I have a couple of decent ETF strategies. Unfortunately, it is now very hard for Europeans to have access to some of the most relevant US ETFs. The reasons are too boring to explain, but for the interested:
https://www.justetf.com/en/news/etf/us-domiciled-etfs.html
I then have an account with IB which, since Brexit, moved from being domiciled in UK to Ireland; and it is limited by the above regulations; hence I have no access to those ETFs.
Now the question: does anyone know if any of the other Wealth-Lab supported brokers (Alpaca or Tradier) allows European customers to trade those ETFs?
From what I can read, they seem to accept European customers; but if they keep them "domiciled" in US, then they probably don't enforce those limitations. However, it would be good to have confirmation of someone (from Europe) having an account with one of them.
Thank you!
https://www.justetf.com/en/news/etf/us-domiciled-etfs.html
I then have an account with IB which, since Brexit, moved from being domiciled in UK to Ireland; and it is limited by the above regulations; hence I have no access to those ETFs.
Now the question: does anyone know if any of the other Wealth-Lab supported brokers (Alpaca or Tradier) allows European customers to trade those ETFs?
From what I can read, they seem to accept European customers; but if they keep them "domiciled" in US, then they probably don't enforce those limitations. However, it would be good to have confirmation of someone (from Europe) having an account with one of them.
Thank you!
Rename
Thank you Eugene for that link!
It seems to suggest to replace the use of ETFs by futures that follow the same underlying asset. I am familiar with the approach (in fact, I mostly trade futures), but it's not really the same: for example, there are a lot of sector ETFs that have no future contract equivalent; then there are the problems associated with rollovers, etc... Still, sometimes it's a valid replacement and I am already trading a strategy for the SPY, using the ES contract instead - this works well, because it's a single contract and I don't have to make many "translations", between the SPY order and the equivalent (more or less) ES order.
But I wanted to trade a basket of 10-20 ETFs; which will give me a lot of orders on some days. Because of it, I wanted to auto-trade it with Wealth-Lab; and then it gets very difficult to perform those "translations"; or even impossible for the ETFs that have no equivalent.
This is why I was hoping that one of the WL supported brokers would maybe not enforce those silly regulations (ETFs are too dangerous for the average investor; but yet Cryptos are completely unregulated - go figure...). IB definitely enforces it for Euro-area based accounts and I don't think it's now possible to chose to have a US account if one is resident in the EU. In fact my IB account started in US; was then migrated to UK; and now to IE.
It seems to suggest to replace the use of ETFs by futures that follow the same underlying asset. I am familiar with the approach (in fact, I mostly trade futures), but it's not really the same: for example, there are a lot of sector ETFs that have no future contract equivalent; then there are the problems associated with rollovers, etc... Still, sometimes it's a valid replacement and I am already trading a strategy for the SPY, using the ES contract instead - this works well, because it's a single contract and I don't have to make many "translations", between the SPY order and the equivalent (more or less) ES order.
But I wanted to trade a basket of 10-20 ETFs; which will give me a lot of orders on some days. Because of it, I wanted to auto-trade it with Wealth-Lab; and then it gets very difficult to perform those "translations"; or even impossible for the ETFs that have no equivalent.
This is why I was hoping that one of the WL supported brokers would maybe not enforce those silly regulations (ETFs are too dangerous for the average investor; but yet Cryptos are completely unregulated - go figure...). IB definitely enforces it for Euro-area based accounts and I don't think it's now possible to chose to have a US account if one is resident in the EU. In fact my IB account started in US; was then migrated to UK; and now to IE.
Are you trying to tell me that you know better what the risks are for you than a government organization doing it for you? 🤔
Of course not: didn’t want to seem that presumptuous! ;-)
The average European investor is too stupid to trade a simple ETF, but sophisticated enough to trade more mundane things like futures, options, options on futures, forex, crypto…
The average European investor is too stupid to trade a simple ETF, but sophisticated enough to trade more mundane things like futures, options, options on futures, forex, crypto…
My apologies for bumping this topic: is there any European customer out there, of either Alpaca or Tradier, who can confirm if they make US ETFs available for trading?
Thank you again!
Thank you again!
I don't know for sure, but I think it's not possible. Even though I'm a U.S. citizen with IRA accounts at TD Ameritrade and IB, I live in Spain and still cannot trade ETFs.
Thank you Cone. I was afraid of that.
This morning, I have been doing some tests to open accounts with the brokers supported by Wealth-Lab: I already have an account at IB (and know for sure it’s not possible to trade ETFs for Europeans, unless changing the client status, which brings other complications); then tried TD Ameritrade (and it’s not even possible to open an account); then Tradier and Alpaca: with these two, I’m able to open an account and now need to submit the personal documents to move forward. At this point, I’m willing to go ahead and check for myself if it’s possible or not to trade ETFs after.
I will give an update in a few days…
This morning, I have been doing some tests to open accounts with the brokers supported by Wealth-Lab: I already have an account at IB (and know for sure it’s not possible to trade ETFs for Europeans, unless changing the client status, which brings other complications); then tried TD Ameritrade (and it’s not even possible to open an account); then Tradier and Alpaca: with these two, I’m able to open an account and now need to submit the personal documents to move forward. At this point, I’m willing to go ahead and check for myself if it’s possible or not to trade ETFs after.
I will give an update in a few days…
@alkimist
The question to trade US ETF's has been cropping up again for years and also offers possible solutions.
You have to own an LLC/LP outside the EU (Seychelles, Singapore, New Zealand, Delaware, Florida, Nevada, South Dakota, Texas, Washington, Wyoming, Alaska).
Or you are listed as professional Investor/Trader. However, you must meet two of the following three criteria:
- Your portfolio exceeds 500'000 EUR
- You have made an average of 10 trades per quarter in the past year with the relevant product
- You are/were professionally active in the financial sector for at least one year
The question to trade US ETF's has been cropping up again for years and also offers possible solutions.
You have to own an LLC/LP outside the EU (Seychelles, Singapore, New Zealand, Delaware, Florida, Nevada, South Dakota, Texas, Washington, Wyoming, Alaska).
Or you are listed as professional Investor/Trader. However, you must meet two of the following three criteria:
- Your portfolio exceeds 500'000 EUR
- You have made an average of 10 trades per quarter in the past year with the relevant product
- You are/were professionally active in the financial sector for at least one year
Thank you Springroll!
I am aware of those workarounds, but they also bring on other problems for me. I have a “day job” and wouldn’t be able to register as professional (or at least, I shouldn’t); also, IB’s Market data fees would increase a lot (some by a factor of >10x) and I would end up paying almost 1000€ a month just in fees.
I am aware of those workarounds, but they also bring on other problems for me. I have a “day job” and wouldn’t be able to register as professional (or at least, I shouldn’t); also, IB’s Market data fees would increase a lot (some by a factor of >10x) and I would end up paying almost 1000€ a month just in fees.
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