Markets: Canada

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Saxo Bank (Saxo Markets)

Founded in Denmark in the early 1990s, Saxo Bank now offers services to investors around the world and is one of two truly global operators (the other being Interactive Brokers). The name can cause some confusion – this is a brokerage and investment bank rather than a traditional retail bank. For this reason, it is now known as Saxo Markets in some countries.

The firm offers more countries for online trading than any other firm in the broker database. Trading commissions are mostly reasonable, but fees vary greatly depending on which country your account is opened in, so check your local version of the Saxo website to clarify these. The exact markets available may also be different, due to regulatory restrictions.

The commission on currency conversions also varies, but has unfortunately now risen to 1% in some countries (it was previously 0.5%). Investors trading in and out of stocks in the same foreign currency frequently will therefore want to keep the proceeds in cash rather than transferring back to their base currency.

You can operate multiple foreign currency sub-accounts to let you do this, but these need to be set up individually for each currency you require. In some countries, there may be a minimum account size to open sub-accounts.

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Interactive Brokers

Interactive Brokers is a US-based firm with registered offices in a number of other countries, including the UK and Hong Kong, and is one of two genuinely global retail brokerages along with Saxo Markets. The firm offers extremely low-cost Direct Market Access to a large number of international exchanges in Asia, Europe and North America.

The underlying service is an institutional-level trading platform – it’s used by many professional traders and small hedge funds – and Interactive Brokers mostly markets its services to very active traders. However, non-traders shouldn’t be put off by that. This is a cheap and efficient solution for many long-term investors as well, with commendably transparent pricing.

There is a minimum monthly fee of US$10 for accounts under US$100,000, offset against commissions, but the low overall charges – including almost free currency conversion – mean that despite this the firm can still be a surprisingly cheap option even for relatively infrequent traders.

It is still difficult to recommend Interactive Brokers for inexperienced investors, as the technical support team will not walk you through everything with the same patience as a more retail-focused stock broker. That said, the web portal has become more user-friendly over the last few years.

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Hargreaves Lansdown

Hargreaves Lansdown is one of the UK’s largest direct investment platform and offers a good range of US, Canadian and European stocks in addition to London-listed shares, bonds and a very extensive range of funds. The firm is consistently praised for high standard of customer service, which is a strong selling point for less experienced investors in particular.

International trades are placed via UK-based market makers (such as Winterflood Securities) and the foreign currency share price is converted to sterling each time with a mark up of up to 1%. This becomes costly for very frequent traders – who could look at firms such as Interactive Brokers or Saxo Markets where you can hold and settle in foreign currencies – but is less of an overhead for long-term investors.

Its nearest rival is probably AJ Bell Youinvest. Like Youinvest, Hargreaves Lansdown’s SIPP is set up to receive US dividends with no withholding tax deducted (and reduced tax on Canadian dividends), which is useful for income investors.