Investing and IBKR noob questions

Question

Hi all,

Finally opened an IBKR account

I'm a noob at investing (I only invested in crypto and real estate), I have very few Vanguard ETFs with DEGIRO

After seeing so many folks talking about IBKR, their low commission and a lot of other perks so decided that it was time to open one and diversify my investments

I have been doing my own research and I decided that to start with, I only want to invest in ETFs as I think it is better for newbies

The thing is I see IBKR a bit overwhelming so as I guess a lot of WIPers might be using it would be great some advice, also about taxes for an EU resident.

You know, as a noob any advice is very welcome, even though there are so many ETFs available that is hard to tell what is better, again, as a EU resident.

Thanks in advance, Rod

Marc Köhlbrugge · Accepted Answer

One suggestion is to use their mobile app exclusively as it's easier to use than their website.

That said, you shouldn't be using the app that frequently either IMO. Investment is more of a long term thing. Not something where you use the app everyday.

Related: https://gherget.com/investing-guide

Marek · Answer

Compunding Quality is an awesome and high quality community about investing. I highly recommend it -> https://www.compoundingquality.net/

Romain Simon · Answer

I'm using both Degiro & Interactive Brokers, and I can say that even IBKR is better for many reasons.

Here are a few quick tips :

1. I personnaly don't like the mobile app compared to Degiro. I would advise trying the web app first.

2. Contrary to Degiro, you need to take care of currency conversion if you have EUR and wants to invest in USD

3. IBKR is paying you interest just to hold cash (you need above 100k USD and holdin USD pays more than EUR) : https://www.interactivebrokers.com/en/accounts/fees/pricing-interest-rates.php

4. Reporting is way better. You can benchmark your performance vs an index. Try PortfolioAnalyst on  the top tab "Performance & Reports"

5. You can earn extra cash by lending shares. It's not much, but you need to optin to their Stock Yield Enhancement Program : https://www.interactivebrokers.com/en/pricing/stock-yield-enhancement-program.php (click on your name on the tap bar, then settings and you should see it on the page.

6. There are no free ETFs, but some are very low cost. You can use https://www.justetf.com to find them.

Some examples :

S&P 500 (low fees)
SPYL / 0.03% / accumulating (EUR/USD)

S&P 500 (higher fees but larger fund)
SXR8 - 0.07% / accumulating (EUR)

Hope it helps a bit :)

Greg Raileanu · Answer

My best advice - don’t do day trading ))

brend · Answer

Congrats!
IBKR and Saxo are the best brokers (one for you and one for your biz)
As a EU resident looks at UCITS ETFs and accumulating as well.
Diversify.

Rod · Answer

Thanks Marc, I love that guide, it's what made me decide to take the plunge 😀

cacho · Answer

semi-unrelated but this guy has a great youtube channel on investing long-term in the EU, very pro-ETFs: https://www.youtube.com/@AngeloColomboFi/videos

Rod · Answer

THanks a lot!

Nik Spyratos · Answer

IBKR has extensive documentation on how they function, including for how residency and taxes might work with them. First brush up on your local tax law around investments and capital gains, and then figure out how to pull the necessary documentation from IBKR whenever tax time comes around.

Conveniently, they also are able to "migrate" your investments to a different residency while keeping them in IBKR. So if you ever emigrate, you won't have to sell your investments off just to move the funds "out" of your old residence country.

Dmitrii Pashutskii · Answer

Congrats! It's a significant step towards the future.

It's not financial advice, but I have invested in Total World Vanguard ETF for many years and couldn't be happier—I just DCA to it monthly and check performance quarterly. In Europe, the most famous World ETF is VWCE. It's not the best in terms of fees, but it's the easiest. There are ways to pay fewer fees by combining several, and it's easy to find them online. Here is a good one (in Dutch): https://www.indexfondsenvergelijken.nl. 

I recommend watching some of the financial YouTubers (the best in the EU is https://www.youtube.com/@AngeloColomboFi, in my opinion) or reading a few books ("Psychology of Money" is a good one, but also "The Simple Path to Wealth" is more practical oriented.). Understanding it yourself is always better than listening to somebody else. Most of the people don't know what they're doing when it comes to investing anyway 😂

I also recently started making videos about investing and personal finance (I made one so far). If you're curious, I'll add a shameless plug: https://youtu.be/fgWhNf-Ljd4?si=_jdDQKp5FOqj1jdG

Rod · Answer

Makes sense, thanks again Romain 😀

David Rodriguez · Answer

I found the videos from this Spanish youtuber quite good, and he is also a certified financial advisor: 
https://youtu.be/Yv_Mmf3QzkU?si=Lynw33G4FEGIz2xx

Rod · Answer

Thanks, appreciate it 🙏🏻

Rod · Answer

I don't plan to do trading, only interested in holding

Greg Raileanu · Answer

Just keep buying S&P etfs and don’t touch it whatever happens

Rod · Answer

Thanks a lot Nik

Rod · Answer

Gracias!

Rod · Answer

Thank you very much!

Why do you keep using Degiro?

Romain Simon · Answer

I was thinking about it but transfering positions is quite costly (around 100€ per position it seems) and I don't want to sell as I would have to pay taxes.
Anyway, I'm thinking having two brokers is probably not such a bad idea though it's not very practical

Romain Simon · Answer

(and I choosed Degiro first because it was cheaper than IBKR at the time, which is not true anymore)

Rod · Answer

Thanks a lot

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Investing and IBKR noob questions

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