Can Anyone Suggest Brokerage Firms Suggested for Thai/Norwegian Citizen

[Thomas J]

I am engaged to a woman who is a dual citizen of Thailand and Norway.  I advised her not to have all of her investments based in Thai firms.  Over the past few months she opened a brokerage account with Charles Schwab in Singapore.  We just transferred the final amounts to the account and we have now been advised that Charles Schwab is closing their Singapore office and it is required to open a new account to transfer her assets to.  Can anyone suggest where she might be able to open a brokerage account that would be similar to Charles Schwab.  She would be investing almost exclusively in U.S. Mutual Funds. 

[sonos99]

Internaxx or Saxo

[timendres]

Interactive Brokers is my favorite.

[Thomas J]

2 minutes ago, timendres said:

Interactive Brokers is my favorite.

Can you tell me what they charge?  At Schwab there was no annual custody fee only a fee per trade and that was cheap.  Only $4.95 per trade. 

[William Osborne]

I use Internaxx based in Luxenburg which Im pretty happy with....can buy in multiple currencies/countries.....US trades are about 15 USD which is a bit high so not suitable for small trades.....UK and Euro trades are even higher and may have to pay vat or local tax.

 

IMO.. she would be better of registering as Thai citizenship as a most US based funds are locked out from European citizens..(thanks to the Brussels ????)

 

I also opened an interactive acc last year..(US based)....i didn't like the interface and the funding method....also didnt like the fact it was US based..

Edited September 27, 2019 by William Osborne

[hagai]

Why not stay with Schwab? Just move your account to Charles Schwab International.

 

Regards

[fletchsmile]

1) I use my bank in Singapore - Standard Chartered. The platform is crude and basic, but does the job. Not suitable for day trading where real time up to date data is required and you are spending chunks of your day on it. But fine for mid-longer term investment. The biggest advantages are:

i) it links seamlessly to my Singapore bank accounts in various currencies.

ii) I can borrow against qualifying investments at attractive rates. The borrowing facility is very useful, eg we use instead of a mortgage, large items that might come up, leverage for extra return etc. 

iii) Access to a dozen main countries, eg US, AUS, UK, EUR (Germany, Paris, Netherlands), Singapore, HK, Japan etc

You would be able to buy US ETFs via trading. Mutual funds are available in USD, EUR, SGD, GBP etc, with a variety of fund domiciles. Fund charges are a bit expensive, but again is Ok for me as i often use leverage, so the lower borrowing offsets the higher charge

 

2) In Thailand I use KGI. Mainly for Thai stocks, futures and options. Think they might do some overseas markets

 

3) I made enquiries a while back with Asia Plus in Thailand. They will open accounts also for foreigners to trade various overseas markets. Handy if a local broker is wanted. Main drawback is minimum fee on trades is around THB 3,000. Would be OK for occasional trading and convenience on larger amounts. Less so for a frequent trader. They also want higher value clients. My assets were OK, but not sure what their minimum was. I'd consider for my wife, with her being Thai and us in Thailand.

 

4) Interactive Brokers. I did a trial with their platform. Met my requirements. Variety of markets and currencies. Low trade charges. Borrowing facility available. Main thing I didn't like is they didn't bother responding to messages I sent for further info.  They offer a wide range of US mutual funds. Not sure whether you need a US address to access, as I wasn't interested in them. The range of non-US mutual funds is poor, which was another factor for me. 

 

Of these 4 Interactive Brokers might be best fit for you. You could just sign up and try it.

 

One question I would ask though is why US mutual funds if Thai/ Norwegian and not living in the US? This may not make sense from a tax perspective.

 

eg If I buy a low cost domiciled US mutual fund or ETF, then I suffer witholding tax. Depending on whether your broker will process possible reductions based on your circumstances that would result in a 15% to 30% reduction in say dividends returned.

So a div pays 3% you would lose 0.45% to 0.9% and receive only 2.55% or 2.1%. An unnecessary extra cost for non-US people.

A Thai should be able to get the reduced 15% WHT rate, but some brokers in Singapore will apply only the default rate so you end up losing 30%.

 

So think about why US mutual funds and tax?

 

Cheers

Fletch ????

Edited September 27, 2019 by fletchsmile

[timendres]

50 minutes ago, Thomas J said:

Can you tell me what they charge?  At Schwab there was no annual custody fee only a fee per trade and that was cheap.  Only $4.95 per trade. 

