eToro Vs Avanza 2023: Which Is The Better Online Broker?

eToro Vs Avanza? Online brokers have a reputation for offering a variety of investment options, including a full range of options from stocks and ETFs to cryptocurrencies. As such, it can be difficult to determine which online brokerage is the best for your investing needs. In this article, we'll compare eToro vs. Avanza to see which is the better choice.

What Is eToro?

eToro.com is an online trading platform that began in 2007, and the company has since grown to help over 6 million accounts trade worldwide. The website offers different kinds of securities like stocks, commodities, indices, and ETFs. eToro also offers three kinds of accounts (leveraged, fixed, and CopyFund), starting from $100.

However, the broker has stopped accepting deposits from US traders but continues to serve clients in North America through its Canadian subsidiary eToro Canada Inc.

Trading conditions at eToro are good for beginners because of the free web-based resources provided by the company. But it is not clear whether this broker offers investors a competitive fee schedule.

On the other hand, eToro has gained a good reputation for offering traders an easy-to-use interface with advanced charting and mobile trading.

How Does eToro Work?

eToro aims to provide investors with an array of online trading services. The company offers to trade in equities, indices, commodities, and cryptocurrencies. Traders can open either a demo or live account to trade on the website's platform.

For their global trading platform, eToro has developed web-based software to include different kinds of securities, including ETFs, commodities, indices, and shares. The broker has a mobile application for iOS and Android devices for users to trade from anywhere around the world.

The company's web-based platform comes with a feature called CopyTrader, which allows investors to automatically copy trades made by other traders on eToro.

In addition to that, it offers web-based analytics that provides an extensive range of market data. This broker offers a wide array of educational materials, too, including videos to teach investors how to trade successfully.

eToro also offers its traders the ability to use leverage when trading financial instruments by providing them with up to 10 times the value of their investment in order to make an investment.

The broker provides its clients with access to a variety of risk management tools such as stop loss and take profit order types, pending orders, and limit orders.

How To Open An eToro Account?

To open an eToro account, click on "Join Now." You can either choose to create an individual or a joint account. The next step is to provide your personal information and specify whether you would like to trade like a professional or an individual.

When it comes to choosing the verification process, individuals have three options: None, Verify Identity, Verify Account. For Verification Identity, you will need to provide eToro with your full name, date of birth, and country of residence.

For the second option, which is Verifying Your Account, investors need to upload a scan or photo of their international passport or national ID card along with a proof of address like an electricity bill or bank statement.

However, the process of verifying your account is only available for individuals who live in Sweden, the USA, Canada, Japan, Australia, Germany, and France. Investors living outside these countries will have to choose the third option, which is No Verification.

After that, you need to fill out some information about your trading experience and risk appetite. For the risk assessment questionnaires, there are five options: low, medium, high, very high, and custom. Investors who score high should know that CFD products have a higher level of risk than other forms of investing.

You can choose between different types of investment accounts which include Standard, WebTrader Classic, WebTrader Plus, and Pro.

What Does An eToro Platform Look Like?

The platform is user-friendly, and it contains everything you would expect from a company that has been around for more than ten years. The interface contains different panels such as the market index, arrows, and scrolling tickers. At the top of the main page, users can find their balances and positions.

On the left side of the screen, there is a list of available assets, while on the right side of the page, investors can view the menu, which contains different panels with access to account information and details of open positions/orders.

Overall, eToro's trading platform is helpful for both novice and experienced traders thanks to its clear interface that reduces distractions.

What Are The Security Measures Of eToro?

eToro is one of the most well-known brokers in the industry that has never had a data breach since its inception. The company uses SSL encryption for its login pages, while customers' personal information and funds are stored on servers that run on advanced security protocols.

One of the best features of eToro's security protocol is 2-Factor Authentication (2FA); the broker has integrated the Google Authenticator application, which provides additional protection.

How Is The Customer Support Service Of eToro?

eToro offers different types of customer support such as phone, e-mail, and live chat. Phone: The company's main phone number is +44 203 379 0932.

However, it might be difficult to reach the investor relations department during the week because they are closed between 5 p.m. and 9 a.m. During the weekends, the phone number will remain closed.

E-mail: Before contacting eToro's customer service team via e-mail, you should know that they work only during the week and their hours are from Monday to Friday between 9 a.m. and 5 p.m. During the weekend, e-mails will not be answered.

Live Chat: The company also offers a chat feature at the bottom of its website, which can be used to have a chat with an expert.

What Are The Deposits And Withdrawal Methods of eToro?

Deposits:

eToro accepts different types of cryptocurrencies, such as Bitcoin and Ethereum. Credit cards are also accepted in some countries.

