CapTrader review

Today I want to talk about CapTrader, an introducing broker to Interactive Brokers, and my own experience since I made the switch.

CapTrader enables you to have a fully-featured Interactive Brokers account without any monthly inactivity fees that Interactive Brokers normally charges.

In case you’re wondering what the heck Interactive Brokers is, I don’t blame you. They’re one of the best known and most reputable international brokerage firms in the world, founded all the way back in 1977. They’re also listed on the stock exchange.

interactive brokers stock price

In my opinion, they are an excellent alternative or addition to Degiro for buying stocks and ETFs, especially since Degiro isn’t available in every country.

I also want to use this post as a bit of an update regarding my own Interactive Brokers account, as I recently moved it from TradeStation to CapTrader and I received plenty of questions about it. If you’re in the same situation, I’ll show you how you can easily switch as well.

Last but not least, since many of you are probably new to Interactive Brokers, I also want to show you how investing works on the platform. So at the end of the video, I’ll show you how I invest 1.000€ into my favorite ETF, the Vanguard FTSE All-World.

TradeStation Global: Here’s What Happened

Last year I recorded this video, where I showed you that I was using TradeStation as an introducing broker to get access to Interactive Brokers without paying monthly fees.

However, I recently received an e-mail mentioning that TradeStation was going to introduce monthly fees for European residents starting in March.

If you also have an account on TradeStation, maybe because you watched my video about them, here’s what happened:

  • TradeStation has a license for the UK & some other countries, but due to Brexit the UK license is not valid for European residents anymore.
  • Meanwhile, internally on Interactive Brokers, all European residents were moved from IB UK to IB Ireland or IB Hungary (if you’re based in Eastern Europe) for regulatory reasons after Brexit.
  • As a result, TradeStation is now basically disconnected from its own European clients and doesn’t earn any part of the trading fees any more, which are now entirely managed by Interactive Brokers.
  • Well, that was their entire business model and how they were able to offer the accounts without the monthly 10$ inactivity fee you normally get with an Interactive Brokers account.

So the subscription fee that they announced was more or less a last resort to still earn something from their European clients. From what I heard, they’ve been trying until the last second to find another solution to still be able to manage their clients without monthly fees, which is also why the whole thing was announced with such short notice.

Alright, I hope now you understand the situation. I’m guessing you probably don’t want to pay for that subscription. Here is how you make sure it is removed:

  1. Log in to your account on Interactive Brokers
  2. Click on user settings
  3. Research subscriptions
  4. Make sure the subscription is removed.

However, after doing that, you might still be charged a monthly inactivity fee by Interactive Brokers itself.

CapTrader: The Solution For European Investors

If you’re anything like me, you likely want to avoid extra costs whenever possible, so that you have more money to invest.

I spent plenty of time looking for alternatives to TradeStation over the past few weeks. Ultimately, I found one that I’m very happy with, CapTrader.

captrader

CapTrader is another introducing broker to Interactive Brokers. They were founded in 1997 and are based, licensed and regulated in Germany.

Interactive Brokers Without Monthly Fees

The most important part for most of you is probably that they still allow us European investors to have an Interactive Brokers account without paying any monthly inactivity fees, as they are licensed in Europe.

They also have very low fees for buying and selling ETFs and stocks. I’ll go into more detail on their trading fees later in the article, when I show you how to buy an ETF via the Interactive Brokers web interface.

However, one thing you need to know is that there is a minimum deposit for opening an account via CapTrader, 2.000€. Of course we can use and invest that money straight away, for example into ETFs using Interactive Brokers.

CapTrader’s support is also excellent, which is great since Interactive Brokers itself is a bit lacking in that department.

If you already have an existing Interactive Brokers account through TradeStation for example (like I did) and you want to switch to avoid monthly fees as a European investor, here is what you can do:

  1. Send an email to info@captrader.com and tell them you want to transfer your account from TradeStation to them.
  2. They will provide you with instructions and a PDF to fill out, which is then sent to Interactive Brokers to move your account.

I did this part already and my account was successfully transferred to CapTrader a bit over a week ago.

Interactive Brokers Tutorial: How To Buy An ETF

For this section, I’m making the assumption that you already have an Interactive Brokers account via CapTrader and that you want to know how investing works on the platform.

Let me preface this by mentioning that I’m a simple long-term investor and not a professional trader. As a result, I haven’t played around with any of the more specialized trading tools that are available. I just use the Interactive Brokers website for my needs, that’s it.

What I can tell you is that I usually place my orders at a time when the markets are open, typically Monday – Friday, 9AM – 6PM CET. This way I ensure that I’m paying market price and not buying at a small premium when there is less liquidity.

The 3 tools I use to buy an ETF or stock via this broker:

  1. JustETF to find the ETF I want to buy and its ticker
  2. The Interactive Brokers web interface
  3. TradingView to double-check market prices

Buying The Vanguard FTSE All-World ETF (VWCE)

It’s a lot easier for me to show you this part on video, so here is me investing close to 1.000€ into my favorite ETF, the Vanguard FTSE All-World (VWCE) on Interactive Brokers (jump to 5:07 minutes):

Alright, at this point you should know how you can buy ETFs or stocks with minimal fees using CapTrader and Interactive Brokers.

Speaking about the trading fees, let’s have a closer look.

CapTrader Fees

When you use the IB web interface like I did in the video, your orders are routed via Interactive Brokers smart routing system (NBBO) by default.

interactive brokers smart routing

The integrated smart routing feature always tries to find you the lowest available price for your ETF or stock on all available exchanges when you place an order. The web interface also shows you your estimated fees before you place an order, so there should be no surprises.

interactive brokers commission

I paid 2€ in commissions (fees) for an order close to 1.000€.