$0.05 per share, minimum $1. Thus, 100 shares = $1. 200 shares = $1. 1000 shares = $5.

Best commissions in the business.

 

Worldwide trading.

Multiple instruments (Stocks, options, futures, bonds) all under one account.

There is no broker that competes with IB, IMO.

[Thomas J]

47 minutes ago, hagai said:

Why not stay with Schwab? Just move your account to Charles Schwab International.

Can you explain?  I was under the impression that you had to have a Schwab account at a particular location such as Singapore or Hong Kong?   She is not a U.S. citizen so she could not have a U.S. based account.  I would have thought that Schwab would have suggested that, if that was an easy fix but they mentioned nothing. 

[fletchsmile]

21 minutes ago, timendres said:

$0.05 per share, minimum $1. Thus, 100 shares = $1. 200 shares = $1. 1000 shares = $5.

Best commissions in the business.

 

Worldwide trading.

Multiple instruments (Stocks, options, futures, bonds) all under one account.

There is no broker that competes with IB, IMO.

 

- Charging per share is a ridiculous and old fashioned practice. If you buy penny shares or shares with a low value that 5 cents can look ridiculous. If on the other hand you are buying Berkshire Hathaway which costs USD 000,000's per share it's very cheap.

 

- Modern brokerage fees should be either a flat fee or based on value of transaction. Number of shares are meaningless. If I buy 10,000 shares at $1, why should I pay more than 10 shares at $ 1,000? % or flat fee makes sense. Same value, same work etc

 

Flat fees are useful for high value transactions. eg UK I pay GBP 5.95 regardless of value of transaction, so negligible on GBP 100k

 

But if buying smaller amounts then a % can be more efficient. eg buy SGD 1,000 of SG REITs at 0.18% is only SGD 1.80

 

- Interactive Brokers are pretty good as you say on charges  

 

Edited September 27, 2019 by fletchsmile

[hagai]

4 hours ago, Thomas J said:

Can you explain?  I was under the impression that you had to have a Schwab account at a particular location such as Singapore or Hong Kong?   She is not a U.S. citizen so she could not have a U.S. based account.  I would have thought that Schwab would have suggested that, if that was an easy fix but they mentioned nothing. 

 

I opened my first US Brokerage Account more than 20 years ago and have never been to America,

Schwab International is open to customers word wide, Just go to their web page and click “open account” and you should get all information you need. They also have  Special Customer Service assigned to help foreigners opening new accounts.

[Thailand J]

Lately Schwab International website is accepting Thai residents to open a US based Schwab One International account again. It has stopped redirecting  Thai residents  to Schwab Singapore website. Hong Kong residents are still redirected to Schwab Hong Kong.

 

https://international.schwab.com/public/international/accounts_products/accounts/brokerage_account

 

Click "open an account", scroll down to Thailand and hit "go", and pick an account type to open.

 

 

 

Edited September 27, 2019 by Thailand J

[tgw]

I can't really consider Schwab a broker, it's more of a retail investment consulting firm with corresponding high execution cost.

If you want the same service as Schwab, I can't really recommend anything, but if you want an international broker with great product coverage and low cost of execution I always recommend Interactive Brokers.

https://www.interactivebrokers.com/en/home.php

Drawbacks are, it's not very beginner friendly and you will be asked about your product knowledge before being allowed to trade certain asset classes such as commodities, futures and options.

Edited September 27, 2019 by tgw

[Thailand J]

OP has a Schwab Singapore account, he already know Schwab for whatever it is.

OP wants to invest in US mutual funds, which are not available to non-US clients. He has to go with ETF's.

Schwab Onesource has a long list of commission free ETF's.

 

I mostly invest in index funds, buy and hold. In my decades of investing, I have spend an negligible amount on brokerage fees. If everyone is like me, all the brokerage firms will go bankrupt.

 

https://www.schwab.com/public/schwab/investing/investment_help/investment_research/etf_research/etfs.html?path=%2FProspect%2FResearch%2Fetfs%2Foverview%2FoneSourceETFs.asp%3Fsymbol%3Dundefined

 

 

 

 

Edited September 27, 2019 by Thailand J

[Thomas J]

22 hours ago, fletchsmile said:

eg If I buy a low cost domiciled US mutual fund or ETF, then I suffer witholding tax. Depending on whether your broker will process possible reductions based on your circumstances that would result in a 15% to 30% reduction in say dividends returned.

