Interactive Brokers for dummies


#125

I’m on tiered and find it’s always cheaper

Yes you can change fixed/tiered any time


#126

Confirmed. I’ve changed to tiered after starting an account with fixed.


#127

Why this different type of accounts even exists?
100 VT per month are 0.35cts on tiered
1 usd on fixed (since 0.5 is < 1usd)

but for tiered you add:
0.0000130*Value of Aggregate Sales = 0.091 @70usd/vt

total fixed = 1
total tiered = 0.44
Did I miss something? Why @nugget pays less than 0.35 if that’s the minimum for tiered?


#128

Could be if Nugget is provided liquidity to the market place i.e. placing the order between bid and ask spread. Usually the market places provide some discount compared to if you would buy from the ask and effectively reducing liquidity


#129

I might have understood you.
Bid 70, Ask 71. He want to buy for 70.5. That’s what you meant I think. But the I don’t understand how this influence the fees. I mean. why they do that and where is written.
Sorry but it seems so weird to me.


#130

That is correct. It is not directly IB fees that it affects but the fees NASDAQ/NYSE charges from IB (and eventually from you. It is the marketplaces’ incentive for traders to create more liquidity.

https://ibkr.info/node/201


#131

Ok I think I got it. Isn’t there an example of all the fees summed up? I think it mighit not make much sense for me at the moment, since I still have to pay 10usd per month to IB anyway.


#132

Hi guys,

Got a few questions for you all experts of IB :slight_smile:

I wrote a comparison about DEGIRO and Interactive Brokers on my blog and it turned out I did not consider Tiered Pricing. So I need to redo everything.

There are a few things I am wondering

  1. Does anybody have an example of a trade on SIX with the Tiered Pricing (ideally an ETF)?
  2. Why is the 0.35 minimum, not including the clearing fee. For me, for most trades of higher than 50 trades, we should pay something like 0.36 (MIN+clearing) and not 0.35. Is it because clearing is only used on margin?
  3. Unrelated to IB. Since nobody in this thread seems to use CH ETF: Do you not have a home bias? Or are you buying Swiss ETFs on NYSE (or another US exchange)?

Thanks a lot :slight_smile:


#133

Hi Guys,

After your suggestions I’m considering starting my adventure with IB.

I happen to have iShares Core MSCI World UCITS (IE00B4L5Y983) that I bought on Euronext Amsterdam with Euros. How does it work? - can I transfer it to IB, and keep it listed in EUR on Euronext Amsterdam?
But could I also buy some units of this ETF from another exchange where it’s listed in USD and keep them “together” on my IB account?


#134

I am still deciding on which online trading platform to use. However I am not going to convert my CHF to USD using the trading platform; I am going to use “Transfer wise”; - Transferwise give excellent exchange rate and charge little to transfer funds; so to transfer funds to my online trading platform account (when I find one) I intend to use Transferwise to retrieve funds from CHF bank account, transferwise will convert from CHF to USD, then transferwise will deposit USD into my online trading platform account. I will then buy ETFs with the USD in my online trading account. I am pretty sure that I will save a lot of money this way. Any comments on my proposed strategy? Is IB still the considered the best online trading platform to use? how does it compare to Degiro? (I currently have a Saxo bank account but I dont think I will use them any more because there are cheaper options available)


#135

Your strategy is terrible. You will pay 0.35% to 0.50% (depending on the currencies) to convert at purchase and then the second time when paying out. 0.7% of 100’000 is 700. At IB you would pay like 10 CHF.


#136

You are correct, I will pay 0.35% - 0.5% transfer fee when paying in (or paying out); however the exchange rate is very good on transferwise. But the total cost to pay in (or pay out) is the transfer fee + the exchange rate. I don’t know the exchange rate which IB will offer, I still need to research this more thoroughly; but if IB offer a poor exchange rate, then the disadvantages of the poor exchange rate may outweigh the advantage of the low transfer fee which IB offer??

Is IB still considered the best online trading platform?


#137

You will not get a better exchange rate with Transferwise than with IB.

If you want to convert 100’000 CHF to USD and then back to CHF:

  • you will pay 700 CHF with TW (2 x 0.35%)
  • you will pay 10 CHF with IB (2 x 2 CHF of IB commission + ca. 6 CHF for the bid/ask spread)

#138

I confirm that. IBKR is the best on forex rates and commission, hands down. As a personal example, I recently converted twice CHF to USD (once for 20k, the other for 33k), at the rate I wanted (i.e mid price), for… less than 2CHF each.

Good luck if you want to find anything cheaper anywhere else.

Other brokers (ex: CT, Saxo Bank, even Transfer Wise) gouge you by charging a spread that is often not far from 0.5%. On these two transactions, I would have paid around 265 CHF. That is 66 times more expensive.

IBKR only charges a fixed commission of 2 CHF on each conversion and let you define at which rate you want to convert your currency: If you can find a willing counterparty, you get the wanted rate.


#139

I tried to follow this steps in the paper account and always end up with a negative CHF in the market value.

In this picture I want to “sell” all the 979’068 CHF.
When I press preview -> submit order I end up with -20 CHF:

If I do the opposite; selling all USD to CHF, the USD will go to “0” as expected.

Am I doing something wrong?


#140

I assume the Forex requires a certain fee, so you cannot sell 10000CHF exactly (if that’s all you got in the account), but something a bit less (like 999x or so) - the rest would be needed for that fee.


#141

I think you are right, probably is the commission they charge.


#142

Here is what they write about FX fees:

  1. Commissions for forex trades are calculated off the trade value and then converted and charged to the base currency of the account.

So if your base currency was USD (mine is), then you would be charged 20 USD, not 20 CHF. I guess this test account has CHF as base currency?


#143

Yes, the test account has CHF as base currency.


#144

I had the exact same questions as you have.
This post - - -> https://retireinprogress.com/interactive-brokers-101/ helped me a lot. Once i only trade every 3 months i forget certain steps, i always read this post again, just to remember.
PS: Bons investimentos :slight_smile: