What is the best broker in Switzerland in 2021?

Mr. The Poor Swiss | Updated: | Investing
What is the best broker in Switzerland in 2020?

(Disclosure: Some of the links below may be affiliate links)

I have talked about several brokers on this blog. But I have not yet answered the question of which one is the best broker in Switzerland!

This article will answer this important question. There are several Swiss brokers, and most Swiss banks have their broker service. But some international brokers are also available in Switzerland.

If you want to invest in the stock market, you will need a broker account. So, before you can invest, you will need to choose a broker account. You need to choose carefully since changing brokers is neither easy nor free. Therefore, it is essential to pick the best broker possible.

By the end of this article, you will know exactly which broker you should use as a Swiss passive investor in ETF!

How to choose a broker?

Choosing a broker is not very difficult, but it is a very important decision.

You are likely to use it for many years. You can always switch to a new broker. But moving your shares to a new broker is not free and not straightforward to do. So, it is better to start with the right decision directly. Ideally, you want to start with the best broker for your needs.

The first thing you need to ensure is that you only trade with a reputable broker. You will entrust your investments with this broker. So you want a broker with a good reputation and excellent security.

Mainly, you need to ensure that the broker will hold your assets separately from the broker’s legal entity. That way, if the broker defaults, you can still reclaim your assets through the secondary entity. This is called asset segregation, and it is something that any proper broker will do.

The second thing you should check is whether the broker gives you access to the exchanges you need. For instance, if you want to trade in Swiss stocks, you will need access to the Swiss Stock Exchange (SWX).

Due to a bad set of laws, it is currently challenging to access Exchange Traded Funds (ETFs) from the U.S. Indeed, European investors cannot currently invest in these funds. And only Interactive Brokers (among the affordable brokers) will offer Swiss investors access to these U.S. ETFs. So, if you want to invest in these funds, your choice is overly limited.

Finally, you need to look at the prices of transactions. This is the main issue with most Swiss brokers. They are terribly expensive. As we will see later, there can be a huge difference in fees between different brokers. Most people do not realize this! When you compare brokers, you will see that the difference is too big to ignore!

Out of these three criteria, the third one is the one that requires the most research. Finding reputable and safe brokers is not very difficult. But finding an affordable broker giving you access to the stock exchanges you need is not always easy. If you do your research properly, you will directly start using the best broker for your needs.

The best brokers in Switzerland

As I said before, there are many options. You can probably trade directly with your bank. But Swiss banks are costly for trading. It would be convenient to trade directly with your bank. Unfortunately, they are too expensive. So, you should not trade with your bank.

There are a few okay options with Swiss online brokers:

  • Corner Trader
  • Swissquote
  • Saxo Bank

These are already much more interesting than trading with your bank. But they are not cheap either.

Finally, there are several international online brokers available for Swiss investors:

  • DEGIRO
  • Interactive Brokers

These two brokers are the best options available for Switzerland. They are significantly cheaper than all the other options available in Switzerland. They may not be Swiss, but they offer all their services to Swiss investors. This makes them the two best brokers in Switzerland.

To see that it is the case, we will compare the fees of the different brokers. We can also consider the fact that you do not have to pay Swiss Stamp Tax with them.

Comparison of the brokerage fees

We can quickly compare the fees of some of these brokers for some operations.

I cannot make a comparison of all the brokers available because there are too many. So I picked the most popular brokers in Switzerland. I included two bank brokers, two online swiss brokers, and two international brokers. This should give a good set of brokers for comparison. This should definitely help to show what are the best brokers in Switzerland.

Here are the fees for these 6 brokers for a few examples of operations on Swiss and American stock exchanges. I used the share prices of April 16th for the comparison. Here are all the data I have collected:

Action Postfinance Migros CornerTrader Swissquote DEGIRO Interactive Brokers
Custody Fees 90 CHF / year 0.23% / year
Min 50 CHF
35 CHF / quarter
If inactive
0.025% / quarter
Min 15 CHF
Max 50 CHF
0 CHF 0 CHF
Buy 10 CHSPI shares 25 CHF 40 CHF 20 CHF 9 CHF 2.35 EUR 5 CHF
Buy 100 CHSPI shares 50 CHF 40 CHF 23 CHF 9 CHF 5.55 EUR 5 CHF
Buy 10 NOVN shares 15 CHF 40 CHF 20 CHF 20 CHF 5.42 CHF 5 CHF
Buy 100 NOVN shares 35 CHF 40 CHF 20 CHF 30 CHF 9.23 CHF 5 CHF
Buy 10 MSFT shares 35 USD 40 CHF 25 CHF 25 USD 0.54 EUR 0.35 USD
Buy 100 MSFT shares 70 USD 40 CHF 25 CHF 80 USD 0.90 EUR 0.36 USD

