Interactive Brokers Review 2023: Pros & Cons
(Disclosure: Some of the links below may be affiliate links)
Are you looking for a great broker? Look no further!
Interactive Brokers has all the features you need as a passive investor. Plus, their fees are almost unbeatable in the industry.
I have been using IB for several years and could not be more satisfied. They offer a wide range of products at excellent prices.
In this review, you find all you need to know about Interactive Brokers, what you can do with IB, how much IB will cost you, and much more!
By the end of this review, you will know whether IB is a good broker for you!
| Custody Fees | 0% per year |
|---|---|
| Inactivity Fees | 0 CHF |
| Buy Swiss ETF | 5-15 CHF |
| Buy American Stock | 0.50 – 1 USD |
| Currency Exchange Fee | 2 USD |
| Languages | English, French, German, and Italian |
| Mobile Application | Yes |
| Web Application | Yes |
| Custodian Bank | 8 different US banks |
| Established | 1978 |
| Headquarters | United States |
What is 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
Interactive Brokers (IB) is a well-established brokerage firm (a broker) from the United States. IB was founded in 1978 already.
Today, Interactive Brokers is a huge brokerage company. They are the largest electronic brokerage firm in the United States. They are also leading the forex broker market. IB is also profitable, with over one billion US dollars in yearly revenue. IB employs more than 1500 employees worldwide.
IB offers access to stocks, bonds, options, futures, and other financial instruments on the leading stock exchange in the world. You will have access to all the investing instruments you will ever need.
So, let’s see precisely what IB offers as a broker.
Interactive Brokers Account Types
Interactive Brokers offers two types of accounts.
The default account type is the Cash account. With this account, you can only trade with the money you have in the account. It is the account type I am using and the one that is good for most people.
The other account type is the Margin account. With this account, you can trade on margin. It means that you can buy stocks with money you do not have. So, IB will lend you money to trade on the stock market. And you will pay interest on the money loaned to you.
Generally, with margin, you have a certain level of margin. For instance, if you have 10K cash and a 4:1 margin, you will have 40K available.
If you are interested in margin accounts, you should first read IB’s page on Margin accounts. And you should be careful about the risks of trading on margin.
For most people, a Cash account will be the best choice. If you do not know what margin is, do not consider getting a Margin account. You could lose a lot of money if you do not know what you are doing. On the other hand, if you know what you are doing and want to use leverage, you can choose a Margin account.
Interactive Brokers Fees
In the long term, you need to reduce your fees. Investing fees are extremely important.
Interactive Brokers has two fee systems:
- Fixed Fee System
- Tiered Fee System
The fixed fee system is straightforward. You will pay a fixed fee for each exchange. For instance, you will pay 0.10% on transactions on the Swiss Stock Exchange (with a minimum of 10 CHF).
The tiered fee system is much more complicated. You will pay all the individual fees, such as clearing fees, trade reporting fees, and transaction fees. And the rules are different for each stock exchange.
Many people are turned away by the complexity of the tiered fee system. But for simple investors, the tiered system is often significantly cheaper. In most of my calculations, the tiered fee system was less expensive than the fixed system. So, if you want the lowest fees possible, you should generally opt for the tiered system.
I will not go into details about all the fees of Interactive Brokers because they are complex. But overall, the fees of IB are really low. For instance, here is a comparison I did for the best brokers in Switzerland:
When you compare IB with other brokers available in Switzerland, we can see that the fees of Interactive Brokers are excellent. If you trade a few times per month, your costs will be really low!
Custody / Inactivity Fee
Fortunately, there are no custody fees or inactivity fees at IB!
Having no custody fee is an excellent advantage of IB compared to most other brokers. Not only do they have outstanding transaction fees, but having no custody fees is fantastic!
Negative Interest Rates
If you have more than 50’000 CHF in cash (not invested), you will pay negative interest rates on the sum higher than this amount. At the time of this writing, the negative interest rate is -1.06%.
You can get the current interest rate on this page.
Many people are worried when investing because IB warns about CHF carrying a negative balance. But this only applies to balances higher than 50K CHF, so no worries!
