Three years ago, I started investing through DEGIRO. In this DEGIRO Review, we’ll go into my experience and tips on investing through DEGIRO.
DEGIRO is a broker that you can use to invest in stocks, obligations, options, and index funds. At the moment, DEGIRO is available in 18 countries in Europe.
We’ll focus on reliability, commission, the possibility to invest in index funds, and customer support. One of the most important things for me is the reliability, safety of funds, and commission. If you pay a high fee on your trades, your return will suffer in the long term.
What is DEGIRO?
DEGIRO is an online broker based in the Netherlands. It is my favorite broker, and I’ve been using their services for almost three years now. DEGIRO has been around since 2008 and opened to retail clients in 2013.
It operates in the majority of Europe, and it’s the fastest-growing European broker. Unfortunately, it’s not running in the US yet. They have a reputation of being a low-cost broker that offers a wide variety of products on worldwide markets.
DEGIRO is registered in Amsterdam in the Chamber of Commerce and regulated by the AFM and under the prudential supervision of the DNB.
DEGIRO has a reputation of being the best low-cost stockbroker in 2016 and 2017 & the best mobile share dealing in 2017 as decided by the Financial Times and Investors Chronicle.
Is DEGIRO regulated?
It is essential to know if a broker is regulated before you invest your money.
DEGIRO has been around since 2008, which means they have an excellent track record. Since I started using them three years ago, everything went smooth when using their service.
DEGIRO is registered in Amsterdam in the Chamber of Commerce and regulated by the Authority of Financial Markets (AFM) under the prudential supervision of the Dutch Central Bank (DNB). These institutions monitor all the Dutch financial institutions, and they are responsible for regulating and managing the financial platforms.
Your assets are traded on the exchange. DEGIRO is the broker that facilitates the buying and selling activity. It means that even if DEGIRO goes bankrupt, your assets are safe. You are the owner of the ETFs and stocks that you buy on their platform.
Just remember: investing involves risks of losses.
DEGIRO Fees & Pricing Model
DEGIRO is well-known for the low fees they offer. Their goal is to make investing accessible and affordable for everyone. How do they do that?
- You can open your account for free.
- There is no inactivity fee on their platform. It means that even when you don’t trade, you won’t get charged.
- There is no fee for withdrawing money from the platform.
Their low fees and the absence of monthly fees make it the perfect platform for long-term investors who don’t regularly trade, like me.
With regards to fees, DEGIRO has:
- Variable fees for shares, bonds, or ETFs that you trade. The amount of fees you pay depends on the value of your trades.
- Fixed fees on options and futures that you trade.
Because of this trading fee structure, DEGIRO is convenient if you’re a passive or smaller investor. The buy and hold strategy works for DEGIRO.
DEGIRO has over 200 free ETFs that you can trade once a month without paying any fees. Including all-time favorite VWRL. The amount of trade does not matter for this! Of course, conditions apply. If you trade the same ETF in the same direction (buy/sell) in the same month & trade at least €1000, there will be no fee!
If you want to trade on global stock exchanges, you pay the DEGIRO exchange connection fee. It means that every year you will pay 0,25% of your account value, with a maximum charge of €2,50 per exchange.
If you’re investing in your home country’s stock exchange, you pay no fees for that. So for me, I don’t pay any yearly fees to trade on Euronext Amsterdam and Euronext Brussels. If you open an account with DEGIRO UK, you don’t pay any confection fee for the London Stock Exchange.
If you’re interested in individual stock trading, let’s check my first transaction with Walt Disney. Going back to the fees, I paid €0,55 for the entire transaction of €2000. If we look at, for example, Interactive Brokers or a bank, the differences are certainly there! For Interactive Brokers, the fee would have been €1,00, and if we look at my bank, it would be way over €5,00.
- DEGIRO is cheaper when investing in stocks.
- DEGIRO charges €2,50 annually for trading on a stock exchange (except your home countries stock exchange)
- With DEGIRO, you can monthly invest in one ETF from their list for free (conditions apply).
It means that if you’re like me and love to secure your financial future with ETFs or low-cost index funds, DEGIRO is the ideal pick!
DEGIRO Pros and Cons
Let’s list the pros first:
- DEGIRO has one of the lowest fees in the market.
- Broad access to markets, so you can access the most important international and local exchanges.
- Very user-friendly web platform and mobile application.
Okay, now let’s list the cons:
- Only available for you if you have a European bank account.
- No price alerts available.
Why Low Costs Is So Important
If you’re investing in stocks, bonds, or ETFs, it is extremely important to focus on low fees.
