Pepperstone has 61 currency pairs vs eToro with 47. eToro offers 16 vs 5 cryptocurrencies. Pepperstone gives you ECN priced trading through 3 trading platforms and 4 social trading tools. eToro is a social trading platform with 6 types of CFDs.
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The first factor considered in our Pepperstone vs eToro broker review is the account types each broker offers. At Pepperstone, retail traders can choose between 2 different account types (Standard and Razor), while at eToro, there is a single all-in-one live account.
Pepperstone’s Razor Account has true ECN-style trading conditions with no dealing desk execution that offers distinct trading conditions, including:
The module below gives an indication of what trading costs one can expect using Pepperstone’s Razor account. The module calculates the average spread for the Razor account plus commission when opening your position.
Calculate Your Trading Costs Below
Total Fees
Commission
Spread Costs
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Pepperstone’s Standard Account offers the same features as the Razor Account but with zero-commission trading. This makes the account more suitable for beginners as all trading costs are incorporated in the spread. Spreads on the Standard account are widened by 1 pip.
eToro clients unlike Pepperstone clients, don’t have the flexibility to choose from multiple account options as eToro only offers one trading account. This account gives you access to 7 different asset classes, a proprietary trading platform with built-in social trading, spreads that start from 1.0 pips, 0% commission trading and dividend earning potential.
Yes, both brokers offer a Free Demo Account. Pepperstone offers a 30-day Practice Trading Account with $50,000 in virtual funds, while eToro offers a Free Demo Account, which comes with $100,000 in virtual funds.
Both brokers offer a Swap-free option (Islamic Account) for clients of the Muslim faith. Pepperstone swap-free account is the same as the standard account but uses an admin free in place of overnight fees. If you hold an active position for more than 10 days, Pepperstone will charge an admin fee for each standard lot you trade. Depending on the trading instrument, the admin charge will be as follows:
eToro has a minimum deposit requirement of $1,000 on its Islamic account. No interest will be paid, and no additional rollover commissions will be charged on contracts lasting more than 24 hours. Additionally, the brokerage will not charge any account management fees. Unlike Pepperstone, eToro does not allow scalping and hedging.
eToro charges inactivity fees, Pepperstone does not. Inactivity fees of $10 per month will apply if clients do not log in to their live account for a period of 12 months.
| Standard Account (zero-commission) | Razor Account (Interbank spreads) | Demo Account | Swap-Free Account | MAM/PAMM Account | Active Trader Account | |
|---|---|---|---|---|---|---|
| Pepperstone | ✓ | ✓ | ✓ | ✓ | ✓ | ✓ |
| eToro | ✓ | ✘ | ✓ | ✓ | ✘ | ✘ |
Overall, Pepperstone has a wider range of account types to suit the specific needs of different trading styles. The Standard Account is more suitable for beginners. By comparison, the Razor Account provides perfect conditions for traders who employ scalping and automated strategies.
View Pepperstone ReviewVisit Pepperstone
Spreads are one of the most important factors to consider when deciding on a broker. ECN trading with low spreads (plus low commissions) means greater potential savings. This is especially important if you are a high volume trader as these costs apply for each lot you trade.
The two brokers offer two very different pricing models. eToro offers only variable spreads while Pepperstone offers two pricing models for Forex and trading CFDs:
The advantage that Pepperstone has over eToro comes from overall lower spreads and a flexible pricing structure. At Pepperstone, traders can enjoy low spreads starting from 0.0 pips, while at eToro spreads start from 1.0 pips.
Standard Accounts – No Commissions
For a fair comparison, our team of experts took into consideration the Pepperstone spread-only model compared to eToro’s variable spreads. This comparison is fair as both these models are spread only, without the need to consider other factors such as commissions.
The average EUR/USD spread found on the Pepperstone Standard account is 1.13 pips compared to eToro’s average spread of 3.0 pips. That’s equivalent to 165.48% in trading cost savings.