Opening an account with Interactive Brokers
Opening an account with Interactive Brokers is not complicated, but it will take some time. The procedure asks many questions and has many steps.
First, they will ask for general information about you (name, address, and such). You will also need to select the type of account you want. This choice is essential. This step is also where you will choose the base currency of your account.
The second step of the procedure is to give financial information. IB will ask you how much money you have and how much experience you have with stocks. And you will have to choose which instruments you want to invest in. Do not worry too much since you can register for new investing instruments later.
The next step is about accepting the terms and conditions of Interactive Brokers. I would recommend at least skimming through them. After this, they will ask for proof of your identity and extra tax-related information.
Finally, you only need to fund your account for it to be complete. While this is not the most straightforward procedure, I do not think this is too complicated.
If you want more information on the process, I have a guide on creating an Interactive Brokers account.
Sub-accounts
It is worth mentioning that you can have sub-accounts in your Interactive Brokers account. It means that you can manage several accounts in the same primary account.
The best usage of sub-accounts is if you want to invest for your children and easily separate your stocks from theirs. Legally, the stocks are still yours since you cannot create accounts for minors. Nevertheless, it is good to see them separate. I have bought a share of VT every month for my son.
If you want more information, I have an article about investing in stocks for your children.
Using IB to trade
Interestingly, IB has many user interfaces:
- The standard web application
- The mobile application (IBKR Mobile)
- The WebTrader web interface
- The Trading Workstation (TWS) desktop application
So, there should be an interface for everybody!
You can do most things from all interfaces. For instance, you can trade stocks from each of these interfaces. The problem with IB is that many people have been discussing the TWS interface. So, many beginners believe they should use it. But the TWS interface is the most complicated of these interfaces by far.
I have never used the TWS application for trading. It is just too complicated for most investors. You only need the Account Management interface if you are a simple investor and invest in ETF. You can also use the IBKR Mobile application to trade if you prefer phones.
From account management, you can trade everything you want. And you can also transfer money to and from your account. All these operations are relatively simple.
You can fund your account for free with a bank transfer. First, you must declare your bank account in IB, and then you can make a deposit. Withdrawals are working in the same way. You can only send money to accounts in your name. I never had any issues with either deposits or withdrawals.
If you want more information, I have a guide on how to fund your IB account and trade an ETF.
Other features
IBRK has some other interesting features.
I would especially like to mention the Stock Yield Enhancement Program. If you enable this option in the settings, IB can lend your shares to other investors.
I like that IB shares 50% of the profit with you if you use that option. This sharing starkly contrasts with other brokers that would lend your shares by default without giving you any profits.
I am not saying everybody should enable this option, but for me, this shows that IB is a great broker.
Another interesting feature is that you can trade fractional shares. This feature allows you to buy fractions of shares. This feature is helpful if you want to buy some expensive shares or if you want to purchase many different companies without having a large portfolio. You can read more about fractional trading at IB.
Is IB safe?
You want your broker to be safe if you invest significant money. So, let’s look at the safety and security of IB.
Regulations
First, we can take a look at regulations.
Depending on the customers’ country, Interactive Brokers has seven legal entities. For instance, Interactive Brokers LLC works in the US, while Interactive Brokers (UK) Limited works for European clients.
Each of these entities is regulated. For instance, the US Entity is regulated by the Security Exchange Commission (SEC), and the UK entity is regulated by the Financial Conduct Authority (FCA). So, overall, IB is extremely well-regulated.
Financial Strength
Currently, Interactive Brokers is considered very strong financially. They have a strong capital position and advanced risk controls.
The company manages over two million accounts and executes almost two million daily trades. These are substantial numbers showing that IB has many active users.
In April 2023, IB had over 7 billion USD above the regulatory capital they needed. The company invests mostly in the short term to ensure it has enough money to cover issues in the short term. So, IB’s money is not locked when it needs to be available.
Overall, Interactive Brokers’ financials are good. The company has not been showing any sign of financial troubles.
Protections
On top of that, protection in case of bankruptcy is also critical. Even though IB is financially strong, we still want to know what would happen should it go bankrupt.