Why? Are you familiar with the compounding returns effect? In short, it means that when you start investing, your money will start to make money.
A great example is when you double a penny for 30 days. In the beginning, your money starts to make money on a smaller scale. The longer you keep at it, the more the money grows. By the last couple of days, it grows exponentially.
Visually, it would look like this:
Let’s take a real-life example of you investing. In the first year, you invest $50,000, and your money will grow by 7% (the average stock market return). Your money will grow by 7% in the second year, including the 7% of the previous year. It means that your money is making money, and it’s growing. In 30 years, your $50,000 has grown to $405,825! Amazing!
Now, what happens if you pay a 1% fee on your investment. You invest $50,000 and your money will grow with 6% the first year, for 30 years. After 30 years, your $50,000 has grown to $301,129.
While still a great amount, you have missed out on $104,696 simply because of the fees. The fees don’t seem significant when you hear them, but their impact on your return and the overall investment is real!
That’s why investing at a brokerage that has low fees is crucial, and that’s why my choice has been DEGIRO for the last three years!
How Do I Open An Account At DEGIRO?
If you want to open an account on DEGIRO, you can do it quickly and easily. You can do it online within minutes, and your account can be up in one business day. Sometimes it can take 2-3 business days.
You can open an account with DEGIRO if you have a bank account in your name in: Czech Republic, Germany, Finland, Ireland, the Netherlands, Hungary, Poland, Sweden, Greece, Switzerland, Denmark, Spain, France, Italy, Norway, Austria, Portugal or the United Kingdom.
Here are the exact steps to open an account:
- Go to this link and select your country.
- You can click on Open an account on the top right.
- Insert your email address and your username.
- Once you’ve completed that, you will be asked to confirm your email.
- After you’ve confirmed your email, you can log into the DEGIRO platform.
- Now you will be asked to provide the required personal information to verify your identity.
- After that, you will be asked to upload your identity proof.
- Choose the type of account that you want to use. Can choose between a Custody, Basic, Active, Trader & Day Trader account. I would recommend choosing Basic when you are starting, as this is the account that comes with the free ETF trading.
After that, you have only taken the following actions to get started trading:
- Agree to the conditions
- Transfer money to your investment account
Deposit & Fund Your DEGIRO Account
When you want to deposit money to fund your DEGIRO account, it is easy as well. You need to transfer money through a bank transfer. If you’re trading in another currency, using Revolut could potentially save you a lot of money.
When you’ve transferred the money, it will be available on the platform within 1-3 business days.
With IDEAL, you can directly transfer money in and out of your account for free. The funds will be available instantly on the platform.
When you want to withdraw money from the account, you can do this without paying any additional fees. It takes one business day on average to have the money back in your account.
Using DEGIRO Trading Platform
The trading platform of DEGIRO is very intuitive and easy to use. The desktop website is straightforward to use and has a clean look. It is easy to navigate, and you can buy and sell on the platform quickly.
If you’re an advanced trader, the platform may be too basic. For the beginner investor or for the investor who wants to keep things simple, that platform is perfect.
The platform looks like this:
You will find a search bar where you can type in a product name on the top right. You can see on which stock market it’s listed, as well as what the currency is.
The portfolio and fees information available through DEGIRO is clear and well organized. It is clear about what to do and how much fees you paid for your transactions.
When you want to buy stocks or ETFs, you get the below screen:
DEGIRO offers other financial products as well. However, I’m only using the platform to trade in stocks and ETFs.
Let’s get to the mobile app
Confession time, I primarily use the mobile app, as it is effortless to use and straightforward! It’s available in your language as well, which makes things easier.
Buying and selling is the same screen as used on the website platform.
DEGIRO Review & Experiences – Conclusion
DEGIRO is the right choice if you are focusing on low fees and a simple to use platform. It meets all the criteria that I have for a broker. I’ve been using them for three years now, and I am satisfied with their platform and service.
DEGIRO is available to you if you have a European bank account. They accept investors from Czech Republic, Germany, Finland, Ireland, the Netherlands, Hungary, Poland, Sweden, Greece, Switzerland, Denmark, Spain, France, Italy, Norway, Austria, Portugal, or the United Kingdom.
DEGIRO It is far cheaper than the big European competitors. Their platform is very intuitive, both their webpage and their mobile app.
There are no minimum deposits with DEGIRO, which means you can start investing with even small amounts!
If you haven’t done so already, sign up with DEGIRO now and try out their low-cost and user-friendly platform. Let me know below, what do you think?