The table below highlights the side-by-side spread comparison across the full spectrum of CFDs offered by the two brokers.
| Average Spreads (13/08/2020) |
Forex currencies (EUR/USD) | Index CFDs (SPX500) | Commodities CFDs (Cocoa) | Metals CFDs (Gold) | Energies CFDs (Oil) | Cryptocurrencies CFDs (Bitcoin) |
|---|---|---|---|---|---|---|
| Pepperstone | 1.13* | 0.40* | 5.0* | 0.50* | 0.50* | $10 |
| eToro | 3.0* | 0.75* | 6.5* | 0.45* | 0.50* | 0.75% |
ECN Accounts – Pepperstone Only
If we compare Pepperstone’s ECN pricing model (raw spreads) the trade cost savings go even lower with the Australian-based broker. The spread savings on forex trading with Pepperstone is 2200% lower compared to eToro’s spread cost.
Note* The spreads on eToro’s account are higher because variable spreads are subject to mark-up pricing.
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Pepperstone Spread Comparison
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|---|---|---|---|---|---|
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0.22 | 0.43 | 0.47 | 0.50 | 0.12 |
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0.17 | 0.30 | 0.14 | 0.25 | 0.02 |
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0.20 | 0.50 | 0.20 | 0.30 | 0.10 |
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0.20 | N/A | 0.20 | 0.30 | 0.20 |
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0.42 | 0.30 | 0.20 | 0.83 | 0.44 |
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0.30 | 0.68 | 0.24 | N/A | 0.17 |
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0.40 | 0.70 | 0.30 | 0.70 | 0.20 |
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0.50 | 0.80 | 0.30 | 1.10 | 0.10 |
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0.50 | 0.40 | n/a | 0.30 | n/a |
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1.23 | 1.23 | 0.77 | 1.41 | 0.44 |
Avg. spreads are taken from each broker's website and updated monthly. Last update on 01/09/2023
The head to head comparison revealed that eToro offers commission-free trading across all CFD instruments including stock trading. Traders can only incur a fee for short selling stocks or for holding overnight CFD positions. The fee is charged to cover the costs associated with using leverage.
On the other hand, Pepperstone Razor account charges a small commission to cover the costs of using the ECN pricing technology. Pepperstone allows traders of all styles to save money on trading commissions due to their low charges. Traders can expect a commission rate of USD 3.5 per side (USD 7.0 round-turn) for 1 standard lot traded.
| MT4 Razor Account | MT5 Razor Account | cTrader | |
|---|---|---|---|
| Commission USD | $3.76 ($5.53) | $3.5 ($7 round-turn) | 7 units charged of the base currency |
Overall, Pepperstone offers the cheapest bid and ask spreads on Forex and CFDs compared to eToro. With eToro traders can only benefit from lower trading cost on Gold CFDs where the spreads are slightly lower (0.45 basis points compared to 0.50 BP on Pepperstone). The low spreads allow scalping and day trading strategies to maximise their profit potential. To learn more about Pepperstone spreads and fees view the full Pepperstone fee article.
Both brokers have to comply with different regulatory frameworks in several jurisdictions. The forex leverage can vary across the board. For example, ASIC and FCA regulated brokers can offer a maximum leverage ratio of 1:30 compared to 1:500 leverage ratios offered by offshore regulators.
Both eToro and Pepperstone are regulated in:
As per CySEC, FCA and ASIC regulation, both brokerages offer a maximum leverage of 1:30 on major currency pairs and leverage of up to 1:20 on minors, exotics, Gold and major stock indices.
Pepperstone is also regulated in Dubai (DFSA) and Germany (BaFin), but the broker’s subsidiaries in these locations follow ASIC and FCA trading rules of 30:1 leverage caps.
If 30:1 leverage is too low for you, Pepperstone operates offshore branches where retail traders can access significantly higher leverage:
Overall, Pepperstone offers higher leverage ratios across a wide spectrum of asset classes via its offshore branches. Retail traders need to keep in mind that there is a high risk of losing money if you’re exposed to unhealthy high leverage ratios.
