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Vanguard Review 2019

4.2 4 stars · Aug 2019
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Vanguard logo

Vanguard is a US stockbroker founded in 1975. The company is regulated by the Securities and Exchange Commission (SEC) and Financial Industry Regulatory Authority (FINRA).

Vanguard is considered safe because it has a long track record and is regulated by top-tier regulators.

Recommended for long-term investors who are looking for great ETF and mutual fund offers.

Pros
  • Free ETFs and low non-trading fees
  • Easy account opening
  • Great mobile trading platform
Cons
  • No credit/debit cards and electronic wallets for money transfer
  • Only US market covered
  • Basic research tools

Vanguard pros and cons

Vanguard offers free ETFs and low non-trading fees. The account opening is fully digital and user-friendly. The mobile trading platform is easy to use and well-designed.

It doesn't provide credit/debit cards and electronic wallets as for money transfer. The product portfolio covers only the US market and the research tools are limited.

Compare to other brokers

Vanguard review
Fees 3 stars

Vanguard offers free ETFs, some mutual funds and some bonds are free too. The non-trading fees are low, no withdrawal and inactivity fee is charged. On the negative side, the fees for stocks, options, and non-free mutual funds are higher.
Pros
  • No withdrawal fee
  • No inactivity fee
  • Free ETFs, some mutual funds and some bonds are free too
Cons
  • High financing rate
  • Higher fees for stocks, options, and mutual funds
Vanguard fees snapshot
Assets Fee level Fee terms
US stock Average Asset invested under $50k: $7 for first 25 trades per year, $20 thereafter
EURUSD - Not available
US tech fund High $20 per trade if investment is less than $500k, but Vanguard funds and 3000 other funds are free
Inactivity fee Low No inactivity fee

We ranked Vanguard's fee levels as low, average or high based on how they compare to those of all reviewed brokers.

To get things rolling, let's go over some lingo relating to broker fees. What you need to keep an eye on are trading fees, financing rates, and non-trading fees.

We also compared Vanguard's fees with those of two similar brokers we selected, Fidelity and Firstrade. This selection is based on factors like products offered, client profile, fee structure, etc.

Let's start with the trading fees.

Trading fees

Vanguard trading fees are average. The fee structure is transparent but a bit complex as the fees are tiered based on your account balance.

Vanguard offers different services based on your investment account balance. If you have a higher investment account balance, you will get discounts:

Vanguard service categories and fee structures
Services (investment account balance) Stock commission per trade ETF commission per trade Non-free mutual fund commission per trade Treasury bond commission Options commission per trade
Standard
(Under $50k)

$7 for first 25 trades per year, $20 thereafter

$0 $20 $0 $7 + $1 per options contract
Voyager Services ($50k-$500k) $7.0 $0 $20 $0 $7 + $1 per options contract
Voyager Select Services
($500k-$1 million)
$2.0 $0 $8 $0 $2 + $1 per options contract
Flagship Services
($1 million - $5 million)
$0 for first 25 trades per year, $2 thereafter $0 $0 for first 25 trades per year, $8 thereafter $0 $0 for fist 25 trades per year, $2 + $1 per options contract thereafter
Flagship Select Services
(Over $5 million)
$0 for first 100 trades per year, $2 thereafter $0 $0 for first 100 trades per year, $8 thereafter $0 $0 for first 25 trades per year, $2 + $1 per options contract thereafter

In this review, we calculated with the fees for Vanguard's basic service, called Standard.

Stock fees and ETF fees

Vanguard has generally average stock trading fees.

Stock fees of a $2,000 trade
  Vanguard Fidelity Firstrade
USA $7.0 $5.0 $0.0

The commission for stocks is $7 per trade for first 25 trades per year and $20 per trade thereafter.

The commission for all ETFs is free which is superb.

Fund fees

Vanguard fund fees are generally high

Fees for a $2,000 fund purchase
  Vanguard Fidelity Firstrade
USA tech fund buy $20.0 $37.5 $0.0

We calculated with a non-free mutual fund commission which is $20 per trade.

Vanguard does not charge a commission for its own Vanguard mutual funds and more than 3,000 non-Vanguard funds. However, if you sell the no-transaction-fee funds within 60 days after the purchase, a $50 fee is charged for the sale.

