When I started investing, the biggest challenge for me is to decide which brokerage account is the best. There are many choices in the market, but few are quite known in your own country, as a result, most people just go with the well-known one despite the disadvantages in many aspects. If you are like me, spend time to research and compare, you can set yourself on the right track to avoid hefty fees and have a wide range of investment to choose from through the brokerage account. I share with you 2 trading apps that I use every single day. I don’t trade every day, but it is good to have them on my smartphone and be informed whenever I want to see how my investment is doing. One has the great auto-invest function which makes your investment go on auto-pilot mode and set you to build long term wealth with minimal hassle.

1. Interactive Brokers

Choice of products

Interactive brokers cover 135 markets in 33 countries offer investment products in 23 currencies. No matter from the range of products or reach of the global market, Interactive Brokers provides its users with great diversification. Unlike some brokerage companies, you might be limited to a certain range of products, if the investments are not listed on the exchanges that included in the brokerage service you can not buy them. With interactive brokers, I have not yet encountered this problem.

Low fees

Besides the choices, the other major reason for me to go with them is the fees. There are types of pricing structure: tired and fixed. You can decide which one you want based on your trading volume and products. For example, you don’t need to pay any transaction fees when you buy US ETFs. If not ETFs, then you pay US$0.35 per order or a maximum of 1% of your trade value.

If you buy EUR, CHF, USD, PLN, ILS, and HUF-Denominated Products Tiered, when the trading value is less than 50 million, the fee is only 0.05% of the trading value with a cap at CHF49 and minimal at CHF1.5 for CHF dominated products. Similar fees apply to others in Europe listed products.

Put it simply, if you invest $1000 per month using the dollar-cost averaging method to buy a US ETF. such as VTI or VOO, You pay a $0.35 transaction fee. If you invest CHF1000 per month to buy a CHF ETF, such as CHSPI or CHDVD, you pay a CHF1.5 transaction fee. If you have 3 ETFs in your portfolio, you invest once a month, your monthly transaction fee will be only a few dollars or just $1.05 if you have 3 US ETFs. However, if your account has less than $100,000 value, your minimal monthly fee will be $10. This means if you incurred no matter $1.05 or $ 8 transaction fee, your monthly account maintenance fee will still be $10. But this does not apply in the first three months, because Interactive Brokers give you time to get used to their product. If you have more than $100,000 value in your account, the minimal maintenance fee does not apply to you any more.

On the other hand, do you know how much other brokerage service charges you? The most well-known brokerage firm in Switzerland is called Swissquote. If you buy Swiss products, a minimal fee is CHF9 per transaction. If you invest CHF1000 per month on one single product, it costs you CHF20 per transaction.

Now if you also have 2 US ETFs in your portfolio, you pay even more. With $1000 invested in each US ETF, you pay $25 for each transaction, $50 in total. In a month if you just make 3 transactions, you already pay about $70 transaction fees!

That is around 2.3% of your total investment value!

Besides transaction fees, you can directly exchange foreign currencies on Interactive Broker that gives you a better exchange rate. It is just like buying another investment products, you buy the FX pair using your original currency.

Transparency

When you use the app to trade, or on the website, you can generate reports based on your own selection. You will see how much fees you paid in the chosen period, how much dividends did you receive, how much tax do you pay and account balances, and so on. It can be as comprehensive as you want it to be. I particularly like that it automatically take into consideration of your tax residence, then applied the tax treaty to your dividends. So you don’t have to worry that you pay more withholding taxes when your tax residence has a treaty with the investment product domiciled country. For more information, you can read: <Simple Explanation of Swiss/US Tax Treaty and Its Impact on Your Investment>.

If you invest with a bank, you will not be able to check your investment directly from your phone. I had some investment with a company before, I have to log into their portal, put in my personal information, then I can see the results. And I have so many questions regarding the fees they deducted from my balances. There was just too much hassle. I much prefer a solution that I can manage myself easily and with the lowest cost.

Convenience

As mentioned above, you can download the Interactive Broker app, where you can trade and view your account anytime you want. Of course, you can also download the trading terminal, but it looks really scary for beginners. It looks too overwhelming to me, as a non-professional trader. I now only use the app. But you can log in to the client page online, it is like a normal website where you can change your setting, generate reports, and others. You don’t have to download the Trader Workstation by Interactive Broker.

If you are worried about what happens to your broker when it goes bankrupt, therefore choosing a well established on if recommended. You can read this article on The Poor Swiss site.

2. Trading212

Trading 212 is a UK company that has gained huge popularity among traders and individual investors. It’s zero-fee and mobile-friendliness has attracted smartphone heavy users like me. I like it when I can do everything through an app. I can even buy some shares while brushing my teeth!

No fees

Trading212 uses Interactive Brokers as the back-end and provides users a simple user interface to trade and manage their portfolios. They absorb the fees for users because their revenue model is based on margin traders. If you are an average investor like me, then you only need to open a Trading 212 Invest account, instead of the Trading212 CFD account.

Auto Invest

This is my favorite function of Trading212. You buy shares on Interactive Brokers manually, but you can do it automatically with Trading212. With hundreds of investments to choose from, you can select the ones you want to form a portfolio using dollar-cost averaging to invest. You can link your portfolio (or called Pie in the app) with your credit card, the set amount will be automatically deducted from your card with a frequency you set and buy the investment products automatically. You don’t have to worry about foreign exchange, when to buy, placing orders, and such. You just need to:

1. Build a pie. You can even copy other people’s pie in the pie library and see what is the projected growth. This is your portfolio. You can have as many Pies as you want. Inside the pie, you might have several investment products, you can put a percentage allocation to each so the total value of the pie is 100%. You can adjust the allocation anytime. In the next autoinvest round, the system will buy according to your new allocation.

2. Set an investment amount and frequency. You can choose how much you want to invest in the pie when the system buys for you. For example, you can set every Wednesday to est $100 in the pie, or daily, monthly, or so on a specific day from Monday to Friday.

3. Rebalancing. After awhile your asset value might change due to the market movement. But you don’t have to manually calculate how much you should sell or buy. You can just hit Rebalancing, the system will automatically sell and buy within your portfolio so that your allocation remains as what you wanted. How convenient is that?

This auto-invest function really helps me to stay on track with my investment using dollar-cost averaging. So I won’t deter buying when the market is high or keep waiting and lose the buying window. It eliminates human emotions and automates the investment process for me.

Community

If you go to pie library, you will see people’s comments. You can also share your own pie to the library and exchange ideas with others. When you don’t find a product on trading212, you can submit a request online. Where there are enough likes on those requests, the team will add them pretty quickly. Sames goes to function improvements, adding new functions, and so on. It is a trading app built for users.

And now when you open an account with Trading212 through this link, you can get a free share of $100. I received a free Disney share at $95 before but stupidly sold it at $85, the lowest price possible. Now, look at where Disney’s share price is!

Let me know which share did you receive.

Conclusion

Before opening a brokerage account, please do some research and compare what is best for you. So you won’t need to sell your investments and move to another one when you find out this brokerage is not the best for you. when you do an account transfer, you have to sell your shares and that is really bad as you might lose some money due to the market movements between the time you sell and the time you buy in again. There could be better options in your country, please do some research on this.

Those 2 apps are the ones I chose after doing extensive research myself and so far I have been using them for almost a year and still happy about it. I will continue investing in the long term.

Get free shares with Interactive Brokers.

Get a free share with Trading212.