Again, your protection with IB depends on where you are domiciled. The SIPC will protect US Investors. SIPC protects your assets up to 500K USD. On the other hand, SIPC will only protect your cash up to 250K USD.
For investors in the Interactive Brokers UK entity, it is a bit more complicated than that. Your protection will depend on what you are trading. With forex, CFDs, and non-US options and futures, the FCA protects you for up to 85K GBP. For stocks, bonds, funds, and US options, the SIPC protects your assets for up to 500K USD (cash is only protected for up to 250K USD).
Again, you have good protection against bankruptcy with Interactive Brokers.
It is important to note that since Brexit, European investors have been using other entities of IB. In that case, the protection is worse since you will not get SIPC protection on stocks, only FCA.
If you want to learn more, I have an entire article about broker bankruptcy.
Technical security
Finally, technical security is also essential.
With Interactive Brokers, you will have strong technical security. All the communications with the server are encrypted. But all honest brokers are using encrypted traffic.
Most importantly, you can use Two-Factor Authentication for your account. For that, you will be able to use the IBKR Mobile Application. Every time you log in from the web interface, you must confirm the login and enter one more code on your phone. This second factor adds a great layer of security to your account.
So, Interactive Brokers has excellent security!
My Experience with IB
I started investing with Interactive Brokers when DEGIRO suddenly blocked access to US ETFs to Swiss Investors. Since then, I have been delighted with Interactive Brokers. I have been investing with IB for more than three years.
My entire stock portfolio is in my IB account. I buy new ETF shares every month from the default web interface. I have tried other interfaces as well. The IBKR Mobile application is very well done. But I generally prefer using my desktop computer rather than my phone.
I do everything from the Account Management interface. This interface suits all my needs. And IB fits my needs perfectly well. I have learned to ignore most of the tool’s features with time. I only need a few features for my trading.
Since I sometimes get paid in USD, I can wire them directly to my Interactive Brokers account. That way, I do not have to pay any currency exchange fees. And that way, I can directly invest the money.
Overall, I am happy with my experience with IB. I never had an issue with the broker. All my transfers reached IB very quickly. When I needed to withdraw money for the downpayment on our house, I had no problems. And all my trades have been flawlessly executed. The reporting on the web interface is also precisely what I need. I can only recommend IB!
IB Reputation
It is essential to look at a broker’s reputation before using it to invest in the stock market.
As a source of review, I always use TrustPilot. So, let’s look at the reviews of IB on TrustPilot. On average, users rate IB at 3.3 stars. Before looking at this, I was expecting a higher score. So, let’s look at what people are complaining about.
First, let’s look at what people do not like about IB. We can categorize most of the negative reviews into two categories:
- Poor user interfaces. It takes a while to get used to the user interfaces of IB. But after some time, it is straightforward to use.
- Poor customer service. It seems that many people have issues getting help from customer service. I cannot comment on that since I have never used their customer service. But I know people in Switzerland that did and never had issues with them.
Overall, I am not too worried about these negative comments. A lot of them do not seem serious. And many commenters seem pissed off at making mistakes with the platform. But of course, it would be better if they are fewer negative reviews.
One good thing is that most reviews (39%) rate IB at five stars. So, let’s look at what positive reviews are saying:
- Excellent customer service. It is interesting to note that there are both negative and positive reviews of IB’s customer service.
- Excellent fee system
- Excellent order execution
- Good platforms
So, we can see that overall the reviews are mixed for IB. I think it comes from the fact that it takes a while to get used to it. Once you get used to it, and you focus only on the things you need, IB is quite simple to use.
Interactive Brokers Awards
One way to see how a broker is doing is to check out the awards they got from external sources. Over the years, Interactive Brokers has received many awards.
They received seven awards only in the year 2022:
- Best Online Brokers of 2022, by Barron’s
- Three awards from Investopedia, including best broker for international investing
- Several award titles from stockbrokers.com
- Several award titles from forexbrokers.com
- Several award titles from brokerchooser
While this is not the only thing that matters, awards are a good sign for Interactive Brokers.
