Interactive Brokers vs. Saxo Bank: Which broker suits your trading style? Compare fees, platforms, and market access to make the best choice.
Choosing between Interactive Brokers (IBKR) and Saxo Bank can be a challenge, as both offer an array of services for traders with various needs. By comparing these two brokers across key areas, such as fees, platforms, account types, and available assets, traders can make a decision that aligns with their objectives.
1. Account Types and Minimum Requirements
The account opening process varies between these two brokers, with each catering to different kinds of traders.
Interactive Brokers (IBKR)
IBKR provides several account types, such as individual, joint, and institutional accounts. One of the standout features is that there’s no minimum deposit requirement for the IBKR Lite account, making it ideal for new traders. The IBKR Pro account, however, comes with different costs depending on trading volumes and the assets being traded. IBKR also offers a demo account, which is perfect for those just starting out and wanting to practice before committing real funds.
Saxo Bank
Saxo Bank’s account requirements differ by region. Some areas offer a minimum deposit as low as $0, while in other regions, it can reach $10,000, particularly if premium services are involved. Saxo does not provide a demo account, which may be a disadvantage for traders who want to familiarize themselves with the platform before making actual trades.
Winner: Interactive Brokers
IBKR wins this round due to its flexible account options and the availability of a demo account, which gives beginners a chance to practice trading without financial risk.
2. Trading Fees and Pricing
Fees are a major factor when deciding between brokers, as they can affect overall profitability.
Interactive Brokers
IBKR offers competitive fees, with a pricing structure that can go as low as $0.0035 per share for U.S. stocks and ETFs. For other markets, pricing depends on the region but generally starts at 0.05% for European stocks. IBKR also has a low currency conversion fee of 0.0020%, which is one of the lowest in the industry.
Saxo Bank
Saxo Bank’s pricing starts at 0.4 pips for forex, which is higher than IBKR’s rates. For U.S. stocks, the minimum commission is $3, which is more expensive than IBKR. Saxo also charges a currency conversion fee of 0.25%, which is significantly higher than IBKR’s fee. Moreover, Saxo has an inactivity fee, which could be problematic for traders who do not trade frequently.
Winner: Interactive Brokers
IBKR is the better choice here, offering lower fees for U.S. stocks, currency conversion, and more cost-effective commissions overall.
3. Trading Platforms
Both brokers offer excellent trading platforms, but they differ in their features and target audience.
Interactive Brokers
IBKR’s flagship platform, Trader Workstation (TWS), provides access to a wide range of global markets and financial instruments. TWS is highly customizable, offering detailed charting tools, real-time data, and powerful research features. IBKR also offers the IBKR GlobalTrader app, which caters to those who prefer a mobile-friendly platform for trading in stocks, ETFs, and options.
Saxo Bank
Saxo Bank offers two main platforms: SaxoTraderGO and SaxoTraderPRO. SaxoTraderGO is aimed at retail traders who prefer a user-friendly experience, while SaxoTraderPRO is designed for professionals and offers advanced features. Both platforms are reliable and include essential tools such as real-time data, charting capabilities, and access to various asset classes.
Winner: Draw
Both platforms excel in providing advanced tools and access to a wide array of markets. Your preference may depend on whether you value a mobile-friendly app (IBKR) or advanced platform features (Saxo).
4. Market Selection and Instruments
A wide selection of financial instruments can greatly enhance a trader’s portfolio.
Interactive Brokers
IBKR provides access to over 150 markets and supports various asset classes, such as stocks, options, ETFs, futures, bonds, and mutual funds. It also allows trading in commodities and cryptocurrencies, which offers more flexibility for traders seeking diverse markets.
Saxo Bank
Saxo Bank offers a broad selection of over 40,000 instruments, including forex, commodities, stocks, ETFs, bonds, and mutual funds. However, Saxo does not offer cryptocurrency trading, which may be a disadvantage for some traders looking to diversify into this emerging asset class.
Winner: Saxo Bank
Saxo Bank takes the lead in terms of the number of available instruments, offering a larger selection overall, especially for traders looking for diversity in their portfolios.
5. Regulation and Security
Regulation is a critical factor in selecting a broker, as it ensures that the firm adheres to strict standards for financial security.
Interactive Brokers
IBKR is well-regulated by top authorities, such as the SEC, FINRA, FCA, and ASIC. The broker offers SIPC protection for U.S. clients, meaning that in the case of insolvency, your funds are protected up to a certain limit. IBKR is known for its strong security protocols and risk management practices.
Saxo Bank
Saxo Bank is also highly regulated by authorities including the FCA, MAS, and ASIC, among others. The firm offers solid security features, including encryption and segregated client accounts to protect traders’ funds. Saxo adheres to strict financial regulations, ensuring peace of mind for traders.
Winner: Draw
Both brokers are highly regulated by multiple authorities, ensuring that they follow stringent financial and security standards. There is no clear winner here as both offer strong protection for their clients.
6. Educational Resources and Research Tools
Having access to educational resources and research tools can be a game-changer for traders who are looking to improve their skills and stay informed.
Interactive Brokers
IBKR offers a wealth of educational materials, including webinars, tutorials, articles, and research reports from third-party providers. Their educational hub is comprehensive and provides valuable insights, particularly for beginner traders. The IBKR GlobalTrader app also provides learning resources for newer traders.
Saxo Bank
Saxo Bank is known for its excellent research tools and premium educational content. The bank offers in-depth market analysis, research reports, webinars, and podcasts from industry experts. Saxo’s research platform provides actionable insights that traders can use to inform their strategies.
Winner: Saxo Bank
Saxo Bank takes the lead in this category thanks to its extensive research tools and premium educational content, which cater to traders who want to deepen their knowledge and stay up-to-date on market developments.
Final Thoughts: Making the Right Choice
When deciding between Interactive Brokers and Saxo Bank, traders must consider their specific needs and priorities.
- Interactive Brokers is an excellent choice for traders looking for lower fees, a wide selection of global markets, and a flexible platform with a demo account. Its cost-effective pricing and advanced features make it a strong option for both new and experienced traders.
- Saxo Bank is ideal for those who require access to a large variety of instruments, in-depth research tools, and advanced platform features. However, its higher fees and lack of cryptocurrency offerings may not suit every trader.
Both brokers have their strengths, and your decision will depend on whether you prioritize cost, platform features, or the range of financial products available.
