This article was last updated on January 9, 2022
This article will review Degiro and speak about DIY investing. For those interested in investing please email me (advice@adamfayed.com) or speak to me on the WhatsApp function below.
For those that prefer visual content, the video below summaries the article:
Before we begin – something on DIY investing and the 2020 pandemic
Study after study has shown that DIY investors don’t do very well long-term. The main reason is emotions which means they buy high and sell low.
That doesn’t mean that every DIY investor needs an advisor. It merely means that in the same way that most people benefit from a gym instructor in the gym for motivation and knowledge, a good adviser can increase returns and self-discipline.
It is much harder to sell during a market crash, for example, when you have somebody talking in your ear about the need to be patient!
The current market falls is proving this point. It really is “easier said than done” to say you won’t panic during any huge falls.
I have met countless people in the last few weeks who promised themselves that they would invest through thick and thin, and when there is blood on the streets, to quote Warren Buffett:
So the benefits of an advisor in this situation is immense, as it is behavioural as well as technical advice.
Now does appear to be a great time to invest for a long-term investor, but controlling emotions like fear and greed is key to long-term investing success.
Degiro Introduction
‘DEGIRO’ is an online broker from the Netherlands which offers low prices along with great discounts to its customers. It was established in the year ‘2008’ but started stock brokerage in the ‘2013’ for the retail investors. DEGIRO provides access to more than 60 security exchanges to its customers.
Investors can be able to buy or sell stocks, bonds, mutual funds, ETFs, options, and warrants using the DEGIRO’S online electronic trading platform or with the help of a mobile application.
The countries where investors can be able to make a trade using DEGIRO are Netherlands, Italy, France, Austria, Switzerland, Germany, Czech Republic, Spain, Portugal, Poland, Greece, Hungary, Denmark, Sweden, Norway, United Kingdom, Ireland, and Finland. People living in countries other than these cannot be able to use the services of DEGIRO.
Top-tier financial regulators such as The Dutch AFM (Authority of Financial Markets) and DNB (Den Norske Bank) approved DEGIRO to be one of the safest online brokers available in the market. In the above-mentioned 18 countries, DEGIRO has about 400,000+ customers. The investment protection feature is available for the customers for €20,000.
DEGIRO is considered to have very affordable and lowest prices available. Investors cannot be able to trade in derivatives such as CFDs (Contract for Difference) using the same DEGIRO account where other assets are traded.
Fees and Commissions:
When compared with other online brokers, Degiro provides its customers with satisfactory, affordable and lowest prices available on the market in its category.
ETFs (Exchange-Traded Funds) can be traded once every month with the help of DEGIRO, which is the best opportunity when it comes to investors who want to buy and hold.
DEGIRO makes a proud statement saying that it offers 84% lower fees than any other brokers available in the market. Customers won’t be experiencing any kind of fees while opening or closing an account, account fees, managing fees, inactivity fees, financing rates, etc.
‘Trading Costs’ – The trading costs are very low that any investor would want to make an investment using DEGIRO. Trading fees are the charges that are generally charged by the broker when the investor makes a trade. This can occur in the form of either commissions or spreads. Having the lowest fees available, DEGIRO can be suggested as a smart choice for people to make regular trades.
Stock Fees –The trading costs of DEGIRO may vary depending on the country of the investor. Trading fees are the same for Stocks, ETFs, and CFDs. When it comes to stock trading, DEGIRO can be said as the best option available to the investors.
- For a $2000 trade from the USA, DEGIRO charges $0.6
- For a $2000 trade from the United Kingdom, DEGIRO charges $2.4
- For a $2000 trade from Germany, DEGIRO charges $5.7
It also gives discounts to its customers, if the customer who makes an investment in a country’s stock market is from the same country. For example, if a person who is from Germany chooses to make a trade in the German market, he/she will be charged 0.026% + 2 euros instead of the normal price which is 0.058% + 4 euros. These discounts can be utilized by every customer in the countries where DEGIRO is available.
Some ETFs are available at DEGIRO, in which free trade can be made every month as we have discussed earlier. The size of the trade is negligible as long as a short position isn’t generated. Not only that, but DEGIRO also gives the opportunity to make the free trade again in the same month, if the trade is made on the same ETF (with a minimum amount of $1000) in the same direction as before.