Or, if you prefer, here is the data in graphical format:

Swiss Broker Transaction Fees
Swiss Broker Transaction Fees

As we can expect, the Swiss traditional brokers are in a terrible position. Swiss online brokers are slightly better. SwissQuote is not as bad in some cases, except for USD shares. The worst would be Migros since they do not have a maximum on their custody fees, which is a terrible drag once you have a large portfolio.

In most cases, Interactive Brokers is the cheapest broker. It is followed by DEGIRO. So our two online foreign brokers are significantly cheaper than the others. In the worst case, IB is 222 times cheaper than Swissquote!

On average, if you are doing big enough transactions, both DEGIRO and IB will be much cheaper than the other brokers. They are always among the cheapest and are never in the most expensive options. For me, this shows that DEGIRO and IB are the best brokers available in Switzerland.

If you would like to have more brokers included in this comparison, let me know, I can extend the list if many people are interested. I know that some people want to have a Swiss broker. For them, I have an article where I compare the best Swiss brokers.

Swiss Stamp Tax

In Switzerland, there is a tax called the Swiss Stamp Tax  (or Swiss Stamp Duty). This is also called the Swiss Securities Transfer Tax. This is a federal tax.

This levies a tax on each transfer of securities when a Swiss securities dealer is involved in. By Swiss securities dealer, the tax means Swiss banks and Swiss brokers.

The amount of the tax depends on the exchange:

  • Swiss securities: 0.075% fee
  • Foreign securities: 0.15% fee

This tax only applies to Swiss securities dealers, not foreign securities dealers! This means that by choosing a non-Swiss broker, you will save on the Swiss Stamp Tax! Since this tax is levied in both directions (buy and sell), by using a Swiss Broker, you are effectively losing 0.30% of your transactions! Over the years, this can quickly add up to a large amount!

This tax effectively moves people away from Swiss brokers. This law officially makes foreign brokers the best brokers for Switzerland.

For more information, read my article on the Swiss Stamp Tax Duty.

The two best brokers in Switzerland

As we could see from the comparison, the choice is fairly easy. From a fee point of view, only Interactive Brokers and DEGIRO are good choices. All the others are too expensive. Interactive Brokers is the cheapest of the available brokers.

For me, Interactive Brokers is definitely the best broker available in Switzerland. Even though DEGIRO is also cheap, it cannot fully compare with IB.

There is one big difference currently between these two brokers. Only Interactive Brokers currently offers access to U.S. ETF. So, if you want to invest in U.S. ETF, you will need to use IB. This is only the case for ETFs. Both brokers are giving access to all other U.S. securities.

Aside from these two differences, they are both excellent brokers. DEGIRO is a bit more expensive for currency exchange. This makes it a bit more expensive for a Swiss investor. On the other hand, DEGIRO is cheaper for European securities. So it makes DEGIRO interesting for European investors. And European investors do not have access to U.S. ETFs anyway, so they have more choices of brokers.

IB is a bit cheaper and offers excellent foreign exchange trading. And it offers tons of features and analysis tools. This comes at the price of complexity. At first sight, Interactive Brokers is quite intimidating. But it has become better and better over the years. As a simple investor, you will only need a small portion of all the features of IB.

Interactive Brokers – The best broker

Best Broker for Swiss Investors
Interactive Brokers

Interactive Brokers is an outstanding broker, with extremely affordable fees! Trade U.S. security for as little as 0.5 USD!

As mentioned before, Interactive Brokers is the only one of the two best brokers to give you access to U.S. ETFs. So, if you plan to invest in them, IB should be your choice. It is my favorite broker, the one I use and the one I recommend!

Interactive Brokers is a broker from the United States. But if you are in Europe, you will use its United Kingdom subsidiary. But this remains the same broker. It is a very well-established broker, funded in 1978. It has many customers all over the world.

Although it is a low-cost broker, it offers many features. They offer access to almost all instruments available in many stock exchanges. You can trade in stocks, contracts, options, and other derivatives. And they have a great platform for FOREX trading. For passive investors, you will have many more features than you need.

