Comparison of Stock Brokers for US Stocks in Malaysia

With Dow Jones, S&P 500, and Nasdaq going higher and higher, there is no telling how far they will go. Is it a good time to long the stocks or shall we start to short the stocks? Only time and the market will tell. However, to purchase or short sell US stocks, you will have to create an account with a stock broker first. In this post, let’s compare the stock brokers and the brokerage fees to involve in the US stock market.

Charles Schwab (formerly TD Ameritrade)

Effective Dec 1 2023, Charles Schwab only provides services to accredited investors. To become their accredited investor, you need to satisfy at least one of the following conditions:

• personal income of SGD300k per year in the last 12 months
• net personal assets of SGD2mil where the primary place of residence can only contribute up to SGD1mil
• net financial assets of SGD1mil

It has one of the lowest, if not best pricing among all the other stock brokers for US stocks, ETFs, and Options. You can take a look at their pricing list here. However, the entry requirement is very steep for most retail traders and investors.

eToro

eToro is the most active platform among all the others here in the list in terms of ad spending. Besides stocks and ETFs, they also offer cryptocurrency and CFD trading. For stocks and ETFs, they offer 17 exchanges around the world which includes US, EU, UK, and HK. The full list can be found here. However, do take note that not all stocks are available in those stock exchanges.

In terms of fees, eToro does not charge any commission or management fees. However, they do charge for withdrawal fee of USD5, conversion fees for currencies besides USD, and also a USD10 per month of inactivity fee after 12 months with no login activity. For the full list of items, you may refer to their page here.

eToro has a few unique points compared to the other stock brokers in this list. Firstly, you can deposit your account with a credit or debit card. This means that you can earn those cash back or reward points from the cards. However, do take note that some banks exclude eToro/investments as eligible spending for cash back or reward points. Besides that, there is a CopyTrader function where you can copy a person’s trades easily with just a single button. For example, you can copy Dividend Magic or Spark Liang at eToro. To understand in-depth on how it works, you may refer to this page.

Lastly, do take note that eToro is not licensed to operate in Malaysia. Therefore, our account is actually registered under eToro AUS Capital Pty Ltd which is authorised by Australian Securities and Investments Commissions (ASIC). However, it is legal to use eToro in Malaysia.

Firstrade

With Firstrade, you can trade US stocks, ETFs, mutual funds, and options with $0 commission. Besides that, there is no account fees or minimum deposit to open an account. However, there are certain fees to take note of when you deposit or withdraw your funds which you can refer to the full list here.

Besides trading and investing, Firstrade also offers DRIP and Securities Lending Program. DRIP stands for Dividend Reinvestment Plan and with this, the dividend that you receive for a stock will be reinvested to purchase more of the same stock. You can read about DRIP here. On the other hand, you can lend shares that you own to earn some extra income. However, do take note that not all stocks that you own can be loaned out. For the FAQs, you can refer to this page.

FSMOne

FSMOne is famous in Malaysia for its wide selections of funds and bonds. However, in Mar 2021, they start to offer Malaysia stocks and ETFs on their platform which I have compared it to the other local brokers here. Few months after that, they are now offering HK and US stocks and ETFs as well. Although FSMOne has one of the lowest brokerage fee for Malaysia stocks and ETFs, they are one of the highest charging platform for US stocks. For US stocks and ETFs, the processing fee is 0.08% or minimum of USD3.80. Besides that, there are other charges such as exchange settlement fee and trading fee which you can refer to the table here.

Interactive Brokers (IBKR)

If 17 market exchanges by eToro sounds a lot, Interactive Brokers is in a whole new level by offering a whooping 135 markets. In addition, they have the most comprehensive offerings compared to the other stock brokers. Besides the usual stocks, ETFs, and options, they also offer futures, currencies, bonds, and funds. In fact, they have almost everything covered except cryptocurrency.