Both Pepperstone and eToro comply with the regulatory standards of some of the most reputable Forex authorities around the world. As such, both online brokers can be considered safe. If a forex broker wants to provide online trading services to retail clients it must be regulated by an appropriate regulatory agency. However, not all forex licenses carry the same weight.
On this note, Pepperstone abides by the standards imposed by various tier-1 regulatory bodies and tier-2 regulatory bodies. By comparison, eToro complies with the regulatory framework of 3 tier-1 financial institutions.
| Pepperstone Regulation | eToro Regulation |
|
|---|---|---|
| Tier-1 Regulation | ||
| UK's FCA | Registration No. 684312 | Registration No. 583263 |
| Australia's ASIC | AFSL No. 414530 | AFSL No. 491139 |
| Cyprus' CySEC | ✔ | License No 109/10 |
| Germany BaFin | ✔ | ✘ |
| Tier-2 Regulation | ||
| Dubai's DFSA | License No. F004356 | ✘ |
| Kenya CMA | ✔ | ✘ |
| Bahamas SCB | SIA-F217 | ✘ |
Pepperstone and its corporate arms are authorised and regulated in the following jurisdictions:
At the same time, eToro and its corporate arms are authorised and regulated in the following jurisdictions:
Both brokerages assure clients that they keep client funds completely segregated from their own corporate accounts, which minimises the risk of unethical behaviour.
Overall, it’s safe to trade with Pepperstone and eToro. Both brokers are in good standings and licensed by the world’s top regulatory agencies. At Pepperstone, client funds are held in segregated accounts with tier-1 banks National Australia Bank (NAB) and Barclays UK. eToro also uses dedicated segregated accounts with tier-1 banks to keep clients’ funds safe.
*Your capital is at risk ‘68% of retail CFD accounts lose money’
eToro’s range of financial instruments focuses more on stocks, ETFs and cryptocurrencies, while Pepperstone focuses more on forex pairs. Still, the Australian brokerage also offers some CFDs and a limited selection of cryptos*.
*NOTE: Under new FCA regulations, UK retail traders are no longer able to trade cryptocurrencies.
Both forex brokers offer CFDs on 7 different financial markets. The head to head comparison revealed that Pepperstone offers most of the same financial instruments like eToro excluding ETFs. At the same time, eToro’s range of investment products doesn’t include CFDs on currency indices.
| Pepperstone | eToro | |
|---|---|---|
| Forex Currency Pairs | +61 | +47 |
| Index CFDs | 14 | 13 |
| Share CFDs | +60 | 2038 |
| Commodities | 15 | 12 |
| Cryptocurrencies | 5 | 16 Coins 1 Commodity Crosses 14 Crypto Crosses 63 Currency Crosses |
| Currency Index CFDs | 3 | ✘ |
| Metal Pairs | 10 | 7 |
| ETFs | ✘ | 151 |
The range of financial instruments available for trade includes:
Neither brokers offer CFDs on Futures or Bonds.
Risk warning: CFDs are complex instruments that involve a high risk of losing capital rapidly, as leverage is used. Our Pepperstone review has shown that 79.3% of retail investor accounts lose money when trading CFDs with this broker, while our eToro review has concluded that 75% of retail investors lose money when trading derivative instruments with this provider.
Retail clients need to be aware if they fully understand how CFDs work before opening a live trading account.
Overall, traders can find more tradable CFD instruments with eToro, however, that’s mainly due to its large selection of stocks (+2,000 from 17 leading world stock exchanges). Excluding share trading, Pepperstone offers more options for forex traders seeking lower spreads and overall better trading conditions.
*Your capital is at risk ‘68% of retail CFD accounts lose money’
Pepperstone and eToro are brokerages with a different focus. While Pepperstone aims to ensure optimal trading conditions and the most comprehensive trading tools for its clients on a range of CFD trading platforms, eToro focuses on the social side of trading and its benefits for retail clients.
eToro’s main strength is its own proprietary social trading platform. The platform is built to enable make the most of copy trading capability and a place to share and follow different trading strategies and trading signals.
In terms of specialised forex and CFD trading platforms, Pepperstone offers a suite of 3 powerful trading platforms. On the other hand, eToro’s software solution only includes its proprietary social trading platform.
