Freetrade vs eToro
Which is better, eToro or Freetrade? We compare them in detail below.
Freetrade and eToro are share trading platforms where you can buy and sell investments such as stocks and exchange-traded funds (ETFs). Freetrade’s suited to beginners, while eToro is better suited to intermediate investors or confident beginners.
Both have an app and both offer commission-free stock trading. When we tried them out, we concluded that Freetrade is easier to use, but eToro is far more comprehensive. In this guide, we’ve pitted them against each another, comparing the investments available, fees and features. In each section, we’ve scored and highlighted the main aspects and said which platform we believe is better.
Freetrade vs eToro: Vital stats
 |  | |
| Finder score | ★★★★★ | ★★★★★ |
| Customer satisfaction survey | ★★★★★ | ★★★★★ |
| Stocks and shares ISA available? | ||
| FSCS protected? | ||
| Fees score | ★★★★★ | ★★★★★ |
| Keep in mind | Capital at risk | Capital at risk. 51% of retail CFD accounts lose money |
| Go to site More Info | Go to site More Info |
At first glance, these providers look similar, with both getting a good overall Finder score in our analysis. One major benefit of Freetrade over eToro is that it offers an individual savings account (ISA), so you can invest up to £20,000 in each tax year without having to pay capital gains tax on your profits. However, the Freetrade ISA comes with a £5.99 monthly fee. eToro does not offer ISAs, so you could be liable to pay capital gains tax on profits over £3,000 in each tax year.
Also, everything on eToro is denominated in US dollars, so you’ll always have to convert your pounds before investing and then again when you want to withdraw money.
eToro is a Share Dealing Innovation winner and was highly commended in our ESG innovation category in the Finder Investing & Saving Innovation Awards 2023.Both Freetrade and eToro are protected by the Financial Services Compensation Scheme (FSCS), which protects your deposits by up to £85,000 if the platform were to go bust.
Round 1: Fees
| | |
| Fees score | ★★★★★ | ★★★★★ |
| Minimum deposit | £2 | $10 |
| Standard trading fee | £0 | £0.00 |
| Best trading fee | £0 | £0.00 |
| Foreign exchange fee | 0.99% | 0.75% |
| Keep in mind | Capital at risk | Capital at risk. 51% of retail CFD accounts lose money |
| Go to site More Info | Go to site More Info |
Both eToro and Freetrade are commission-free for share trading, so there’s no brokerage fee for buying or selling stocks. There are other fees that might be applicable with both providers, though. One is the foreign exchange (FX) fee, which you’ll pay to change your currency if you were to trade overseas shares.
A really key point to know about eToro is that funds held in your account have to kept in US dollars. That means that when you deposit pounds sterling, they’re immediately converted to dollars and you’ll incur that 0.75% FX charge. If your plan is to invest in US stocks, then it’s less of an issue, but if all you wanted to do was buy UK stocks, it’s a fee we think you shouldn’t really have to stump up. Freetrade’s FX fee starts at 0.99% on the free plan and is lower on the paid plans is, while eToro’s is a flat 0.75%.
eToro has additional fees, such as for withdrawal and inactivity. If you want to invest in an ISA with Freetrade, you’ll need to pay at least £5.99 per month to upgrade your plan. It’s also worth bearing in mind that eToro has a $10 minimum investment amount, whereas Freetrade is just £2.
Winner: Freetrade
Compare fees for buying shares on eToro vs Freetrade
Pick a stock, select a quantity and our calculator will give you a guide to the total cost of that trade on each of these platforms. We regularly check fees, but bear in mind that stock prices, exchange rates and spreads fluctuate in real-time.
Stock
Quantity of shares
5
| Platform | Finder Score | Account fee | Min. initial deposit | Trade cost | Link |
|---|---|---|---|---|---|
|
4.4 ★★★★★ |
£0 | £1 | £918.31 |
Go to siteCapital at risk
|
|
4.3 ★★★★★ |
£0 | $100 | £916.13 |
Go to siteCapital at risk
|
Full comparison of share dealing platforms
Round 2: Stock exchanges
| | |
| Exchanges covered score | ★★★★★ | ★★★★★ |
| UK - London Stock Exchange | ||
| US - NASDAQ | ||
| US - New York Stock Exchange | ||
| Canada - Toronto Stock Exchange | ||
| Japan - Japan Exchange Group | ||
| Euronext | ||
| Germany - Deutsche Börse | ||
| Keep in mind | Capital at risk | Capital at risk. 51% of retail CFD accounts lose money |
| Go to site More Info | Go to site More Info |
Both Freetrade and eToro have access to the main stock exchanges, such as the London Stock Exchange (LSE), Nasdaq and the New York Stock Exchange (NYSE).
