA at Robinhood with point-in-time advice would be another good idea.
Small Investors: We pick Robinhood because it has the smaller investment minimum for fractional-share trades ($1 versus $10).
Mutual Funds: Although neither firm here has mutual funds,
Charles Schwab does.
Final Verdict
Robinhood definitely has the lead over its rival eToro, who isn’t much of a rival, at least in the United States.
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