There is also a required initial investment and there is a required minimum for each additional investments.

Vanguard mutual fund investment requirements
Mutual fund type Initial minimum investment Additional minimum investment 
Non-free funds $1,000 $1,000
Non-Vanguard, but free funds

$3,000 for nonretirement

$1,000 for IRAs

$1,000
Vanguard STAR Fund and Vanguard Retirement Fund $1,000 $1
Vanguard Admiral share from $3,000 to $100,000 variable
Vanguard Investor share $3,000 variable

Bond fees

Vanguard has generally low bond fees. The bond fees vary among the different bond types. We calculated with the fees for Treasury bonds.

Fees of a $10,000 bond trade
  Vanguard Fidelity Firstrade
USA $0.0 $0.0 $40.0

Treasury bonds are free of charge which is great. The new issue bonds, except new issue municipal bonds, are also free.

The bonds on the secondary market have $2 per $1,000 face value with a $250 maximum if you invest less than $500k. If you invest more than $500k the commission is $1per $1,000 with a $250 maximum.

Options fees

Vanguard options fees are generally high.

Stock index options fees of 10 contracts
  Vanguard Fidelity Firstrade
USA $17.0 $11.5 $0.0

The options fees comprise a flat and a volume-based fee: $7 per trade plus $1 per contract.

Financing rates

Vanguard financing rates are generally high.

Financing rates are charged when you hold your leveraged positions for more than a day. It can be a significant proportion of your trading costs.

Vanguard annual financing rates
  Vanguard Fidelity Firstrade
Apple financing rate 9.5% 9.8% 9.5%

Vanguard financing rate is volume-tiered. It applies a base rate plus a premium depending on the financed amount. The base rate is set by its discretion, at the time of the Vanguard review the base rate was 7.00%.

Vanguard annual financing rates
Debit balance Rate% Base rate + / -
$1,000,000 or more 5.75% Base rate - 1.25%
$500,000 - $999,999 6.25% Base rate - 0.75%
$250,000 - $499,999 7.50% Base rate + 0.50%
$100,000 - $249,999 8.00% Base rate + 1.00%
$50,000 - $99,999 8.50% Base rate + 1.50%
$20,000 - $49,999 9.00% Base rate + 2.00%
Under $19,999 9.50% Base rate + 2.50%

Non-trading fees

Vanguard has low non-trading fees. It charges no inactivity and account fees.

There is no withdrawal fee if you use ACH transfer. The withdrawals to other banks using wire transfer cost $10. This fee isn't charged to Flagship and Flagship Select clients.

We tested ACH, so we had no withdrawal fee.

Vanguard non-trading fees
  Vanguard Fidelity Firstrade
Account fee No No No
Inactivity fee No No No
Withdrawal fee $0 $0 $0

Vanguard review
Account opening 4 stars

The account opening is fully digital and user-friendly. There is also no minimum account balance. However, the account opening and verification takes a bit longer, 2-3 business days.
Pros
  • Fully digital account opening
  • No minimum deposit
  • User-friendly
Cons
  • 2-3 business days account opening

Can you open an account?

Vanguard is a US stockbroker and targets primarily US clients. In this review, we tested Vanguard's services provided within the USA.

Vanguard has a global presence through the group's other subsidiaries and partners. The available product range and the form of business vary widely country-by-country. For example, in Germany, only institutional clients are served, while in the UK retail clients can open an account as well.

What is the minimum deposit at Vanguard?

The required Vanguard minimum deposit is $0. The minimum deposit can be more if you trade on margin or prefer using Vanguard's robo-advisor.

Vanguard minimum deposits by account types
Trading preferences Minimum deposit
Trading at Standard (basic) accounts $0
Margin account* $2,000
Vanguard Personal Advisor Services $50,000

*You trade with money borrowed from the broker, also called trading on leverage.

Account types

Vanguard offers several account types:

Vanguard account types
Account type Short description
Individual Brokerage Account Account is owned and used by a single individual
Joint Brokerage Account Account is owned and used by two or more individuals
Business Accounts Account is owned and used by a legal entity

Roth / Traditional / Rollover IRA Accounts

Individual retirement accounts
Education Savings Account Account is for educational purpose savings
Trust Account Account is in the name of an already established trust
Vanguard Personal Advisor Services Account is managed by Vanguard's technological (robo) and personal advisors

In this review, we tested the Individual Brokerage Account.

