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AJ Bell Youinvest

AJ Bell Youinvest was a pioneer in low-cost online SIPPs before expanding to offer regular trading accounts and ISAs. The firm offers an extensive range of funds and bonds in addition to UK and international shares.

The online international dealing service covers foreign stocks that can be held through CREST, the UK’s settlement system and securities depository, which essentially means major North American and European stocks. Some non-CREST markets are also available for telephone dealing, including some of the major Asian markets. There is a minimum trade size of £10,000 for Asian markets, but no minimum size for phone orders in other markets.

International trades are done through market makers rather than directly on the overseas exchange – the same method used by Hargreaves Lansdown, which is probably its closest direct peer.

Trading commissions are relatively low, but FX charges are up to 1%. This remains lower than some rivals, but investors who will be trading in and out of foreign-currency positions frequently may prefer brokers that offer the ability to hold foreign currency balances to minimise currency conversions. Like Hargreaves Lansdown, a Youinvest SIPP will automatically receive US dividends with zero withholding tax deducted and Canadian dividends at a reduced tax rate (not all discount brokers are set up to do this).

Overall, Youinvest is one of the better UK brokers for international dealing, especially for long-term investment in foreign shares within an ISA or a small SIPP (with larger SIPPs, it may be worth paying higher fees for a provider that lets you hold foreign currencies). Feedback on customer service is good.

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IW Bank

Part of UBI Banca, one of Italy’s largest banking groups, IWBank is an online brokerage offering online and telephone stock trading in most major European markets and some other global ones. It provides services in several European languages, but seems to be relatively little used by non-Italian clients if the shortage of customer feedback is anything to go by. Commissions seem reasonable for some markets and rather high for others.

Although IW Bank operates separate sites under .co.uk, .fr, .de and other European domains, the firm does not have authorised subsidiaries in these countries and so all accounts fall under the Italian regulatory regime and the investor protection rules there.

This isn’t a problem – Italy is of course a member of the European Economic Area (EEA) and EEA rules are intended to establish minimum standards, enabling financial services to be “passported” across borders. But investors should always be aware when they are dealing with a passported institution, so that they know to which regulator they have recourse in the event that something goes wrong.

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Finasta

Temporary note: As of November 2011, Finasta’s parent company Snoras has been nationalised by the Lithuanian authorities amid allegations of fraud and seems likely to be wound up. Finasta says it is operationally and legally separate from Snoras, will continue to operate as usual and is expecting to be sold as a going concern to a new investor. This entry will be updated with more information when the outcome becomes clearer.

Finasta is the investment and brokerage arm of Lithuanian banking group Snoras. Among other services, it offers online stock trading for a large number of markets in Eastern Europe and beyond at relatively low rates in many cases.

We don’t have any experience of using this firm or comments from other feedback yet. It’s included in the directory because it may be of interest to investors looking to invest in this region, alongside firms such as Brokerjet, Orion Securities and Swissquote. If you have any feedback, you can send us an email using the contact form.

In terms of likely investor security, while Lithuania is not a top-tier financial centre, it is a regulated market and Finasta is overseen by Securities Commission. Lithuania is a member of the European Union and has implemented the EU directive on minimum investor compensation standards, which means that the Deposit and Investment Insurance Fund provides protection of up to €20,000.

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Orion Securities

Orion Securities is a reasonably well-known investment bank and stock brokerage in Lithuania. The firm offers online stock trading for the Baltics, plus broker-assisted trading for a large number of other markets – most significantly, it covers much of Eastern Europe and rates on many are reasonably low.

We don’t have any experience of using this firm or comments from other feedback yet. It’s included in the directory because it may be of interest to investors looking to invest in this region, alongside firms such as Brokerjet, Finasta and Swissquote. If you have any feedback, you can send us an email using the contact form.

In terms of likely investor security, while Lithuania is not a top-tier financial centre, it is a regulated market and Orion is overseen by Securities Commission. Lithuania is a member of the European Union and has implemented the EU directive on minimum investor compensation standards, which means that the Deposit and Investment Insurance Fund provides protection of up to €20,000.

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Swissquote

Switzerland’s leading discount brokerage offers a reasonable range of North American and European markets for online trading and a far larger number for broker-assisted trades. As far as I know, it’s the only retail-orientated brokerage in Europe that offers markets such as Brazil or Japan’s Osaka Stock Exchange (as opposed to the more widely traded Tokyo exchange) – although Daniel Stewart, a UK institutional firm that accepts private clients, can also access these and more, while the Hong Kong-based Boom Securities and Phillip Securities are other cheaper alternatives for Japan.

The main drawback is the fees. Minimum commissions on the broker-assisted markets are so high that they are unrealistic for most retail investors. This may be understandable, since they will be traded via intermediaries. However, even the online markets are not cheap – you will do better through many other discount brokers.