The biggest disadvantage of IB is that it is sometimes a bit obscure to use. IB has many different user interfaces, and at the beginning, it is not very clear which one should be used.

Other than that, IB is an excellent broker!

If you are interested, I have a guide on opening an account at Interactive Brokers and a guide on trading ETFs with Interactive Brokers.

DEGIRO – The simplest broker

DEGIRO is the broker I have started with. It is a good and cheap broker. It is relatively simple to use. However, they are much less professional than IB.

DEGIRO is a broker from The Netherlands that is available to most countries in Europe. They started in 2008 already, and they have been growing really fast since that time. Now, they are one of the major brokers in Europe.

One disadvantage of DEGIRO is that it does not offer proper FOREX trading. You cannot hold different currencies in your account. This means that your cash is converted automatically when you make a trade in another currency.

And you will have to pay fees for these transactions. This makes it a little more expensive than IB when your base currency is not the currency of your main ETF.

On some transactions, it can also be a bit more expensive than Interactive Brokers. But unless you are doing substantial transactions, this should not be a  big difference.

A big limitation is that DEGIRO does not let Swiss investors invest in U.S. ETFs. For starting investors and people that do not plan to invest a large amount of money, this is probably fine. But with a large portfolio, you can save a significant amount of money investing in these U.S. ETFs.

Finally, you need to be aware that, by default, DEGIRO will lend your shares to other investors. You can avoid this by opting for the Custody account, but you will pay some significant fees on dividends.

If you are interested, I have a tutorial on how to open an account with DEGIRO.

Conclusion

Best Broker for Swiss Investors
Interactive Brokers

Interactive Brokers is an outstanding broker, with extremely affordable fees! Trade U.S. security for as little as 0.5 USD!

Interactive Brokers and DEGIRO are the best brokers available in Switzerland. They are both reputable and safe brokers. And they are the cheapest brokers available in Switzerland. Moreover, you will save on the Swiss Stamp Duty that you only have to pay with Swiss brokers.

Swiss brokers are working fine, and there is nothing fundamentally wrong with them. But they are much more expensive than online foreign brokers. And when you add the Swiss Stamp Duty on top of that, the difference is quite large. When you invest, you do not want to waste your returns on fees. So, you need to minimize the fees. And for that, you need to choose the best brokers.

I strongly believe that Interactive Brokers is the best broker for Swiss investors in all cases. There are only very few cases where DEGIRO is slightly cheaper than Interactive Brokers. And IB is a much more complete solution for investors. It also has a better reputation. Finally, given that they offer access to U.S. ETFs, IB can help you save a lot of money. If you want, here is a guide on how to get started with Interactive Brokers.

Now, some people are uncomfortable having their shares in a foreign broker. For these people, I have found the best Swiss brokers.

If you want even more detail about the best brokers in Switzerland, read the full comparison of Interactive Brokers and DEGIRO! You may be surprised by the results!

What about you? What is the best broker for you?

Mr. The Poor Swiss is the author behind thepoorswiss.com. In 2017, he realized that he was falling into the trap of lifestyle inflation. He decided to cut on his expenses and increase his income. This blog is relating his story and findings. In 2019, he is saving more than 50% of his income. He made it a goal to reach Financial Independence. You can send Mr. The Poor Swiss a message here.

117 thoughts on “What is the best broker in Switzerland in 2021?”

  1. Hi, how high is the protection with Swiss online brokers? I have been involuntarily migrated from IB UK to IB Ireland (20k only) and look for diversification. Are Swiss brokers open to EEA applicants? Thank you.

  2. Dear Mr. The Poor Swiss,
    1. You are using several times expression “brokers available in Switzerland”. What does it mean?
    2. In the times of internet, a person living in Switzerland, theoretically, could open an account at any location in the world. What would be the consequence, if a person living in Switzerland, would use broker not available in Switzerland?
    3. How to check if the broker is “available in Switzerland”?

    Regards,

    1. Hi,

      1) It means that some foreign brokers are not open to Swiss investors. Many big U.S. Brokers only cater to U.S. Investors.
      2) There is not problem, but these brokers will simply not let you open an account if you are not a U.S. citizen or U.S.-resident (or other limitations for other countries). So, unless you lie (and it’s illegal to provide false information), you simply cannot.
      3) If you can open an account with the broker, it’s available in Switzerland.

