Does Interactive Brokers get worse execution in US?
A study shows IBKR has high trade execution costs for US Stocks. Its still cheaper than most other brokers for US and has the best data & tools. Its still the best broker in Singapore.
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Interactive Brokers (IB) has significantly lower all-in pricing than all other Brokers we tested. In most major markets their pricing was lower by 80%+ compared to most peers. Despite this, IB also offers the most comprehensive set of analysis tools and data in the market.
On our calculations, you could save more than S$1,000 a year trading a mid-size portfolio on IB vs. some other brokers.
We loved that their quoted rates include most additional fees from exchanges etc. unlike other brokers, who charge these over and above the quoted rates. This means IB’s actual commission rates are even cheaper than they look.
Their platform was somewhat harder to set up and use compared to the best-in-class peer. However most common tasks were still fairly easy to perform and in our opinion the cost savings are large enough to more than justify dealing with a slightly less polished interface.
Interactive Brokers' prices are lower than most peers by 80% or more and they have the widest selection of tools to help you invest.
If you found this useful, consider signing up for IB via the link above. This gives you access to the best deals and helps us maintain the site.
If you need to trade smaller markets like Indonesia and Malaysia, which are not available on IB, POEMS is your best bet. POEMS has the widest coverage of smaller markets and their commission rates are the lowest for those markets as well. In Indonesia and Philippines, their minimum commission amount is higher than peers, which means they would not be the cheapest for smaller transactions there.
However we would not use POEMS for the major markets like US, Hong Kong etc. as IB has much lower all-in pricing, better tools and data. POEMS also has a number of account types with different pricing and features which is confusing and the wrong choice could land you with much higher rates. We recommend their Cash Plus account as it has the lowest fees.
POEMS has the widest coverage and lowest commission rates in the smaller stock markets in Asia.
If you found this useful, consider signing up for POEMS via the link above. This gives you access to the best deals and helps us maintain the site.
We spent more than 100 hours researching 12 Stock Brokers in Singapore. We spent many hours on each website / app comparing the markets and products available for trading. We compared their fee structures for trading stocks and margin lending in Singapore and 6 other major markets. We simulated the annual cost of trading on each platform for a Buy & Hold type investor and a more active trader.
We opened live trading accounts on most of the major Brokers in Singapore and spent hours evaluating the ease of use and the quality and quantity of tools provided by each broker. We installed and configured their trading software to evaluate the options for more sophisticated traders. We carried out multiple trades on a few of the better platforms to verify our fee calculations and to test their reporting tools.
We interacted with the helpdesks to gauge their responsiveness and looked for user reviews on the internet. We also looked up the licenses they had on the MAS website and went through the conditions of licensing to understand the processes they would have in place to safeguard your funds.
If you would like to invest in individual stocks and ETFs on your own, either in Singapore or globally, then you need an account with a Stock Broker. You don’t even need to be an active trader. If you’re willing and able put in a little effort, it is possible to create a well-diversified passive portfolio that is similar or even identical to investing via a mutual fund or a robo-advisor, at a much lower cost using a broker.
Most of the brokers do a lot more than allow you to trade stocks. They often offer leverage via margin lending or through options, futures & CFDs, the ability to lend your shares for some yield, access to bonds, mutual funds and managed portfolios among other things.
Brokers are also increasingly providing the ability to trade Forex and Cryptocurrencies on their platforms. Each broker also offers their own set of data and tools to help you research and manage your investments
Stock Brokers often have confusing pricing schemes with different commission rates for different trade sizes / markets / customer tiers and also different minimum commissions that they charge, which makes it difficult to easily compare the pricing. Our analysis cuts though the confusion to find out the right answer for you.
To find the best Stock Broker in Singapore we compared them based on 4 criteria: number of markets and products covered, pricing, ease of use, data and tools provided.
Coverage The 12 brokers we looked at provide access to different sets of markets, exchanges or countries. We shortlisted 15 countries that we felt most investors in Singapore would care for and compared the brokers on how many of those they covered.
The primary focus of this comparison was to find the best stock broker. However we also compared brokers on access to products like Commodities, Cryptocurrencies, DLCs, CFDs etc. and all else equal we preferred brokers with a wider range of products available.
We found it challenging to accurately compare the products offered by each broker on a like for like basis because they don’t always classify the product in the same manner. For instance some brokers categorize stocks and ETFs as separate products while other do not. Some brokers like Saxo list Crypto as a separate product category while IB includes it as a subset of its Futures product. IB does not list CFDs as a separate product on its Singapore website but mentions on its UK website that Singapore Residents are eligible to trade CFDs.