Alternatives to Interactive Brokers
There are many alternatives out there.
The one that is the most interesting for a Swiss investor is DEGIRO. But we should also compare IB with a Swiss broker.
Interactive Brokers vs DEGIRO
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My top pick
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Good broker for Europe
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No custody fees
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Very affordable
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Pros:
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Pros:
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Cons:
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Cons:
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- Great prices
- Many investing instruments
- Excellent execution
- Access to US ETFs
- A little intimidating at first
- Affordable
- Wide range of investing instruments
- Expensive currency conversions
- No access to US ETFs
- Lend your shares by default
For European investors, DEGIRO is another interesting alternative. So, it is interesting to compare these two brokers.
The first main difference between the two brokers is that only Interactive Brokers offers access to US ETFs to Swiss investors. This difference makes IB a much better choice than DEGIRO for Swiss investors. It will make a significant difference in the performance of your portfolio. If you invest with DEGIRO, you must invest in inferior European funds.
But we can also look at the fees of both brokers. There are a few differences between DEGIRO and IB:
- IB is much cheaper for the American Stock Market
- DEGIRO is very slightly cheaper for the European Stock Market
- IB is much cheaper for Foreign Exchange (FOREX)
For the features part, there are a few differences as well. IB is also a FOREX broker, so you can hold many currencies in your account. And foreign currency exchanges are cheap. On the other hand, DEGIRO offers automatic currency exchanges when you buy and sell, but it is significantly more expensive than IB (unless you do small conversions).
For the user interface, DEGIRO is slightly easier to use than IB. On the other hand, IB has many more features. But, likely, simple investors will not need many of these features.
Also, there is another difference in share lending. By default, DEGIRO will lend your shares to other investors. You, unfortunately, have no choice about that.
On the other hand, IB will not lend your shares by default. But with IB, you can choose to do that (it is called Stock Yield Enhancement Program), and then IB will give you some percentage of the profits. IB’s approach is much superior by not lending your shares by default.
Finally, IB was established in 1978, while DEGIRO only started offering brokerage accounts to retail investors in 2013. So, IB has more extensive experience.
So, overall, Interactive Brokers is a much better broker than DEGIRO. You will be able to access US ETF if you are Swiss. And you will be able to get excellent service at very low prices.
If you want more details, you can read my DEGIRO Review.
Interactive Brokers vs Swissquote
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Best broker overall
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Best Swiss Broker
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Extremely cheap
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Very affordable
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Pros:
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Pros:
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Cons:
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Cons:
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- Outstanding prices
- Many investing instruments
- Excellent execution
- Access to US ETFs
- Good reputation
- A little intimidating at first
- Swiss broker
- Easy to use
- Many investing instruments
- Access to US ETFs
- Good reputation
- Expensive to trade US shares
- Expensive currency conversion
Many Swiss investors prefer to use a Swiss broker. So, we should compare Interactive Brokers vs Swissquote, a great Swiss broker.
Both brokers offer access to US ETFs and have more or less the same set of features. If you are a simple passive investor like me, both brokers will have more than enough features for you.
You can trade with both brokers from your computer and your mobile phone or tablet. Swissquote is slightly easier to use than Interactive Brokers, but not by a long shot.
The main difference between these two brokers is price. If you use another stock exchange than the Swiss Stock Exchange, IB is much cheaper than Swissquote. In some cases, IB can be 100 times cheaper than SQ. This difference can be very significant.
On top of that, SQ has some custody fees, while IB has zero account management fees. So, if you are looking to optimize price, IB is the clear winner here.
For many investors, Swissquote will have the advantage of being in Switzerland. It may make it easier to deal with them if you have issues, while it could be complicated with IB. So, if you are looking for an affordable (not cheap) Swiss broker, Swissquote is an interesting alternative.
For more information, read my review of Swissquote or my comparison of Swissquote vs Interactive Brokers.
Frequently Asked Questions
What is the minimum deposit for Interactive Brokers?
There is no minimum deposit at Interactive Brokers. You can open an account without any money inside. Since there are no inactivity fees, this is perfectly fine for a small amount.
