Swissquote vs Interactive Brokers

By Baptiste Wicht | Updated: | Investing

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

Interactive Brokers is my favorite foreign broker, and Swissquote is my favorite Swiss broker. Both brokers are very well known and have a good reputation.

So, it is time to compare Swissquote vs Interactive Brokers in detail. In this article, I look at their fees, features, and usability. We also look at the user reviews for these two tools.

Swissquote

Swissquote is a Swiss broker and bank. They were founded in 1996 and have more than 700 employees. The broker itself is part of the Swissquote Group Holding SA company.

Although it is a Swiss company, it offers financial services to several countries. But in this article, I focus on Swiss investors.

Swissquote is a publicly traded company, meaning it must reveal its financials publicly. It is also a licensed bank in Switzerland. They currently have more than 400’000 users.

They offer access to many financial services. But in this article, I only want to focus on the stock exchange brokerage services.

Interactive Brokers

Interactive Brokers is a broker from the United States with a presence in Europe.

They have several legal entities. You will deal with a specific entity depending on where you are from. For instance, Swiss investors deal with the entity from the Unit Kingdom.

They also are a publicly traded company and a very profitable brokerage company. They have more than 1500 employees worldwide and were founded in 1978. As of 2021, they have more than 1.6 million customers.

They also offer access to a wide range of investment instruments. In this comparison, I will only focus on the stock broker part of Interactive Brokers.

Features

The most important criterion is that your broker should have all the needed features. So, let’s start by comparing the features of Swissquote vs Interactive Brokers.

While important, it is not a very difficult criterion. Indeed, most investors do not need many features. You only need very few features if you are a passive investor like me. And after that, some features are nice to have but not essential.

Both brokers give you access to the most important stock exchanges, such as the Swiss Stock Exchange (SIX) and the New York Stock Exchange (NYSE). And they give you access to the biggest European stock exchanges.

You can access stocks, bonds, and ETFs with both brokers, which is probably everything most investors need. You can also access futures and options and more advanced investments, but that only concerns a tiny portion of investors.

Very importantly, both brokers will give you access to US ETFs. These ETFs are the most efficient for Swiss investors.

Both brokers will let you trade from your desktop and your mobile phone. And they both have different applications.

We should also talk about a few advanced features. Both brokers will give you access to margin loans if you ever need leverage. Interactive Brokers allows you to buy fractional shares, while Swissquote does not have this feature. I do not think it is a big deal, but some people like to have access to fractional shares.

Overall, both Swissquote and Interactive Brokers should have all the features you need for investing in the stock market.

Fees

Fees of a broker are the second most crucial criterion, very close behind the first. So, let’s compare the fees of Swissquote vs Interactive Brokers.

Let’s start with account management fees. Interactive Brokers has no custody fees of any sort. At Swissquote, you will pay 0.025% custody per quarter, with a minimum of 15 CHF and a maximum of 50 CHF. So, you will pay anywhere between 60 CHF and 200 CHF per year in custody fees. This custody fee is not cheap, depending on your account size.

Let’s look into the transaction fees next. IB has two fee systems: tiered and fixed. I am using the tiered system because it is cheaper for small investments.

Swissquote has only one system, with different fees for each stock exchange. On top of that, SQ has a list of so-called ETF Leaders, with a fixed cost of 9 CHF on the Swiss stock exchange and 9 EUR on European stock exchanges. However, even for ETF Leaders, you still pay the stock exchange fees on top of the 9 CHF.

Finally, since Swissquote is a Swiss broker, you will have to pay Swiss stamp duty. This fee is 0.075% on Swiss stocks and 0.15% on foreign stocks.