All-in Pricing Brokers are typically compared on the trading commission rates they disclose. However for our comparison we also included some additional charges such as custody fees and FX conversion spreads while trading stock in currencies other than the Singapore Dollar.
These other charges can often account for a very large proportion of the total cost of trading but are usually overlooked in most analysis. For Buy & Hold type investors, FX spreads can often be a larger proportion of the overall trading cost than the trading commission itself. It is less important, but still meaningful, for active traders since it is required only once.
We compared the total annual cost for investors at each broker in two scenarios, for a Buy & Hold type investor and a more active Trader.
For the Buy & Hold investors, we assumed they invest their annual savings over 10 equally sized trades and have an average balance equal to 3x their annual savings in custody at the broker. In other words, a person investing S$50K in a year carries out 10 trades of $5000 each and has a portfolio worth S$150K in custody with the broker.
For the active Traders, we assumed that they turnover their entire capital 4x a year i.e. if they are trading with S$50K of capital, their total traded amount is S$200K over the year and the average annual balance in custody is S$50K.
We assumed each type of investor pays the FX spread only once in the year, and only if they trade markets other than Singapore.
Since the brokers often have minimum commission levels, we ran these scenarios for different portfolio sizes from an annual investment of S$10K to $1M, in four major markets, Singapore, USA, UK and Hong Kong. The charts above show the results for a portfolio size of S$50K and the tables below show other scenarios.
The impact of minimum commission levels can be surprisingly large for smaller portfolio. On our calculation, the smaller portfolios raked up effective commission rates as high as 11% despite reported commission rates of only 0.25% to 0.7%.
To confirm the accuracy of our calculations and to identify any hidden charges, we also executed live trades on 5 platforms and compared the actual cost of those trades across the platforms based on the trading statements.
For this analysis, we purchased 4000 shares of Singtel on each platform at the same time, and sold them 3 days later, again at the same time. We received identical execution price on all 5 platforms on both legs.
This confirmed that while IB, Saxo and POEMS all advertise an identical 0.08% commission rate in Singapore, the actual cost to customers differs a fair bit.
IB includes the SGX trading and clearing fee within this 0.08% while the others charge that separately.
moomoo advertises a 0.06% rate with 180 days of commission free trading. However the 0.06% is split as 0.03% commission and 0.03% platform fee and only the commission is waived for the first 180 days. They also charge SGX fees separately. As a result despite our being in the 180 day commission free period, our actual cost for the trades was only marginally lower than the fully loaded cost with IB.
Tiger advertises a 0.04% rate but that does not include the additional 0.04% platform fee and as with most others, the SGX fees are charged separately.
All-in Pricing ended up being the single most important criteria in our eventual choice because of surprisingly large range of prices charged by different brokers.
Ease of Use We evaluated each broker along multiple dimensions such as ease and speed of signing up process, intuitiveness of the overall interface including common activities like funding, finding the stock of interest, trading, setting up watchlists and charts, finding basic information on your portfolio and its performance etc.
We also considered how good and complete the information on the website was e.g. details on products and pricing, FAQs, trading guide etc.
Tools & Data The best brokers offer many tools and data sources that can help investors and traders make better decisions regarding their portfolios. We considered 5 different categories here: watchlists & screening, charting & technical analysis, Exposure & Risk Analysis, Performance evaluation and Fundamental analysis.
On each platform that we chose for detailed review, we tried to create the following setup on the trading platform:
While this is not a comprehensive test of these trading platforms, some of which support fairly advanced setups, we felt this was likely to be a “good enough” test for most individual investors needs.
Interactive Brokers is our pick as the Best Broker in Singapore for most people. Not only does IB offer the cheapest all-in pricing by a mile for the major markets, but it also has the most comprehensive suite of tools and data sets to help investors make their decisions and track their performance.
We were blown away by how much cheaper it is to trade on IB compared to nearly every other broker in every other market. In many major markets, their all-in pricing was lower than peers by 80% or more. In USA, for an average trade size of S$5000, most brokers charge 10-45 times (yes! TIMES!) what IB charges. A lot of this gap was hidden in the FX spread, where IB offers a 0.002% spread over interbank rates while nearly everyone else charges between 0.15% to 1.15% for currency conversions.
For investors deploying S$30-50K a year, the difference in all-in cost may be anywhere from S$25 to S$1000+, per year.
