For some time now, I’ve been trying to figure out which broker I should invest with. I’m particularly concerned about the cost of selling.
Currently, I’m with Neon, investing in Invesco with zero trading fees. So, only the stamp tax of 0.15% applies. However, many say that the cost of selling is expensive, which is 0.5% of the amount.
Here’s a simple calculation: If my portfolio is worth 100K CHF, the cost of selling would be 500 CHF, a 0.5% fee.
Many say Interactive Brokers is cheaper. I have searched for a long time, but it’s unclear to me what the commission would be at Interactive Brokers.
They have tiered and fixed pricing per order. Is this the same for selling? Can anyone explain
where it’s cheaper to invest so that I don’t lose too much profit when selling in the end?
Well, at what stock exchange do you want to buy/sell your stocks/ETFs? Here you have a screenshot for Switzerland.
It depends on the pricing model your account uses. Fixed or Tiered:
Fixed Pricing
The Interactive Brokers Fixed pricing is straightforward.
For buying an ETF on the Swiss Stock Exchange, you pay 0.10% of the total transaction. The minimum fee is 10 CHF, and there is no maximum fee.
For purchasing an ETF on the European Stock Exchange, you pay 0.10% as well. But the minimum fee is only 4 EUR (4.28 CHF), and the maximum is 29 EUR (31.05 CHF).
In some cases, your order may use IB Smart Routing. In that case, the fees can be even lower. However, it is difficult to know which order uses which routing system. Therefore, I assume the higher fees. But it is good to know that fees can go even lower!
Tiered Pricing
The Interactive Brokers Tiered system is more complicated.
First, you must pay some transaction fees to IB for each region. Then, based on the stock exchange, you must pay some extra fees. And they are entirely different based on the exchange.
For buying an ETF on the Swiss Stock Exchange (I took EBS), you pay 0.05% in transaction fees to IB (with a minimum of 1.50 CHF and a maximum of 49 CHF). You then pay a flat fee of 1.5 CHF for the exchange and an exchange fee of 0.015%. On top of that, you pay a 0.38 CHF clearing fee and a 1 CHF trade reporting fee.
For buying an ETF on the European Stock Exchange (Euronext Paris), you pay 0.05% in IB transaction fees with a minimum of 1.25 EUR and a maximum of 29 EUR. You pay a 0.01% exchange fee (with a minimum of 0.8 EUR). And the clearing fee is 0.10 EUR.
We can observe that it is much cheaper to trade on Euronext than on SIX. Switzerland has a reputation for being expensive!
But remember, this is about the Swiss Stock Exchanges, the US has a completely (and much more cheaper) pricing system. That’s also where people buy VT for example.
I was thinking to buy ETF on IB, but IB is so complicated, thats why I went for NEON invest.
If I really want to sell portfolio (let’s say 100k) then I could transfer it to IB and then sell it from there. It would only cost 49CHF - compared to NEON, which would cost 500 CHF.
In my opinion, NEON is much easier for someone with the strategy “buy ETF and hold”.
Any other opinions?
I logged into the webversion of IB. I don’t have a good overview if my portfolio is performing well or not. In Neon, I see in a glance if it is in plus or not.
Also I don’t see all the orders I made in one overview. While in Neon I see everything at a glance (how much I bought for month x)
And the fees, I have to download the report in order to see the fees, sometimes it is not that clear what that fee mean.
In Neon after every order I can download the pdf, and import it into portfolio performance.
In IB I don’t even know which report I need to download…
Thats why I sold my 700 CHF VT. I wanted to go all in for Neon invest invesco, but then I saw the selling fee. Now I am not sure which broker I should go for
There is no way around IB for professionalism, great services and affordable prices. Get the app, set up an account and use them. Even if only as a secondary broker. You will get used to the interface, see your performance at a glance and not regret it.
If you are talking about spreadsheet to estimate costs of investing in NEON / IBKR / Swissquote, then it is at this post
If you are going to sell ETFs in one shot with such large amounts, then yes IBKR or Swissquote would be cheaper because they have flat fees options. NEON does not have flat fees, so it would be 500 CHF + duties as you estimated already.
I do not know the answer about portfolio performance as I dont use it.
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