Swissquote vs. Saxo for keeping money

[Suzy Emerald]

Usd gets you almost 2% interest on free cash if you have at least 100K NAV. Euro etc have a negative interest (eur -0.8% or so)

 

[rowena]

You can

How does that work? I guess it applies only to USD balance (or other currencies?) and above some amount, right?

I remember they had something like $10k minimum balance to get started and then something with $100k regarding the interest.
Sorry, I'm too lazy to find it now / I'd prefer someone with direct experience to share it.

IB really seems pretty good, better than some banks (offering you mutual funds...) in some aspects and at a similar level of safety compared to banks. Then there's Degiro, Internaxx, Swissquote, Saxo... What's the deal with Swissquote, they look like some fancy Swiss bank but what are the advantages? Maybe you get your own account number compared to IB where you just have a trading account and compared to Degiro which isn't even allowed to hold your funds by law (so they hold them in cash funds through some strange structure).

Yes, they have min balance requirements. You can find the details from their website.

The most important difference IB is USA based broker. Swissquote, Saxo, Degiro etc are EU.

IB will not issue own account number to customers. You need to deposit their bank account but you can put your money and enjoy the interest you earn. No need to invest or trade. IB is the biggest broker company in the world.

 

[Mr Magoo]

interesting topic. These brokers can compete with EMI's / banks. When it comes to holding funds. IB even now can issue a debit card and pays as mentioned 2% interest on idle cash. NOTE: FDIC insures 250k USD (no other currencies) but cash above 250K can be distributed over multiple banks. So if you have 800K, its just broken up in slices of 250K and all you money is insured..... in theory. I have still my doubts on the FDIC reserves available when the s**t really hits the fan.

 

[Tax Cow]

Does ING LU accept remote opening for non-EU residents?
I actually couldn't find any product offer in their website aimed for residents outside BE LU FR and DE

Banks in EU can't overtly advertise any degree of openness to non-EU residents as it will only cause problems. Nasty commies will be at their throat if the percentage of non-resident account exceeds ~25% of all accounts. Fines aimed at big financial institutions are the new form of taxation to make up for the shortfall in states' coffers.

If you check their Price List for Individuals, you will see that 50EUR/Quarter fee specifically applied to non-EU residents. This will answer your question.

 

[Tax Cow]

@mrau Idk. if remote opening is possible in 2019 but worth a try.

 

[Elve]

I deposit same amount cash to SQ or Saxo they will rip off me via hidden/inactivity fees and pay me $0 interest.

In my opinion SQ is much better than Saxo for keeping balance. With SQ I have never had inactivity charges and with own multi currency IBAN (USD, EUR, CHF) for banking operations.

Saxo can only be received and sent to or from own bank accounts and there are inactivity charges.

Another broker in Switzerland that has no inactivity charges is strateo.ch but without personal IBAN.

 

[Flatworld]

SQ is much better than Saxo for keeping balance +1

 

[OTR365]

BullionStar (Singapore) could also be a solution for some people.

When you hold cash in a BullionStar account, you are holding cash outside the fractional-reserve banking system. BullionStar does not operate under any banking system. In this way, a BullionStar account is safer than a Singapore bank account. BullionStar is headquartered in Singapore, one of the safest and most secure jurisdictions in the world, a country with strong property rights and a strong rule of law.

Unlike a bank account where the depositor is an unsecured creditor of a bank and at risk of a bail-in, BullionStar accounts are operated under what is known as a single-purpose Stored Value Facility (SVF) as defined under Singaporean law. Under this facility, BullionStar customers make use of the SVF to fund and maintain funds on their BullionStar accounts and to purchase products such as bullion from BullionStar. Funds in BullionStar’s SVF are diversified across physical cash, precious metals and a number of different Singapore bank accounts used by BullionStar.

 

[Martin Everson]

Then there's Degiro, Internaxx, Swissquote, Saxo... What's the deal with Swissquote, they look like some fancy Swiss bank but what are the advantages? Maybe you get your own account number compared to IB where you just have a trading account and compared to Degiro which isn't even allowed to hold your funds by law (so they hold them in cash funds through some strange structure).

Some Feedback:

I used Degiro but ended relationship with them last year after too many failing in their handling of interest payments and withholding taxes not to mention my move out of EU. They also use Deutsche Bank to receive hold funds before moving euro balances to JPM's AAA rate liquidity fund as they can't hold cash funds as you mentioned. If you transfer in i.e 50k they freak out. They are little man broker. You don't get a dedicated iban account either.

Internaxx is Swissquote and you do get dedicated iban account in multiple currencies. I used it for low cost back to back loans when arranging my affairs. You can't trade bonds with them so not exciting to use but a useful broker in AAA country.

