Is Interactive Brokers safe for Swiss investors?
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(Disclosure: Some of the links below may be affiliate links)
I have been using Interactive Brokers for many years now. But many Swiss investors are wondering whether Interactive Brokers is really safe for their money, especially considering the fact that it is not a Swiss broker.
So, in this article, we are going to investigate whether Interactive Brokers is safe. We look at the financial shape of the broker, how it manages its money, and how it protects assets and accounts. This helps paint a picture of Interactive Brokers safety.
Interactive Brokers for Swiss investors
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
Before delving into whether Interactive Brokers is safe, we should look at the different Interactive Brokers entities.
Interactive Brokers has entities in many countries. As Swiss investors, we deal with Interactive Brokers (U.K.) Ltd. This entity is affiliated with Interactive Brokers LLC, which is the main US entity. Residents in the European Union are generally using different entities, such as the ones in Ireland or Liechtenstein. This is an important difference because as Swiss investors, we get an advantage by using IB UK, such as being able to use US ETFs and benefit from SIPC protection. European customers do not get this custody by IB LLC.
The Interactive Brokers UK entity is regulated by the Financial Conduct Authority (FCA) in the UK. In the US, they are regulated by the Financial Industry Regulatory Authority (FINRA). So, Swiss investors may fall under both regulations. In Europe, entities are regulated differently. For instance, Interactive Brokers Ireland is regulated by the Central Bank of Ireland.
We are discussing a standard investor in stocks here. This distinction is critical because not all assets from the UK entity are custodied in the US entity. For instance, CFDs would not be custodied in the US.
Now, we have enough context to delve into the safety of Interactive Brokers.
Interactive Brokers is financially safe
When considering the safety of a broker, it is critical to consider its financial status. A good broker will be profitable and have a long-term history. So, we can look at key financial figures of Interactive Brokers.
As of June 2025, Interactive Brokers has 18.5 billion USD in assets. These are the assets of the firm itself, not the clients. So, they have a significant amount of equity. It is worth mentioning that they hold 12 billion more than they are required by regulations.
In 2024, Interactive Brokers reported more than 3.5 billion USD in pretax profit. This high profitability is a good sign for the future of the company.
We can easily say that Interactive Brokers is in excellent shape financially. The fact that they are profitable despite having low fees is an excellent sign. Often, some brokers do not have a profitable business model and end up closing after some time. If we care about our assets being safe, we should care about how long a broker will last.
Interactive Brokers manages a lot of money
We can also look at how much money Interactive Brokers is managing.
As of August 1st, 2025, IBKR was managing about 685 billion USD in client assets. This is a very significant amount. And the good news is that this amount is still increasing, showing potential for growth.
At the same time, they had about 3.3 million customers. Again, this shows the popularity of Interactive Brokers.
Overall, Interactive Brokers has a solid user base and is trusted by many investors. It does not prove they are safe, but it proves they are trusted by many and able to handle many customers.
Interactive Brokers is a conservative broker
It is also important to check what a broker does with its money and that of its investors.
In that case, Interactive Brokers is a very conservative broker. They invest the cash of their investors in very short-term investments (government securities of only a few months). Additionally, Interactive Brokers does not hold any assets such as CDOs, MBS, or CDS (all instruments leading to the 2008 financial crisis).
IBKR only provides margin loans, which are secured by securities. They also have strict margin requirements. All their investments are marked to market daily to avoid unnecessary risks.
The company itself has no long-term debt.
Overall, compared to other brokers, Interactive Brokers appears to be very conservative. A conservative broker is much safer for our assets.
Interactive Brokers is not a bank
Contrary to many brokers, Interactive Brokers is not a bank. In terms of safety, this is actually an advantage.
Indeed, since IB is not a bank, they cannot do unsecured long-term loans. This is good because it means they have less leverage and as a result, less risk.
Another advantage is that they are free to use banks for their customers. And in fact, IBKR is using multiple banks to store cash. This means risk is reduced by not relying on a single bank.
One issue with some brokers that are also banks is that they allow arbitrary outgoing wire transfers. Normally, a broker will only allow accounts in your name for incoming and outgoing transfers.
Finally, since they are not a bank, they do not have products of their own. Banks could be incentivized into selling their products. But this is not the case with Interactive Brokers, which does not have their own products.
Overall, the fact that Interactive Brokers is not a bank is actually an advantage for the safety of our assets!
Interactive Brokers has a long history
Having a broker with a long history is generally a good sign that the broker is safe and stable and should be around for a while.
Interactive Brokers was founded in 1978, almost 50 years ago. It originally was market maker. Brokerage operations started in 1993. Since its founding, it has been growing quickly and has accumulated multiple millions of customers all over the globe. It indicates that they have global experience, dealing with many countries and regulations.
Another good sign is that the founder is still in the company and is still the chairman. Indeed, Thomas Peterffy founded the company and acted as CEO until he stepped down at 75 years old in 2019. Currently, he is still chairman of the board.