Let’s run a few examples:

  • 1000 CHF of CHSPI (ETF Leader): 11.75 CHF at SQ, 3.60 CHF at IB
  • 10’000 CHF of CHSPI (ETF Leader): 18.5 CHF at SQ, 9.20 CHF at IB
  • 1000 CHF of Nestlé (SIX): 20.75 CHF at SQ, 3 CHF at IB
  • 10’000 CHF of Nestlé (SIX): 37.50 CHF at SQ, 6.50 CHF at IB
  • 1000 USD of VT (NYSE): 26.5 USD at SQ, 0.35 USD at IB
  • 10’000 USD of VT (NYSE): 45 USD at SQ, 0.37 USD at IB

We can observe a few important when comparing the fees of Swissquote vs Interactive Brokers.

  • For ETF Leaders, Swissquote is relatively affordable, but still twice more expensive than IB.
  • For Swiss shares, the difference is already more pronounced, about 5 times more expensive on large operations.
  • For US shares, Swissquote is much more expensive than IB, more than a hundred times.

If you want to buy something in a foreign currency, you will need to convert from your base currency, for instance, from CHF to USD. Interactive Brokers will charge you 2 USD per currency conversion. Swissquote will charge you 0.95% for each currency conversion.

Let’s compare the fees of Swissquote vs Interactive Brokers for a few conversions:

  • 100 CHF to USD: 2 USD at IB, 0.95 CHF at SQ
  • 1000 CHF to USD: 2 USD at IB, 9.5 CHF at SQ
  • 5000 CHF to USD: 2 USD at IB, 47.5 CHF at SQ

For currency conversions, Interactive Brokers will generally be much cheaper than Swissquote. Only if you convert less than 200 CHF will IB be more expensive than SQ.

Overall, Interactive Brokers is significantly cheaper than Swissquote. The difference will not be critical if you only invest in Swiss ETFs. However, the difference can be significant if you primarily use US ETFs.

Safety

If you invest a significant amount of money with a broker, you want your money to be safe. So, we must compare the safety and regulations of Swissquote vs Interactive Brokers.

Let’s start with the regulations. Swissquote is regulated in Switzerland by the Swiss Financial Market Supervisory Authority (FINMA). Interactive Brokers is regulated in the US by the Security Exchange Commission (SEC) and in the UK by the Financial Conduct Authority (FCA). So, both brokers are regulated by well-respected supervisors.

Both brokers segregate the money from the customers from their main entities. So, if they default, the creditors will have no claim on the money from the customers.

In case of bankruptcy, in theory, all your assets should be safe since everything is separated from the entity itself. If one of the custody banks defaults, your cash has an extra level of protection. For Swissquote, your cash is protected by esisuisse for up to 100’000 CHF. With IB, your cash, stocks, and bonds will be covered by SIPC for up to 500’000 USD (250’000 USD limit for stocks).

If you have a lot of cash, protection will get even better since they will use multiple custody banks, and each bank will get protection up to 250’000 USD. You need to opt for the Insurance Bank Deposit Sweep program. So, in theory, your cash is safe at IB for up to 2.5 million USD. But this should not be the case for most of my readers.

The fact that both brokers are publicly-listed companies lends credibility to these two companies.

Regarding technical security, both brokers seem to be doing everything they need. I have not found any information about data leaks or security breaches. They both offer second factors of authentication, which is extremely important.

Swissquote will likely be easier to deal with in case of an issue since they are based in Switzerland. It may be harder to deal with serious issues with IB, given the more limited access to their customer service.

Overall, both brokers are among the safest stock brokers available. I have a significant amount of money in my IB account and feel safe with it.

Reputation

Reputation is also an essential part of choosing a broker. This tells a lot about what users think about the services. So, let’s see what users think of Swissquote vs Interactive Brokers.

In both cases, these brokers have an excellent overall reputation. I have never heard of massive issues with these brokers.

On TrustPilot, both brokers get similar scores with 3.3 stars for IB and 3.2 for Swissquote. For both services, people complain about the customer service. While this is not a great sign, this is the case for almost every service I have reviewed.

On Interactive Brokers, people complain about how it is sometimes complicated to use it. And on Swissquote, people complain about the high fees.

