Which German broker is better, DEGIRO or NAGA? Both are powerhouses in the European market, and both have shares traded on German stock exchanges, but each has achieved its success in opposing sectors of the brokerage industry. DEGIRO follows a banking, stockbroker business model, while NAGA is a forex and CFD trading company with a heavy focus on copy-trading, a service that DEGIRO does not offer. DEGIRO operates in the European Economic Area (EEA) as a low-cost provider with tight spreads, while NAGA could be more competitive at retail levels.
Investing involves risks. You can lose (a part of) your deposit. We advise you to only invest in financial products which match your knowledge and experience.
RISK WARNING: Derivatives are complex instruments and come with a high risk of losing money rapidly due to leverage. A high percentage of retail investor accounts lose money when trading derivatives with this provider. You should consider whether you understand how derivatives work and whether you can afford to take the high risk of losing your money.
The most glaring differences between DEGIRO and NAGA are in the fee and product areas, where DEGIRO has a decided edge, but in most other areas, they were very similar. The primary difference is that each firm has excelled via different approaches to the broker business model. DEGIRO has 2 million+ customers, while NAGA has on-boarded 1 million clients.
The DEGIRO subsidiary of flatex AG operates out of Amsterdam, but its parent is traded on the SDAX exchange in Germany. Founded in 2013, it is a stockbroker supported by an internal banking subsidiary. It is heavily regulated, and its popularity is derived from its revolutionizing how stocks are bought and sold in the EEA. Fees and commissions are nearly non-existent, which is why it is considered the largest online stockbroker in Europe.
NAGA was formed in 2015 and quickly went public on the Frankfurt Stock Exchange in Germany. Its founders wanted a user-friendly social trading network for European traders, though the firm is global, with 10 offices spread out across multiple jurisdictions. However, it does restrict services from over 50 countries, including the UK due to Brexit issues. It also plans to list its stock on the Nasdaq exchange for broader investor acceptance. CySEC and BaFin are its primary regulators.
Opening an account with DEGIRO is easy. There is no minimum deposit required, but funding your account must be through wire transfer or direct deposit. NAGA, on the other hand, does have a list of convenient deposit methods, but it also has a minimum deposit amount of 250 units of GBP, EUR or USD.
DEGIRO has earned its reputation through its revolutionary low-fee model for pure stockbrokers in Europe. Access to 50+ global exchanges may come at a cost, but it will be low. There are no inactivity fees, and there are no fees for opening an account or making a deposit or withdrawal.
NAGA does not have inactivity fees either, but it does complicate its withdrawal process with a fixed 5 GBP/EUR/USD charge, which might be waived for large-balance accounts. It also follows the forex/CFD industry model for having several account categories with benefits tied to the size of your account balance. Copy trading also carries a €1 transaction fee per trade, but you can become an ‘expert’ in the system and earn profits, net of a small profit-sharing charge.
With DEGIRO, you will not find leverage as you might with a forex broker, but you will be able to buy and sell on margin, up to a high of 5%. The big attraction with DEGIRO, however, is access to very tight Bid/Ask spreads and little to no commission, except for exchange pass-through fees.
NAGA advertises tight spreads, but access to these low rates is reserved for its highest account offerings, which are $25,000 and up. Retail account spreads range from 1.2 to 1.7 pips for the EUR/USD currency pair. Leverage levels in the EEA are limited to 30:1 for this and other major pairs, but upwards of 1000:1 in other less restrictive jurisdictions.
DEGIRO keeps it simple with a single trading account as its standard. Unfortunately, NAGA presents a confusing array of six account classifications, tied to deposits ranging from $250 to $100,000. Spreads and the ability to earn copy-trading premiums also gradually improve as you move up this account scheme. To its credit, NAGA does offer a free demo account, but DEGIRO has chosen not to offer one.
As an online stockbroker, DEGIRO developed its own in-house proprietary and award-winning trading platform and mobile app. Both are full featured, user-friendly and easy-to-use platforms to buy and sell the firm’s product offerings, but there are no demo systems for practice trading.
NAGA has taken a dual approach. It supports the MetaTrader family of trading platform products, both MT4 and MT5, and it also has a proprietary system, designed specifically to showcase its Autocopy service. Its Web App platform is similar to MT4 and MT5, so traders will not be put off by it. Its founders have succeeded in offering superior copy-trading technology to clients.
The DEGIRO portfolio includes shares, ETFs, leveraged products, bonds, options and futures, access to 50+ global exchanges, but no forex trading at a retail level. NAGA offers trading in currency pairs and CFDs for stocks, ETFs, indices, commodities, cryptocurrencies, futures, and a platform dedicated to copy trading. Non-EEA clients have access to direct stock trading as a new service.
NAGA includes a free demo account in its offering, but DEGIRO does not.
DEGIRO does rank slightly better than NAGA, but ultimately it comes down to what you want from your market access partner. DEGIRO is a low-cost stockbroker that is a leader in the EEA, and NAGA is a forex/CFD broker with an excellent platform for copy trading. Each is worthy of your patronage, but it comes down to your personal objectives.