My order was executed on the German Gettex exchange, which has the same fee model as a few other available exchanges. You can see the full list on CapTrader’s website. Gettex was added recently, I was informed that the list will be updated soon to reflect that.

For my order, the fee was 0,1% of the amount I invested, with a minimum of 2€.

That means I could have also placed an order of 2.000€ and I would have paid the same 2€ fee, as that is exactly 0,1%.

A 5.000€ order on the other hand would have been 5€ in fees (-> 0,1%) for example.

If for whatever reason, you want to use a specific exchange instead of the integrated smart routing system, then you can do that by using the other free available tools for your account, like Trader Workstation (TWS). I haven’t tried those myself yet.

CapTrader vs. Degiro

There are 4 more things you might be curious to know about CapTrader (Interactive Brokers), especially if you’re coming from Degiro:

  1. Like Degiro, the brokerage account is free of monthly charges and inactivity fees
  2. There are no dividend fees
  3. No yearly exchange connectivity fees
  4. There is no share lending by default. You can activate it manually if you want to, and get 50% of whatever interest is earned from lending out your shares against collateral.

Also, if you receive a lot of dividends in USD on Interactive Brokers and you want to convert them to EUR, here is a bonus tip:

  • You can either convert USD to EUR directly on IB and pay a small exchange fee
  • Or you can send the USD from IB to a free Revolut bank account and convert them there without conversion fees. I already tried this last month and it works!

Conclusion: Great Degiro Alternative

In summary, all I can say is that I’m very happy that I found CapTrader and that I was able to move my Interactive Brokers account there. I think they’re an excellent alternative or addition to Degiro, especially since Degiro isn’t available in many countries.

I can easily recommend CapTrader to any investor that is looking for a reliable, low-cost broker to buy ETFs or stocks. You just need a minimum of 2.000€ in capital, in order to open your account. You can then of course invest that money according to your own investment strategy on Interactive Brokers.

Admittedly, the Interactive Brokers interface is not the most beginner friendly, but I hope I was able to at least show you how to buy ETFs using your account and to provide you with a bit of extra information.

Just so you don’t get me wrong, I’m still keeping my Degiro account as well. I like having several brokerage accounts running in my name and to have the option to choose were I place my next order.

If you’re based in Austria or Germany, make sure you also check out my list of local brokers. We have quite complicated tax laws compared to many other European countries. As a result, choosing a local broker that takes care of everything for you, could make your life easier.

That’s it! Thank you for reading my introduction to CapTrader. I hope you’ll like the broker as much as I do!

If you found this article helpful and you’d like to support me, you can get your own brokerage account on CapTrader using this link.

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Valuable Resources

  • My Investment Tools
    A list containing all my investments in P2P Lending, the brokerage accounts I use to buy ETFs, my speculative investments in Bitcoin and my free bank accounts. It even includes the tools I use for blogging and YouTube.
  • P2P Bonus Offers
    A collection of all the best, currently available bonus and cashback offers in the P2P lending space. Regularly updated.


Disclaimer: Investing involves risks of losses. You should always do your own research before investing into anything. Also, some of the links are affiliate links, which help support me, the website & YouTube channel. I only link to services I use myself, none of them are sponsored.

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8 Comments

  1. Hi Angelo,

    First of all, thanks for all your tips’n’tricks. You’ve been a great reference on the web and trustworthy guy, hope you can continue like that.

    I saw your video about CapTrader (and TradeStationGlobal by consequence). I’ve around €1000 in TSG and I definitely don’t want to pay the subscription fee. Just one question though: what was the process for you to cancel your TSG account? I mean, did you closed all your positions first? Have you delink your account?

    What have you done after those 4 bullet points you mentioned where you said to log in into Interactive Brokers and make sure the subscription is removed? I don’t want any more “business” with TradeStation, could you give some more insight please?

    Cheers.

    1. Thank you Samuel! I explained it in more detail in this video, did you see it? You might still be able to switch to CapTrader with a balance of >1.000€ as well, to avoid monthly inactivity fees on IB. I would send them an e-mail at info@captrader.com and ask if you can transfer your account. There is no need to close the account or sell anything. If it works, they should send you a PDF to fill out as well as some instructions, so that you can move the account over to them and keep it free of monthly fees. That’s what I did as well.

      1. Hi Angelo, didn’t saw the video before. Now it’s totally clear for me, will try to do that. Thanks for all the insight.

  2. Terrible service from them and i wouldn’t recommend.

    I wanted to switch from IBKR or Degiro to them when i saw your video for inactivity fees. After long delay to answers questions for transfer. I made an application and to my surprised it got rejected. Reason : “No reasons will be given for this”
    Never had problems with all 4 other brokers i’m using. Just wasted my time and refusing to give a motive for rejection. Just Terrible.

    1. Sorry to hear that. I would imagine your account was too small (less than 1.000-2.000€) at the time of your request. That would not make it worth it for them to take you on from a business perspective vs. their fixed costs (eg. IB inactivity fees).

  3. Hello!
    I recently opened up an Interactive Brokers account. Today, I got email from IB that says:
    We have decided to eliminate our monthly inactivity fee so there are no impediments to maintaining an account with IBKR. Effective July 1, 2021, you will no longer be charged USD 10 for not maintaining a minimum balance or transaction activity.

    And as I understand the commission fees are still lower in IB, it seems to be a better option over Captrader.