there are sporadic posts about one or the other, I thought maybe to bring experience and wisdom in one thread altogether.
So, here goes a kickstart question to open the discussion:
TD Ameritrade, Charles Schwab. They are reliable, gigantic, and available to subscribe to international investors. Why are they getting sub mentioned as compared to e.g. Degiro about being a choice of preference ?
In my view
- easy to subscribe to online with no hustle (admiteddly it takes Schwab couple of weeks, or more, to review the application, TD Ameritrade does in as short as one week or less)
- to the most direct full access to US markets
- zero transactional fees, no account maintainance cost
- low entry access (no minimum deposit for TD Ameritade, 25k USD first deposit within 90 days for Schwab, yet edivence shows that once the deposit is made the account balance can fall back to any low without risk of account closure)
- straight forward against US withholding tax rate (from 30% to 15%) with W-8BEN on file
- option to apply for margin on te account, with avail to borrow as high as 50% (maybe more) of held securities (for those who want to play the game and colaterise their securities to buy e.g. the dips while missing the cashflow) and then repay the margin loan with sending funds later
- US estate tax complications (not always and not for everyone, though). But, this is not a broker
s issue per se, it is rather dependent on the instrumentss domicile, the same implicatons equate to European brokers, too.
- risk of preventing Swiss investors as of 2022 from buying US ETF`s, see FinSA . (yet, as of now, they continue accepting EU investors, so by extension this seems low likelihood scenario, yet to note it as possibility here.)
- losing on irrecoverable L1 withholding for those US ETF
s holding non-US assets e.g. VXUS, VWO or partially holding non-US assets e.g. for the non-US portion of VT. i.e. Whereas US investors get tax credit on those withholdings against their IRS taxes, it appears that non-US persons cant do.
- High margin loan interest rates of ~10% (compare to margin ability in the pros)
- base currency conversion to USD - transfer/funding hassle
- can`t think one right now, add any other (TBD)
So, all in all, where those may be lacking (or not) in being the generally accepted choice of preference for a broker ?
What say you all ?