Withdrawals:

Different options for withdrawing funds include credit cards, bank transfers, and cryptocurrencies. In some cases, the withdrawal fee will vary depending on the method you choose.

For example, if you choose to withdraw funds through Bitcoins, you will have to pay a fee of 0.0002 BTC + the network fee (the average network fee is between $0.05 and $1).

Credit Card:

There might be restrictions on some credit cards based on the country and spending amount; there might also be fees depending on the currency and the card processor.

Bank Transfer:

Most countries accept bank transfers as deposit and withdrawal methods. However, some banks might charge fees for the transfer. In addition, some countries have stricter limits on wire transfers. For example, Sweden does not allow international wire transfers if the amount is higher than 20 000 SEK (~$2240).

In some countries, the minimum deposit amount is different. For example, in Australia, it is $200 AUD (~$160 USD) if depositing cryptocurrencies or 50 AUD (~41 USD) if using a credit card.

Who Should Use eToro?

Since eToro is a social trading and multi-asset brokerage company, it can be used by anyone who wants to become an investor or trader.

There are different types of assets that can be traded through this broker, such as stocks, commodities, indices, and currencies. It is ideal for beginners because it offers educational resources, news feeds, and other learning materials.

What Is Avanza?

Avanza is one of the largest online brokers in Europe and offers many services, including trading on forex and CFDs and buying and selling different types of stocks, ETFs, funds, and options.

Avanza has been operating in Europe since 1999, and it is known for its low commissions and high service levels. The broker does not charge any commission on opening an account or depositing money into it, while there are some exceptions to this rule, like phone orders of up to 20 units which cost £9 per trade.

The market maker is only available on Swedish shares, while the company offers a free demo account to allow traders to test their strategies before trading with real money. In terms of fund management, Avanza allows investors to trade up to 500 different securities from more than 20 countries worldwide.

Due to financial regulation laws in Europe, this broker will ask for additional documents if you are an investor from outside Sweden. Avanza is only regulated in the EU, while its parent company, listed on London Stock Exchange under ticker AVZ, has received a good customer score of 8.1 out of 10 at TrustPilot.

How To Open An Avanza Account?

1. Go to the official website and click on the "Open Account" button.
2. Fill out your personal details, such as name, address, phone number, and e-mail. You will be asked to specify whether you are a Swedish citizen or not. If you are, the broker asks for your social security number (personnummer).
3. Provide your bank details and personal identification document. Avanza only accepts citizens of Sweden with a Swedish personnummer, while it requires international traders to provide proof of address in addition to their personal IDs.
4. Download the platform and enjoy trading.

What Does An Avanza Platform Look Like?

Avanza provides a user-friendly interface with a clear design. The main page contains the list of all available assets, including CFDs on stocks, indices, and commodities. There is also an option for investors to filter their search by country, market cap, exchange, and industry.

The menu on the left side of the screen contains different panels such as account information and your positions/orders, while the right side of the page shows a list of tickers that move in real-time.

Overall, Avanza offers a simple and clean interface which is perfect for inexperienced investors who do not know how to use complicated platforms.

How About Avanza?

Avanza is a regulated company in Sweden, and it uses SSL encryption for its login pages. The platform does not require any form of verification to open an account, while funds and personal information are stored on secure servers.

The company has never had a data breach, but it does not use 2FA for its accounts. Also, Avanza offers an extra layer of security with cash (Ekonomiskt Sekuritetssystem) which ensures 100% protection.

How Is The Customer Support Service Of Avanza?

Avanza offers four types of customer support: phone, e-mail, chat, and FAQs. Phone: Avanza's main phone number is +46 8-545 545 55. However, it might be difficult to reach the investor relations department during the week because they are closed between 5 p.m. and 9 a.m. During the weekends, the phone number will remain closed.

E-mail: Before contacting Avanza's customer service team via e-mail, you should know that they work only during the week and their hours are from Monday to Friday between 9 a.m. and 5 p.m. During the weekend, e-mails will not be answered.

Live Chat: The company also offers a chat feature at the bottom of its website, which can be used to have a chat with an expert.

FAQs: Avanza publishes several FAQ articles that include information about the platform's features, how to open an account and fund it, etc. The main address for these FAQs is https://www.avanza.se/kundservice/faq/.

What Are The Deposits And Withdrawal Methods Of Avanza?

Deposits:

Different options for depositing funds include bank transfer, credit/debit cards, SOFORT-Transfer, and internet banking. In some cases, the fee will vary depending on the method you choose.

Bank Transfer:

All countries accept bank transfers as deposit and withdrawal methods except for Indonesia. In most cases, there is no minimum amount that can be deposited or withdrawn this way. However, some banks might charge fees for the transfer.

