Direct banks offer attractive price models for investors who are willing to switch
Switching securities accounts to flatex can render spectacular savings results for the investor, as a study by Stiftung Warentest on the topic of securities accounts shows.
The persisting low-interest phase presents a big challenge for banks and investors. While banks raise their fees to secure their income, investors pay attention to lowering their costs. This is understandable because every expense that does not go directly to the monetary investment reduces the expected profit.
Anyone who pays securities account management fees and excessive order fees to his bank should change to an affordable direct bank. The current study by Stiftung Warentest can be a help to the investor for making a decision.
The test compared the custodian and order fees of 38 direct and branch banks. The incurred costs were calculated for two different sample customers: one customer with big assets and few orders, and one customer with low assets but many orders.
The result: By choosing an affordable direct bank without securities account management fees, investors can save lots of money. In this regard, they should also pay attention to low order prices. Particularly customer-friendly are so-called “flat fees”, which are flat prices on orders. “The more buy and sell orders there are, the higher the benefit of the “flat fees” offered by flatex (...) An order costs EUR 5 flat, regardless of whether the investor invests just EUR 500 or EUR 50,000”, 1is the praise expressed by Stiftung Warentest.
For both sample customers, flatex is the most affordable broker and therefore the test winner. Given a free securities account and flat order fees of EUR 5, both investors would pay just EUR 30 or 100 per year. “As before, investors can buy securities most affordably at flatex (...). The annual savings compared to an average branch bank are spectacular. Even those who trade only occasionally will save EUR 500 to 600 while more active traders can even save EUR 800 to 1000.” 2
The expert advice from Stiftung Warentest: Comparing costs regularly is worth it to investors. “By switching to a bank with free securities account, you can save every year – often several hundreds of euro.“ 3
1,2,3 Source: Stiftung Warentest, “Finanztest”, Test of custodian fees, issue of 12/2016