  3. Hi,

    Do you have experience with Smartbroker? It would be interesting to have it in the comparison table as the seem to offer in many cases very cheap rates.

    Thank you btw for the great website!

    Best,
    Andrés

  4. Hello
    I have a couple of questions:
    – with IB can I hold money in EUR and CHF or they get converted automatically in my default currency? I have 2 accounts (1 in Italy and 1 in CHF) and would like to make deposits from both without necessarily converting the money
    – What would be the best broker for trading ETF and ETC? I see deGiro has several ETF for free
    – is the landing of shares from DEGIRO really risky for the investor?
    Thanks for your help!

    1. Hi Elisa,

      * You can hold many currencies with IB. I hold CHF and USD without any issues. And there is no automatic currency conversion with IB.
      * Very likely will be IB
      * It’s a risk, but it’s not a huge one. If DEGIRO bankrupts while your shares are lent, it may be difficult to get back your shares. And if both the borrower and DEGIRO defaults, you won’t get back your shares.

  5. Hi Mr. The Poor Swiss,

    Can you please let me know how to check on IB what’s the current status on the fees?

    We recently invested, following your advice, btw I did go for another bank fund (too expensive fees) and we wonder if IB sends a monthly fee?

    How does it work?

    Thank you

    Cheers

    Lucas

    1. Hi Lucas,

      I am not sure what you mean by the status of the fees.
      Do you mean how much fees you are paying? You can go into Reports and generate activity statements for a month (or several months) and this report should show you how much you pay in taxes.
      Do you mean whether you are using fixed or tiered fees? You can go into Account Settings and it should be on the right side of the screen.

      Thanks for stopping by!

  6. Hello,

    I have a lot of money in Interactive Brokers (300,000 CHF) but I do not feel very comfortable having all my money in a discount broker.

    Is there any bank (ideally brick and mortar such as UBS) that have no custody fees?

    I want to do a 1 time trade of ~200,000 and buy VT or a UCITS equivalent, OR transfer my portfolio from IKBR to a brick and mortar bank.

  7. Hi Mr. The Poor Swiss,

    Looking today at the fees on Interactive Broker, I cannot see how you come to 5 CHF for 10 or 100 NOVN shares. Could it be that their conditions have changed since you posted ? Or maybe I don’t interpret correctly their conditions ?

    Thanks
    Zora

  8. Hi Mr. The Poor Swiss,

    Thanks for your great articles.

    I’ve just read about this platform: trading212

    Have you ever heard about it? And is it better than IB?

    Thanks for your answer!

    Best,
    Lee

    1. Hi Duke,

      I have heard about it but never did proper research.
      It does not give you access to the Swiss stock exchange, so for me, this is a blocker and I won’t recommend it to Swiss investors.
      The fees look alright but the spread seems to be high.
      Overall, at first sight, I do not think this has any advantages over IB.

      1. Hello, i am interested in using IB but can i use it to invest in Swiss bonds & stocks and companies like Nestle or Roche?

        Thank you
        Roman

    2. Hi Duke,

      Here are my thoughts (rehashed):

      I never did any proper research about Trading212. They look interesting. It seems the fees are good but the spread could be tighter.
      I do not like their focus on CFDs.
      It also seems like they do not give you access to the Swiss stock exchange. As such, I would not recommend it to any Swiss investor.
      Reviews look positive and it looks legit. But it’s a bit young and too shiny for me.

      Thanks for stopping by!

  9. Hi there,

    Great blog! What do you think about the migration from IB to IBCD (Hungary based) due to the Brexit?

    Personally I’m considering moving my IB assets to Swissquote.

    Thanks,

    1. Hi Manuel,

      Currently, there is no need for Swiss investors to migrate their accounts since we are not part of the EEA.
      I would be against migrating to Swissquote, they are incredibly more expensive than IB. Even if we had to migrate to IBCD, I would migrate there rather to invest with SQ.

      Thanks for stopping by!

  10. Thanks for the blog! Interesting reading. You say that “only Interactive Brokers will offer Swiss investors access to these U.S. ETFs”. Is that really true? In PostFinance Etrading factsheet seems that it is possible to invest in NYSE, where one could find all U.S. ETFs…

    1. Hi Rob,

      I am not entirely sure, but I have heard that PostFinance stopped offering these ETFs.
      Just because they are offering access to NYSE does not mean they give you access to ETFs. The rules for ETFs are different than the rules for Stocks.

      Thanks for stopping by!

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