How to open your account

The account opening is user-friendly and fully digital. The online application takes roughly 15 minutes, but the verification is a bit slower. It took 3 business days until our account was verified.

Steps at Vanguard to open an account:

  1. Choose your funding method (bank transfer, rollover, other)
  2. Choose the account type
  3. Add your investment goals and preferences
  4. Add personal information, like Social Security Number, residency, phone number, etc.
  5. State your employment status and financial profile
  6. Fund your account
  7. Review your information
  8. Acknowledge the terms and conditions
  9. Sign up for web access
Vanguard review - Account opening

Vanguard review
Deposit and withdrawal 2 stars

Vanguard deposit and withdrawal can be improved. You can use only bank transfer, there is only USD as a base currency, and a fee is charged for wire transfer withdrawals. As a plus, there is no deposit fee and transferring money is easy and user-friendly.
Pros
  • No deposit fee
  • User-friendly
Cons
  • Credit/Debit card not available
  • Only one account base currency
  • $10 for outgoing wire transfers

Account base currencies

Vanguard offers only USD as a base currency. It lags behind Fidelity, but the same as at Firstrade, where also only USD is provided as a base currency.

Base currencies at Vanguard vs similar brokers
  Vanguard Fidelity Firstrade
Number of base currencies 1 16 1

Why does this matter? Two things. First, if you fund your account in the same currency as your bank account, you won't be charged a currency conversion fee. Second, if you trade assets in the same currency as your account base currency, you will not have to pay a conversion fee.

A convenient way to save on the currency conversion fees can be to open a multi-currency bank account. Revolut or Transferwise both offer bank accounts in several currencies with great currency exchange rates as well as free or cheap international bank transfers. The account opening only takes a few minutes on your phone.

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Deposit fees and options

Vanguard charges no deposit fees. US clients can use check, ACH, and wire transfers for the deposit. Credit/debit cards and electronic wallets are not provided.

Vanguard deposit options
  Vanguard Fidelity Firstrade
Bank transfer Yes Yes Yes
Credit/Debit card No No No
Electronic wallets No Yes No

We tested ACH transfer for deposit and it took 2 business days. You can only deposit money from accounts which are previously linked to your brokerage account.

A bank transfer can take several business days, while payment with a credit/debit card is instant.

You can only deposit money from accounts which are in your name.

Vanguard review - Deposit and withdrawal - Deposit

Withdrawal fees and options

Vanguard charges no withdrawal fees if you use ACH withdrawal, but US domestic wire transfers cost $10. If you have more than $1 million account balance, there is no fee for wire transfers.

Vanguard withdrawal fees and options
  Vanguard Fidelity Firstrade
Bank Transfer Yes Yes Yes
Credit/Debit card No No No
Electronic wallets No Yes No
Withdrawal fee $0 $0 $0

How long does it take to withdraw money from Vanguard? We tested the ACH withdrawal and it took 2 business days.

You can only withdraw money to accounts in your name.

How do you withdraw money from Vanguard? You can withdraw money from Vanguard by following these steps:

  • Log into the account
  • Go to the "My accounts"
  • Select the "Buy&sell" menu, select "Transfer money to/from your Vanguard settlement fund"
  • Choose the transfer type (one time or regular), your Vanguard account, and your previously connected external account
  • Add the amount you wish to withdraw
  • Preview and initiate the withdrawal

Compare to other brokers

Vanguard review
Web trading platform 3 stars

Vanguard has an average web trading platform. It offers two-step login and there is a clear fee report. However, the trading platform's structure is a bit confusing and some features are hard to find. The search functions can be improved and the customizability is missing.
Pros
  • Clear fee report
  • Two-step (safer) login
Cons
  • Poor search function
  • Limited customizability (for charts, workspace)
  • Some features are hard to find
Vanguard platforms to choose from
Trading platform Score Available
Web 3 / 5 stars Yes
Mobile 4 / 5 stars Yes
Desktop - No

Vanguard has an in-house developed web trading platform. It is available in English.

