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FAQs

UK stockbroker accounts for non-residents

One regular question about the UK online stockbrokers list and UK international stockbrokers list is whether any UK stockbrokers will open accounts for non-residents.

Generally, many of the UK stockbrokers are not very helpful on this score, due to a combination of money laundering regulations and a tendency to regard overseas clients as a hassle. (The same problem is true for non-residents wanting to open an UK bank account.)

There are a handful of UK stockbrokers that indicate they will deal with non-residents, but investors report different levels of success opening and using accounts. It may depend on whether you are a UK citizen but non-resident, whether you are neither a citizen nor a resident, whether you are resident in the European Union (EU) or European Economic Area (EEA), whether you have a UK bank account and even who you speak to at the company.

The following firms have been reported to open online trading accounts for at least some non-residents and are probably worth investigating first:

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News

India considers opening stock market to foreign individuals

Reuters is reporting that the Indian government is considering relaxing restrictions on foreign individuals investing in Indian shares, in an attempt to attract more foreign capital. If this goes ahead – and that’s a big ‘if’ – it could be a very exciting development.

Very few countries actively bar foreign individuals from investing in their stock markets, although some make it difficult. Oddly enough, it’s the BRICs – the four emerging markets that foreign investors talk about the most – that are the hardest. And India is arguably the most frustrating of all.

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News

MF Global and brokerage account security

You’ve probably seen that MF Global, one of the big brokers in futures, options, CFDs and other derivatives has gone bust. While we haven’t heard all the details yet, this seems like it might be a rather worrying case when it comes to the safety of your brokerage account.

MF Global went under because of trades it was making on its own account (known as proprietary or ‘prop’ trading). Specifically, it had bought European sovereign bonds on high leverage and couldn’t make the margin calls when these fell in value (fuller details at the FT).

This was an extremely stupid thing to do, but it was MF Global’s own bet. It shouldn’t have mattered to clients.

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Updates

International stock broker updates – Charles Stanley, Daniel Stewart, HMS Markets, Finasta, Orion Securities

There are a number of updates to the directory of international stock brokers. These include details of five more firms – two from the UK, one from Luxembourg and two from Lithuania – with a few more on the way.

Charles Stanley is a long established UK broker and it offers international stock trading for much of Asia, Greece, Poland and South Africa as well as the usual developed European and North American markets. This is a full-service private client stock broker, which means that fees are a little than the discount stock brokers and you’re probably looking at minimum trade sizes of £2,500-5,000 to be cost effective.

On the other hand, once you factor in better execution and other costs, firms such as these may be more cost-effective for larger international investments. For example, the currency conversion charges that most discount stock brokers charge should be far less with a good private client firm.

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Updates

Brazil, Russia, Turkey stock trading through Swissquote

Swissquote is now in the stock broker directory. This is a somewhat unusual firm, being an online execution-only broker that attempts to add on some of the flexibility that a traditional Swiss private bank provides for broker-assisted dealing.

This means that it will trade a fairly wide range of exchanges that are unusual among European retail stock brokers. If you want this kind of choice in one place, you’re normally talking about a minimum account size in the high net worth individual range. The international stock trading options include Brazil, Japan’s Osaka Stock Exchange (most firms only offer Tokyo), Russia, Sri Lanka, Turkey and many others.

The snag is that Swissquote is doing this through intermediaries and hence it’s not cheap. You’re talking CHF200-400 (US$200-400) minimum commission for most of these. So frequent trading in most of these markets is going to be impractical for most retail clients. But it could be useful for investors who want to make the occasional long-term investment in these markets.

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News

South Africa online stock trading from Saxo Bank

Saxo Bank is keeping very busy with new launches. After rolling out Japanese and Polish equities in the last couple of months, it’s now adding stocks and CFDs for South Africa. This makes it the first stock broker outside Africa to offer online trading in cash equities for the Johannesburg stock exchange to retail investors.

