Best Brokers for those in other nations

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Topic Author
Benjamin Buffett
Posts: 86
Joined: Sun Nov 25, 2018 2:20 pm
Location: Indiana

Best Brokers for those in other nations

Post by Benjamin Buffett » Sat Jan 19, 2019 5:11 pm

I have a friend in East Africa that asked me about where I invest my money and I said I buy US index funds, he wanted to know if something existed that would allow him a low cost way to buy US index funds. Does anyone here have any ideas of some brokers that might be useful for someone in his position? I only invest in the US using US brokers so I had no ideas for how he could invest in us markets.

imperia
Posts: 155
Joined: Tue Feb 21, 2017 6:31 am

Re: Best Brokers for those in other nations

Post by imperia » Sat Jan 19, 2019 9:19 pm

Interactive Brokers!
He can buy ETF, but he can not index funds.
He also need to check tax treaty with USA and if his country has not tax treaty with USA, than is better to buy Irish domicile ETFs that tracks US index,...

TedSwippet
Posts: 2254
Joined: Mon Jun 04, 2007 4:19 pm

Re: Best Brokers for those in other nations

Post by TedSwippet » Sun Jan 20, 2019 4:25 am

Benjamin Buffett wrote:
Sat Jan 19, 2019 5:11 pm
I have a friend in East Africa that asked me about where I invest my money and I said I buy US index funds, he wanted to know if something existed that would allow him a low cost way to buy US index funds. Does anyone here have any ideas of some brokers that might be useful for someone in his position?
What imperia said above. For more, see this section of the wiki: Outline of Non-US domiciles - Bogleheads

Looking closely at this table listing US tax treaties, I see very few African countries, and no East African countries. Almost certainly no US tax treaty coverage, then. In which case, avoid US domiciled ETFs entirely and use broadly equivalent Ireland domiciled ETFs traded on European exchanges, for example London and Euronext.

Topic Author
Benjamin Buffett
Posts: 86
Joined: Sun Nov 25, 2018 2:20 pm
Location: Indiana

Re: Best Brokers for those in other nations

Post by Benjamin Buffett » Sun Jan 20, 2019 3:49 pm

Thank you very much for the information.

TedSwippet
Posts: 2254
Joined: Mon Jun 04, 2007 4:19 pm

Re: Best Brokers for those in other nations

Post by TedSwippet » Sun Jan 20, 2019 4:33 pm

Benjamin Buffett wrote:
Sun Jan 20, 2019 3:49 pm
Thank you very much for the advice.
I was actually surprised when looking through the list of US tax treaties that so few African nations feature on it. South Africa, Tunisia, and (most of!) Egypt are the only ones. It had not occurred to me before that Africa is so poorly represented in this area. Shrug. Anyway, hopefully your friend will have some success with Interactive Brokers, or failing them, perhaps Saxo Capital Markets.

Finally, both imperia and I have implicitly assumed so far that this person is not a US citizen or green card holder, and perhaps we ought not to have done this so glibly. If they are either of these, then a whole different dynamic comes into play (such that non-US domiciled ETFs would now be poor choices). It's a minefield, unfortunately. Full gory details in the wiki, anyway. Please ask again if anything remains unclear.

ICH
Posts: 218
Joined: Wed Jun 13, 2018 3:08 am

Re: Best Brokers for those in other nations

Post by ICH » Sun Jan 20, 2019 5:37 pm

imperia wrote:
Sat Jan 19, 2019 9:19 pm
Interactive Brokers!
That's the best bet. But he can also look at:
Saxo (reasonable prices)
Swissquote (expensive, but in Switzerland)
Internaxx (currently owned by Swissquote but has different pricing structure)
Degiro (dirt cheap but only if he has by any chance bank account in Europe)

Topic Author
Benjamin Buffett
Posts: 86
Joined: Sun Nov 25, 2018 2:20 pm
Location: Indiana

Re: Best Brokers for those in other nations

Post by Benjamin Buffett » Mon Jun 17, 2019 9:53 am

Thank you all very much for your input, you are right, it is indeed a mine field.

glorat
Posts: 66
Joined: Thu Apr 18, 2019 2:17 am

Re: Best Brokers for those in other nations

Post by glorat » Tue Jun 18, 2019 9:22 am

ICH wrote:
Sun Jan 20, 2019 5:37 pm
Degiro (dirt cheap but only if he has by any chance bank account in Europe)
Thank you thank you for making this important but subtle quote! Per another thread, I already have IB but am also looking for a second broker as backup. I thought Degiro was out because I don't live in Europe but I managed to register with them with my UK bank account, UK postal address but still declaring I was tax resident elsewhere. Win!

glorat
Posts: 66
Joined: Thu Apr 18, 2019 2:17 am

Re: Best Brokers for those in other nations

Post by glorat » Thu Jun 20, 2019 7:30 am

glorat wrote:
Tue Jun 18, 2019 9:22 am
ICH wrote:
Sun Jan 20, 2019 5:37 pm
Degiro (dirt cheap but only if he has by any chance bank account in Europe)
Thank you thank you for making this important but subtle quote! Per another thread, I already have IB but am also looking for a second broker as backup. I thought Degiro was out because I don't live in Europe but I managed to register with them with my UK bank account, UK postal address but still declaring I was tax resident elsewhere. Win!
But after further enquiries with Degiro, they require your primary residence to be in that relevant European country.

The system does let you register if you have a postal address but it is against their policies. I don't want to break their policies so I'm closing their account with them. Oh well

ICH
Posts: 218
Joined: Wed Jun 13, 2018 3:08 am

Re: Best Brokers for those in other nations

Post by ICH » Thu Jun 20, 2019 11:39 am

Strange. I opened it a year ago, specifically told them that I am resident in another non-EU country and they were OK with it. I opened it in the UK since I have a bank account there. I don't have a UK postal address, I used my real one.
Maybe it is new requirement. I don't plan on closing my account.

megatron1911
Posts: 6
Joined: Fri Mar 29, 2019 2:52 am

Re: Best Brokers for those in other nations

Post by megatron1911 » Fri Jul 12, 2019 4:55 am

ICH wrote:
Thu Jun 20, 2019 11:39 am
Strange. I opened it a year ago, specifically told them that I am resident in another non-EU country and they were OK with it. I opened it in the UK since I have a bank account there. I don't have a UK postal address, I used my real one.
Maybe it is new requirement. I don't plan on closing my account.
I inquired a month ago about the possibility of opening an account with them. The bank account i would have been funding the brokerage account with is located in Europe and is on the list of "OK" countries. My residency, on the other hand, is outside of Europe. The representatives (in 2 countries) told me it was not possible anymore, and that this was a new policy.

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