This article compares the costs for trading equities and options in the United States market. However, both Interactive Brokers and Saxo Markets offers access to other capital markets and products as well, such as Forex, Fixed Income and Mutual Funds etc.
Disclosure: Some of the links below are affiliate links, meaning, at no additional cost to you, I will earn a commission if you click through to make a purchase.
READ: How to Sign Up for Interactive Brokers Referral Program
1. Trading Fee for Equities
Interactive Brokers
> 0.005 per share (minimum fee of 1 USD, maximum 1% of the trade value)
Saxo Markets
> 0.01 USD/ share (minimum fee of 3.99 USD)
2. Minimum Commission for Equities
Interactive Brokers
> 1 USD
Saxo Markets
> 15 USD
3. Minimum Holding Fee
Interactive Brokers
> Monthly minimum fee of 10 USD for accounts between USD 2000 and 100, 000 USD in portfolio value
Effective 1 July 2021, clients will no longer be charged USD 10 for not maintaining a minimum balance or transaction activity. Interactive Brokers’s decision to remove inactivity fees aligns them with industry standards and reflects their ongoing commitment to provide clients with low cost trading solutions.
Saxo Markets
> Zero
4. Trading Fee for Options
Interactive Brokers
> 0.70 USD/ Contract (minimum $1)
> Fixed Rates for Infrequent traders
> Tiered Rates for Active Traders
Saxo Markets
> 6 USD for trade volume between 1 -250 Contracts
> 3 USD for trade volume between 251 to 1000 Contracts
> 1.50 USD for trade volume between 1000 to 5000 Contracts
> No Minimum Fees for Contract Options
> No Custody Fees for Contract Options
READ: How to Convert from Base Currency to Trading Currency in Interactive Broker
5. Trading Platforms
Interactive Brokers
Desktop – Trader Workstation.
Personal note: I was not able to download the Trader Workstation software onto my laptop due to the software being incompatible with laptops.
Mobile App (2FA) Webtrader Platform
Saxo Markets
> SaxoInvestor for beginners who are starting out
> SaxoTraderGO for traders with some knowledge
> SaxoTraderPRO for advanced traders
6. Customer Service Comparison
Interactive Brokers
Hotlines dedicated to various regions, chat bot, FAQ
Personal experience: It is hard to get customer support, send emails, received no replies request for callback, received callback after 2 days
Tried chat-bot, answers provided by the machine were weak and not so relevant.
*Update: Hotline works but it is not toll-free, no Singapore hotline and I had to call Hong Kong hotline which is costly. As for the Live Chat function, I had to wait for some time before the next available agent was ready. Response from the agent was slow and the problem was not resolved by the time I ended my Live Chat. (Issue I encountered was Delayed Data not showing on my Trade Workstation
Saxo Markets
Dedicated Singapore local hotline from 0830 to 1730. Singapore office available for customers to make contact.
Personal experience: Dedicated Saxo Account Manager based in Singapore to assist with my queries. Follow up call to check on my interest in opening a trading account with them.
7. Company Reputation
Interactive Brokers
Established since 1977. Local Singaporeans like myself are not allowed to trade in Singapore markets. This is most likely a move to protect the local brokerages’interest as the latter charge higher fees.
No impact as I am already using OCBC Securities to trade in Singapore market.
Edit as of July 2020: Interactive Brokers opens a Singapore office and offers access to Singapore stocks.
Saxo Markets
Fully licensed Danish Bank can trade in Singapore markets, but that is not a decisive factor.
8. Minimum Sum Required to open/ Maintain the Account
Interactive Brokers
> For Cash Account, there is no minimum balance required
Saxo Markets
> 2000 USD
9. Monthly Activity Charges
Interactive Brokers
10 USD monthly (or equivalent in your Base Currency), cannot be waived unless your portfolio has more than 100, 000 USD in Equity or portfolio generates more than 10 USD in commission and fees.
Saxo Markets
100 USD for 6 consecutive months of NO trading
10. Cash Movements
Interactive Brokers
1 free withdrawal per month. Thereafter, 10 USD for Wire transfer and 1 USD for GIRO transfer.
Saxo Markets
No charges if request is submitted via online. 40 USD if done manually
11. How to Fund the Account
Interactive Brokers
Bank transfer
READ: How to Do a Fund Transfer for Interactive Brokers
Saxo Markets
Bank Transfer with a processing time of 1 to 5 days. Funding via Credit/ Debit Card will be immediate. However, credit card will incur charges additional charges from 0.5 to 2.5% in transaction fee.
Conclusion
Personally, I chose to open my account with Interactive Brokers because I love the feel of the Trading Platform and the fact that there is no minimum account balance required. I acknowledge that there are cons as well such as the monthly inactivity fees and the relatively poor customer service but those are mitigating factors in my opinion. What is your opinion on this?
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