Look and feel

Vanguard's web trading platform is well-designed, but the structure could be improved. Sometimes it is rather hard to find features, for example, it took a quite long time until we found how we could place an order for stocks or set price alerts.

The platform does not offer any customizability.

Vanguard review - Web trading platform

Login and security

Vanguard provides a two-step login. You can turn on and off the two-step authentication in your account under "My Account\Account maintenance". If you do not want to receive text or voice codes, you can declare your computer as a trusted device and log in your regular ID and password combo.

Search functions

The search functions are not fully seamless. You need to navigate under the Buy & Sell menu, select "Trade an ETF or stock" option to access the search field. You can search by typing both a company's name or asset's ticker. The search results are not always relevant or have lower relevancy.

Vanguard review - Web trading platform - Search

Placing orders

You can use basic order types, the more sophisticated ones are missing

  • Market
  • Limit
  • Stop
  • Stop limit

If you are not familiar with the basic order types, read this overview.

There are also two order time limits you can use:

  • Day
  • Good 'till cancel (60 days)
Vanguard review - Web trading platform - Order panel

Alerts and notifications

You can set alerts for stocks, ETFs, and mutual funds. However, only email alerts are available and setting alerts is not a piece of cake.

You have to click on "Stocks and other ETFs"  under Investing menu. On the right side of the page, you can sign up for alerts. Then, you can set alerts if you go to the "Enroll now" button. It would be much easier if you could set alerts when you search for an asset.

Portfolio and fee reports

Vanguard has a clear portfolio and fee reports. You can find them under "My accounts" menu "Transaction History". It is a handy table, but you can't download it.

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Vanguard review
Mobile trading platform 4 stars

Vanguard offers a user-friendly and well-designed mobile trading platform. However, it lacks price alerts and you can't trade with options and bonds.
Pros
  • User-friendly
  • Two-step (safer) login
Cons
  • No price alerts
  • Options and bond trading are not available

Similarly to the web trading platform, Vanguard has an in-house developed mobile trading platform which is called Vanguard Investors. The app is available both on iOS and Android. We tested it on iOS.

On mobile, you can trade only with stocks, ETFs, and mutual funds. The options and bonds are missing.

The mobile trading platform is available in English.

Look and feel

The Vanguard mobile trading platform is user-friendly and easy to use. The app has a modern design and its structure is not confusing, contrary to the web trading platform.

Vanguard review - Mobile trading platform

Login and security

Vanguard provides a two-step login. Similarly to the web platform, you can declare that you have a safe device and use user ID & password combo. 

You can use TouchID and FaceID as well.

Search functions

The search functions are good. You can search both by typing the assets' name or ticker and the search results are relevant.

Vanguard review - Mobile trading platform - Search

Placing orders

You can use the same order types as on the web trading platform.

Vanguard review - Mobile trading platform - Order panel

Alerts and notifications

You cannot set alerts and notifications on the Vanguard mobile platform.

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Vanguard review
Desktop trading platform

Vanguard does not offer a desktop platform.

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Vanguard review
Markets and products 2 stars

Vanguard gives access to different asset classes, from stocks to options. However, the offered products cover only the US market and you can't trade with forex and futures.
  Vanguard Fidelity Firstrade
Stock Yes Yes Yes
ETF Yes Yes Yes
Forex No No No
Fund Yes Yes Yes
Bond Yes Yes Yes
Options Yes Yes Yes
Futures No No No
CFD No No No
Crypto No No No

Vanguard has an average ETF and mutual fund offers. The stock, bond, and options offers are worse than the average.

Stock and ETF

Vanguard gives access only to the US market. It is similar to Firstrade's offer but less than Fidelity's which gives access to international stock exchanges as well.

  Vanguard Fidelity Firstrade
Stock markets (#) 4 29 5
ETFs (#) 2,300 2,300 2,300

You can trade with stocks on these stock exchanges: NYSE, NASDAQ, AMEX, and OTC. 

Fund

There is an OK mutual fund coverage. It's less than the available mutual funds at Firstrade and Fidelity.

  Vanguard Fidelity Firstrade
Fund providers (#) 291 560 415

Besides Vanguard's own mutual fund offer, you will find funds from other big fund providers, like Blackrock.

Bond

Vanguard's bond offer could be improved. It lags behind the competitors.