Trading Fees at DEGIRO is usually combined with flat fees and the percentage of the traded volume. It is different for the countries’ US and Canada, as the trading fees is calculated based on the trade made in the number of shares. Flat fees can be high in the case of smaller markets as well as Asian markets.
| Country’s Market | Commission Charges |
| The United Kingdom | £4 + 0.022% |
| USA | €0.5 + $0.004 per each share |
| Germany – XETRA | €4 + 0.058% |
| Germany – Zertifikate-Börse Frankfurt | €2 + 0.118% |
| Germany – Frankfurt (Stocks) | €7.5 + 0.098% |
| Belgium, Denmark, Finland, France, Ireland, Italy, Netherlands, Austria, Norway, Spain, Portugal, Switzerland, and Sweden | €4 + 0.058% |
| Italian CFDs | €4 + 0.158% |
| Canada | €2 + 0.01 CAD per each share |
| Australia, Hong Kong, Japan, Singapore | €10 + 0.068% |
| Poland | €5 + 0.168% |
| Hungary, Greece, Czech Republic, Turkey | €10 + 0.168% |
ETF Fees – The charges for ETFs are usually around 2 euros plus 0.038% all over the world. As we know already the first trade made every month is absolutely free.
Fund Fees – The fees for US Funds are also usually lower when compared to others. Generally, the buy fund fees for a $2000 trade on USA tech fund is 10.6 dollars. But some other brokers may provide a somewhat lower price for the European Funds. The European stock fund buy fees for a $2000 trade is also 10.6 dollars. DEGIRO does charge in the same way for funds as it does for stocks and ETFs. In the case of non-listed funds, these fees are high.
- The commission for ‘Non-Exchange Listed Investment Funds (Non-STP)’ is €75 + 0.10% and the annual fees are 0.2%.
- The commission for ‘Euronext Fund Services’ is €7.5 + 0.10% and the annual fees are 0.2%.
- The commission and annual fees for ‘FundShare Cash Funds’ are free of cost.
Bond Fees – The Bond fees for DEGIRO are very low when compared with other rivals in this category such as Saxo Bank. The fees for European bonds at DEGIRO are $11.5 whereas it is $91.2 for Saxo Bank. The Commission charges are also considerably low at DEGIRO.
| Market | Commission |
| Germany – Xetra/Frankfurt | €5 + 0.058% |
| Netherlands, Belgium, Portugal, France | €2 + 0.068% |
| OTC Bonds such as Norwegian Bonds | €35 + 0.038% |
Options Fees – DEGIRO charges options fees lower than many other brokers such as IB (Interactive Brokers). The fees are based upon the number of contracts. For example, the Stock index options fees for 10 contracts in the USA at DEGIRO are $6.5 and it is $7 for IB and $60 for Saxo Bank.
The options fees for stock index options at DEGIRO are as follows:
| Market | Fees |
| The USA | $0.65 per contract |
| Germany | €0.90 per contract |
| Spain | €1.65 per contract |
| The Netherlands, Belgium, France, and Portugal | €2.15 per contract |
| Norway, Finland, Sweden, and Denmark | €0.65 per contract |
| Other countries | €2.15 per contract |
| Option exercise or Option assignment | €1.00 per contract |
Futures Fees – The Futures fees at DEGIRO is also based on the number of contracts just like the options fees.
| Futures | Trading Fees |
| NYSE Liffe | €2.65 per contract |
| EUREX main indices | €0.90 per contract |
| EUREX other stock indices | €2.65 per contract |
| The USA | $0.65 per contract |
| MEFF | €1.65 per contract |
| Norway, Finland, Sweden and Denmark | €0.65 per contract |
Crypto Fees – Investors are able to make an investment in cryptos only with the help of ETNs (Exchange Traded Notes). Trade can be made in Bitcoins and other ETNs on the Stockholm Stock Exchange.
The trading fees for cryptos are 0.058% + €4 and the maximum amount is €60.
Financing Rates– Financing Rates are the borrowing charges applied when a trade is made with leveraged products (Forex and CFDs) per each day. The financing rates depend upon the volume of the trade. Yearly financing rates at DEGIRO are very low when compared to other brokers such as IB and Saxo Bank.
For Example, the financing rates for Apple at DEGIRO are 4.3% while they are 5.8% for IB and 7.1% for Saxo Bank. Similarly, the financing rates for Vodafone are 2.5% at IB when they are 3.9% and 5.3% respectively for IB and Saxo Bank. The financing rates differ for each country.
‘Non-Trading Fees’ – Very low Non-trading fees are applicable at DEGIRO, where there is no Inactivity Fee, Account Opening Fee, Withdrawal Fee, Deposit Fee, etc. An annual fee of €2.5 is charged when a trade is made in stocks (other than London Stock Exchange).
DEGIRO charges a currency conversion fee if the currency of the investor’s country is different from the currency of the asset. The charges vary based on the automatic conversion and manual conversion. For an automatic conversion, the customer is usually charged with 0.1% of the transaction amount and it is 0.02% along with a fee of €10 when it comes to manual conversion.