One of the best and cheapest European brokers I use because of their off exchange trading plus low cost is flatex.de in Germany. They offer dedicated iban in EUR and GBP and USD. However you need to be ideally proficient in German (which I am). Their bond trading is 200 x cheaper than IB and securities trading way cheaper than IB due to use of dark pools aka OTC securities trading with liquidity provided by UBS, GS, DB, HSBC, BNP. They also offer a low cost flat fee charged trumping IB by a large margin.

There are so many brokers I use (12+) I see a world beyond IB . However I still like IB for the desktop platform that is the best in the industry.

 

[AND2]

I am in the process of opening a bank account with Dukascopy justfyi. It is covered by the Swiss bank deposit insurace, has Swiss bank license, fees can be workarounded or are small imo, they do remote, haven't read any horror stories in the web, they told me they are happy with idle cash... My 2cts

 

[Martin Everson]

Dukascopy brings back memories..small world. Another Russian founded broker who obtained a Swiss passport. I remember the CEO's wife approached me on email to an advert I put out for a bank for sale. This was back when Switzerland insisted all Forex brokers must obtain a banking license to continue offering forex services in Switzerland. I had never heard of their company at that point and never took them seriously. It's good however to see they managed to survive the crisis that at the time all brokers in Switzerland went through.

https://www.financemagnates.com/for...ofit-in-h1-2019-but-revenues-remain-flat-yoy/

 

[AND2]

Dukascopy brings back memories..small world. Another Russian founded broker who obtained a Swiss passport. I remember the CEO's wife approached me on email to an advert I put out for a bank for sale. This was back when Switzerland insisted all Forex brokers must obtain a banking license to continue offering forex services in Switzerland. I had never heard of their company at that point and never took them seriously. It's good however to see they managed to survive the crisis that at the time all brokers in Switzerland went through.

https://www.financemagnates.com/for...ofit-in-h1-2019-but-revenues-remain-flat-yoy/

wow you fly high I managed to open an account. Details here Postfinance termination

 

[celizo]

One of the best and cheapest European brokers I use because of their off exchange trading plus low cost is flatex.de in Germany.

Unfortunately, for europeans lots of bonds (i.e. US corporate bonds) are restricted now with Flatex. Thus, I use mainly IB for bonds picking. I have Swissquote, Saxo, Tradestation aswell.
Always for bonds (but never used): there are Oblis.be (not cheap), Cornertrader/Corner Bank and obviously private banks.

 

[Martin Everson]

Unfortunately, for europeans lots of bonds (i.e. US corporate bonds) are restricted now with Flatex.

Thanks didn't know that as I never buy anything US due to inheritance tax on US assets.

btw US interest rates are heading to zero which will drive US stock market into an even bigger bubble. I looked at my old brokerage account I used to hold assets in i.e medirect and saw their fixed term deposit rates have reduced and now inverted on USD . You get a higher deposit rate on 1 year fixed than 5 year fixed. The USD rate on 3-5 year is also less than EUR rate even . Crazy times.

https://www.medirect.com.mt/save/fixed-term-deposit
P.S Now ECB deposit rate has gone even more negative i.e moved from -0.40% to -0.50% from Sept 18th I am sitting pretty with my 30 year treasury eurobonds . Stay safe out there and if your into US stocks ride the bubble which will be stimulated by further treasury rates cuts but get out when hedge funds start to dump shares. Passive hedge funds hold like 60% of the entire US stock market I think.....lol.

 

[celizo]

Currently it's not easy indeed to invest without important risk. Bond rates are so low, especially in Europe. I have a very conservative diversified portfolio (stocks, bonds, REIT, gold) with a big portion of cash if there is a crash in the next coming years.

 

[Martin Everson]

Holding cash like instruments is the way. Right now everything is overvalued, stocks, bonds and REIT etc. I don't see any asset class that offers value right now. Saying that the US market will continue to rise if the Fed continues to cut rates next week and continues along that line

 

[Suzy Emerald]

Agree, right now hold cash or put it in a moneyfund or maybe ultrashort bond fund. IB still pays 1.9% on idle USD balance.

 

[Tax Cow]

Thanks didn't know that as I never buy anything US due to inheritance tax on US assets.
...

Not that there's much value in those investments right now. But US Corporate bonds, interest-bearing cash balances in US banks held by non-residents are exempt from Estate/Inheritance tax.

 

[KJK]

Unfortunately, for europeans lots of bonds (i.e. US corporate bonds) are restricted now with Flatex. Thus, I use mainly IB for bonds picking. I have Swissquote, Saxo, Tradestation aswell.