  Vanguard Fidelity Firstrade
Bonds (#) 13,400 113,000 38,500

The bonds cover both government and corporate bonds.

Options

CBOE and other US options exchanges are covered, but Vanguard doesn't disclose which ones exactly.

Vanguard Personal Advisor Services

You can also use a managed account service which is great if you need help to manage your investments. You'll get a recommendation with the help of an expert and Vanguard's robo-advisor technology.

After you add your financial goals, the advisor recommends a portfolio which is rebalanced regularly.

The minimum investment is $50,000 and has an annual 0.30% fee.

Vanguard review - Vanguard Personal Advisor Services

Vanguard review
Research 3 stars

Vanguard research tools are easy to use but limited. You can use fundamental data and a few analyst recommendations. However, a sophisticated charting tool and other analytical tools are missing.
Pros
  • Analyst recommendations for any product
  • Data on asset fundamentals
  • User-friendly
Cons
  • Limited interactive charting
  • No/limited set of analytic tools

Vanguard research tools can be found on the website when you search for a product. Similarly to the web trading platform, the tools are available only in English.

Trading ideas

Vanguard provides trading ideas, focusing mainly on stocks. The ideas come from Argus and Market Garder, third-party providers.

Vanguard review - Research - Recommendations

Fundamental data

Vanguard offers fundamental data. You will find basic financial data for 4 years if you are initiating a search in the "Investing" menu "Stocks & other ETFs". We missed the peer comparison and financial metrics.

Vanguard review - Research - Fundamental data

Charting

Vanguard has a very limited charting tool. You can't add trend lines and other editor tools. There are only 15 technical indicators.

Vanguard review - Research - Charting

News feed

The news on Vanguard is OK. be improved. It is easily readable but lacks visual elements, like charts or pictures. It is provided by third-parties, like Associated Press or MT Newswires.

Compare research pros and cons

Vanguard review
Customer service 4 stars

Vanguard has great customer service. They give fast and relevant answers. On the flip side, there is no 24/7 and live chat is missing.
Pros
  • Fast response time
  • Relevant answers
Cons
  • No live chat
  • No 24/7

You can contact Vanguard via:

  • telephone
  • email

Vanguard's telephone support gave relevant and helpful answers, the speed was OK.

On email, we got relevancy answers and it took 1-1,5 days to answer.

We missed 24/7 availability and live chat.

Vanguard review - Customer Service

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Vanguard review
Education 4 stars

Vanguard offers good quality educational articles and videos. There are also high-quality and interactive webinars. However, a demo account and trading platform tutorial videos are missing.
Pros
  • Trading platform tutorial
  • Educational videos
  • Good production quality
Cons
  • No demo account
  • No trading platform tutorial videos

At Vanguard you can learn in the following ways:

  • General educational videos
  • Webinars
  • Quality educational articles

The general educational videos and the archive webinars have good content quality, mostly targeting beginners or general topics such as yield curve, what is a bond, how to approach your investments, etc.. There is a good amount of content targeting retirement and tax issues.

We liked the interactive webinars, however, you can not download the materials and there are once per month on average.

Besides videos, you can listen to podcasts and read downloadable PDFs. Most of these features are accessible from your account under the News&Perspectives menu. Vanguard has a well-structured info base called Vanguard blog as well.

Vanguard review - Education

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Vanguard review
Safety

Vanguard is regulated by top-tier financial authorities, like the SEC and FINRA. You are also protected by a high investor protection amount, $500,000 which includes $250,000 for cash. On the negative side, negative balance protection is not provided and Vanguard does not have a banking background.
Pros
  • Regulated by top tier financial authority
  • High level of investor protection
Cons
  • No negative balance protection
  • Does not hold a banking license
  • Not listed on stock exchange

Is Vanguard regulated? Yes, it is regulated by the Securities and Exchange Commission (SEC), and the Financial Industry Regulatory Authority (FINRA).

Is Vanguard safe? To be certain, it is best to check two things: how you are protected if something goes wrong and what the background of the broker is.

How you are protected

This is important for you because the investor protection amount and the regulator differ from entity to entity. With Vanguard this is not an issue though as all customers are covered by Vanguard Brokerage Services and the US investor protection scheme, called SIPC.

