DEGIRO vs Interactive Brokers for European Portfolio: Who is cheaper in 2024?
| Updated: |(Disclosure: Some of the links below may be affiliate links)
DEGIRO and Interactive Brokers are great brokers for European investors. But how do they compare exactly? Which one should you choose?
In this article, I compare DEGIRO vs Interactive Brokers in terms of price for a European ETF portfolio. I compare different scenarios that should cover the needs of most long-term investors.
We only compare the costs of both brokers, not the features and usability. If you are interested in the features, I have written reviews of both brokers.
And remember: Investing involves the risk of loss. Always do your research before you invest and know why you invest and what you invest in.
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Great broker for Europe
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My top pick
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4.5
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5.0
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Our investment portfolios
For this comparison of brokers, we consider two different portfolios.
Since the fees do not change, we are not interested in the exact ETFs used. We are only interested in which exchange you purchase the ETFs.
For a choice of ETFs, I wrote about possible portfolios with European ETFs. To know why we must invest in European ETFs, you can read why we may lose access to superior U.S. ETFs. Swiss investors still have access to US ETFs, but European investors have already lost access.
The first portfolio is for a Swiss investor. This investor has 25% of his portfolio in a Swiss ETF (from the SIX stock exchange). The rest of the portfolio is from a European ETF (from the Euronext Paris stock exchange).
Our second portfolio, for a European investor, is even more straightforward. This investor has 100% of his portfolio in European ETFs (from the Euronext Paris Stock Exchange).
In both cases, each investor only invests once a month in one ETF. It is a perfect way to invest with low fees. Some people are investing every quarter. But it barely reduces fees, and it makes you keep more cash. Investing every month is also an excellent way to build an investment habit. So monthly investments make more sense.
For these two investors, we compare the prices of two brokers: DEGIRO vs Interactive Brokers. These two brokers are among the cheapest available in Europe. But which is more affordable for each scenario?
DEGIRO Fees
First, we study the fees for each service, starting with DEGIRO.
With DEGIRO, you pay a connectivity fee of 2.5 EUR (2.68 CHF) per year and per stock exchange on which you own shares. If you have an ETF on SIX and one on Euronext Paris, you pay 5 EUR per year. However, your local stock exchange is free. So, if you are a Swiss investor, you get SIX for free.
If you convert currency on your account, you pay a fee of 0.25%. It can quickly become expensive once you invest a large amount of money. A currency exchange happens if your base currency is CHF and you buy an ETF in EUR.
The fee system of DEGIRO is pretty simple. Unfortunately, it is slightly different for each country. I wish DEGIRO had the same prices regardless of which country you come from.
A collection of Core ETFs is also cheaper with DEGIRO. It used to be free, but the service fee still applies. You also still have to pay currency exchange fees if necessary, but the other expenses are waived. We do not use that for this comparison since that would significantly restrain our choice. But if you choose ETFs in the core selection, you can make it cheaper.
With DEGIRO, a Swiss investor pays 3 EUR (3 CHF) for each purchase of a Swiss ETF. The price is also the same (3 EUR (3 CHF)) for a European ETF. 2 EUR goes to DEGIRO while the other 1 EUR covers the third-party (the stock exchange) costs.
Now, for the European investor case, I take the example of DEGIRO France. The fees are a bit different from country to country. So, if you are not in France, you can check out the prices on your DEGIRO website.
Interestingly, this investor only pays 2 EUR (2 CHF) for each purchase of a European ETF. DEGIRO gets 1 EUR, and 1 EUR is for the third-party costs. It would be the same price for a Swiss ETF. However, European investors are unlikely to invest in Swiss ETFs. Interestingly, this is significantly cheaper than investing for a Swiss investor.
In the past, another account type was the DEGIRO custody account. But as of 2022, this account is not offered anymore to new customers.
Interactive Brokers Fees
Now, we also have to study the fees for Interactive Brokers. They do not have two account types but have two fee systems: Fixed and Tiered. So we compare these two. Other than the prices, there are no differences between the two pricing systems.
Regardless of where you live, you pay the same fees, which simplifies them a bit. In both cases, there are no custody or inactivity fees!
For both account types, you pay 2 USD (2 CHF) for currency exchange. The Swiss investor must exchange some CHF into EUR to buy European ETFs.
Fixed Pricing
The Interactive Brokers Fixed pricing is straightforward.
For buying an ETF on the Swiss Stock Exchange, you pay 0.10% of the total transaction. The minimum fee is 10 CHF, and there is no maximum fee.
For purchasing an ETF on the European Stock Exchange, you pay 0.10% as well. But the minimum fee is only 4 EUR (4.28 CHF), and the maximum is 29 EUR (31.05 CHF).