TDAmeritrade, with their zero commission pricing is potentially cheaper than IB for US listed stocks. However they do not disclose the FX spread they charge and you cannot choose when you convert your S$ to US$ either. In our testing, the conversion happened 3 days after the fund transfer. Since FX spread often accounts for a very large portion of the all-in cost, we cannot be sure that TDAmeritrade is actually cheaper than IB for US. They also do not cover any other market and have a more limited tool / feature set compared to IB.
IB was also the cheapest provider for margin lending across all major markets including Singapore, with rates lower than peers by 1-4%. Unlike peers, IB does not fix the amount of leverage offered but instead provides what they call “Risk based” leverage.
Incredibly, despite having the cheapest pricing in the market, IB also offers the widest array of tools and data sets to all investors. In our testing, IB was the only broker to provide free access to data points like 3 years of analysts’ earnings estimates for stocks and list of major shareholders. Most other brokers only offer trailing data. They are also the only broker to have a marketplace with a large number of research and data providers that you can subscribe to from within your account.
IB’s platform for pro traders, the TWS, also offers advanced trading tools such a automatic portfolio rebalancing and “What-if” scenarios analysis, among many others. We did not find such functions on any other platform.
There are many such details that make it clear that IB is squarely focused on the professional traders. Until recently one concern for less active traders was the monthly minimum fee of $10 that IB charged. However IB eliminated that fee on 1 Jul 2021 and made the platform a lot more friendly for everyone.
Overall, IB could be fairly said to be that rare phenomenon – the best product at the lowest price.
Could be better IB offers great value but it is not without some flaws.
The TWS has a somewhat dated appearance and has a relatively less intuitive user experience overall – for everything from finding the correct tools to default settings. While it wasn’t very hard to set up the TWS the way we wanted, the process was notably harder than more user friendly platforms like Saxo. The platforms crams an absolutely enormous feature set in a somewhat haphazard manner and finding & configuring the one you want, the way you want can be frustrating sometimes. This was not a dealbreaker for us but the UI could benefit from a makeover.
IB also does not offer access to a number of markets in Asia like Taiwan, Korea, Indonesia etc. This seems like a curious hole in the portfolio considering their focus on active / professional traders. This could be a deal breaker for some investors but we felt that most investors would be better off using IB as their primary broker and perhaps relying on another broker to access these markets because of the huge difference in pricing. Most brokers let you open accounts using myInfo now, so opening 2 accounts isn’t much of a pain.
The pro version of their platform, the Trader Work Station (TWS) repeatedly crashed on macOS Monterey, and was unusable in our initial testing. This was fixed later by switching to the TWS Beta version as recommended on their website. We had no issues using the TWS on Windows 10.
POEMS by Philip Securities is our pick if you need to trade markets not covered by IB e.g. South Korea, Taiwan, Indonesia, Thailand, Malaysia, Vietnam and Philippines.
POEMS is the only broker to provide access to every single one of these markets, unlike other local peers which cover only a few of these.
Their commission rates in all of these markets are either on par or better than competition. Their minimum commissions were higher in some cases making them more expensive for smaller trades. On our calculations, they were almost always the cheapest broker for these markets if the trade size was more than S$5K.
The POEMS Pro software is a solid but average trading platform relative to peers. We liked the fundamental snapshot it provides powered by Refinitive but it includes only historical data. The other functionality is in line with what rest of the market offers and we did not have any difficulty in creating our test workflow on the platform.
Saxo Markets stood out for the user-friendliness of their trading platforms. Of the 3 platforms they offer, SaxoInvestor (basic) and SaxoTraderGO (full featured) are web-based and relatively simplified while SaxoTraderPro is desktop-based, professional grade platform. The user experience on all 3 platforms was best-in-class. Common tasks were easy to accomplish, pre-set defaults were often exactly what we wanted and changes were simple to make.
We were surprised by the lack of a dedicated mobile trading platform. However, both SaxoInvestor and SaxoTraderGO worked well on mobile browser after a slow loading time.
Saxo’s all-in pricing is significantly higher than our pick, Interactive Brokers. This is not as obvious for SGX listed stocks where Saxo and IB both advertise the same 0.08% commission rate and do not charge custody fee. However, unlike IB, this 0.08% fee does not include the SGX Trading and Clearing fee with Saxo, which means their effective commission rate is nearly double that of IB. Saxo’s minimum commission of S$5 is also double that of IB (S$2.5) which also makes them more expensive for smaller trades (<S$6250).
Outside of Singapore though, the gap is meaningful. First, the headline commission rates that Saxo charges are higher than IB e.g. 0.15% vs. 0.08% in Hong Kong and 0.10% vs. 0.05% in London. They also charge a 0.06% custody fee on all assets held outside of Singapore. This is not a trading fee but adds meaningfully to the cost of the platform, especially for a buy & hold type investors, where the invested amount might be a multiple of the annual trading volume. IB does not charge this fee.