Interactive Brokers offers 2 commission structures which are tiered and fixed. For fixed commission, the rate is USD0.005 per share with minimum of USD1 while tiered commission varies based on your trading volume as per the table below:

Interactive Brokers has one of the most detailed and most complicated pricing structure. You can refer to this page for the full pricing details.

Besides that, Interactive Brokers also offers something similar to Firstrade’s Securities Lending Program. It is known as Stock Yield Enhancement Program. For Interactive Brokers, they will pay you 50% of the income for the stocks that you lent. However, this program is only available if you have a margin account with them or cash account with more than USD50k. You may read the full details of the program here.

M+Global

You might have heard of M+Online if you buy/sell Malaysia stocks. Now with the introduction of M+ Global, you can trade MY, HK and US stocks and ETFs.  Their fees is 0.10% of trade value with min of USD3. They also offers margin trading which you can take a look at the interest rates here.

MIDF Invest

MIDF Invest is launched by MIDF Amanah Investment Bank Bhd in partnership with Saxo Markets Asia Pacific, a subsidiary of Saxo Bank. It offers Malaysians US stocks and ETFs on the New York Stock Exchange (NYSE) and Nasdaq. Their charges are as below:

1) brokerage fee of 0.12% of transaction value with min of USD1.99

2) stamp duty of RM1.50 for every RM1k

3) SEC clearing fee of 0.00051% of the total sale value

4) no custodian fee until further notice

One of the unique features of MIDF Invest is that you can choose between conventional or Islamic when you open an account. If you choose Islamic account, you can only see Shariah-compliant US stocks and ETFs. MIDF Invest works with IdealRatings Inc to perform the quarterly Shariah screening. Besides the fees and charges section in the FAQ page, one of the most important thing to take note is the selection of your account. If you choose conventional account, you cannot switch to Islamic account and vice versa. You can download MIDF Invest from Google Play or the App Store.

Moomoo

Moomoo app is now offered by Moomoo Securities Malaysia Sdn Bhd which is a subsidiary of Futu Holdings Limited. Futu Holdings Limited offers digitized brokerage and wealth management platforms and is listed in Nasdaq.  With Moomoo, you can participate in the US and local MY market. For US stocks and ETFs, Moomoo charges 0.03% of transaction amount. In addition, they also charge a fixed platform fee of USD0.99 and variable regulatory fees for each order. You may refer to this page for the pricing list.

Currently, if you are a new user and deposit RM10k for 2 months, you can stand a chance to win fractional shares of Nvidia and Apple. However, their promotions change every 2 months so you can refer to this link for the latest promotion.

POEMS

Philip’s Online Electronic Mart System aka POEMS is owned by Philip Securities Pte Ltd. With POEMS, you get access to 26 market exchanges with products such as stocks, CFDs, forex, futures, unit trust, and bonds. POEMS charges different rates for different markets and also based on your asset value with them. The higher the asset value with them, the better the rates will be. There are 3 tiers which are

1. Starter (SGD 0-29,999)
2. Premier (SGD 30,000-249,999)
3. Privilege (SGD 250,000 and above)

You can take a look at their pricing here.

POEMS also offers Regular Savings Plan (RSP) which is a Dollar cost averaging (DCA) method that buys periodically into shares or unit trusts. There are 3 RSP which are Recurring Plan, Share Builders Plan, and Unit Trust Regular Savings Plan. Below is the comparison table between the 3 plans. You can also read more about it here.

Rakuten Trade

With Rakuten Trade, you can trade MY, HK, and US stock markets. There are 3 different types of accounts that you can open with Rakuten Trade:

• Cash account where you can trade based on your deposit in the account
• Contra account where you can trade up to 5x of the money in your account
• RokuMargin account where you can trade up to RM100k based on collateral

Depending if you are trading the US markets in MYR or USD, the brokerage fee varies accordingly:

You can take a look at the full pricing list here.

For every RM1 paid for brokerage fees, you will get 1 Rakuten Trade (RT) points. You can pay brokerage fees using your RT points at conversion of 1RT=RM0.01. There are other ways to earn RT points such as making your 1st deposit (min RM5k), transferring your shares over to Rakuten Trade, and referring others to use Rakuten Trade. You can take a look at this page for more info.