In some cases, your order may use IB Smart Routing. In that case, the fees can be even lower. However, it is difficult to know which order uses which routing system. Therefore, I assume the higher fees. But it is good to know that fees can go even lower!
Tiered Pricing
The Interactive Brokers Tiered system is more complicated.
First, you must pay some transaction fees to IB for each region. Then, based on the stock exchange, you must pay some extra fees. And they are entirely different based on the exchange.
For buying an ETF on the Swiss Stock Exchange (I took EBS), you pay 0.05% in transaction fees to IB (with a minimum of 1.50 CHF and a maximum of 49 CHF). You then pay a flat fee of 1.5 CHF for the exchange and an exchange fee of 0.015%. On top of that, you pay a 0.38 CHF clearing fee and a 1 CHF trade reporting fee.
For buying an ETF on the European Stock Exchange (Euronext Paris), you pay 0.05% in IB transaction fees with a minimum of 1.25 EUR and a maximum of 29 EUR. You pay a 0.01% exchange fee (with a minimum of 0.8 EUR). And the clearing fee is 0.10 EUR.
We can observe that it is much cheaper to trade on Euronext than on SIX. Switzerland has a reputation for being expensive!
As you can see, this is much more complicated than the Fixed system. But you do not have to worry about this; I do all the math for you!
Swiss Investor
We can start with our Swiss portfolio, with 25% of a Swiss ETF and 75% of a European ETF.
In this case, our example investor invests once every four months in the Swiss ETF and the other months in the European ETF. The Swiss Investor has CHF as its base currency. It means that buying the European ETF incurs a currency conversion.
It is the kind of portfolio that most Swiss invest in. If you do not want a Swiss ETF, skip to the next section for a complete Europe ETF Portfolio. However, the following section uses EUR as a base currency.
We compare DEGIRO vs Interactive Brokers for this Swiss investor for several scenarios.
Starting investor
Our first scenario is with a person starting to invest.
The investor begins with 25’000 CHF and invests 1000 CHF every month. It is a typical scenario for someone just investing in the stock market. But this is only an example. There is no problem starting with zero CHF.
Here are the total fees for each broker account:
In this case, Interactive Brokers Tiered and Fixed are slightly cheaper than DEGIRO, but it is not significantly different. We can see that the Tiered pricing of IB is more affordable than Fixed for small investments.
So, in this particular case, Interactive Brokers Fixed and Tiered are the best choices.
Standard Investor I
For the second scenario, we can take an investor who has 100’000 CHF and invests 2000 CHF monthly. After a few years of investing, this is the state that many investors can reach.
Here are again the total fees for each broker account:
Both Interactive Brokers Tiered accounts are now significantly cheaper than DEGIRO.
So, in this particular case, Interactive Brokers Tiered is the best choice. However, it is only marginally cheaper than Interactive Brokers Fixed. Both are excellent choices for this scenario.
Standard Investor II
Here is what happens if we invest 5000 CHF monthly instead of 2000 CHF. It is still a typical investing case.
This scenario would give us the following totals:
We can see that Interactive Brokers Fixed is the best option here. Interestingly, Fixed is now cheaper than Tiered. And Interactive Brokers is now twice as cheap as DEGIRO.
Once again, in this particular case, Interactive Brokers Tiered would be the best choice.
Advanced Investor
We should check the last scenario for our Swiss investor. This time, our investor has 500’000 CHF and is investing 10’000 CHF every month. This scenario is not typical since this is a lot of money. But this is still possible.
We get the following totals from this case:
Not a lot of things have changed in this scenario. We can note that the gaps between the different options are increasing. The Fixed account is still the best option. Tiered is still relatively cheap as well. However, Interactive Brokers is now more than three times cheaper than DEGIRO!
In this case, Interactive Brokers Tiered is the cheapest option.
Conclusion Swiss Investor
The broker you need to buy stocks and ETFs reliably and at extremely affordable prices. Trade U.S. stocks for as little as 0.5 USD!
- Extremely affordable
- Wide range of investing instruments
We can draw several conclusions for Swiss investors:
- Interactive Brokers Tiered is the cheapest account for small investors
- Interactive Brokers Fixed becomes cheaper for the higher amount invested per month.
- The difference between Interactive Brokers Tiered and Interactive Brokers Fixed is relatively small.
- DEGIRO can become several times more expensive than Interactive Brokers
- Most of the fees of DEGIRO come from currency exchanges.
For Swiss investors, I recommend using Interactive Brokers.
It does not mean that DEGIRO is a bad broker for Swiss investors. In the worst scenario, you would pay 264 CHF more per year. This is not a considerable amount. DEGIRO is still a great broker, not just as cheap as IB. If you do not want a broker from the United States, go with DEGIRO!
European Investor
If you live in Europe, you likely have a portfolio with only European ETFs.