Pepperstone’s MetaTrader 4 and MetaTrader 5 platforms offer some of the best conditions for CFD and Forex trading. At the same time, Pepperstone’s cTrader trading platform offers advanced order capabilities and customisation options.
Each trading platform has its own advantages, including:
MetaTrader 4 – an easily customisable trading platform that features live quotes, real-time charts, in-depth news and analytics, a variety of technical indicators and order management tools. The software also provides a good environment for automated trading (Expert Advisors)Pepperstone, unlike eToro, only offers copy trading solution through 4 different third-party platforms:
Myfxbook – an automatic copy trading feature integrated with MetaTrader 4 and MetaTrader 5. This copy trading platform allows its users to access profile statistics and advanced analytical tools
The cutting-edge proprietary social trading review offered by eToro empowers retail traders to:
Additionally, the CopyPortfolios feature allows traders to allocate their funds to Top Trader Portfolios which spreads the funds across an array of professional traders. More, eToro offers CryptoPortfolios for a diversified and balanced allocation in the cryptocurrency market.
eToro Clients are able to copy up to 100 traders simultaneously. They can also discontinue the copy, pause it, add or remove funds at any time. All in all, copy trading is a way for inexperienced traders to earn a passive income with a minimum deposit of USD 200.
Overall, Pepperstone clients can enjoy more flexibility by being offered to choose between 4 different third-parties services. At the same time, eToro’s disruptive copy trading platform remains one of the most popular social trading networks among retail traders. If you’re looking for the best Forex trading signals, Pepperstone is a better option while for social trading in general, eToro is a better fit.
Perhaps the greatest advantage of spread betting over CFD trading is that profits are tax-free. UK-based traders will probably find spread betting attractive, as they will not have to pay stamp duty, while any gains from such trading operations are exempt from Capital Gains Tax.
Spread betting does not involve any trading commissions at brokerages such as Pepperstone. Similar to CFD trading, clients will only pay the spread.
When spread betting with Pepperstone, clients will be able to take advantage of no dealing desk execution, low latency and ultra-fast execution speeds on the broker’s MetaTrader 4, MetaTrader 5 and cTrader platforms.
eToro, unlike Pepperstone, does not offer spread betting to its clientele!
Pepperstone comes ahead in this section offering their clients the option to explore financial spread betting. This forex broker is at the forefront when it comes to integrating new financial products. With over USD 12 billion in trading volume processed on a daily basis, the Australian-based broker has one of the most diverse lists of financial products.
The risk management tools can help traders take control over their trading which is why it’s a key metric we used in our Pepperstone vs eToro review. Both brokers offer standard solutions for limiting the inherent risk of trading CFDs. Traders can limit losses and protect profits via the normal stop-loss and trailing stop-loss orders.
Pepperstone clients can enjoy more advanced risk management solution when compared with eToro. The key risk management tools including:
Both forex brokers offer an automated stop-out system that will liquidate your positions and protect your balance from falling below zero. Pepperstone uses a stop-out level of 50% for cTrader accounts and a stop-out level of 90% for the MetaTrader 4 and MetaTrader 5 accounts. By comparison, eToro uses a 50% stop-out level which follows the guidelines of the ESMA rules.
Additionally, the ECN pricing model used by Pepperstone also mitigates some of the risks that come with the market maker model used by eToro. Unlike other brokers, eToro execution model combines the STP technology with the NDD execution.
Overall, Pepperstone comes out as the net winner in this category. eToro only managed to gain an advantage against Pepperstone due to its Negative Balance Protection (NBP) policy which promises to protect clients against their balance falling below zero. Pepperstone only offers NBP on a case by case basis and at their sole discretion.
The minimum deposit requirement at Pepperstone is AUD 200 for all of the broker’s account types, while eToro requires a minimum deposit of $200 for credit and debit cards and a minimum deposit of $500 for bank transfers.
It is worthwhile noting that eToro only allows deposits only in US Dollars. Deposits made in other currencies will have to be converted to US Dollars and will incur a conversion fee!