Credit/Debit Cards:

Different options are available for depositing funds using a credit or debit card, such as iDeal (Netherlands), Sofort (Austria and Germany), and Trustly (Sweden). In most cases, credit cards have higher limits than debit cards; however, there are no fees for depositing funds if using a credit card.

SOFORT-Transfer:

This method is only available to residents of Germany, Austria, and Switzerland. It uses your internet banking with the bank of PostFinance (Switzerland), Raiffeisenbanken, or GIROPAY/eNETS (Germany).

Internet Banking:

This is another option for those living in Sweden, Norway, and Finland. It depends on the bank you have as to which account(s) can be used for this method. In most cases, there are no fees for using internet banking to deposit or withdraw funds from your Avanza account.

Who Should Use Avanza?

Avanza is a brokerage company that specializes in stock trading. It can be used by both beginners and experienced traders because it offers resources such as an economic calendar, video tutorials, webinars, and educational materials to help them become more knowledgeable about the stock market.

From what I can see, eToro is better than Avanza. It seems like they offer the same type of trading services; however, eToro provides an educational component while Avanza does not.

This factor makes eToro a great platform for beginner investors because it will help them get acquainted with the different types of assets and learn more about stocks, currencies, and commodities. 

How Does Avanza Work?

Avanza's trading services include a contract for difference (CFD) products like forex, indices, stocks, commodity CFDs like gold and silver, and cryptocurrencies.

This broker offers its clients three types of accounts (micro, mini, and standard) with different conditions to suit individual traders' preferences. These accounts also have different minimum deposits for investors to get started.

When it comes to trading on Avanza's platform, traders can choose between fixed spreads or floating spreads which are either fixed or variable depending on the market conditions.

There are also some additional charges, including financing charge, which is calculated as the difference between buying and selling rates, a commission which has a range of 0.09%-0.35% per trade, and UK stamp duty/VAT on spread-betting accounts.

What Types Of Orders Do eToro And Avanza Offer?

eToro allows you to choose between market, limit, stop loss, one-click, and several other types.

Market Order: 

This order type is the simplest one, and it allows investors to buy or sell a set amount of currency at the market rate. For example, you want to purchase 100 USD, so you will have to choose the market order type and then enter your desired amount in US dollars.

Limit Order: 

This order type allows investors to specify the price they are willing to pay for a set amount of currency, while it can be executed at any moment. For example, you want to buy 50 USD when the price reaches 100 USD, so you will have to set your limit order at 100 USD and wait for it to be executed.

Stop Loss: 

This type of order helps investors protect their profits by setting a price floor; if the currency's value starts dropping after an initial increase, then the position is closed automatically. For example, if you have bought USD at 93 USD, you will have to set a stop-loss order when the price reaches 91 USD.

One-Click Order: 

This type of order allows an investor to buy or sell a set amount of currency by clicking only once on the "Buy" or "Sell" button. If you want to start a market order by clicking only once, then choose the one-click option. Avanza offers several types of orders, including market, stop loss, take profits, and trailing stop orders.

Market Order: 

This type of order is executed at the current market price for a set amount of the chosen asset. For example, you want to buy 200 GBP, so you will have to choose the currency and then enter your desired amount. Avanza also offers a one-click option for this type of order.

Take Profits: 

This type of order helps investors lock in their profits by setting a price ceiling after an initial increase; it works in a similar way to the stop-loss order. For example, if you have bought USD at 95 USD and you want to sell when the price reaches 101 USD, you will have to set a take-profit order with that price ceiling.

Trailing Stop: 

This type of order does not specify any fixed price; instead, it allows investors to set a percentage to either buy or sell when the currency reaches that price. For example, you want to buy USD if it goes up by 3% from the current price of 95 USD, so you will have to choose the trailing stop option and set it to 3%.

How Is eToro Different From Avanza?

Copy Trading: 

This feature allows investors to automatically copy other traders' investments and strategies. For example, if you want to join an expert's trade, then choose it on eToro's web platform or mobile app and specify the amount of money you wish to invest in that trade. eToro offers Copy Trading, while Avanza does not offer this service.

CopyFunds: 

This feature is similar to CopyTrading, but instead of copying one single trade, you can copy a whole portfolio of investments and strategies.

Social Trading Network: 

eToro's trading platform has a built-in social network that allows investors to follow other traders, engage in discussions about investments, and share ideas. On the other hand, Avanza does not offer this.

Multi-lingual Platform: 

Avanza works only with Finnish and Swedish speakers, while eToro offers 12 different languages on its web platform.

User Experience: 

Avanza's platform offers a simple and clean interface, while eToro's web and mobile platforms provide more in-depth information and content to help investors understand the different trends and strategies.