In this case, the example investor invests monthly in a European ETF. It is a simple scenario. Since a European investor has euros, there will be no currency conversion in this scenario. It makes a significant difference!
This should be the case for most European Investors except for Swiss investors. It could also be different for people from the United Kingdom since they do not have euros.
Some of the prices from DEGIRO vary from country to country. For this example, I took the prices from France. Interactive Brokers has no difference based on where you come from.
We compare DEGIRO vs Interactive Brokers for the same scenarios for this European investor.
Starting investor
Our first scenario is for a person that is starting to invest. The investor begins with 25’000 EUR and invests 1000 EUR every month. This scenario is typical for a European investor just starting to invest in the stock market.
Here are the total fees for each broker account:
In this case, DEGIRO is very slightly cheaper than Interactive Brokers. But both are affordable in this case. Interactive Brokers Tiered is better than Interactive Brokers Fixed.
So, in this case, DEGIRO is the best option. But IB is also very cheap.
Standard investor I
Our second scenario is with a person in the second stage of investing. The investor already has a portfolio of 100’000 EUR. This standard investor invests 2000 EUR each month.
Here are the total fees for each broker account:
Nothing changed in this scenario. So, in this case, DEGIRO remains the cheapest option by a small margin. But IB is also very cheap.
Standard Investor II
Here is what would happen if this standard investor invested 5000 EUR per month instead of 1000 EUR.
This scenario would give us the following fees per broker account:
Now that the investments increase, IB becomes more expensive while the prices for DEGIRO do not change. The gap is starting to be more significant here. Interactive Brokers Fixed is now cheaper than Interactive Brokers Tiered.
For this particular case, DEGIRO is the best option.
Advanced Investor
Finally, we also check the final scenario for our European investor. Our last investor has 500’000 EUR and is investing 10’000 EUR every month. It is not a typical scenario since this is a lot of money. However, this is still possible for dedicated investors or high-income earners.
Here are the prices for each broker account:
Once again, DEGIRO is the best option, twice cheaper than Interactive Brokers Fixed.
Conclusion European Investor
We can draw several conclusions for European investors:
- DEGIRO is the cheapest account
- Interactive Brokers Tiered is a good option for small investors
- Interactive Brokers Fixed is a good option for investors with more money
- Investing without currency exchanges can save a lot of money.
Most European Investors should go with DEGIRO.
One advantage of IB is that you can move from country to country without changing your account to a new entity. With DEGIRO, the entity you use depends on where you live. So, if you move abroad, you may have to switch your account, which is not free. So, if you plan to move abroad or be a nomad, I recommend Interactive Brokers.
Conclusion – DEGIRO vs Interactive Brokers
The broker you need to buy stocks and ETFs reliably and at extremely affordable prices. Trade U.S. stocks for as little as 0.5 USD!
- Extremely affordable
- Wide range of investing instruments
There you have it! We now know the cheaper option between DEGIRO vs Interactive Brokers for several scenarios. Interestingly, both broker accounts are competitive. There is no bad option between these two brokers.
We can draw some conclusions from this comparison:
- For a Swiss Investor, Interactive Brokers Tiered should be the most affordable broker unless you invest a lot, in which Interactive Brokers Fixed becomes interesting.
- DEGIRO should be the most affordable broker option for a European investor.
- There is very little difference in prices between DEGIRO and Interactive Brokers. Both brokers are very affordable.
So which should you choose? Swiss investors should probably go with Interactive Brokers Account. If they do not want a US broker, they should go with DEGIRO.
European investors, on the other hand, should probably go with DEGIRO. It is significantly cheaper for beginner investors.
If you need more information on these brokers, you can read my reviews:
What about you? Which broker do you use?
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Hi there,
Thanks for doing this in depth comparison. I’m migrating myself, in part because DEGIRO doesn’t support my new country of residence.
A couple questions:
(1) Did you open a cash or a margin account on IB? I was thinking of opening both, a cash account for the buy and hold), and a margin for more active trading. But as with everything on IB, it’s hard to actually find the info that helps navigate their complex platform.
(2) Do you invest via the app, web or workstation? The latter, as is clear from online reviews, is a pain to learn
Hi Sam,
1) I would not open two accounts. It’s better to open a margin account and do both things in a single account, no? I only have a cash account since I have never used leverage so far.
2) I only use the web portal, this is simple and works well for me. The mobile application works well too. I do not recommend Trading Workstation, it’s indeed way too complicated for 99% of investors.
Given the fact that this page has 3 ads for EB, I don’t think we can really talk about any fair comparison. Do you have any comment on that ?
Hi Leo,
The reason I have ads for IB and not for DEGIRO is that I am not part of DEGIRO affiliate program.
Adding ads for one service does not change the fairness of the comparison.