Clients in most countries are able to fund their trading accounts and to withdraw funds without being charged any fees by Pepperstone. Both eToro and Pepperstone offers multiple account funding options. There are 7 funding methods that can be found with both brokers, including:
Debit or Credit Card by Visa or MasterCardAdditionally, Pepperstone offers two more options for deposits and withdrawals via POLi and BPay. At the same time, eToro clients can use direct banking via RapidTransfer and Klarna/Sofort Banking.
In comparison, there are no fees on deposits with eToro, but the broker will charge a $5 withdrawal fee. It also has a minimum withdrawal amount requirement of $30. Depending on the payment method used, clients will be able to receive their funds on average between 1 and 2 business days and up to 8 business days via wire transfer and credit/debit card.
Overall, Pepperstone overshadows eToro due to a lower minimum deposit, accessibility, no deposit and withdrawal fees and more account base currencies. Pepperstone offers a multi-currency deposit solution with 10 different base currencies (AUD, USD, JPY, GBP, EUR, CAD, CHF, NZD, SGD and HKD). Traders can take both brokers for a test drive with a demo account before making a real deposit.
The last metric we used for our Pepperstone vs eToro review page is the customer support service. When real money is on the line, the expectation is for the forex brokers to deliver on sky-high expectations and offer fast channels of communications.
Pepperstone offers professional 24/5 customer support service via live chat, email as well as over the phone. The live chat option is highly recommended as we managed to contact a representative from the brokerage within a minute and received adequate answers to our queries. Additionally, Pepperstone clients can also send a message to support by using the online form located in the “Contact Us” section on Pepperstone’s website.
In comparison, eToro offers 24/5 customer support service via live chat or a web-based ticketing system. By using that system, clients will get a response to their inquiries via email.
On the downside, eToro’s live chat link cannot be found immediately on its website. We discovered that the link was actually located below the FAQ in the “Help Center” section. But what we found really inconvenient was that the broker’s chat option appeared offline too frequently.
Finally, eToro does not offer client support over the phone, which we consider as another drawback.
Another factor we weighted in our scoring system was educational resources and market analysis tools. Both brokers are equipped with educational resources but Pepperstone’s education centre offers more resources aimed to help new traders and professional traders trade with more confidence.
Pepperstone provides its clients with a number of different resources including:
Market analysis and news (technical and fundamental)By comparison, the news service offered by eToro focuses more on stocks and there are a limited number of video tutorials. The most unique feature offered by eToro is the Digest & Invest weekly podcast.
In terms of technical analysis tools, Pepperstone clients can access the Smart Trader Tools package, which includes 16 trading tools and 15 custom indicators. Additionally, Autochartist is a great research tool that Pepperstone clients can use to assist them in their daily trading activities.
On the other hand, eToro lacks the feature-rich trading tools that can be found with the Australian-based broker.
In today’s competitive markets we found Pepperstone’s customer support team maintains a professional reputation. The live chat connects you directly to real FX experts bypassing the hassle of dealing with a bot. Overall, it’s much easier and more accessible to get in touch with the support team at Pepperstone.
View Pepperstone ReviewVisit Pepperstone
All in all, when it comes to CFD trading and spread betting, Pepperstone turns out to be the better choice for retail clients, as it offers some of the most competitive ECN trading conditions, a variety of tools to manage risk, an award-winning customer support service and charges no fees on deposits and withdrawals.
Established in 2010, in Melbourne, Australia, Pepperstone is an award-winning, multi-regulated Forex broker focused on providing clients with superior technology, raw ECN pricing, ultra-fast, no dealing desk execution and professional customer support service. Pepperstone does not offer online trading services to clients from Belgium and the United States.
On the other hand, eToro is a well known CFD provider for its social trading feature. With this provider, retail clients can enjoy a seamless account opening process, no fees on deposits and easy access to markets through its user-friendly web-based trading platform. eToro welcomes clients from all parts of the globe.
Account Types
Spreads
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Regulation
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Forex Pairs + CFDs
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