Introduction of FX Conversion Fee

[RLX]

As I suppose there isn’t too much US-residents or even there isn’t any (especially due to US IRS FATCA), and most people use GBP or EUR or other European currencies, I imagine the USD stocks trade volume will decrease at Trading 212.

And probably will increase home currency investment, in some cases, like UK stocks it could less advantageous than the FX fee due to Stamp Duty Tax (0.5%) or in French stocks due Transaction Tax (0.3%) it is break-even. With the Europeans buy even less stocks and ETFs at T212 due to a lesser supply on EUR-denominated stocks & ETFs.

In other side, on some brokers there are fixed fees for doing transactions, besides the FX fee, if someone do the maths, some have less FX fees than T212, and if we buy a bigger amount, the fixed fees will dilute and the total fees are less than on T212.

Example:
T212: Currency Fee = 0.15% → 1500$ * 0.15% = 2.25$
xyz: Currency Fee = 0.10% → 1500$ * 0.10% = 1.50$ + 0.60$ = 2.10$

The 0.60$ is the transaction cost of 0.50$ + 0.10$ for 25 stocks bought (it could be more or less stocks bought)

[AlinMC]

Romania. Not sure about Portugal but I know XTB can have different offerings per country. For example in UK you would only be able to trade CFDs, not real stocks.

According to brokerchooser: “Trading real stocks and ETFs is available for European clients, except in the UK, Cyprus, Hungary and Italy.”

[Caricp]

I have a brokerage account with them for real stocks (not cfd) with zero trading fee but there is an fx spread. I asked them if i could open an USD trading account and they replied that this is not allowed, only in the currency of the country you have your residency.
But now I am puzzled because you mentioned the possibility of a multicurrency account with XTB.

[Caricp]

You should name the xyz broker! Those using degiro knows this is the example you are giving right? Please correct me if I am wrong.
Also don’t forget the Spanish transaction taxes of 0,2% for those trading Spanish stocks (Endesa and REE in my case)
So as for your example Degiro is now cheaper than t212?

[Kennybobs]

Ooh. Along with the withholding tax I might even get 50% of my dividends. Whoopee woo wa.

[Richard.W]

@Caricp

So as for your example Degiro is now cheaper than t212?

The answer to this depends on how much you transact. Do you buy in many small transactions? Degiro charges € 0.50 + USD 0.004 per share on a US share and a £ 1.75 + 0.014% on a UK share (maximum £5) and has fees to purchase ETFs. Trading 212 charges 0. I made a table comparing total costs under various assumptions. See

Introduction of FX Conversion Fee

I made some computations in a spreadsheet. It that may interest others or provoke discussion. Suppose we make these assumptions: We will add £20k to our account each year. We will trade/rebalance 1/4 of our entire account each year and assume the worst case, that all of this will all involve two 0.15% fx fees with Trading 212. Revolut Premium account costs £72/year and comes with 0 fee fx and 8 shares trades a month, further trades cost £1. Interactive Brokers has $10pm fee which can be used a…

[Caricp]

Thank for drawing my attention to your table, its very useful.

I do have 2 comments/questions
The first is on the degiro charging for etfs. This is not 100% correct. I am using them only for etfs, currently hold 5 etf and never paid any fee since they are in the free etf list. So it is possible to have etf without any fee.
The second is that I don’t understand to what refers the recurrent platform fee. It is true that I have a basic account with degiro, for that they charge me 2,5 euros/year as connectivity fee, per market.
So currently I pay 7,5 euros a year because I have etfs traded in Amesterdan and in Germany. I also do some trades with usd stocks thus 3x2,5 euros.

One last thing is that now Degiro allows multicurrency accounts so I assume we can get rid of the 0,1fx spread.

[Richard.W]

@Caricp

One last thing is that now Degiro allows multicurrency accounts so I assume we can get rid of the 0,1fx spread.

There is a table that takes account of that. I put a small platform fee for Degiro to cover the connectivity fees, as those are uavoidable. Of course it depends on what you invest in, their list of fee fee ETFs, or ones from Vanguard and iShares, etc.

Introduction of FX Conversion Fee

Manual is only cheaper than automatic 0.10% option if you are exchanging more than about £8775 at once. Here is the table redone assuming that each £20k deposit and the final withdrawal iare done in one lot, the manual way. [image]

[Telemario]

Very nice table indeed!
I just think that one number is wrong, this is the monthly fee that interactive brokers apply. It’s true, is 10$/month, but only if you don’t make at least 10$ on commissions.
If you spend, say, 6$, they charge only 4$/month, if the total of your commissions is above 10$, commissions go to zero.
And the table has not taken into account that we will not know if t212 will put another fee on us, rising their % of costs.

Beside that, thank you for sharing your table, it’s been very kind!

[Richard.W]

I am glad you found the tables helpful. That is right that the 10$/m can be used as credit against commissions. I actually allowed for that in my tables. The transactions fees shown in column d are with the 10$/m in column e deducted. It would have been clearer to deduct the other way around, subtracting d from e. I may have overestimated the cost of a transaction as £1. It can be less, say 0.35$. I have updated the tables to show monthly fee reduced by trade commissions in the case of IB.

[Darko]

@RLX

s I suppose there isn’t too much US-residents or even there isn’t any (especially due to US IRS FATCA), and most people use GBP or EUR or other European currencies,

Sorry, I don’t understand this, you don’t have to be a US resident to have a USD account. I have a USD account, and I will pay, maybe, fx conversion fee only on one eft (ingr ishares global clean energy) if I decide to keep it in my pie.

[Fonfo]

I just read the the currency conversion charge will be changed from 0% to 0.15%. Are you really charging 0.15% for every order execution if I use eur to buy us stocks?? Lol.

[Layfon]

Making the most of the last few weeks of FX fee free swing trades.

Once the fee comes into place this will not only discourage traders but dividend investors to think twice when pulling the trigger!!

[Ywt]

Hi! Since we can only switch to a USD account by closing and reopening an account, it would be great if you could facilitate the process for us existing users and not put us in the wait list.

[Ywt]

Btw, I trade on both IBKR and T212, I’ve seen some incorrect IBKR fee calculation in this thread. Their fee page is confusing, but for example for a $1000 order, you’ll probably pay between $0.2 and $1 per order depending on what you trade.
Their FX is $2 per change, but you only change once, since they have multi currency accounts.

[Domenico]

I made the same considerations too.
I share what you wrote.

[Gaffers]

Lot of replies here, so apologies if this is answered above;

Will the fee be included in the FX Impact figure? Or elsewhere?

So, if I sell a stock that’s showing as +.03% p/l, will I be in profit, or will it no have been accounted for, and I’m net zero?

(I don’t intend to regularly sell at ±.3%, it’s just an example!)

[Alien]

The P/L figure should take into account he modified Fx rate, so you should get waht you see.

[Caricp]

I think his point is that the majority of t212 clients don’t have a usd account. They have open the account in their “domestic” currency

[CeeGee]

So I asked the question regarding the 0.15% FX on dividends being received still in pence and received this answer. Is it me or does it not explain how on earth 0.15% can be applied to dividend received in pence?

I expected a reply stating it would be applied to a “minimum amount” or something of the kind.

Instead does it read what we already know???
(Maybe I’m not reading it right, I need a second opinion)

Thank you