I don’t really understand something, you say that swiss people can only trade US ETFs with EB but I have a Degiro account and can trade US ETFs all day. Is there something I missed ?
Can you trade VT on DEGIRO? I had a DEGIRO account, where I was investing in VT and they stopped this access before.
Keep in mind that I am talking about US-domiciled ETFs, not ETFs that invest in the US.
Could you please clarify the tables? In the first scenario, you wirte “The investor begins with 25’000 CHF and invests 1000 CHF every month.”, but in the table below, the investor invests 1000 CHF every 4th month, and 1000 EUR in months between. This pattern repeats in other scenarios.
Hi Woky,
I am simulating an investor with a Swiss ETF (in CHF) and a European ETF (in EUR). And I am simulating 25% in the Swiss ETF and 75% in the European ETF. That way the investor is investing 1000 CHF in the Swiss ETF every four month and 1000 EUR in the other months.
Does that make more sense?
Thank you. What you just said makes perfect sense. I’ve freaky habit of reverse engineering figures to fully understand the subject. In case of what’s in the article, the wordings above tables do not correspond to data in tables below (i.e. “The investor begins with 25’000 CHF and invests 1000 CHF every month.”).
Anyway, the first paragraphs explaining the various fee structures are super clear and helpful. Thanks for that!
That’s actually a good habit :)
You should not trust blindly figures, I have made several errors in the past!
Next time I update this article, I will improve the wording on these graphs to make it more clear!
Hi
I’m trying to get a permissionn on IBRK for ETF’s but can’t seem to find the option on where to activate it. When I do search, I always land on a page where you can select the products like futures, options etc. but I can’t choose ETFs anywhere…
I tried with mutual funds but it doesn’t work. Also, they ask how much experience you have and funds require at least 2 years. If you don’t have that, you’d have to complete a tutorial, but that tutorial is nowhere to be found. This is all very confusing…
Hi Bill,
ETFs are traded like stocks. So you need only permissions for stocks normally. You do not need bonds and funds permissions.
Hello,
Portugal here
Great article and Blog.
until recently i was using TradeStation to have the IB montly fee waived. unfortunatly brexit put and end to Tradestation fee waving. Im currently migrating to Captrader. Do you any feedback on them or on the other alternatives LynxBroker , Mexem, TradeRepublic?
Hi,
To be honest, I do not think it is necessary to waive this fee. It’s only 120 CHF per year, it’s pretty much irrelevant. I would recommend IB and sticking to it.
I have no feedback on all these brokers, no.
Good Evening,
This is all great insight!
My case is similar about wanting to invest in US EFT for the long term DCA, but Im from Ireland. Would the same rules apply?
Thank you
Johnny
Hi Johnny,
I am not sure you can invest in U.S. ETFs if you are from Ireland. Especially with Brexit now that makes everything more complicated.
But if you can, yes, IB would be superior to DEGIRO.
Thanks for stopping by!
Hello,
I am looking to open an Investment account here in Switzerland, investing around 1,000/2,000 fr a month. I intend to mostly be investing in US ETF’s and some individual stocks, which would be the best option for me here? I have already opened an IB account and funded it with 2k to start, just wondering if I made the right choice and if I did should I switch to Tiered pricing?
Hi James,
If you intend to invest in U.S. ETFs, Interactive Brokers is the way to go! You did the right choice!
You should probably switch to Tiered Pricing to save a little money. It won’t make a world of a difference though.
Thanks for stopping by!
Hi,
Thanks for the response! Great article by the way, I appreciate the advise and in depth comparison. Choosing a broker can be quite daunting especially when moving away from free brokers such as trading 212 and picking your first paid broker, this article was extremely useful.
I will make the switch to tiered and begin my journey to 100k.
Thanks so much
Thanks for your kind words! Good luck reaching 100K!
hi,
I was taking a deep look at the calculation, and I was just wondering if there is an error, or am I calculating wrong.
if you assume in the starting investor scenario 1.8% dividend yield. in the first quarter you have 27.000 EUR, the dividend yield should be 1.8% 27.000 = 486 EUR , and with DEGIRO custody you’ll pay 1 EUR + 3% 486 EUR = 15 EUR
instead, in your calculation you get 120 EUR (91 EUR + 30 CHF) as dividend yield, consequently also the DEGIRO custody fee on dividend yield will be about 3 times lower.
Can you please clarify where is the mistake? I am not sure
Hi,
The dividend yield is for the entire year. So, you have to divide by 4 to get the quarterly dividends. Most ETFs pay quarterly dividends.
Does that make sense?
It would be really great to see the same kind of comparison between IB : Zacks : MeDirect
Hi,
I will try to do more comparisons of the sort in the future.
But Zacks Trade seems only suited to U.S. investors. I am not sure it’s a good fit. Me Direct looks more interesting.
Thanks for stopping by!