Of course, no history is perfect. During these years, Interactive Brokers has been fined a few times by regulators. For instance, they had a technical issue with negative pricing of futures. They were also fined a few times for free-riding (transactions without sufficient capital, related to cash settlement) and naked short selling (short-selling an asset without first borrowing it).
The fact that Interactive Brokers lived through many financial crises is a great sign. That and its great financial shape are good signs of longevity and safety for the future.
Interactive Brokers protects assets
How a broker protects assets is mostly defined by regulations. But some brokers decide to go further. So, we can see how Interactive Brokers protects customer assets.
In the US, brokers must segregate assets. Segregation means that the broker assets must not be held together with the customer assets. In the US, this is done through the use of omnibus accounts. These accounts are accounts where the assets of multiple customers are held along with a ledger keeping track of everything. This is also what Interactive Brokers is doing.
Being a US broker, Interactive Brokers gets SIPC protection for customer assets. I must mention that I am talking here about Swiss investors. Indeed, Swiss investors will deal with Interactive Brokers UK, which will custody some assets with Interactive Brokers LLC (the US entity). This is not the case for other Interactive Brokers European entities.
SIPC is protection for up to 500’000 USD per customer, with a maximum of 250’000 USD in cash. This will protect customers in case of bankruptcy. Normally, the stocks should be protected by segregation, but SIPC would also protect stocks in case they were mismanaged and missing after the bankruptcy.
It is worth noting that SIPC has a global pool of money available; it is not unlimited (exactly like the Swiss deposit protection insurance). Currently, SIPC has about 5 billion USD at its disposal. It can also borrow about 2.5 billion USD from the Treasury. Overall, it means that SIPC has a global protection worth about 7.5 billion USD.
Additionally, Interactive Brokers has extra insurance from Lloyds to cover the funds that would not be covered by SIPC, for up to 30 million USD per customer, with a total cap of 150 million USD. There is a cash limit of 900’000 USD per customer. This is great for people with high net worth.
Overall, Interactive Brokers protects investor assets really well and keeps them safe. The three levels of protection are very effective.
Interactive Brokers protects accounts
These days, technical security is essential. It is essential to secure your account so that nobody else can access it. And the minimum is to enforce a second factor of authentication.
IBKR forces all accounts to have a second factor of authentication. There are two options:
- A digital second factor, with either the IBKR Mobile application or a standard TOTP authenticator app (Yubico, Google Authenticator, Proton, …).
- A physical security device (called Digital Security Card+) for accounts with a balance greater than one million USD.
Overall, Interactive Brokers is doing an impressive job at protecting user accounts and is technically safe.
Since we are talking about security, I should remind people that the biggest security vulnerability is generally human error. So be careful with your accounts and take online security seriously.
Interactive Brokers is not a Swiss broker
Obviously, Interactive Brokers is not a Swiss broker; it is a US broker, so it obeys different regulations. However, this does not mean it is less safe than a Swiss broker.
There are two main differences in regulations between a Swiss broker and a US broker.
- They both have to segregate investor assets from their assets, but they do it in different ways. In Switzerland, brokers are required to open a custody account for each of their customers. In the US, brokers use omnibus accounts, which are accounts holding the assets of many investors together.
- They both have some level of protection. In Switzerland, cash is protected by the Swiss deposit insurance for up to 100’000 CHF in case of bankruptcy. We have seen that Interactive Brokers has SIPC protection for up to 500’000 USD. SIPC includes stocks that are not protected in Switzerland. But in practice, this should not happen since the stock protection would only happen if some stocks were to be missing in a bankruptcy.
We have also seen that Interactive Brokers has insurance for extra-SIPC assets, which is not common. I am not aware of any Swiss broker doing such a thing.
Overall, assets with Interactive Brokers are as safe as with a Swiss broker. In case of bankruptcy, our cash is even better protected at IB than at a Swiss broker.
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 does a great job at protecting the assets of its customers. It is also financially very stable, which is great for long-term continuity and stability. Since it is a conservative broker with a long history, this gives us confidence.
The conclusion is simple for me: Interactive Brokers is a safe broker for Swiss investors. I plan to keep the main part of my portfolio, with US ETFs, at this broker until retirement.
If you would like to learn more about Interactive Brokers, you can read our Interactive Brokers review. You can also look at how IB compares with Swiss brokers.
What about you? What do you think about Interactive Brokers?
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Hello Baptiste
I just heard something that is a bit allarming. Not concerning Interactive Brokers only but all brokers in general.
Brokers has lended to clients 1 trillion USD in total and have 400 billions USD in cash, this in the US. It seems that many clients work with lendind and investing.
This feels like some situations that we have seen in the past and that lead to disasters.
Are there brokers that expose themself more to this kind of requests or is IB one of them?
Hi gold
Yes, many other US brokers are much more aggressive in their lending practices. IB is one of the most conservative lenders, as far as I know.