Is Interactive Brokers safe?
Yes. Interactive Brokers has been around for more than 40 years and has a great reputation. On top of that, it is well regulated in several different countries. Finally, your money is insured at Interactive Brokers for up to 500’000 USD, thanks to SIPC.
Is Interactive Brokers good for beginners?
Yes. While it is not the simplest broker out there, IB allows you to get started with little money and very low fees. The basic interface is simple enough to use and will allow you to do everything you need to start investing in the stock market.
What Interactive Brokers entity should I use?
As a Swiss investor, I recommend using the Interactive Brokers UK entity that offers the best regulations, protection, and features.
Interactive Brokers FAQ
Interactive Brokers is an excellent broker with everything you need to buy stocks and ETFs, reliably and at extremely affordable prices. With IB, you can trade U.S. stocks for as little as 0.5 USD!
Product Brand: Interactive Brokers
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Interactive Brokers Pros
Let's summarize the main advantages of Interactive Brokers:
- A vast range of investments
- Very low fees
- No custody or inactivity fees
- Very professional service
- Offers US ETFs to Swiss Investors
- Good overall reputation
- Long experience
- Excellent security
Interactive Brokers Cons
Let's summarize the main disadvantages of Interactive Brokers:
- It can be intimidating at first
- Too many user interfaces
Conclusion
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
Overall, Interactive Brokers is an excellent broker. Their fees are incredible, and their service is top-notch. Interactive Brokers should be your choice if you want a professional broker at a very fair price.
Since they are still offering US ETFs to Swiss investors (why US ETFs are the best), Interactive Brokers is currently the best broker for Swiss investors. No other broker even comes close if you want to optimize your portfolio.
I have been using Interactive Brokers for more than two years now. IB is the broker I am currently recommending to Swiss investors. And it is also an excellent choice for European investors. I am pleased about IB and plan to continue using it for a long time.
Many people argue that we should not pay fees for brokers since there are free brokers. However, you have to be careful. There are many downsides to commission-free brokers. I much prefer paying very little for a great broker than not paying for a bad broker.
If you are interested in IB, I have a guide on opening an IB account.
What about you? What do you think of Interactive Brokers?
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I got a notification this morning that an open order to buy VT was cancelled, because there is no KID in a language approved in Switzerland… has the day finally come where we lose access to US ETFs?
Hi Andreas,
Let’s hope this is a glitch. I just submitted an order for VT, we will see what happens when the market opens.
That would really suck :(
Or it could be account-specific to me, as it would not let be even submit an order for VOO or VT anymore, while you are able to…
Then again I was able to buy them until today, so it wouldn’t make sense why I would have suddenly lost access.
Which IB entity are you using?
I’m with IBKR UK.
Customer support sent me a long response referring to PRIIPS as the reason, however it only refers to EEA and UK residents, so it didn’t really clarify anything.
I have specifically asked them now if it also applies to Swiss residents, or if it’s a mistake on their side. But if it is a mistake, then it’s strange that it’s not applied across the board to all Swiss accounts…
Below is what they responded, in case anyone is interested:
+++
Due to an end of a grace period and the rule coming into force by the beginning of this year, opening orders from Retail investors residing in the European Economic Area (EEA) and the United Kingdom that are associated with a product that does not comply with the EU’s Packaged Retail and Insurance-based Investment Product Regulation (PRIIPS) will be rejected. The regulation is intended to enhance understanding of these products through provision of disclosure documentation referred to as the Key Information Document (or “KID”). The KID provides information such as product description, costs, risks & performance.
Interactive Brokers is required to provide European Economic Area (EEA – the 27 member states of the European Union, as well as Norway, Iceland and Liechtenstein) and United Kingdom retail customers with Key Information Documents (KID) for certain financial instruments.
Relevant products include ETFs, Futures, Options, Warrants, Structured Products, CFDs and other OTC products. Funds include both UCITS and non-UCITS funds available to retail investors.
