Actually that is not much for a trader. If you trrade with Ā£10,000 and buy then sell 150 times, that will add up to Ā£3 million.
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That doesnāt make sense. Isnāt it for 150 trades you mean at exactly Ā£10000 per trade = Ā£4500. Thats a rate of 0.3% entry and exit.
I meant make 150 buy orders and sell them again, 300 transactions.
So then people will trade less for higher amounts
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So if one gets paid a dividend in USD, there will be a conversion fee implemented as well?
In case of a DRIP, one is subject to the fee 3 times; first time you buy the stock, dividend, and reinvestment?
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I think that is the objective/direction for T212
Like many of you, Iām also unhappy that Trading 212 have introduced another fee, especially after boasting about the profitability of the ISA & INVEST platforms with this statement just over 2 months ago:
They say they need the money to finance the development of new features, but theyāve been able to introduce the innovative and complicated Pie feature while remaining profitable. If theyāre not planning to introduce multi-currency accounts or Flexible ISAs (the two features I want, selfishly), Iām struggling to imagine what major developments theyāre planning that could justify abandoning their unique selling point (USP) of being truly free for customers.
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Having said that, I always like to play Devilās Advocate.
If the spot exchange rate for GBP/USD is, for example, 1.4, then Trading 212 will use an exchange rate of 1.3979, which is a reduction of 0.0021.
On Friday (12/03/2021), the exchange rate (according to Xe) ranged from 1.38664 to 1.39997, which is a swing of 0.01333. That is more than 6 times the difference caused by the new fee.
Iām not a day trader so Iām interested to hear how much attention traders pay to the exchange rate when theyāre placing their trades. For example, if you were happy to place a trade at 1.39997, would you hold off at 1.39787 (0.15% less)?
To be honest, I think Iāve only ever considered the share price when buying shares. I have sometimes thought āthe pound is stronger than the dollar at the moment so itās a good time to buy US stocksā but Iāve certainly never worried about the 3rd decimal place in the exchange rate. Should I?
I assumed that day traders would mostly use the CFD platform, in order to benefit from leverage. Am I right in saying that, due to the way the CFD platform works, the new 0.15% FX fee will only be applied once (not twice, like ISA & INVEST), at the point of closing the trade?
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It is absolutely understandble Trading 212 should not be paying the cost of currency exchange fee as the currency exchange is dynamic and it is beyinf their control. But keep in mind 0.15% look small but you will be paying the conversion fee twice when you buy it (Ā£/) and when you sell it (/Ā£).
In my opinion this could easily be avoided by allowing a person to have a dollar account. That is what eToro is doing. You just need to pay the conversion fee once e.g. when you added the cash in to the trading account. You could recycle that $ dollar account for trading indefinitely.
You could also avoid this 0.15% conversion t all if you feed Trading212 ac from US currency account. For example, using Revolut US$ currency, or US$ account form another bank that does not charge you for an international transfer.
The current system charging 015% is just a waste as it is very kees benefit to T121 as this waste just loss somewhere in the system, and a certain loss for the account holders.
I am fully aware you can not have a non Ā£ account in ISA ac but it could at least be applied to CFD and Invest account.
How does it sound.
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Some people believe that Trading 212 are not paying a currency exchange fee.
Am I right in saying that eToro only supports USD accounts though? If thatās true then its offering is poorer than Trading 212, who offer multiple currency options, albeit limited to a single currency per user. Any Trading 212 user could have a USD account, but I think theyād have to close down all non-USD accounts first.
Is it possible to create a second Trading 212 INVEST or CFD account with a different currency, just by using a second email address? If not, why not? Would that not be a very easy way to restore their arguably no-fees status?
They do not anyway, this is not for covering a cost, this is introduced purely as a profit, read a few posts from the top. Even T212 did not claim such a thing, it is clearly stated this is for extra income and IB does not charge T212 for FX.
Is this fee worse for these or those people? is it higher lower? is it a fee or commission? I still think these are diluted polemics around the issue here.
In any case Iāll shamelessly quote my own post here seeing it was a few hundred post ago.
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In case it wasnāt clear, I totally agree with you!
As you say, theyāve gained a million new customers on the strength of their no-fees claim. These new customers will bring additional revenue in terms of share-lending, CFD spreads, CFD financing costs, etc. There may be some additional infrastructure costs to support these new users, but if that cost isnāt covered by the increased revenue then the business model isnāt sustainable.
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FWIW it is still the cheapest among ISA providers. FX was the main reason for moving my ISA, Iām always ok with fixed amount costs but % based costs are NO for me.
On the bright side it will force me to invest long-term.
If only IBKR had ISA.
If you had a USD account would you still be able to have an ISA??
But youāre staying anyway?
Yes, for now. Iām not aware of other alternatives.
If there was no competition from FT, FX fees would have been much higher than 0.15%.
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Iāve already stopped trading on T212, I only close positions now.
When they allow it I will open a new account in USD.
With my T212 in EUR, I have cheaper trading at IB (plus options, margin, broader markets, pre-market and after hour trading, etc.)
For people in the UK, I heard IG is free after the first month.
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IG is free for US stocks provided you do 3+ trades in prior month and use their instant currency conversion fee on each trade at 0.5%. Otherwise $15 per trade if you keep a USD account. So could only be cheaper than T212 if you were doing all trades at values exceeding $10,000.
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I have not looked IG into detail. I am already heard people talk about IG anf eToro. What aboutt if you did 3+ Trade for a small amount, say oenny stock to avoid currency exchange fee in the following month ?
Also has anyone had a look on Fidelity for trading and coukd provide a comparison with T212 if you are doing a lot of trading US stock (say 100+) in a month. I understand fidelity is very well known in the US as they cover other features that T212 does not have such as more OTC stock broader markets, pre-market and after hour trading, etc.
Indeed, with eToro you could only have a US$ account. But saying that eToro is poorer than Trading 212, just because T212 is offering multiple currency options limited to a single currency per user is misleading. Limited to a single currency account is not multiple currencies account as the name has suggested
You will not say that if you currently get sucked with Ā£85,000+ (say) value of US stocks in US$. Because you have chosen a Ā£ pound currency AC which is a good decisiion at the time you apply.
With eToro you already know it from the beginning when you want to open the account. So this is already part of your decision making. You could even avoid this fee in the first instance if you mean it. For example, using Revolut US$ currency, or US$ account form another bank that does not charge you for an international transfer to feed you US$ accountā¦