That much lending is quite insane and is indeed a bit concerning.
In case of strong market volatility or crash it will hurt….the investors for sure but also the brokers who has lended.
If a broker is using segregation account we are protected, right?
Normally, segregation would protect us, indeed. The problem mostly happens when brokers are not doing it properly (or at all), which is not something I am worried about with reputable brokers. That being said, even a reputable broker can take too much risks and end up in bankruptcy. In this case, the risk is that our stocks are locked for a while.
Hi Baptiste,
As a european, if I open an account and buy ETF while being resident in Switzerland but later come back to my european country (France)… what happens? Do I need to close the account and sell everything ? Thank you
Hi Marie
You will be forced to migrate accounts because IB UK is not available, but normally this can be arranged by support without needing to sell everything. But to be sure, you would have to ask IB itself.
So for which countries is IBKR UK usable?
I only know it’s used for Switzerland and the UK since the new laws from the European Union. There may be others, but I don’t know the details of each country.
Hello dear, thank you for your wonderful content!
Just a doubt, in case of some hacker can enter in a IB account, the only way to take out the money is to transfer to the beneficial owner registered account right? He cannot transfer the money to other account. Is that correct?
Thank you,
Best
Hi Carlos
That’s correct, they should only be able to wire money to your accounts.
However, he could mess up your accounts by buying and selling, so it depends on what the hacker is looking for.
Dear Baptiste
While I do believe IB is safe, I decided to use a Swiss broker (your other recommendation Saxo) mainly because of the complex processes that needs to be followed after death of investor. I would rather have peace of mind that my dependents can easily access my investments. A good summary here
https://thepoorswiss.com/us-estate-tax-swiss-investors/
Hi Anna
Keep in mind that (at least in theory), even with a Swiss broker, you are subject to the US estate tax if you are using US ETFs. If you are using EU ETFs, it should not matter which broker you use.
But I agree that peace of mind is important.
Hi Baptiste,
you state “I plan to keep the main part of my portfolio, with US ETFs, at this broker until retirement.”
Do you use one or more other brokers? If yes, which ones and for what reason/purpose?
Hi MixMax,
I currently use a secondary broker (Saxo) for my Swiss ETF (15% of my portfolio). The reason is so that if one of them is either unavailable, I have access to the other one.
Dear Baptiste,
This piece is very reassuring for me, thank you!
Like yourself, I have been using interactive brokers for over a year now and I continue to be satisfised by their service and intend to remain with them for the foreseeable future. Initially, I was a bit reluctant seeing that they were a US broker for Swiss Tax declaration as I did not know how this would work out. However, I found it pretty straight forward to pull a report showing the performance of my particular funds prior to my Swiss Tax declaration date which was accepted by my Tax assessor and subsequently by the Swiss Tax authorities.
Hi Mike,
Thanks, I am glad you like it.
Yes, people make a big deal of using a US broker, but in the end, once you have done it once it’s really not too bad :)
Hi,
Interesting for me is that you don’t get some document that proves you bought something, it is just accessible in transactions of this day, and in case of some event this can potentially disappear. So my comment to IB would be it would be very nice to get some official confirmation for any transaction. Ok, you can always download monthly transactions, but it’s a bit strange for me such approach. What do you think on this Baptiste?
Hi Mitch,
You would like to get a report for each transaction? For me that would be noisy, but I understand the value to some.
What you could do is generate a daily activity statement every time you do an operation so you always have a trace.
Dear Baptiste,
This was very useful and reassuring, thank you! I signed up to interactive brokers after reading one of your articles a couple of years ago and referenced you when asked for who recommended them. I am continuously impressed and satisfied.
Thanks, Denise! I am glad you are satisfied with the blog and IB.
I guess people who are wondering this are more worried about having their assets overseas in a US account at a time of chaos and lawlessness in US international policy.
Hi Paul
That’s a fair point indeed. But it’s difficult to quantify this risk. I don’t think anything will happen because it will hurt US brokers and US stocks too much. But they could increase dividend withholding and void treaties for instance.
But I don’t see much happening as long as they try to protect their stock market. But you are right, that with Trump, we never know what will happen next.
Hi Baptiste,
Very interesting article! Thanks a lot for it! It seems that, during financial crises, some brokers have to change their margin requirements or cancel margin loans entirely (not a margin call, but rather a liquidity protection measure from the bank itself). Are you aware of Interactive Brokers doing either of these things during the dot-com crash or the global financial crisis, for example? If not, this would be another sign of their financial strength, in my opinion. What do you think?
Hi Michael
Yes, there are been such examples. During the dotcom bubble, they have restricted margin on some internet stocks. During the real estate crisis, they have also restricted margin on some leverage ETFs for instance. Finally, they also increased margin requirements for GME during the gamestop saga.
I am not sure that this is a bad thing since they have to protect themselves and protect lenders. I think this is common among brokers.