As for the good reviews, people think it is very simple to trade with Swissquote, and people like the fees of Interactive Brokers.

Overall, the reputation of both brokers is sound. Many people are complaining, but none of these complaints are very worrying. Overall, long-time users of both brokers are happy with it.

Swissquote vs Interactive Brokers Summary

Let’s make a summary of Swissquote vs Interactive Brokers:

Best broker overall
Best Swiss Broker
5.0
4.5
Extremely cheap
Very affordable
Pros:
  • Outstanding prices
  • Many investing instruments
  • Excellent execution
  • Access to US ETFs
  • Good reputation
Pros:
  • Swiss broker
  • Easy to use
  • Many investing instruments
  • Access to US ETFs
  • Good reputation
Cons:
  • A little intimidating at first
Cons:
  • Expensive to trade US shares
  • Expensive currency conversion
Best broker overall
5.0
Extremely cheap
Pros:
  • Outstanding prices
  • Many investing instruments
  • Excellent execution
  • Access to US ETFs
  • Good reputation
Cons:
  • A little intimidating at first
Best Swiss Broker
4.5
Very affordable
Pros:
  • Swiss broker
  • Easy to use
  • Many investing instruments
  • Access to US ETFs
  • Good reputation
Cons:
  • Expensive to trade US shares
  • Expensive currency conversion

Conclusion

Overall, both Swissquote and Interactive Brokers are great brokers for Swiss investors.

For me, the choice between Swissquote vs Interactive Brokers boils down to a few points:

  • If you want the cheapest broker, use Interactive Brokers.
  • If you feel safer with a Swiss broker, use Swissquote
  • If you want to trade US stocks and ETFs heavily, use Interactive Brokers
  • If you only want to trade CH stocks and ETFs, use either of them

I am trading mostly in US stocks and do not mind a good foreign broker, so I use Interactive Brokers. When my portfolio reaches a significantly higher (yet to be determined), I will probably also have a Swissquote account and trade my Swiss shares with them for some diversification.

For more information on these two brokers, read my reviews:

What about you? Which broker do you prefer?

Baptiste Wicht 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.

17 thoughts on “Swissquote vs Interactive Brokers”

  1. Hi Baptiste, thanks a lot for the comparison.

    Two quesitons:

    1)
    What about Postfinance (E-Finance). They use the same software/plattform as Swissquote and seem to be a little cheaper as Swissquote.

    Do you see any other reason why not using Postfinance (E-Trading)?

    2)
    About Safety at IB:
    You write: “You need to opt for the Insurance Bank Deposit Sweep program.”
    How can I do this exactly at IB?

    Thanks a lot for your answers.

    Regards,

    1. Hi Dan,

      1) In some cases, PF is cheaper than SQ, but not all. I have a review of PostFinance E-Trading.
      I would not trust PF with my money, they are not very professional. Since they use SQ anyway, I’d rather use SQ directly.
      2) I believe you can do that in your account settings, but maybe this option is only available when you have enough for it to be worth it. Since this is only for cash, I don’t really care.

  2. Salut Baptiste,

    As usually great content.

    There is no doubt that SQ’s fees are (crazily) high. However, looking how the geopolitics can take things upside/down quickly, with heavy impacts sometimes, makes me reluctant to invest via an intitution outside our old continent … anyway, just my opinion.

    How come you only focused on SQ and IB; i.e., where you’d position Degiro in your investment equation/strategy?

    I read your reviews on Degiro, but surprised to read now that you’d use SQ (as a backup) but not Degiro, eventhough the former’s fees are drastically higher than the latter.

    Best,

    1. Hi,

      Thanks :)
      They are high, but if you compare with other brokers within Switzerland, only FlowBank is cheaper than SQ. So, I would not say that SQ is crazily high.