Mobile App: 

Avanza offers only an online web trading platform, whereas eToro has iOS and Android apps that allow investors to access their accounts from their mobile devices.

Margin Trading: 

Avanza does not offer margin trading, while eToro allows investors to borrow money from the broker in order to trade on margin.

Maximum Leverage: 

Avanza offers a maximum of 1:10 leverage while eToro has 1:30 and even 1:50, depending on the investment financial instrument.

CFDs: 

eToro offers its clients more ways to invest, including CFD trading. Avanza does not offer this type of trading.

Regulation: 

eToro is regulated by the Cyprus Securities Exchange Commission (CySEC). On the other hand, Avanza is regulated by the Financial Conduct Authority (FCA).

Now that we have learned about both the brokers let us understand what brokers are and how they work.

What Are Online Brokers?

Online brokers, also known as discount brokers or trading platforms, allow you to buy and sell financial products such as equities and bonds without visiting a branch. In addition, online brokers provide clients with a platform to access a broad range of markets from anywhere at any time.

What Is The Role Of An Online Broker?

In contrast to traditional brokerage firms, online brokers do not offer financial advice. As such, they only aim to provide their clients with the best available prices for trades that can be carried out directly on a trading platform or via an app.

How Does An Online Broker Work?

Online brokers charge clients directly for each trade. As a result, they do not require you to hold an account with them. Instead, investors are provided with their own trading accounts and can use the broker's platform or app for placing trades (which is far cheaper than working through a human broker).

While online brokers offer affordable prices and many advanced features, there are several factors to consider before working with a particular broker.

What Should You Look For When Comparing Brokers?

Before choosing a broker, it is important to understand whether or not they suit your trading needs. For instance, if you want to invest in forex and cryptocurrencies – you will need a web-based platform instead of a mobile app. In addition, you should consider the following factors:

Deposit And Withdrawal Fees:

You will need to pay a fee for depositing funds into your account and withdrawing them. Since online brokers do not provide financial advice, they charge lower commissions than traditional brokers (which is why it makes sense to work with an online broker).

Minimum Deposit:

Most online brokers require a certain minimum initial investment. This means that you need to deposit a certain amount of money before their platform becomes available for use.

Account Opening:

Before choosing a particular broker, it is important to see how much information they require and what conditions must be met in order to open an account.

Customer Service:

The availability of customer support representatives can be a significant factor for some investors. In addition, different brokers have different working hours – you should ensure that your chosen broker provides assistance during the times you are going to use their products.

Tools And Assets:

Different brokers offer a range of tools that will help you choose financial products, choose the right time to trade them, and monitor your investments. While some brokers only offer their clients access to one market (e.g., international equities), others provide you with access to multiple markets (in addition to advanced trading tools).

Education And Research:

Consider the educational resources that are available to you. These include webinars, articles, and videos on investing strategies. You might also want to look for an auto-trading feature (which is convenient for beginners).

Types Of Orders:

You should also consider how much flexibility you have when placing orders. Oftentimes, online brokers provide several kinds of order types (for instance, market, limit, stop-loss, etc.). Furthermore, some brokers offer their clients different kinds of orders based on the amount they are willing to invest.

Fees For Advanced Features:

Before firm a broker, it is important to see what kind of fees will be applied for using advanced trading tools. For instance, if you want to use margin trading – this could cost additional fees, so make sure to check whether or not the broker you want to work with offers this kind of service.

Security:

Your chosen broker should provide a safe environment for you and your assets. You should look into how secure their website and trading platform are before choosing which broker to work with.

Privacy: Online brokers usually follow strict regulations when it comes to user privacy. As a result, it is important to make sure that you are provided with all the information about your account and assets in order to be able to work with your broker seamlessly.

Regulatory Oversight:

Some investors prefer working with brokers who are supervised by specific regulatory authorities (e.g., CySEC or FCA). This is particularly important if you want to work with a regulated broker.

Price:

Finally, when choosing a broker – compare their prices and see whether or not they suit your needs in terms of features and fees. Following these factors will help you choose the right online broker for your investment needs.

Conclusion

Which Is The Better Online Broker? The answer to this question depends on your needs and preferences. eToro offers an advanced trading platform with more in-depth trading tools, while Avanza has a clean and simple interface that makes it easy for beginners to start trading.

eToro's web and mobile platforms are in different languages, while Avanza offers only English and Finnish on its web platform. eToro also lets you copy trades, but Avanza does not offer this service.

After comparing between eToro and Avanza, it becomes clear that both brokers have their advantages. This is why, when choosing a broker, you should compare them against your own needs in order to see which one suits you better.