Interactive Brokers - all eggs in one basket?

Other useful links for me:

Is your money safe from hackers at Interactive Brokers and Robinhood?

Reading this caused me a terrible headache: Hackers Are Hijacking Phone Numbers And Breaking Into Email, Bank Accounts: How To Protect Yourself

Whereas this upped my mood:


(In particular I was thinking myself about dedicating a small computer just to my accounts, and here I got confirmation that it could be a good idea)

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My plan is building a Swiss Permanent Portfolio so mainly CH ETFs. With Schwab UK is only possible to hold US products? Seems odd but since I read:

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Why a small computer when you can install linux on a usb stick and use it instead? Bonus point if you use a Readonly device :slight_smile:

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Compromised hardware, physical keyloggers, somebody finally cracked the ME, stuff like that.

Though it is not likely such attacks will be used against you it is still a risk and if you want to go paranoid, why not go full paranoid.

yeah…

:slight_smile:

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Again about Brexit and Interactive Brokers I found this: Interactive Brokers: Das passiert mit EU-Kunden bei einem Brexit. Specifically:

Update 14.01.2019:

Interactive Brokers reagiert mit einem Brief an seine Advisor Kunden

Interactive Brokers verfolgt die Entwicklungen im Hinblick auf den Brexit seit vielen Monaten und plant verschiedene Eventualitäten.

Ungeachtet des Ergebnisses der bevorstehenden Abstimmung im Vereinigten Königreich am 15. Januar 2019 bezüglich des vorgeschlagenen Brexit-Deals und unabhängig davon, ob es einen “hard” oder “soft” Brexit geben wird, eine Verlängerung des Brexit-Zeitplans oder eine neue Brexit-Abstimmung, Interactive Brokers erwartet keine Beeinträchtigung , unsere Kunden in der EU oder in Großbritannien zu bedienen.

Interactive Brokers hat mehrere Tochtergesellschaften in der Europäischen Union und wir sind gut vorbereitet, um rechtzeitig weitere Registrierungen in der EU zu erhalten, um den EU-Kunden auch im Falle eines No-Deal-Brexit den vollen Umfang unserer Brokerage-Dienstleistungen anbieten zu können.

IBKR sendet derzeit keine Brexit-bezogenen Mitteilungen direkt an Ihre Kunden / Kundenkonten. Wir empfehlen Ihnen mit Ihren Kunden in Kontakt zu treten, um ein Einführungsgespräch zum Brexit zu ersuchen. Ein wichtiger Punkt ist, dass sich die Konten auf eine juristische Person beziehen: Diese Konten müssen über einen LEI (Legal Entity Identifier) ​​verfügen, dieser bei verschiedenen Anbietern, sowie über IBKR erhältlich ist. Der Erwerb eines LEI kann je nach Diensteanbieter 5-10 Arbeitstage dauern. Wir empfehlen Ihnen daher dringend, Ihre Kundenkonten zu prüfen und bei Bedarf mitzuteilen.

Wir werden Sie in den nächsten Wochen und Monaten über die nächsten Schritte bezüglich der weiteren Entwicklungen des Brexit auf dem Laufenden halten. Unabhängig von den Ergebnissen hat Interactive Brokers alle Schritte unternommen, um ununterbrochen alle Kontentypen, Handelsdienstleistungen und Anlageprodukte für unsere EU-Kunden anbieten zu können.

Vielen Dank, dass Sie Interactive Brokers verwenden.
Interactive Brokers Client Services

(Der Text wurde auf Deutsch übersetzt)

Ok we are not EU but still…What about Swiss kunden? If IB takes the trouble to write about it, it means that some problems are going to rise, aren’t they? (By the way, the meaning of the letter, quite foggy to me.)

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Just as a feedback to my post in Oct 18: Buying shares on IB, transferring it to Postfinance works as expected. Transfer takes about 4 - 5 business days. No charge or fee on any end. I do this to not have all my wealth at IB (all eggs in one basket).
Still I can benefit from the lower transaction fees and lower spreads at IB and no Swiss stamp tax.

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Neat idea. Will do the same.

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So at the end what are you going to pay? just the yearly stamp fee and the 90chf?

Postfinance also mentiones

Ausbuchung aus Depot E-Trading zu Gunsten Depot bei einem anderen Finanzinstitut:
CHF 107.70 pro Titel

that you’ll have to pay one day.
Not a big deal if you have an all-VT portfolio.

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90 CHF per year. Yearly stamp fee I don’t know what you are referring at.
I think the approach is not limited to Postfinance. However, Postfinance is attractive as it does not have custody fees beyond the 90 CHF.

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I also dont know what is „yearly stamp fee”. Stamp duty is only on transactions.

Your Postfinance transfer idea seems quite nice. Why not Corner Trader, though?

Also, how would you go on with withdrawals, when the time comes?

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Yearly stamp fee is a fee I have to pay every year on an old account I have in Ticino. I suppose it’s just a thing there.

Postfinance because I already have regular accounts there. Cornertrader is an option for the future if the goal is further diversification. But they will have to have proper 2FA then. Do they in the meantime?

No detailed plans for withdrawal yet. A lot will happen until then. Perhaps even Swiss ridiculous fees will be lower. Still I plan to hold only max 2 positions on Postfinance. I may just transfer them out when it comes to selling.

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Another nice plus on this moving positions to postfinance is that you will go over 25k CHF in investments thus having your whole postfinance account for free.

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Agree this is a neat idea. Wonder how feasible it is to do this on a regular (semi-annual) basis?

If you do this with US-ETFs, I guess you want the target CH-broker to be a Qualified Intermediary. Is PostFinance QI? From CT we know they are not. Is Strateo QI? Swissquote?

See what IB responded when I asked if fees apply. They did not mention any limitation in terms of frequency.

Me: “What are the fees of such a transfer on IB side?”

IB: “This transfer will be free of charge as you are transferring out an European asset. US assets are free of charge as well but for Asian positions the following fees apply: https://www.interactivebrokers.co.uk/en/index.php?f=14718

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What about the safekeeping and administration annual fees?
(Actually mine in a swiss bank are 0.167% and I’ve been told it is a very good deal.)

A few banks/brokers in CH do not have annual safekeeping / custody fees. One of them is Cornertrader I think. Postfinance has a 90 CHF/year fee that you can use up for transactions. But no fees proportionate to account’s value.

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Not yet sure, but Schwab UK might be an option for the ‘eggs in different basket’ problem: holding US ETFs seems to be problematic for EU brokers due to PRIIPS and for CH brokers due to Stamp Duty Tax and Qualified Intermediary Status… so why not have half of your US assets in Interative Brokers and the other half in Schwab UK … IIUC you can trade for 5$ in US, so “almost for free”. They don’t seem to have a custody/account fee (but I need to double check). The downside I found so far are cash related though: Cash out is 25$ and FX fee is 1% - so even though they have a CH-IBAN converting CHF to USD is a no-go. But I guess you could do CHF->IB, FX @ IB, USD->Schwab.
So I guess the choice could be: IB+Schwab - or transferring the securities every now and then to a CH-based broker…
The advantage of Schwab could be that it is well-established, so sounds somewhat secure…

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