The SIPC investor protection scheme protects against the loss of cash and securities in case the broker goes bust. The limit of SIPC protection is $500,000, which includes a $250,000 limit for cash. This amount is substantially higher than the amount most investor protection schemes provide. 

Vanguard does not provide negative balance protection.

Background

Vanguard was established in 1975. The longer the track record of a broker, the more proof we have that it has successfully survived previous financial crises.

Being in operation for a long time and regulated by top-tier regulators are all great signs for Vanguard's safety.

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Vanguard review
Bottom line

Vanguard is one of the biggest US stockbrokers regulated by top-tier regulators.

Vanguard offers free ETF trading. It doesn't charge inactivity and account fees. The account opening is easy and fully digital. The mobile trading platform is user-friendly and has a great design.

It has some drawbacks though. Vanguard doesn't provide credit/debit cards and electronic wallets for transferring money. The product portfolio covers only the US market. The research tools are very basic.

As there are low non-trading fees and no inactivity fee is charged, feel free to try Vanguard.

Vanguard main features and highlights

🗺️ Country of regulation USA
💰 Trading fees class Average
💰 Inactivity fee charged No
💰 Withdrawal fee amount $0
💰 Minimum deposit $0
🕖 Time to open an account 1-3 days
💳 Deposit with credit card Not available
👛 Depositing with electronic wallet Not available
💱 Number of base currencies supported 1
🎮 Demo account provided No
🛍️ Products offered Stock, ETF, Fund, Bond, Options

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Vanguard logo

Vanguard is a US stockbroker founded in 1975. The company is regulated by the Securities and Exchange Commission (SEC) and Financial Industry Regulatory Authority (FINRA).

Vanguard is considered safe because it has a long track record and is regulated by top-tier regulators.

Recommended for long-term investors who are looking for great ETF and mutual fund offers.

Compare to other brokers

Overall 4 stars

Pros
  • Free ETFs and low non-trading fees
  • Easy account opening
  • Great mobile trading platform
Cons
  • No credit/debit cards and electronic wallets for money transfer
  • Only US market covered
  • Basic research tools

Fees 3 stars

Pros
  • No withdrawal fee
  • No inactivity fee
  • Free ETFs, some mutual funds and some bonds are free too
Cons
  • High financing rate
  • Higher fees for stocks, options, and mutual funds

Account opening 4 stars

Pros
  • Fully digital account opening
  • No minimum deposit
  • User-friendly
Cons
  • 2-3 business days account opening

Deposit and withdrawal 2 stars

Pros
  • No deposit fee
  • User-friendly
Cons
  • Credit/Debit card not available
  • Only one account base currency
  • $10 for outgoing wire transfers

Web trading platform 3 stars

Pros
  • Clear fee report
  • Two-step (safer) login
Cons
  • Poor search function
  • Limited customizability (for charts, workspace)
  • Some features are hard to find

Mobile trading platform 4 stars

Pros
  • User-friendly
  • Two-step (safer) login
Cons
  • No price alerts
  • Options and bond trading are not available

Markets and products 2 stars

The available asset classes to trade:

  • Stock
  • ETF
  • Fund
  • Bond
  • Options

Research 3 stars

Pros
  • Analyst recommendations for any product
  • Data on asset fundamentals
  • User-friendly
Cons
  • Limited interactive charting
  • No/limited set of analytic tools

Customer service 4 stars

Pros
  • Fast response time
  • Relevant answers
Cons
  • No live chat
  • No 24/7

Education 4 stars

Pros
  • Trading platform tutorial
  • Educational videos
  • Good production quality
Cons
  • No demo account
  • No trading platform tutorial videos

Safety

Pros
  • Regulated by top tier financial authority
  • High level of investor protection
Cons
  • No negative balance protection
  • Does not hold a banking license
  • Not listed on stock exchange

AUTHOR OF THIS REVIEW

Gergely Korpos
Gergely Korpos
Co-founder, CPO
Gergely's aim is to bring more clarity into personal investing. He has 10 years of experience in financial markets with GE Money, KPMG and MOL. He concluded thousands of trades as a commodity trader and financial portfolio manager

METHODOLOGY

Everything you find on Brokerchooser is based on reliable data and unbiased information. We combine our 10+ years finance experience with readers feedback. Read more about our methodology

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