Saxo Bank

Saxo Bank offers 40+ exchanges worldwide and as much products as Interactive Brokers which includes forex, futures, commodities, bonds, mutual funds etc. However, they also offer cyrpto which IBKR does not. Saxo Bank has 3 account tiers which is similar to POEMS. Their tiering is as below:

1. Classic
2. Platinum (SGD 300k)
3. VIP (SGD 1.5mil)

You can take a look at the full benefits for each tiering here.

Just like POEMS, Saxo Bank also offers Regular Savings Plan. However, you only have 4 options as below which are managed ETF portfolios with insights from Lion Global and BlackRock. For more info, you may refer to this page.

Tiger Brokers

Tiger Brokers’ parent company UP Fintech Holding Limited is listed in Nasdaq. Besides that, Tiger Brokers offers US, HK, SG, Australia markets, and China A-shares. In terms of pricing, Tiger Brokers charges USD0.005 per share with minimum of USD0.99 per order for US stocks. For the full list of pricing, you can refer to this page.

Currently, Tiger Brokers is having a new user promotion where you can obtain fractional shares of Nvidia, Tesla, Apple, or Amazon based on the deposit you put into Tiger Brokers.

• SGD1k, you get 1 chance of lucky draw
• SGD3k, you get 3 chances of lucky draw
• SGD10k, you get 6 chances of lucky draw

In addition, there is a clause in the T&Cs that stated you have to keep the deposit value for 30 days and complete 5 trades. You can view the full T&Cs here.

Tiger Brokers is a trading platform + social media platform. This is because you can post on your wall, like/share/comment on others’ posts, follow other traders etc. With Tiger Brokers, there are missions such as leave 1 comment, follow 3 users etc where you will earn Tiger coins. The coins can then be used to exchange for commission-free vouchers or stock vouchers.

In addition, Tiger Brokers also offers Stock Yield Enhancement Program (SYEP) which you can lend your shares to earn interest. You can read about it here.

TradeStation Global

There are 2 TradeStation websites which are beautifully differentiated as below:

TradeStation US can only trade the US markets and only available to the US residents. Therefore, do make sure you are accessing TradeStation Global.

When you open an account with TradeStation Global, you are actually opening an Interactive Brokers Universal account but powered by TradeStation. Therefore, you will also have access to the same 135 markets and products such as options and futures that you can find in IBKR. However, TradeStation Global charges USD0.01 per share with minimum of USD1.5 per order. For the full pricing list, you can refer here.

Webull

Webull Malaysia is launched recently in May 2024. It has a fee of 0.05% of transaction value with min of USD0.99. Currently, it is offering $0 platform fee until further notice. However, the other fees such as stamp duty and regulatory fee is still applicable as below:

You can take a look at the pricing list here as well.

Besides the ability to purchase fractional shares, you also get 2.5% pa interest on your idle cash in your account.

Table of Comparison

Conclusion

There is no perfect stock broker as each of them has their pros and cons. However, here are a few things to consider so that you can make a decision. Firstly, determine if you are an investor or trader. If you are an investor, as long as the commission fee is not too expensive, any stock broker should be fine. However, if you are a trader, then $0 commission is the best choice as the fees can quickly add up to a huge sum.

Next, decide if you only want to use a platform that is approved by the Securities Commission (SC). In the table above, FSMOne, MIDF Invest, and Rakuten Trade are licensed by SC.

In addition, decide if you need any additional features or services that are provided by the stock broker. For example, if you like the CopyTrader function, then you can go for eToro. Or if you are a long-term investor, then you can consider those platforms where you can lend out your shares to earn interest.

If you decide to go with Tiger Brokers, you may use my referral code IJ9KKD or via this link.

Here is my referral code via this link if you choose Moomoo Malaysia instead.

Which stock broker that you are currently using for US stocks? Please feel free to share your experiences in the comment section below.