      I am not “only focused on SQ and IB”. I think SQ is the best Swiss broker while IB is the best foreign broker. So, it makes sense to compare them together.
      DEGIRO is strictly worse than IB, so it does not make sense to consider it.

      I am thinking in the future in having a broker in Switzerland for diversification. DEGIRO would not offer me any interesting diversification. If I diversify here, it’s for safety in case of foreign troubles. I don’t want to have foreign troubles with DEGIRO.

  3. Thanks for the overview. Very helpful. I’m using both services myself. For European shares i usually go with SQ and for US trades i use IB. For Swing trading, IB is definitively my preferred choice. Costs of SQ are simply too high.

  4. Thanks for the comparison Baptiste. I started with Swissquote, I still have an account there. But I make all my new investments through IB.

    1. Hi Dror

      Thanks for sharing :)
      At some point, I think it makes sense to keep two brokers. I am thinking of doing that in the future and transfer some shares to SQ, but I am not at that point :)

      How is early retirement going?

      1. Hello Baptiste, thanks for asking, pretty good.

        It would be better if the markets were in good shape. :)

        But as a good investors, we know that this is only a phase.

  5. Hi Baptiste, three questions:

    1. How should I transfer my ETFs from SQ to IB? I have basically three ETFs, 1 Swiss, 1 World and 1 US for at about 100k CHF. Is it cheaper to sell them on SQ, transfer the money from SQ to IB and buy there again or would you recommend to use the transfer fund option?

    2. I have SWDA and CSSPX in my portfolio, both located in Ireland. Does it make sense to buy exact the same ETFs again or should I consider US-based ETFs like VT?

    3. Is there a two-factor auth in place at IB?

    Thanks in advance, will for sure use your referral link for IB as soon as I make the decision!

    1. Hi Sereros,

      1) I would use the share transfer services to make it easier. But it may not be cheaper.
      2) I would consider US ETFs to save on dividend taxes
      3) Yes, it’s mandatory, based on IBKR Mobile applications

      Thanks for thinking about my referral link :)

  6. Thank you for your review, I really enjoy reading them. It‘s great that you also take a look into safety in case of broker default, which is something I too spent quite a bit of time researching.

    Regarding investment fees I have a slightly different experience since SQ also charges for stamp duty and exchange fees:
    1500.- CHF ETF Leader with SQ: 9.- fixed fee + 0.85 real time snapshot (seems to be mandatory…?) + 2.25 stamp duty + 2.- stock exchange fee = 14.10

    Same transaction with IB: 3.61

    If one puts the fees in terms of percentages of the 1500.- CHF investment there is a big difference between the two:
    SQ: 0.94% fee
    IB: 0.24% fee

    Cheers!

    1. Hi Bearfall,

      That’s a good point, I need to take stamp duty into account. I have not paid this fee in a long time and almost forgot about it!
      Normally, the real time snapshot should not be mandatory.
      2 CHF stock exchange fee does add a lot to 9 CHF base! Thanks!

      I will update the article in the coming days.

  7. Hi! Thank you for your blog! I have learned a lot! I am a complete newbie in investment and I have 2 questions. First, How much will be the minimum amount of money you will recommend for starting to invest? Namely, should we first save an X amount of money before thinking on starting to invest it?
    Second, how will you start? Using a robot advisor or going directly into a broker like IB?
    Thanks!

    1. Hi Lila,

      I don’t think there is a minimum. The problem is that fees for very small investments are expensive. If you have 1000 CHF to start, I already think it’s worth it. The important thing is to start so that you get used to it.

      As for robo-advisor vs IB, it’s up to you to decide. There are some good robo-advisors. A robo advisor will always be more expensive than investing by yourself if you do it right. But you will need to learn more things if you are investing by yourself and there are more manual steps. So, it depends on how involved you want to be.

      1. Thanks a lot! Do you recommend any resources to start to learn how to invest by your self?. I read your book about early retirement, but that’s all the knowledge I have. I need more on the practical details of investing.
        Thanks.

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