What is the biggest potential costs – capital gains tax can be high in the Netherlands. Low-costs isn’t much use with 30% capital gains tax.
Account at DEGIRO:
An account can be easily opened at DEGIRO if the customer lives in one of the 18 countries mentioned earlier. A mainland UK bank account (in GBP) would be required for customers requiring United Kingdom registration.
Transfers- Transfers cannot be made from UK overseas territories or Crown dependencies which include Jersey, Gibraltar, Isle of the Man, etc. Customers in Hungary have to make sure that they trade the amount in their account within two days. If they fail to do so and hold the cash, then the amount will automatically be reverted to their bank accounts.
Minimum Deposits – Customers at DEGIRO won’t require any kind of minimum deposit. This can be considered highly beneficial to investors who are willing to make investments in smaller amounts at DEGIRO.
Account Types – There are 5 types of accounts available to the customers at DEGIRO, which are:
- Custody Account
- Basic Account
- Active Account
- Trader Account
- Day Trader Account
The availability of access to more products and features is in the ascending order from the above list. As access to the products and features becomes more, the riskier it becomes.
There are many more advantageous options for customers at DEGIRO such as Joint account, Corporate account, Availability of account for Minors, etc.
The account on DEGIRO can be opened in a simple and fast digital process, which is available within 2-3 working days. The documents required for the registration process are a copy of a passport or an ID card and the bank details of the customer (in which the customer wants to receive or make the payments).
The above-mentioned process is considered as an initial registration process and after finishing that, the customer is required to complete an appropriateness test to make sure that he/she is familiar with the risks involved while trading. The customer is also asked whether he/she agrees to conditions of the prices or not. After completion of this process, the investor is able to transfer the money into his DEGIRO investment account.
Transactions (Deposits and Withdrawals):
DEGIRO doesn’t charge any type of fees or commissions while making a deposit or a withdrawal. This is considered as an advantage to the customers while trading at DEGIRO.
‘Deposits’ – At DEGIRO, the deposits can be made in a hassle-free way. There are two methods available to the investors in order to make a deposit into their account. These methods are Bank Transfer and Trustly (Payment method). The huge backdrop at DEGIRO is that the investor is not able to make use of a Credit Card or Debit Card while making a deposit.
The time taken for a bank transfer is around 2 – 3 working days, whereas the Trustly usually takes nothing more than 30 minutes. The deposits can be made to the account only if it is on the same name as the customer.
‘Withdrawal’ – There is no withdrawal fees for the customers at DEGIRO. Unlike the deposits, withdrawal can only be made through bank transfer. There is no other option available for the customers for making a withdrawal other than this method.
On average, it takes around somewhere between one to three days in order to withdraw the funds to the bank account. Like the deposits, withdrawals can also be made only to the account under the investor’s name.
Trading Platform:
DEGIRO is available to the customers in a web-based trading platform and a mobile trading platform. There is no desktop trading platform available to the customers.
‘Web Trading Platform’ – The web trading platform on DEGIRO is user-friendly and very easy to understand. The interface can be easily understood by customers even with a beginner level of knowledge in trading. It is very secure and has a safe login option with two-step Google Authentication.
DEGIRO is available on the web trading platform in different languages. The respective country’s language is automatically made available to the customer. The design looks very good on the web trading platform, but a minus is that the customization feature is not available.
The functionality of the search is also very productive for DEGIRO. The results are available on typing the product name. The search results are varied based on their asset classes. You can also view the updated currency of the desired product, the stock market, etc. The order types that can be selected are Limit, Market, Stop Loss, Stop Limit and Trailing Stop. The order types might not be available for all the tradable instrument.
The two order terms available on the DEGIRO web trading platform are Day and Good-till-cancel (GTC). When it comes to executing an order, DEGIRO doesn’t have internal matching anymore. Some customers might have a negative point of view due to the lack of an internal matching option.
An organized pattern of Fee reports and Portfolio are available on the DEGIRO web trading platform. It lacks some essential features such as text message notifications and price alert function. The alerts are received through an email.
‘Mobile Trading Platform’ – DEGIRO has an excellent and quite productive mobile trading platform. It is available on both Play Store (for android users) and App Store (for iPhone users) in many different languages. Just like the web trading platform, the mobile trading platform is also very easy to understand and has a good design.
It also has a safe login option availability with two-step user authentication. Although it has a good design, some customers might find it a little bit old fashioned.
Unlike the web trading platform, where the search function shows the asset classes of the search results, the mobile trading platform doesn’t show any type of differentiated results according to the assets and considered a little bit backward from mobile apps of other online brokerage firms.