However, there is no minimum account size and admin fees don’t look unbearable. So if you’re aiming to make a handful of long-term investments of at least US$5,000-10,000 each in some of the more inaccessible markets it offers, Swissquote could be worth a look. Feedback on everything except fees has generally been good.

The Hong Kong and Singapore stock brokers may be alternatives for Asia, while Brokerjet, Finasta and Orion Securities may be worth considering for Eastern Europe.

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Keytrade Bank

Keytrade – owned by Crédit Agricole – offers online trading in most European markets and in North America. Fees are reasonably good, but there are probably better stock brokerage choices available for most international investors.

What could make it very useful for some is its fund supermarket, covering around 500 funds. This is worth considering alongside the better-known TD Direct Investing International (formerly Internaxx) for anyone looking for an offshore fund supermarket that will allow you to invest in Europe-domiciled funds, especially since the lack of custody charges means it may be slightly cheaper than TDII.

Keytrade has divisions in Belgium, Luxembourg and Switzerland. Since the Luxembourg arm is likely to be most popular with non-residents, the details below are taken from its terms, although there is relatively little difference between the three.

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Brokerjet

Run by Austria’s Erste Bank, Brokerjet seems to be the main multimarket account offering online stock broking across several Eastern European countries (Croatia, Czech Republic, Hungary, Poland, Slovenia) that caters to English-speaking clients.

The firm also offers the smaller German regional exchanges (Berlin-Bremen, Dusseldorf, Hamburg, Hanover and Munich), as well as the main Frankfurt exchange and the smaller Stuttgart one. These are not usually provided by stock brokers outside Austria and Germany, although they are probably of limited interest to most investors. Fees seem reasonable compared to what you’ll pay for most Eastern European markets through traditional stock brokers.

The platform doesn’t seem to support multiple currencies in one trading account. So you’ll have to open separate deposits if you want to be able to settle deals in Poland directly in zloty, for example, and these may carry inactivity charges. But the currency conversion charge is a fairly low 0.25% if you don’t want to go to trouble of opening multiple currency accounts for settling the occasional trade in smaller markets.

I don’t have any direct user feedback, but found customer service was extremely fast and helpful when approaching them with questions about the account. Alternatives could be the Lithuanian firms Finasta and Orion Securities or the more costly Swissquote.

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Fidelity

Fidelity has recently overhauled its international trading service to the point where it may be relatively useful. Previously, you needed a minimum balance of US$25,000 and over 120 trades per year or a balance of US$1,000,000, which made it extremely uncompetitive since any investor who met those conditions could do better elsewhere.

But with the international trading service now open to all account sizes, a large number of new markets added and reasonable fees for online trades in most, it now seems to be one of the most competitive providers available to US investors, at least in terms of range (Interactive Brokers is considerably cheaper, but covers fewer markets). However, be aware of the usual excessive FX conversion fee (up to 1%) – investors should try to work around this as much as possible by avoiding changing currencies within the account too frequently.

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EverTrade

EverTrade is part of Florida-based EverBank, which specialises in postal, telephone and internet banking. It offers a large range of international markets – especially in Europe – for online and broker-assisted trading.

The service is roughly comparable to Fidelity in terms of reach and which one would work out as better value would depend on your individual trading pattern. Broadly, Fidelity looks cheaper for online trades in many circumstances, while Evertrade may be more competitive when placing orders through a broker.

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Charles Schwab One Account

This US online brokerage giant now has two international brokerage services: The Schwab Global Account, open to US citizens and residents only, and the international trading part of its long-standing Schwab One Account. The firm has never really advertised the latter much, but it can deal in a very wide range of overseas markets, albeit by telephone during US hours only.

Schwab One Accounts are available to clients outside the US, although the minimum account size will be larger – US$25,000 for most markets, US$10,000 through the Hong Kong and UK arms. Overseas dealing is likely to have a minimum of around US$5,000 per trade for some markets.

The main snag with the service is cost. International dealing rates are 0.75% with a minimum of US$100. While this is lower than rates at the wirehouses, you can do better than that for many of the markets it offers – within the US, try Interactive Brokers, Fidelity or Schwab’s own US resident-only Schwab Global Account. On top of this, its correspondent stock brokers in the overseas markets will add their own charges, include FX conversion (since you can only hold US dollars within the account). That will vary by market, but it’s likely to add 0.15-1.5% depending on region (Europe will be cheaper, emerging Asia more expensive).

That said, while nobody I know well has used Charles Schwab for buying international shares, second-hand feedback says the customer service is very good. Certainly, I was impressed with the knowledge of its representatives when I enquired about opening an account. At this price, I’d still say look for a cheaper broker for the easy markets. But perhaps consider this firm for the more exotic ones if you trade in reasonable size and the US$100 minimum is bearable.