Affordable trading – allgorite helps you save costs
High fees are always a nuisance. Avoiding them can be a reliable “source of income”. This is especially true for frequent traders and those with a short-term investment horizon. Comparing fees certainly is worthwhile. We will help you choose the right broker and show how easy it is to open a very inexpensive trading account in the U.S.
This section is aimed at our international customers. Most U.S. Residents have their own online trading account although it might be worth reading it.
allgorite recommends Interactive Brokers
Of course you can buy the shares allgorite recommends using an existing traditional securities account. Most brokers will offer all the trading options required to do so. Compared to the U.S., however, trading U.S. stocks is significantly more expensive in your country, meaning that fees significantly reduce your profits.
We have therefore taken a look at U.S. online brokers for you and have come to a clear conclusion: Considering allgorite’s trading requirements, we can recommend the well-known and long-established online broker house “Interactive Brokers”. It offers reasonable trading fees and a convenient and professional trading platform. This is confirmed by a recent comparison test by the prestigious U.S. business magazine Barron’s.
Please use this link to open your account directly on the Interactive Brokers webpage and help sustain our business.
A trading account in the United States – how it works
Registration procedures for online banking are a hassle. This also applies to the U.S. At least they are not more time-consuming than in the rest of the world. Since opening a securities account abroad still is a considerable obstacle for some of our customers, we have decided to help out and summarized the essential steps required to open a securities account using the example of Interactive Brokers.
The good news is that many U.S. trading platforms have already adapted to foreign customers. Interactive Brokers also assists you in opening an account with an International version. The trading software that you will later need for equity trading is also provided in various languages.
You have to provide your username and password when you want to open an account. Strictly follow the guidelines like you would anywhere else. What you should be aware of, however, is that once selected, your username will remain the same and cannot be changed. Once this is done, enter your e-mail address. In the response e-mail message you will receive a confirmation code that you must first enter before you can continue. You will then be asked do provide information on your address, income, employer, financial situation, etc.
It is important that you enter this information in careful detail. Do not let this irritate you: Although the amount of detail required may seem unusual, it is common practice in the U.S. You will also be asked to provide detailed information about your trading experience. As it is the case with the banks in your country, your experience is a key factor in receiving authorization for various financial transactions in the USA as well. Should any associated restrictions come up later during trading, Interactive Broker’s highly efficient customer service is available to provide support.
The basic settings in the registration procedure include the actual opening of the account. As a private person, you must first enter “Individual” under Type of customer. The next step is to select the account and your trading permission, which determines what products you are and are not allowed to trade. You can set the latter when opening the account or at any time after that via your account management. All the steps are also explained during registration.
Very important – your account type
A distinction will be made between a regular cash account, and two different credit (or margin) accounts: the “Reg T Margin”, which requires a capital contribution of at least US$ 25,000, and the “Portfolio Margin” with a minimum deposit of at least 100,000 US dollars. A margin account (usually a Reg T Margin) is most suitable for allgorite users because the capital can be invested much more efficiently with the credit option. It offers more trading options, and it is also a multi-currency account. Cash accounts, in contrast, must always have sufficient liquidity for purchases, and credits from sales take three trading days to be transferred, meaning that especially for frequent traders, an optimal use of capital is not possible.
Especially allgorite customers with little trading experience are advised not to rely on the tips given here alone, but rather to familiarise themselves thoroughly with the different types of accounts and the trading configurations, rules and risks. Interactive Brokers provides detailed information on this. To learn about the various trading options, we recommend the interactive Traders’ University.
This completes the registration process and all you have to do now is get money into your account. Fort the EU this is surprisingly easy, since your money is initially wired to Interactive Brokers UK as a free standard EU bank transfer with IBAN and BIC. They then forward it to the U.S. parent company. The money will appear on your new account about two days later. Since dollars are required for trading shares in the U.S., you still need to take one last hurdle and change your domestic currency into U.S. dollars. Once again – this is not a problem. You can exchange currencies very conveniently and inexpensively via your account’s trading platform by buying or selling the desired currency at the current exchange rate.
Done. We wish you much success with allgorite and your new account in the U.S.
If you want to support us, please use this link to open your account directly on the Interactive Brokers webpage.