Exchange-Traded Funds and Commission-Free Stocks Released By eToro

The trading giant did not stop at the release alone. It is also getting rid of management fees and will also cover the costs of stamp duty.

Enter new offers

The giant of retail broking and social trading, eToro, has taken another remarkable step. It just announced that it is opening commission-free trading in stocks and exchange-traded funds (ETFs). eToro is also deviating from convention in the retail trading sector by giving offers of uninhibited access to stocks and ETFs. Normally, other retail trading firms just make use of contracts-for-difference, but as seen, eToro is determined to carve its own niche.

But that is not the only thing in eToro’s new package. Before now, the business was in the practice of charging a total of fees for access to the various financial instruments. But with the announcement of the new products, it means that eToro will not be charging any commission or management fees again. It also stated that it was going to cover all stamp duty costs on its own.

According to Iqbal Gandham who is eToro’s managing director in the United Kingdom, they are putting all these measures in place as incentives for their customers to invest more in the stocks. He also confessed that even though these steps are important as starters, they are still not sufficient enough in getting more people to dive into investing and take more risks.

In the United Kingdom, one of the most problematic issues was the one regarding investment fees in the retail trading sector. This has caused a lot of trouble, especially in the last year. Earlier this year, the Financial Conduct Authority announced that numerous investment platforms complicate their fee structures. It accused the businesses of doing this so as to deliberately discourage the clients from having an idea of what other companies are offering.

Authorities vs. Fees

In March of this year, the regulator body released another publication in which it said it was considering slamming a ban on the exit fees that are charged by the retail investment operators. However, the guidelines given by regulatory agencies in Europe that limit the leverage on foreign exchange and CFDs trading, have also encouraged the retail brokers to expand their service offerings. They are able to do this for their clients by giving them trading options for different assets. But it must also be stated at this stage that commission-free equities trading is now generating different reactions from different quarters.

Probably the most successful company to offer stock trading to customers with no fees, Robinhood is located in the United States and makes much of its revenue by selling order flow to the most active traders. But this has generated serious backlash from critics who accuse the company of engaging in conflicts of interests. It is not clear yet if eToro will be faced with the same merciless criticism but what is certain is that not a few clients will be excited with the new offers. Whatever the effects of the new offers will be, time will surely tell.

Disclaimer

 eToro is a multi-asset platform that offers both investing in stocks and crypto assets, as well as trading CFDs.

Please note that CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

Past performance is not an indication of future results.

Cryptoassets are volatile instruments which can fluctuate widely in a very short timeframe and therefore are not appropriate for all investors. Other than via CFDs, trading crypto assets is unregulated and therefore is not supervised by any EU regulatory framework.