I regularly search for comparisons on Google before subscribing to a new service, or buying a new product. And often, the same scenario happens... After several reformulations of my keywords, I finally come across THE blogpost which explains the pros and cons and which, above all, tells me if the product is worth buying.
It's only after a few minutes of reading that I realize that the blogpost is three years old... ergh... So, is it still worth it or is there a better alternative that has come out since? And here we go again for hours of research...
My last online broker comparison was published two years ago...
I recently realized that my last article about online brokers was starting to be old... (from 2016). There is indeed this study on Degiro that I did 6 months ago with a summary of the situation on brokerage services, but I'm not sure that my dear new readers saw it because the title of the article didn't indicate at all that it contained comparative information.
An alternative solution could be to glean information on the forum's wiki but once again, the newcomers among you may not even be aware of its existence...
Top 2018 online brokers for the Swiss Mustachian investor
The ranking below is sorted according to my order of preference if today, I had to choose my online broker. Nevertheless, the thinking process behind each provider is rather objective since it's purely based on mathematical calculations (cf. the summary table below).
#1 - Interactive Brokers (aka IB)
IB is the best choice for a Swiss Mustachian investor given their very low transaction costs (0.1% of the transaction amount with a minimum of CHF 10/transaction, and no custody fees).
The conditions to be fulfilled for the above sentence to be true are that you must have at least 100kCHF to invest as a basis (because if you have less, there is a fee of CHF 10/month), and that you have no problem to have an IB bank account outside of Switzerland (mine is located in the UK).
Our investment account is at IB, and we'll cross the 100kCHF mark this year — bye bye fees :)
#2 — CornèrTrader (aka CT)
CT is a very good alternative for Mustachians who are thinking of investing between 30k and 100kCHF on the stock market. This company offers a "no custody fees" solution with transaction fees at 0.2% with a minimum of CHF 20/transaction (and 0.12% if you have more than 75kCHF at CT, with a minimum of CHF 18/transaction).
The other point — important for some of you — is that your account is based in Switzerland if you choose this service.
I opened an investment account with them to invest for our children (and to get an idea of their service to share it with you, here on the blog). So far, so good!
#3 — TrueWealth (aka TW)
TW is a good solution for your online investment training. You create your account, transfer cash to it, and then they take care of the rest. This "Made in Switzerland" solution has an all-inclusive fee of 0.5% of your portfolio. Up to 25kCHF, it can be worth it compared to a standard savings account with almost no interest nowadays. For me, it's a temporary solution to get introduced to the investment topic.
#4 — Degiro, l'outsider
This Dutch online broker entered the Swiss market at the end of 2016. Its big advantage: to propose a long list of ETFs free of charge which contains my favorite products.
He clearly beats his three competitors above, at least mathematically. However, my opinion remains the same as six months ago, i.e. I prefer to choose a very established company to invest my several hundred thousand of CHF, compared to the potential gain on costs (about CHF 1'000 over 10 years between Degiro and IB).
Top 2018 brokers' summary for a Swiss Mustachian investor
I put below my brokers analysis' Excel spreadsheet which allowed me to arrive at this ranking. You'll find different investor profiles as well as the three other brokers I've analyzed, namely Swissquote, Strateo, and SaxoBank.
The goal of this blogpost is to give you an updated summary for 2018; hence I don't give you all the analysis criteria of my reasoning here — especially since they haven't changed one iota — but you can find them on my comparative article of 2016.
If Swissness is a key element for you, then open an account at CornèrTrader.
If you're just starting out with investing and the Internet in general, open an account at TrueWealth to get your teeth into it, and change later once you've gained confidence.
If you think we only live once, and that the motto "No risk no fun" also applies to your safe as big as Uncle Scrooge's, then go for it, just open an account at Degiro.
For those who already have a broker, I'd be interested to know the name. Is it one of the four above? Or have I missed a key new player on the Swiss market?
Note: if you choose to open an account at Interactive Brokers, CornerTrader or Degiro via one of my links, you won't notice any difference — but the blog will receive a referral fee. I thank you in advance!
As usual, I only write and review things that I trust and/or use daily in my personal life. In the case of this article, it was only my calculations that made me finish with this top 4, and nothing else. (sorry for the usual blabla dear old reader, but I want it to be clear to our brand new reader!)
PS: I'll be on holidays until the end of August, so the blog will be slowing down during this period. If you want Mustachians readings by the beach, you have the choice between the blog archives, or just start from scratch with the first article, and go up post by post with the navigation links at the bottom of each page. If you have already completed this step, there is also the forum where one never stop learning! But don't forget to disconnect and to enjoy the summer!