Welcome to the new world. I think the EU will die of overregulation, subsidies and stupidity. It is similar with American ETFs, until last year you were allowed to buy an ETF, now there is a new stupid regulation that requires ETF issuer to provide a "KIID" document localized into the language of the client to inform him about the risks of the fund. Let me show how retarded this is:

• there are 24 official languages in EU, the ETF issuer would have to create a document for each fund and then translate it so hundreds of new PDFs
• this fucking information is publicly available on hundreds of websites, go to etf.com or morningstar.com or finance.yahoo.com and you will find 10x more detailed information about any ETF you want, much better presented and more info than in this KIID document
• this regulation is supposed to "protect" retail customers from investing into "highly speculative" instruments such as ETF which is nice because an index ETF with 0.1% fee may be just ideal for a customer but that is banned. On the other hand, a shitty local fund with 3% entry fee and 2% TIR yearly fee is allowed to be sold and it doesn't even need and "KIID" document at all because it is distributed through a "financial advisor" (read as salesman).

P.S Now ECB deposit rate has gone even more negative i.e moved from -0.40% to -0.50% from Sept 18th I am sitting pretty with my 30 year treasury eurobonds . Stay safe out there and if your into US stocks ride the bubble which will be stimulated by further treasury rates cuts but get out when hedge funds start to dump shares. Passive hedge funds hold like 60% of the entire US stock market I think.....lol.

What exactly are "passive hedge funds"? Did you mean to say passive index funds/ETFs? I imagine hedge fund like "clever" guys doing stockpicking, options, shorting, leveraging - doing all this and trying to beat the market while taking the standard "2+20%" commission.

Passive funds on the other hands I imagine like an average guy opening a Robinhood account and putting it all into VTSAX or even worse SPY.

I don't know how a "passive hedge fund" would work.

Holding cash like instruments is the way. Right now everything is overvalued, stocks, bonds and REIT etc. I don't see any asset class that offers value right now. Saying that the US market will continue to rise if the Fed continues to cut rates next week and continues along that line

It may be true but there were people saying exactly this ("everything is overvalued") 4 years ago. If they stayed out of the market, they missed at least 50% gains. The problem is that there is too much cheap money in the economy (both euros and dollars), so logically people put it into real estate (via REIT), stocks (via ETFs), if you are desperate you put it into bonds.

Is that going to change in the near future? Is there any good reason why more money would STOP flowing into stocks? If you have zero or negative interest on your bank account, that may motivate people to actually put MORE money into an index fund.

In my opinion having 100% cash would be stupid. I'm not saying there isn't an "everything bubble" but it may go on for longer than you think, Trump getting reelected may have big impact on it.

Many things are overvalued (S&P500, Nasdaq...) but staying out of the market sounds boring.

I'm thinking of dividing some free cash into:
- low volatility world ETF
- Bitcoin
- physical gold and gold miners stock
- US treasuries if there is nothing better

 

[Martin Everson]

It is similar with American ETFs, until last year you were allowed to buy an ETF, now there is a new stupid regulation that requires ETF issuer to provide a "KIID" document localized into the language of the client to inform him about the risks of the fund.

Thats the EU PRIIPs regulation that affects only retail investors. Luckily I am not one. I discussed it in this thread below back in March

https://www.offshorecorptalk.com/threads/opening-ib-us-account-from-eu.25388/post-92085

What exactly are "passive hedge funds"? Did you mean to say passive index funds/ETFs?

Sorry....passive funds.

so logically people put it into real estate (via REIT), stocks (via ETFs),

You mean the stupid people do this. If you have small capital to risk then take the leap but if you have big capital to deploy do not. 99% of people who buy an ETF have never ever read the typical 100-300 page prospectus that comes with it. Most don't even know it exists when they are buying an ETF. KIID is no replacement for reading the prospectus and I agree is no basis for making an informed investment decision. I read the prospectus for every ETF I was interested in and walked away from them all i.e SPDR S&P500 ETF....lol.

https://us.spdrs.com/public/SPDR_500 TRUST_PROSPECTUS.pdf
Hold cash and cash like instruments for me is the most sensible way to go in an overpriced market where valuations are at all time highs. I won't risk big capital on speculating. You have certainty with AAA treasury bonds and cash but with equities your simply speculating in where you think the stock price might go. The market seems to agree with that with yields on most AAA turning negative globally. I would rather know I am loosing 0.5% a year on a bond than buy equities and lose 30-50% and thats how the market is seeing it right now.

I discussed last year how Warren Buffett stock piles cash ($90bn) in Berkshire Hathaway in the form of US treasuries. When there is nothing to priced right to buy and you need safety then treasuries are the way to go if your in dollars. Forget buying into a bubble for the sake of buying into it and trying to beat inflation...lol. Patience is a virtue especially in investing. A market correction is ugly as hell on your finances.

https://www.offshorecorptalk.com/threads/fscs-depositor-compensation-schemes.24550/post-84732