Caution Ahead: Unveiling Strategies for Traders to Minimize Expenses on Stock, ETF, and CFD Transactions
In the dynamic world of online trading, IG stands out as a global leader with over half a century of experience. The company prides itself as the world's leading provider, offering trading services in multiple countries and an extensive range of underlying assets.
IG's commitment to cost-effectiveness is particularly noteworthy for active traders. The broker has implemented a fee structure that rewards frequent trading, aiming to significantly reduce fees and spreads for its users.
One of the key ways IG achieves these savings is through commission-free trading on many stocks. Users who trade actively, at least three times a quarter, can buy and sell U.S., U.K., EU, and Australian stocks without incurring traditional commission fees, such as the previous £8 fee for share trading.
Moreover, IG's foreign exchange fees are relatively low compared to many other brokers, applying a fee of just 0.7% when trading international shares. The broker also waives its quarterly custody fee for active traders, incentivizing frequent trading to reduce costs.
IG does not charge fees for deposits or withdrawals, and bank transfers are free unless requesting a same-day transfer under £100, which costs £15. The broker also pays 4.5% interest on uninvested GBP cash up to £100,000, benefiting traders holding cash balances while trading.
In terms of CFDs and forex, IG offers competitive spreads. For CFDs, IG offers average spreads of about 0.69 pips during main trading sessions, better than industry averages, and forex spreads close to industry norms with additional volume-based commission discounts available for very large traders.
Traders executing extremely high volumes can expect significant reductions in per-side commission, enabling further cost efficiency for institutional or very high-frequency traders.
IG's fee model rewards regular, active trading by reducing or eliminating commissions and custody fees for such users, coupled with low foreign exchange costs and competitive spreads. This combination makes IG a strong choice for cost-conscious traders who transact frequently.
In a test, IG scored "very good" in the Euro CFD broker test, achieving an overall rating of "very good". The old saying on the stock exchange, "To and fro empties pockets," seems less applicable with IG's cost-effective trading services.
[1] IG, (2021). IG's Fees & Charges, [Online]. Available: https://www.ig.com/uk/forex/fees-charges [2] IG, (2021). IG's Trading Accounts, [Online]. Available: https://www.ig.com/uk/trading-accounts [3] IG, (2021). IG's Custody Fees, [Online]. Available: https://www.ig.com/uk/trading-accounts/custody-fees [4] IG, (2021). IG's Deposit & Withdrawal Fees, [Online]. Available: https://www.ig.com/uk/deposit-withdrawal-fees [5] IG, (2021). IG's CFD Spreads, [Online]. Available: https://www.ig.com/uk/forex/cfd-spreads
- IG's fee structure, particularly with commission-free trading on many stocks and low foreign exchange costs, makes it a strong choice for investors focusing on cost-efficient trading in the stock-market.
- For active traders who transact frequently, IG offers an extensive range of underlying assets, not just in the stock-market, but also in CFDs and forex, with competitive spreads and reduced or eliminated commissions and custody fees.