Rates look good  – 0.25% with a minimum of ZAR100 (US$12) is both cheaper than you’ll pay through other international stock brokers and cheaper than the local brokers. Unfortunately, South African investors can’t take advantage of this – due to local foreign exchange restrictions, Saxo Bank can’t offer the Johannesburg exchange to clients resident there.

It also won’t be available to Swiss residents due to client confidentiality laws there. But for international investors elsewhere, this looks like a helpful development. And the firm says more international markets are likely to be added over the next year or so – in which case, it will reinforce its position as one of the best brokers for international stock trading.

The international stock broker guide and stock broker comparison tables have been updated.

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News

Interactive Brokers now offering Singapore stocks

It didn’t get much of an announcement given that some customers have been lobbying for it for ages, but Interactive Brokers has finally added direct stock trading for Singapore to its platform (it’s had derivatives for years, but not cash equities).

This plugs the last major gap in the firm’s line-up. There are many other exchanges that it will hopefully eventually add, but the absence of SGX was always strange and the biggest limitation of Interactive Brokers’s otherwise very good and cheap service.

Fees are extremely competitive: 0.12% with a minimum of S$3. This compares with standard rates of around 0.275% and a minimum of S$25 in Singapore; even Saxo Bank charges 0.15%. The one caveat is that, judging by the wording of the announcement, Singapore residents still won’t be able to trade Singapore stocks through Interactive Brokers (presumably it doesn’t have a full local licence).

The stock broker list, stock broker comparison tables and Interactive Brokers profile have been updated.

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News

Cheap(er) international data through Interactive Brokers Information Systems (IBIS)

Interactive Brokers have recently announced an interesting new data product called Interactive Brokers Information Systems (IBIS) that seems to be trying to fill the gap for investors and traders who want extensive data and analytics services without the Bloomberg and Reuters-level price tag.

IBIS is available as an add-on to its Trader Workstation for Interactive Brokers’ clients (US$39/month, discounted against commissions) or as a stand-alone product for non-clients (US$69/month for the first year, rising to US$89/month afterwards). That’s the platform fee – you need to pay the relevant exchange and provider fees for price and data feeds on top of that.

Existing clients can already get data through Interactive Brokers on the same terms, so the extra US$39/month value in IBIS is presumably supposed to be the convenience of its interface, portfolio analytics, screening tools and other software. Each trader will have their own view on whether this is worth the money or not.

For non-clients, this now seems to be the cheapest stand-alone way to subscribe to international price and fundamental data. With an IBIS platform subscription, you can then get Reuters Worldwide Fundamentals for US$7/month, for example.

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Updates

Keytrade Bank – another offshore fund supermarket

Keytrade Bank is now in the broker directory. It offers stock broking services for a decent range of European markets, but the main reason it’s likely to be useful is its fund supermarket.

This is a similar offering to Internaxx, but covers more funds (although the two don’t overlap entirely – there are funds on Internaxx that Keytrade doesn’t carry). With no custody fees it may well work out as cheaper than Internaxx over the long run.

To read more on the options for expats and others struggling to find a fund supermarket that accept non-residents, see the guide to offshore fund supermarkets.

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Updates

Eastern Europe online stock trading with Brokerjet

Brokerjet, an online stock broker operated by Austria’s Erste Bank, is now in the broker directory. The firm could be very useful to investors buying shares in Eastern Europe, since it’s the first multimarket online broker to offer a good range of stock markets there that provides services in English.

The available stock markets in Eastern Europe are Croatia, Czech Republic, Hungary, Poland and Slovenia. Given that most of these are expensive and hard to access through foreign brokers, Brokerjet’s fees [PDF] look reasonably good at around €20-35 minimum, although Saxo Bank is cheaper for Poland.

The service also includes most Western European markets. International investors will probably have access to most of these through other stock brokers already, but the inclusion of the German regional markets could be helpful for some. These are not included in many international stock brokers’ coverage, since they are of limited interest to most investors.