1Mon·

Why I opened a USD account!

I have often traded positions directly in the USA. Now I have also set up a USD account with Flatex.

In the comparison below as an example for $ROKU (+0.4%) you can see the difference in performance very clearly. On the left on a € basis and on the right on a $ basis. That's about 5% less return in € over the short term.

37 Comments

Moritz@MoKi28

1Mon

But what's the point? Is it only due to the exchange rate anyway?

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View all 18 further answers

Ella M.@DividendenWaschbaer

1Mon

How do you deal with currency gains and tax? Very few brokers can/will not report this. This means that you would have to report all profits to the tax office.
That seems extremely complex to me.

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Chris@Multibagger

1Mon

@DividendenWaschbaer the currency gains would only accrue when I exchange the $ back and the exchange rate has changed in my favor by then. In other words, the € has lost against the $. As long as I hold my shares and account in $, I have no currency gains.

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Dividendenopi👴@Dividendenopi

1Mon

@DividendenWaschbaer There are new tax bases for currency gains as of 01.01.2025. As these will then also be subject to the KAP tax deduction of 25% plus solidarity surcharge, it is now up to the banks to carry out the tax settlement. All relevant transactions that are affected by the tax changeover should be identified first. Potentially, these are all transactions that can be bought and sold in foreign currency and can generate corresponding profits and losses. These must then also be identifiable in the system in future. As this will probably lead to significant additional work for the banks, I do not believe that this will be free of charge for the account holder.

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Maverick@Pete_Mitchell

1Mon

@Dividendenopi As far as I know, the banks do not do this, but the investor has to declare it. This will lead to a lot of work and trouble. Incidentally, currency gains have always had to be taxed. The tax authorities have only said that they will check this from 2025 if there are currency accounts.

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QUANTIJS@QUANTIJS

1Mon

Isnt flatex expensive for US stocks? Atleast degiro is in NL. I use IBKR for much lower rates and you also have accounts for USD and EUR (with much lower FX costs).

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Chris@Multibagger

1Mon

@QUANTIJS what is expensive for you. I pay €5.90 per trade. That's very cheap for trading in the USA with all the brokers I know in Germany

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QUANTIJS@QUANTIJS

1Mon

@Multibagger I dont know your trade volume for FX, but commissions are $0.35 per trade and I paid 2 euro FX for 2k stock, while at degiro this would be 10 euro or higher.

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Chris@Multibagger

1Mon

@QUANTIJS with my order volume, rather under 500,--€ per trade it is 5,90€. I don't know what the situation is at IBKR with small orders.

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QUANTIJS@QUANTIJS

1Mon

@Multibagger I guess its a percentage. I have trades of 1k with around 1 euro FX. Trades of 230 euro with 0.23 euro FX. You can also buy fractional shares (and DRIP dividend). For me, even buying ETFs from DE market is cheaper from IBKR (around 1.25 euro vs 3 euro on degiro) and NL stocks also 1.25, which is only slightly more expensive than their 'core-selection'. I also don't have 'connection' fees.

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Chris@Multibagger

1Mon

@QUANTIJS When you say there are also fractional shares, do share savings plans also work?

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QUANTIJS@QUANTIJS

1Mon

@Multibagger I think so, but Ive not yet used it. I think they are subject to normal fees (not free like some brokers). I've only used fractional shares for DRIP of US stocks so far, but they are available for more. See csv list here https://www.ibkrguides.com/kb/en-us/fractional-share-trading.htm

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❤️DIST-LOVE@DISTLOVE

1Mon

What's the point? It makes absolutely no difference to exchange rate fluctuations.

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Chris@Multibagger

1Mon

@DISTLOVE I have already explained it in other answers.

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GeldGenie@GeldGenie

1Mon

Swissquote offers x currencies, free of charge and automatically.

However, I usually receive my income in CHF - when I invest I "have" to buy FW anyway. In the end, it's only "useful" for switching. USD share A into USD share B.

It's certainly not a bad decision. 👍

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Matzke@Matzke

1Mon

I think your "performance difference" is solely due to the depreciation of the US dollar against the euro. Incidentally, I think this is a trend that every investor should now be keeping an eye on.

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Chris@Multibagger

1Mon

@Matzke it is not only. In the period under review, the difference was 1 ct. Performance 5%

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DiviMike@DiviMike

1Mon

I would appreciate an invitation link to Flatex. We'd both benefit from it 😉

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Chris@Multibagger

1Mon

Many thanks to everyone for the lively exchange. Finally, I would like to make one more point. Many of your arguments assume that the conversion of the $ rate to the € rate always corresponds exactly to the exchange rate. However, this is by no means the case and can be clearly seen from the chart. Between buying and selling the share, the € rate rose by exactly 1 ct from 1.162 to 1.172. That is not even 1%. That is not even 1%. But the difference in price gain is 5.5% between the share in € and the share in $.
This shows that some of you are mathematically correct in your reasoning, but not in your trading.

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