Open a securities account abroad

Comparison Captrader & Lynx

29.3.2021

After our lastest securities account comparison of German providers, we had a request from our community for providers abroad with good conditions and we know the following from experience: German-speaking customer service.

One of the biggest providers internationally is Interactive Brokers with their headquarters in New York, USA. You can only become a customer there, if you have a US social security number. The problem was solved internationally through cooperations with “resellers”. In Germany, CapTrader and LYNX have established themselves.

You can find out which is perhaps more interesting for you for the opening of a securities account here in the comparison:

	Captrader	LYNX
Focal characteristics
What does the securities account management cost?	unconditionally free of charge	unconditionally free of charge
Securities savings plan	No
Securities account transfer	free of charge
Are phone orders possible?	Yes, but only to close the open positions as a market order (fees depend on the currency)	Yes, free of charge
Is there a trading app?	Yes
Is a securities loan possible?	Yes, you decide on a bar or margin securities account at account opening
Is there a junior securities account?	No
How many order types are available to choose from?	more than 50	40
In how many countries can you make trades?	135 stock markets in 33 countries
Payments
first payment in the calender month	free of charge
every further payment through SEPA	€ 1
every further payment through bank transfer	€ 8
Securities loan debit interest (exemplary)
EUR	2.50 % until 100,000 2 % from 100,000.01	3.50 % until 100,000 3 % from 100,000.01 ≤ 1,000,000 2.5 % > 1,000,000
USD	2.59 % until 100,000 2.09 % from 100,000.01	3.57 % until 100,000 3.07 % from 100,000.01 ≤ 1,000,000 2.75 % > 1,000,000
Order fees (exemplary)
Partial implementations	free of charge at implementations on the same day
Shares Germany	from € 2.00	from € 5.80
Shares USA	from $ 2.00	from $ 5.00
Options Germany	€ 2.00	€ 2.00
Options USA	$ 3.50	from $ 3.50
Futures Germany	from € 1.00	from € 1.50
Futures USA	$ 3.50	from $ 2.50
Securities account opening
Minimum age	Bar securities account 18 years Margin securities account 21 years
First deposit for the securities account activation	€ 2,000 (or transfer of the equivalent of at least € 2,000)	€ 10,000
Creditworthiness check	No
Start the account opening

Conclusion: CapTrader cheaper, but phone orders are not possible

Easily visible from the comparison is that CapTrader is the winner on the part of the fees. Therefore, CapTrader is especially popular for small to medium securities accounts – for people, who like to implement themselves.

LYNX has a whole bunch of customers, who value the phone contact and partially make their orders on the phone. Generally speaking, these are elderly customers with increased securities volumes on average.

Does that help you deciding?

Okay, I have had securities accounts only in Germany – what are the particularities of securities accounts abroad?

You are welcome to read the following most important points, as well as to share questions and experiences using the comments feature.

Upfront: CapTrader and LYNX act at the German market since many years and are subject to the BaFin (Federal Financial Supervisory Authority). Cooperating partner is the Interactive-Broker-Branch in Ireland (before the Brexit, it was in England), so that one can get German customers completely legal from the perspective of the provider.

1. No automatic deduction of the settlement tax

Since 2009, there is an automized tax deduction on the (completed) gains of securities in Germany. In the moment of selling a security with gains, getting a dividend or interest payment, the bank transfers 25 per cent settlement tax plus possible solidarity tax and/or church tax to the tax authority. The rest is credited to the customer.

The federal German tax law applies the principle of world income (someone who is subject to paying taxes in Germany has to pay taxes of his/her worldwide income), but the German legislator cannot lay down the law at banks abroad, so that they automatically transfer the tax to Germany.

So ever customer and tax citizen has to declare the gains for themselves. This is relatively easy by printing the tax report from the online banking of CapTrader or LYNX and enter the sum into the attachment of the income tax return.

Advantage: One can work with 25 per cent more capital until the tax declaration and tax payment!

Tax forms from the online banking of CapTrader.

2. Savings plans are not automatable

Yes, we German people love building efficient systems and this is why we love savings plans so much. Once set up, they automatically run until the next change – without needing our attention or assistance. Moreover, they are far cheaper than single orders.

Securities savings plans are not that common in other countries. Additionally, the order fees are considerably cheaper than at classic or direct bank securities accounts.

This is not a real compensation for the lack of savings plans, but with several order types and a margin securities account, you can set up other creative systems …

3. Margin securities account means automated (Schufa-free) credit line

At the account opening, you can choose between Bar securities account and Margin securities account. A Bar securities account is what we are familiar with in Germany. You deposit money and can buy securities with this money.

At a Margin securities account, a credit line is automatically set up. You do not have to make the effort of a separate application and increase, as with the Comdirect (Richard’s favorite). The credit line is automatically calculated according to the value of the securities. However, you should not play lightheadedly with it. Perhaps it is an occasion for becoming a “qualified investor” and learning to deal responsibly with financial instruments that are outside state-supported publications, such as from the magazine “Finanztest” and the like. 😉

Do you notice something? The customer is in the red with the currency, but has an “available credit” of more than Euros 11,000. This is the automated credit line. Interesting, if you also consider that there are consigned securities with a value of about Euros 16,000 and these are no squeaky-clean state-borrowed assets. 😉 Many thanks to our “Achiever Training” that I can show these pictures here.

4. Buy securities that are not tradable in Germany

Unfortunately, powers in Germany enforced that it is difficult or even impossible to invest in some securities. We have noticed within our community that there is a problematic situation with the precious metal-ETFs of the Zurich Kantonalbank. These are very simple investment products. The Silver ETF for example does not do anything else but storing standardized silver ingots in a high security vault. In change, they get a yearly compensation of only 0.6 per cent.

It is difficult or even impossible to buy them through German securities accounts. At LYNX, you only pay CHF 15 at an order volume of Euros 5,000 . At US competitors and bigger ETF for physically-consigned silver “SLV”, you pay only USD 5 for the same volume. These are transaction costs of only 0.08 per cent and with this, I have not even pushed the maximum, but only mentioned an example from our “Achiever Training”.