Best online broker for overseas (US) share dealing

Jonathan1010

Thanks for that. They charged me 1.2% on top of their 1% margin charge which seems a lot to me.

masonic

Jonathan1010 wrote: »

Thanks for this. So you think 2.2% is competitive then and how do they justify the +/- 1.5% spread at the time of execution? Do they pluck a number out of the sky?

The spread is variable and depends on activity in the forex market. I wouldn't expect stockbrokers and investment platforms to have the cheapest forex services - some just use their bank! The spread is a simple pass through charge from the provider they happen to use. On top of that they make their own conversion charge (1% in your case).

Some years ago, SnowMan used to maintain a spreadsheet of forex charges levied by various platforms for payment of USD dividends. It is still live and may be of interest (this was at a time when this information could not be obtained from some providers):
https://docs.google.com/spreadsheets/d/1dySNAH2vHVf5t6i-gsnfvKA5ZHof_0BYl3RWo1-PFQE/edit#gid=0

You can see I only contributed one entry - once I learned I was getting such an unfavourable rate, I switched to a non-distributing ETF!

hoc

2.2% may seem high but on the plus side ii do not force conversion back to GBP after sale so this can be seen as a one time cost. Many have lower rates around 1% but charge on every transaction, purchase or sale.

jonesMUFCforever

My 2p worth - the forex charges will be small change compared to the paperwork you will be getting soon to do with your residency and tax status.

londoninvestor

jonesMUFCforever wrote: »

My 2p worth - the forex charges will be small change compared to the paperwork you will be getting soon to do with your residency and tax status.

...which II aren't the smartest at dealing with, based on the 3 weeks or so I spent explaining to them what "non-resident alien US taxpayer" means...

stphnstevey

There are cheaper FX alternatives, but it sounds like your not into researching and as there are some hoops to jump through for those, you might end up worse off

Thrugelmir

Jonathan1010 wrote: »

how do they justify the +/- 1.5% spread at the time of execution?

What instructions did you give when you placed the trade?