And finally, Saxo charges a flat 0.30% spread on all FX conversions while IB charged 0.002% – 0.07% in our testing. That puts the all-in trading cost at Saxo, for a mid-size investor, somewhere between 2-10x what IB charges, depending on the market.
Saxo has recently introduced a number of subscription plans. In our calculations we used the pricing in the free Bronze tier. Our overall conclusions will not change with higher tiers.
moomoo is the mobile-only trading app of Futu Holdings that seems to be trying to gamify trading. See our full review of moomoo for more details. Being mobile only restricts the features moomoo can offer compared to the desktop trading platforms of IB / Saxo / POEMS etc. and its not very customizable. However, moomoo does a good job of selecting the defaults and we found it provides nearly all the information that our setups on other platforms did.
moomoo was also the cheapest broker for SGD denominated stocks on SGX in our simulation. This was true for both, the Buy & Hold scenario and the active Trader scenario, where their pricing even lower than IB (0.06% vs. 0.08% and S$2.49 minimum vs. S$2.50). However, their FX conversion spreads (0.34% average) are marginally higher than other pure brokers and much higher than IB. This makes their all in costs outside of Singapore much higher than our pick, IB. They also offer access to only US, Hong Kong / China and Singapore stock markets.
Tiger is similar to moomoo in being mobile first but they do offer a desktop app for trading as well as a web login for administrative tasks (but not trading). Apart from the markets covered by moomoo, Tiger also offers access to the Australian market. Their app is fairly intuitive although we felt that the default data, reports and layouts displayed were not as well chosen as on the moomoo app.
Unlike moomoo, Tiger’s pricing is slightly higher than IB in Singapore due to the same rate (0.08%) but a higher minimum (S$2.88 vs. S$2.50). Outside Singapore, their FX spread was also marginally higher than moomoo (0.38% vs 0.34%), resulting in an all-in cost that is much higher than our pick, IB. See our full review for more details.
TDAmeritrade offers 0 commission trading for the US market and in our testing their FX spread also appeared to be quite low, potentially making them the cheapest broker for trading US stocks. But we cannot be sure.
This is because TDAmeritrade automatically converts your SGD deposits in USD before making the funds available for trading. In our testing this conversion happened 3 days after we transferred funds from our DBS account into their DBS account and at a time of their choosing. This makes it difficult to estimate the spread or control the exchange rate you receive. In our view the 3 days delay to reflect an intra-DBS transfer is also hard to swallow when most other brokers reflect fund transfers on the same day, and some do so within minutes.
Their thinkorswim trading platform is easy to use but is quite basic compared to most other platforms we tested. TDAmeritrade also does not offer access to markets other than US, not even Singapore.
FSMOne offers a flat commission of S$8.8 for all trades in Singapore. This makes them costlier than IB / Saxo / moomoo / Tiger for smaller trade (<S$11K) but the cheapest option for larger trades.
Outside Singapore, their FX spread averaged 0.50%, which was higher than every broker other than the local banks. The high minimum trading fee in these markets also made them more expensive for smaller trades.
Their stock trading platform is a small part of the overall web based interface that FSMOne has. The reports and tools are not very customizable but we were able to create most of our standard workflow on FSMOne. The preset reports for performance and risk tracking were also quite limited.
DBS/OCBC/UOB are the incumbent / legacy players in the Singapore broking market. Their prices are substantially higher than all other brokers we tested, not just IB. And for retail investors investing small sizes ($1-5K) the high minimums lead to fee levels of as much as 1-4%. For more active traders, that can rise to 3-8%.
The process to open accounts with these brokers is also more cumbersome, with OCBC actually requiring a visit to the branch (we didn’t). This is when most Finance companies are connected to the myInfo system and allow fully digital account opening process.
We did not complete a full review of these brokers because of the high fees but in our brief exploration of their systems, we did not see anything that particularly excited us.
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A study shows IBKR has high trade execution costs for US Stocks. Its still cheaper than most other brokers for US and has the best data & tools. Its still the best broker in Singapore.
Webull offers true 0 commission trading (0 platform fee too) but has high spreads to convert FX. The App is very similar to moomoo / Tiger with less gamification.
The "Zero Commission" offers for US stock by moomoo & Tiger cut effective commissions by 7-25% but do not touch FX spread which accounts for 80% of the all-in trading cost. Our pick, IB, is still cheaper by upto 90%.
Which is the best CFD provider??