Zero Commissions Doesn’t Always Mean Totally Free Trades
Watch your currency conversion fees when buying US stocks outside the US market
When you focus on buying international stocks, you most likely start by looking for the platform that provides access to as many asset classes as possible, and with the widest range of options to choose from so that you may find the best possible investments for your strategy.
Another important factor to consider are the fees charged by the broker. Some brokers charge high fees, which can eat into your investment returns, while others shout about their zero-commission trade offers.
But when you see zero commission trading, you may want to consider whether zero commission actually means the implied free trading – or whether there are other fees lurking that make that proposition a bit more costly to your overall stock purchase. This is especially a concern with currency conversion fees for buying a US stock from anywhere outside the US market.
For non-US investors, the cost of investing in US stocks also includes fees for exchanging foreign currencies into USD to buy or sell those shares. This fee can make a big difference in the total cost of your stock purchase or sale, so it’s important to know how much each broker charges for currency conversion.
“International investors seeking exposure to U.S. stocks for portfolio diversification should be aware that zero commissions on U.S. stock trading as advertised by some brokers is anything but free,” said Steve Sanders, EVP of Marketing & Product Development at Interactive Brokers. “When FX conversion and other fees are factored into final transaction costs, select brokers charge significantly more than Interactive Brokers. Interactive Brokers offers investors the ability to trade U.S. stocks at some of the lowest costs in the industry without the added hassle of opening multiple brokerage accounts.”
Therefore, it becomes imperative to know how much each broker charges. And since the main goal of any investor is the highest-possible return, any money lost in relation to this can hurt a person’s overall return on investment.
Interactive Brokers keeps this fee low, with the currency conversion fee being as low as $2.00 or 0.02%, depending upon your market and your stock purchase. If you dive into other brokers’ fee structure, you may find their currency conversion fees can be a multiple of what IB charges. A recent chart published on Interactive Brokers site showed how several “zero commission” brokers were getting away with currency conversion fees between 5x and 10X those of IBKR’s minimal fee. All non-US investors should check their region’s IBKR site to see the potential savings according to their market.
It is important to find a broker that charges low fees so you can keep more of your investment returns. Interactive Brokers keeps currency conversion fees consistently low. In fact, fees at IBKR attend to be among the lowest in the industry, if not the lowest.
What makes the financial institution even more attractive on this front is their integrated account, where investors can have their capital in multiple currencies. This means investors can exchange money when they want to – and are ready – to buy shares or invest in an array of financial instruments.
Adding to this compelling argument is that IBKR also don’t charge for inactivity on the account. This means that an investor can sit on the sidelines for as long as required, waiting for THAT perfect opportunity to arise.
Nor does it require a minimum deposit when opening an account.
And with over 30 years of experience, Interactive Brokers has the experience and resources to help you grow your portfolio.
Interactive Brokers is the perfect choice for investors who are looking to take control of their finances and grow their portfolio. With low fees and a wide range of investment options, Interactive Brokers can help you reach your financial goals.
Get started today by opening an account here.
When will airfares begin to fall?
As the global aviation market rebounds, airlines are changing their service offerings
Over 46 million workers in the global aviation sector lost their jobs as global aviation came to a grinding halt at the onset of the pandemic.
However, Geoffrey Thomas from AirlineRatings.com said passengers have returned to airport terminals and boarded flights in droves.
“When travelled returned, many of us wondered what sort of low airfares will we have to be charged to entice people back onto airplanes.”
In February 2023, total traffic (measured in revenue passenger kilometres) rose 55.5 per cent when compared to February 2022.
Globally, traffic is at 84.9 per cent of February 2019 levels.
“It was a stampede, the likes of which we have never seen before,” Mr Thomas said.
The worst of inflation could be behind us
The unprecedented nature of the pandemic continue to shape international fiscal policy
As reserve banks and federal reserves continue to battle the impacts of Covid-19, inflation has become a dominate issue.
In some parts of the world, rising household costs have slowed consumer spending by more than expected.
It means the end of aggressive rate hikes could come to an end in a matter of months.
In Australia, recent data from the Australian Bureau of Statistics confirmed inflation has passed its peak and is beginning to moderate.
The numbers show annual inflation peaked in December 2022 but will still remain higher for longer than anticipated.
Matt Grudnoff is a Senior Economist at The Australia Institute, who said these are uncharted waters.
“I don’t think they should be fully blamed.
“The pandemic was an entirely different kind of recession, one that we have never seen before.
“The world went into recession because the world shut down for very good health reasons.
“But the economy rebounded extremely quickly, simply because there was no underlying problem with the economy,” he said.
“I think there is a great risk”: will AI steal our jobs?
Artificial Intelligence has become an increasingly powerful and pervasive force in our modern world.
Artificial intelligence is not a new concept. However, the growing advancements have the potential to revolutionise industries, improve efficiency, and enhance the quality of life.
Along with its promising advancements, artificial intelligence also brings certain risks and challenges that must be acknowledged and addressed.
It has become the focus of lawmakers, who are working towards greater regulation of the sector.
U.S. and European Union officials recently met in Sweden to weigh up the benefits and challenges of artificial intelligence, and other emerging technologies.
“The AI process is creeping up on us,” said Dr Keith Suter, who is a global futurist.
“You’ve got competition between companies.”
It’s almost like some of us can see this raft that’s heading towards the rapids and a disappearance towards the waterfall, and we’re giving a warning but it’s not being heeded because everybody’s in this race to get down to the river,” Dr Suter said.
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