Placing an order on DEGIRO, using the mobile application is very easy and similar to that of the web-based application. No specialized price alerts and notifications.
Markets and Research:
‘Markets’ – There is an availability of access to many markets and products which are:
- Stocks
- ETFs
- Funds
- Bonds
- Options
- Futures
- CFDs
- Cryptocurrencies
The major market that isn’t available on the DEGIRO platform is Forex. The product portfolio of DEGIRO can be suggested as a very good one. Excellent offers can be found for stocks, options and futures whereas the offers for funds, bonds, and CFDs are considered as average offers. The access to products on DEGIRO is as follows:
| Stock Markets | 32 |
| ETFs | 5,400 |
| Fund Providers | 68 |
| Bonds | 1,000 |
| Options Markets | 13 |
| Futures Markets | 12 |
| Stock CFDs | 900 |
The access to stock exchanges includes both larger international markets as well as relatively smaller European stock exchanges. Here, the customers can also be made in the penny stocks.
Some of the biggest fund providers such as Vanguard and BlackRock can be accessed using DEGIRO. The number of fund providers on DEGIRO which is 68 is very low when compared to many others in this section.
Despite having both government and corporate bank bond offering, the access to bonds is lower than that of other brokers such as IB and Saxo Bank. The same applies to Options markets and Futures markets as well.
It is highly important to notice that CFDs are very complex and highly prone to have the risk of getting losses. It is duly reported that more than 65% of the people who have invested in CFDs using DEGIRO have lost their money. Keeping that in mind, an investor should make wise decisions and always get the required information from a financial advisor/broker before making an investment. For the convenience of the customers, a negative balance protection feature is made available for the customers at DEGIRO.
Cryptocurrency investments such as Bitcoins and Ether can be made using the ETN instruments on the Swedish Stock Exchange.
‘Research’ – DEGIRO has a very limited amount of research available to investors. It lacks many features such as Trading strategies, In-Depth Research or Analysis, Fundamental data, Tools for analysis, etc. There isn’t much information about the company available for the customers.
The charting tool also lacks advanced data and is very simple. It is only enough for the trading platform and looks very basic. With over 20 technical indicators, the charts cannot be saved using the charting tool.
A news feed is available on both the Web and mobile trading platforms. It cannot be suggested as a highly informative one, but it can be useful and displays important market news.
A tutorial is available for the users on DEGIRO where they can get familiar with the trading platform. There are some general educational videos with good information available. It would have been much better if they have provided the customer with a demo account.
Customer Support:
The customer support at DEGIRO is considered to be having an average overall performance. This is due to the lack of certain features such as Live Chat, availability of the customer service 24/7, well – organized and informational replies for the queries, etc.
The telephone support can be considered as a service with good quality and the customer service is also available in many different languages. The response time of the phone support is very quick. The email support cannot be considered as effective as telephone support.
Ratings:
|
| Rating |
| BROKERCHOOSER | 4.7 stars |
| Trustpilot | 4 stars |
| StockBrokers.com | 3.5 stars |
DEGIRO has received 41 international awards such as ‘#1 for lowest commissions and fees in the year 2019’, ‘Cash Cow award (Best Broker) in the year 2018’, ‘Golden Bull Award in the years 2015 and 2018’, ‘Investment Trends award in the year 2018 ( for both Best Value for Money and Best Mobile Trading App ), etc.
Conclusion:
Degiro is an excellent DIY brokerage for those that have the self-discipline to self-invest. Most people, statistically, don’t. Like a person in the gym that gives up, many DIY investors make foolish decisions, whenever there is market turbulence.
The biggest negatives about this option is the potential tax implications and the fact most European citizens can’t invest in US-based ETFs.
Compared to Saxo Bank and others, Degiro has its advantages and disadvantages. There isn’t a huge difference. The biggest difference is investor behavior and how self-disciplined you are.
Further reading
Considering the suitability of Degiro Review 2022 for investors? Insights into strategic investment approaches can be found in Utmost International Executive Redemption Bond Review.
Don’t forget to mention how their servers become unstable when the market is moving rapidly. Which can effectively hinder you from selling early or realocating during flash crashes. It’s hard to put into words the frustration of being locked out of your account during such times. I am still using the service despite this fact, but people should know they get what they pay for on this front. Don’t expect compensation for the losses you incur on that front either. I was locked out and informed I had to recover a leveraged position while my portfolio dropped by 15%, and my intended move would have recovered 8% immediately. Finally getting in and seeing my account completely empty came with its own set of emotions as well, quite infuriating to be frank. I have experienced the issue multiple times now and think it’s quite amateurish. But maybe I’m just old fashioned for expecting reliable service.