Since clients of Interactive Brokers have agreed to receive communications from Interactive Brokers in English, currently our clients resided in the EEA or in the UK can trade the products detailed above if the relevant KID is available in English or in any official language of the country of their legal residence. For more information on KIDs please read our Knowledge Base article: LINK../4718
Most US-issued ETFs do not currently have a KID, but a large number of EU or UK-issued ones do.
You can find more information on the details of the PRIIPs Regulation by clicking the following link: LINK../2993
These rules apply to all retail clients residing in the EEA or the UK and also to corporate accounts classified as MiFID Retail. Customers residing in the EEA or in the UK who are classified as a MiFID Professional are not affected.
If you have any further questions, please use our FAQ (link below) or contact us if you cannot find the information you are looking for:
https://www.interactivebrokers.com/en/index.php?f=46352
In order to get the KID if available, you will need to check the issuer website. If it’s available you can send it to us the link or PDF and we will upload it in order to lift the restriction.
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Thanks for sharing.
In the past, there had been several cases of people from CH being regulated as part of the EEA. Then, this has been sorted out by support.
I think this is one more case of that. Try to tell the support you are in Switzerland and Switzerland is not part of the EEA.
My order for VT went through yesterday.
Hi Andreas, hi Baptist,
I have just tried with my account (IBKR UK entity, CH resident) and I was able to buy VT and VOO.
I can also buy other US ETFs – the buy button is still showing up for me (e.g. QQQ, VTI, SPY).
I’ll be really curious what IBKR has to say about listing all countries except for CH in their response anyway.
I found this on Federal Council:
https://www.sif.admin.ch/sif/en/home/documentation/specialist-information/extention-kids-finsa.html
Thanks for sharing!
I have the same issue :( I can’t purchase VT or VOO anymore, or I guess any other good US based ETF. I created a ticket with the support. It’s a shame because I just transferred and converted a larger USD amount in IB. If ETFs won’t work anymore, I’ll probably purchase some stock I guess… but it’s really a shame.
Make sure to tell support that CH is not part of the EEA! I hope this is a small mistake.
Thanks Baptiste! I really hope you’re right. Still waiting for a response from the support team – I guess I’ll have to wait until Monday. But it’s promising to hear that you were still able to trade US ETFs successfully, so hopefully it’s just a glitch.
Hi Baptiste,
Which IB entity are you using and are you facing the same issue?
I am using IB UK and not facing any issue so far.
The IBKR Support fixed the issue – I’m very happy to be able to purchase VU again since this morning :)
Eventually Support fixed mine after some back and forth messages and I was able to buy VT and VOO again… Until yesterday I got the exact same message again about my open orders being cancelled overnight due to lack of KID.
Sent a message to Support again and hopefully it gets resolved again, but if it’s happening so often and to so many people then I get the feeling we may need to start looking for the next best alternative
Good to hear that it could be fixed once. But unfortunately, I do not think there will be fixes for everyone, but rather a global blockage :(
I am still waiting until I get a comment from my contact at IB.
Support has this time said it’s a technical issue on their end, instead of access to US ETFs being gone for good, so that’s some encouraging news at least
+++
There is a technical issue for residents of Switzerland where they are not able to buy ETFs due to PRIIPs regulation which is applicable to resident of EU. Our programmers are working on the fix to resolve the issue. We cannot give you the estimate timeframe but it should be fixed soon
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Hi Andreas, are you a EU citizen though? Maybe that is causing the problem.
Hi Andreas,
I had issues with US ETFs as well (since few days) and wrote to IBKR support.
Here’s what I’ve received this morning:
“The warnings, order cancellations or rejections for instruments without Key Information Documents (KIDs) are related to a temporary technical issue on our side which will be resolved soon. We are sorry for any inconvenience.
We have started to make products without KIDs subject to the European Union’s PRIIPs regulation available again to our clients resided in Switzerland. Temporarily restricted products should be automatically available for you again as soon as the update is rolled over for your account. The rollover process has started and is currently ongoing, no further actions are needed from your side.
As the update will be fully implemented, as a Swiss resident you will be able to place opening orders for products (e.g. ETFs) without KIDs again. You will be also able to resubmit your canceled orders if you would like to.”
So it looks like it’s going to be resolved soon.