Fletch, her options as a non USA citizen would be to open some account in Norway which is hardly tax efficient or to leave here in Thailand which is precarious.  Though the banking system looks solid now it was only a few years ago that the country had a coup.  When events like that happen, who knows what the consequences to people who have money in the banks and brokerages would be. 

[Thomas J]

7 hours ago, Thailand J said:

OP has a Schwab Singapore account, he already know Schwab for whatever it is.

OP wants to invest in US mutual funds, which are not available to non-US clients. He has to go with ETF's.

Thailand J  

https://www.reuters.com/article/us-charles-schwab-singapore/brokerage-charles-schwab-closing-singapore-office-two-years-after-launch-idUSKCN1VQ0AL

[Thailand J]

1 hour ago, Thomas J said:

Thailand J  

https://www.reuters.com/article/us-charles-schwab-singapore/brokerage-charles-schwab-closing-singapore-office-two-years-after-launch-idUSKCN1VQ0AL

i know Schwab Singapore office is closing but Thai residents, including non-US citizens  can now open a US based Schwab account on their international website, please refer to post #12 above.

 

Edited September 28, 2019 by Thailand J

[fletchsmile]

1 hour ago, Thomas J said:

Fletch, her options as a non USA citizen would be to open some account in Norway which is hardly tax efficient or to leave here in Thailand which is precarious.  Though the banking system looks solid now it was only a few years ago that the country had a coup.  When events like that happen, who knows what the consequences to people who have money in the banks and brokerages would be. 

The point I was making was why invest in US domiciled mutual funds and ETFs?  Why not other country domiciled mutual funds and ETFs? eg Luxembourg, Ireland, Singapore etc etc

 

Because of (witholding) taxes, US domiciled mutual funds or ETFs are not necessarily the best options for non-US residents.

 

EXample: with any broker that allows trading on multi country markets:

 

If she buys THA - a Thai index fund domiciled in the US the charges are I recall a ball park 0.5%. It pays a div of around 3%. She would lose 0.45% to 0.9% (30% of that div) depending on appropriate tax set up (WHT of 15% or 30%)

So effective cost is 0.95% to 1.4%

 

If she buys LG7 on SGX (another Thailand Index) then charges are similar ball park 0.5%. No WHT suffered. Effective cost 0.5%

 

The main difference is buying a product on the US NYSE or Singapore SGX as they are both Thai index funds. The US "low cost" option is poor value because of taxes

 

At the end of the day an index fund is an index fund if they pick the same index. So why be captured by the US tax regime. Whether you're buying MSCI World index, Thai index, EuroStox50 etc etc

 

I stopped trading any US domiciled funds because of tax and effective extra costs. They may look cheapest on the headline rate, but factor in the cost and for many non-US residents they are not

 

If you open an account with Interactive brokers, you can buy ETFs from most markets in the world, regardless of your nationality/ location etc. So why restrict to US mutual funds and ETFs and suffer more tax? They also offer mutual funds that cover most markets just not as wide a choice and not US domiciled.

 

This is something to consider. IB is good that they allow you to trade US markets, UK markets, EU markets, etc etc. So regardless of where you are based you can choose products domiciled throughout the world.

Edited September 28, 2019 by fletchsmile

[Thomas J]

On 9/28/2019 at 12:53 PM, fletchsmile said:

If you open an account with Interactive brokers, you can buy ETFs from most markets in the world, regardless of your nationality/ location etc. So why restrict to US mutual funds and ETFs and suffer more tax? They also offer mutual funds that cover most markets just not as wide a choice and not US domiciled.

fletchsmile, just so I am clear,  If she opened an account with interactive brokers she could buy lets say an S&P 500 Index Fund just one not domiciled in the USA and not be subject to the 15% withholding tax? 

[fletchsmile]

22 hours ago, Thomas J said:

fletchsmile, just so I am clear,  If she opened an account with interactive brokers she could buy lets say an S&P 500 Index Fund just one not domiciled in the USA and not be subject to the 15% withholding tax? 

Yes. There are many S&P 500 ETfs available with different charges, domiciles etc

 

When buying ETFs don't just buy the cheapest one. Consider the tax implications too.