But as anybody who’s been using Freetrade for a few years will tell you, not all stocks are available in Freetrade’s freemium version (AKA “Freetrade Basic”). We’ve seen Freetrade withholding more and more features for paying customers only, as it looks for ways to be a profitable business. Freetrade basic does give you access to over 4,000 stocks, which is fairly similar to eToro’s 3,000 – but eToro has a wider range of markets.
Winner: eToro
Round 3: Types of investments
| | |
| Financial instruments score | ★★★★★ | ★★★★★ |
| Shares | ||
| ETFs | ||
| Bonds | ||
| Funds | ||
| Keep in mind | Capital at risk | Capital at risk. 51% of retail CFD accounts lose money |
| Go to site More Info | Go to site More Info |
Freetrade and eToro both let you invest in shares and ETFs. With both providers you can also access ETFs that invest in bonds. Neither Freetrade or eToro offers funds. An added bonus of eToro is that it also offers cryptocurrencies.
Winner: eToro
Round 4: Mobile and web features
| | |
| Features rating | ★★★★★ | ★★★★★ |
| iPhone app | ||
| Android app | ||
| Desktop/web app | ||
| Notifications | ||
| Watch lists | ||
| Community or forums | ||
| Keep in mind | Capital at risk | Capital at risk. 51% of retail CFD accounts lose money |
| Go to site More Info | Go to site More Info |
The main benefit of eToro over Freetrade is that it lets you trade on desktop, although this is something that Freetrade has started to offer in beta with its paying members. Both Freetrade and eToro have mobile apps with notifications and watch lists, as well as forums to allow users to chat between them, either to get support or investment ideas.
Winner: eToro
Round 5: Learning resources
| | |
| Resources rating | ★★★★★ | ★★★★★ |
| Guides | ||
| Videos and walkthroughs | ||
| Demo account | ||
| In-depth learning tools | ||
| Keep in mind | Capital at risk | Capital at risk. 51% of retail CFD accounts lose money |
| Go to site More Info | Go to site More Info |
Learning resources can be a great way for beginners to learn how to invest along the way. One of the best resources we’ve found are demo accounts. These give you a set amount of virtual funds, which can be reset if you run out. This way, you can have a go at investing without using real money. eToro offers a demo account, while Freetrade does not.
Both eToro and Freetrade have guides to help you learn and eToro has videos to help you out. Freetrade has a great range of in-depth tools to help investors learn how to get started.
Winner: eToro
Bottom line
So, is eToro better than Freetrade?
We’d say that eToro is better than Freetrade as it’s a lot more comprehensive, offering a fantastic web trading platform and a demo account where you can make mistakes with pretend money! Plus eToro’s not constantly trying to get you to upgrade to a paid version (think of Freetrade Basic as being a bit like the free version of Spotify). eToro’s inactivity and withdrawal fees are admitedly a bit of a shocker, and the FX fees could also add up, but you’ve really got to hold these up against the monthly fees on Freetrade’s Standard plan, which is a closer equivalent.
But Freetrade is a platform that’s much more suited to beginners. It’s really easy to use and puts everything into plain terms. If you’re just starting out, perhaps use Freetrade Basic to see if the amateur trader’s life is for you!
There are a few clear scenarios where you’d just want to opt for Freetrade: 1. you’d like to invest in an ISA (eToro doesn’t offer one), and 2. you only plan to trade UK stocks (eToro converts all deposited funds to US dollars).
Finally, it’s worth noting that you could just open accounts with both. The potential downside to this is eToro’s inactivity fee if you don’t place a trade for over a year. Provided you aren’t going to get hit by that, you could open both and enjoy the best bits of each.
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