8 Costs of Zero-Commission Brokers

In this video, we're talking about 8 costs of zero-commission brokers. Commission-free investing has become the norm among online brokerage platforms both in the U.S and in Europe. European brokers like Trading 212, BUX Zero, DEGIRO, Trade Republic and eToro all offer some form of commission-free investing. However, just because a broker offers commission-free investing, that doesn't mean that there's no cost associated with investing using that broker. We talk about the costs associated with deposit fees, foreign exchange fees, transaction and service fees, opportunity cost, payment for order flow, securities lending, the bid/ask spread and taxes/other costs.

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Intro 0:00
Section 1 - Direct Broker Costs 2:16
Deposit Fees 2:20
Foreign Exchange Fees 3:44
Transaction & Service Fees 5:40
Section 2 - Characteristic Costs 7:11
Opportunity Cost 7:18
Payment For Order Flow 8:43
Securities Lending 10:38
Section 3 - Non-Broker Costs 11:59
Bid/Ask Spread 12:04
Taxes & Other Costs 13:26
Closing Words 14:19

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*Malone Financial is affiliated with the aforementioned companies. Malone Financial receives a commission for any customer conversions realized via the affiliate links. This video includes my own opinions (which do not reflect the opinions of said companies). Investing involves a risk of loss. Nothing mentioned in this video should be construed as financial advice.

[malone_financial]

Have you come across any other costs associated with zero-commission brokers?

[NightElff]

Pretty extensive explanation - probably the best I've came across on YouTube. Thank you!

[gary.mcnulty]

Thanks for this Dan! I for one was caught out when I started investing with Degiro and was hit with €2.50 fees on each investment. Lessons learned for me!

[patmulligan]

Hi Dan, Good video, IBKR seems to be very popular but you don't seem to mention it often. I use Degiro, Etoro and IBKR the fee are just a cost of doing business. The hassle and potential tax implications of changing investment brokers tend to make them sticky.

[mydiscworld]

Hi Dan, deposit interest rates in Ireland are still abysmal. A video on savings options would be useful e.g. 1-year US t-bills paying >5% at the minute. Hard to find where we can buy them as an EU citizen but think you can via Interactive Brokers? If so, a How To video would be great

[declanmcardle]

De Giro increasing costs starting in middle of May...

[declanmcardle]

Question of the day: Do DeGiro etc. bank with SVB? (For overnight/deposit etc.) 🙂

[szymonkowalczyk]

Hi Dan, what is your opinion about Interactive Broker?

[bertoflavi]

wich is the broker free for the best cheap price for stocks and etf ??