Cheers,
Jana
One important note: for Swiss residents, IBRK offers very limited protection of client assets. This should be highligted.
what do you mean? From what I read we still have protection up to 250k in cash and up to 500k invested
Could you expand? With IB UK, we are covered with SIPC protection that is higher than the protection we get with a Swiss broker.
Yes, IB UK was great. But I heard that many Europeans (EU citizens or residents) were forced to leave IB UK. Their accounts were migrated to other IB entities with much lower insurance thresholds.
Is IB UK still available for Swiss residents ?
Can Swiss residents use the IB US entity?
Thanks for any information!
Yes, Swiss residents can still use the IB UK. But we can’t use the IB US entity.
And indeed, after Brexit, many European citizens were moved to other entities (IE and Lux).
Hi,
Is IB Lite account only available in the US? it seems they create a pro account by default?
That’s correct, we use Pro accounts in Switzerland.
Hi Baptiste
In 2022 I started investing in ETFs others.
I’ve read the previous comments regarding the annual report and tax declaration. So i generated the annual statement but I have no idea how/where it has to be declare.
Each investment separately? Together?
Would you be able to make a short review on tax declaration?
Best regards
Hi Raul,
I have an article on that subject: How to file your taxes with Swiss and foreign securities in 2023
Hi Baptist,
Thanks for the content! Very insightful!
I am a Swiss resident (EU citizen).
I have just called (as of 6.2.2023) IB and asked them about the possibility to trade US ETFs (e.g. VOO, SPY) and they have said that these titles are not available even for Swiss residents to trade on IB.
Could you please clarify how is it possible for you to be able to still access and trade US ETFs on IB and eventually which ones they are (just an example)?
I am truly confused about the answer from IB, especially when I got a different answer from SwissQuote (the above mentioned ETFs are accessible for Swiss residents to trade).
Thann you very much!
Jana
Hi Jana,
The support is wrong in that case. I can definitely trade VOO, no problem.
I think it’s a lack of education about IB support because Switzeralnd is tiny, and they forget it’s not part of the EU. Keep in mind that there are hundreds of regulations, so it’s not surprising if even support get confused.
Why don’t you try it? it’s free to open an account.
Hi Baptiste,
Thanks for all your answers.
What if I transfer CHF but the listed fund is in EUR. How does the conversion work in this case?
Any action needed from my side other than perform buy once the funds are at the IB account?
Thanks for your fantastic support.
Best regards,
Ana
Hi Ana,
I have a guide on how to use Interactive Brokers.
You will need to convert currencies manually.
Many thanks for your quick answer and once again thank you for your support.
Hi Poor Swiss,
I was wondering how you obtain the documents needed from IBKR for the Swiss tax declaration. It seems like they do not provide an annual statement, but instead you have to generate a report yourself setting the range from Jan 1-Dec 31. As for the 1042-S, it seems it is only available as of March 15 for non-US citizens, which is a bit too tight to submit the Swiss declaration on time. Any insights would be greatly appreciated.
Thank you!
Hi William,
That’s correct, I generate an annual activity statement and send that directly to the tax office. The 1042-S is made for the IRS, I don’t think that Swiss tax offices would like it.
Thanks for the article!
I think your info about “protection” is not correct.
European customers don’t fall under the UK. (Only Swiss+UK does)
It depends per country
Good point, it changed since Brexit, will update the section, thanks!
Hi Charles, thank you very much for getting back. Have a nice day!
Hi Charles, sorry I am a Newbie and have a couple questions:
1. Regarding The account management and TWS interface, how do I switch between the two?
2. You have mentioned doing the currency conversion within interactive brokers. The account it is requesting me to transfer to is a British account, how do I insure the currency conversion is not performed by my bank? Is it as simple as specifying the transfer in CHF?
Thanks in advance and thanks for all your documented information!
Hi Simon,
1) TWS is a desktop application that you have to install on your computer. The account management is a web application directly from IB website.
2) It should give you a CH IBAN (check that it starts with CH). As long as you transfer from a CH IBAN to a CH IBAN, the transfer will be free.