SaxoTrader vs. Interactive Brokers: Which is Better for European Investors?

When it comes to choosing an online brokerage, European investors face limited options compared to those in the US. Two of the most popular choices are SaxoTrader and Interactive Brokers (IBKR). Each offers a unique set of features, and the right one for you may depend on your specific needs as an investor. In this article, we’ll explore how these two platforms compare, focusing on fees, product offerings, and usability for European investors.

Fees and Commissions

Interactive Brokers is often praised for its competitive pricing, particularly for active traders. IBKR offers a tiered pricing structure that tends to be lower than many European competitors. It has no inactivity fees, making it suitable for both frequent traders and those who may take a more laid-back approach. For European users, currency conversion fees are also quite favorable, especially when moving between different currencies for asset purchases.

SaxoTrader has undergone a significant fee overhaul starting in 2024, which has made it considerably more competitive. Saxo lowered commissions across the board, eliminated inactivity fees entirely, and removed the minimum deposit requirement for Classic accounts. That said, Saxo still operates on a tiered model (Classic, Platinum, and VIP), and the commission rates still tend to be higher than those at Interactive Brokers, especially if you are trading smaller volumes. SaxoTrader also imposes a custody fee, which can make it less appealing for those who hold assets for the long term.

Product Offerings and Market Access

Both SaxoTrader and Interactive Brokers offer access to a wide range of products, including stocks, ETFs, futures, and forex. However, Interactive Brokers provides arguably the most comprehensive global market access in the industry, allowing investors to trade in over 150 markets worldwide. This can be a huge advantage if you have a diversified portfolio across different regions or asset classes.

SaxoTrader also provides an extensive range of products, with a particularly strong emphasis on European markets. Saxo offers some products that Interactive Brokers does not, such as a more robust selection of managed portfolios and access to corporate bonds for individual investors. However, for most investors, the breadth of products and markets available through Interactive Brokers is more compelling.

Platform Usability and Features

SaxoTrader has a user-friendly interface with a sleek design, making it accessible for less experienced traders. Their mobile app is well-designed and offers features that make it easy to manage investments on the go. Saxo also has a range of educational content, which is beneficial for those looking to improve their trading skills.

Interactive Brokers, in contrast, is known for having a steeper learning curve. The Trader Workstation (TWS) is packed with advanced features and tools, which can be overwhelming at first. However, for sophisticated investors or those who need powerful tools for technical analysis, IBKR provides more depth. Its mobile app, IBKR GlobalTrader, has become more accessible in recent years, aiming to compete with user-friendly platforms like SaxoTrader’s. In reality, many investors find that once they get accustomed to IBKR’s tools, the platform offers far more flexibility and capability compared to SaxoTrader.

Regulation and Investor Protection

Both Interactive Brokers and SaxoTrader are well-regulated within Europe. In a major ownership change, the J. Safra Sarasin Group completed the acquisition of a 71% stake in Saxo Bank on March 2, 2026, for approximately EUR 1.1 billion. Founder Kim Fournais stepped down as CEO (moving to board chair while retaining a 28% stake), and Daniel Belfer became the new CEO. The combined entity now manages over $460 billion in client assets, making it a significant force in global wealth management. This represents a major shift from the previous ownership by Chinese company Zhejiang Geely Holding Group, and many European investors will likely view the Swiss banking group’s involvement as a positive development in terms of stability and reputation.

Both brokers offer investor protection schemes that comply with EU regulations. SaxoTrader is covered under the Danish Guarantee Fund, while Interactive Brokers offers protection through the UK Financial Services Compensation Scheme (FSCS). European investors can feel secure with either option, but it’s always a good idea to familiarize yourself with specific details of investor compensation limits, which may vary.

Which Is Right for You?

Cost-Conscious, Active Traders: If you are an active trader looking for low costs, Interactive Brokers is likely the better option, thanks to its low commissions and absence of custody fees. The tiered pricing and flexible structure suit those who trade frequently.

Ease of Use for Beginners: If you prefer a more straightforward platform to start with, SaxoTrader may be more appealing due to its user-friendly interface. However, for most investors willing to invest some time in learning, Interactive Brokers ultimately offers superior functionality and cost advantages.

Investment Variety and Global Reach: For those who want access to global markets and more sophisticated trading tools, Interactive Brokers stands out due to its extensive market access and advanced trading capabilities.

. As of October 2024, the interest rate on cash balances of $150,000 is approximately 4.08%, which translates to an annual interest of $6,120. For example, if you hold a balance of more than $10,000 in your account, you can earn interest at rates that are often higher than what traditional banks offer. Suppose you have $20,000 sitting in your IBKR account; you could potentially earn around 4% annually, which amounts to $800 in a year. If you increase the balance to $100,000, the interest earned could reach $4,000 annually, significantly adding to your returns. With $500,000, you could earn up to $20,000 per year, making it an excellent option for those with large cash balances. This can add up significantly, especially for larger balances.

. For example, for a balance of $150,000, Saxo Bank offers different rates based on account tier: Classic at 2.42% (earning $3,630 annually), Platinum at 2.61% (earning $3,915 annually), and VIP at 3.61% (earning $5,415 annually). These rates are accurate as of October 16, 2024. Additionally, Saxo applies more conditions on earning interest, For example, if you have $20,000 in your Saxo account, the interest rate might be closer to 1%, earning you only $200 in a year. With $100,000, you would earn about $1,000 annually, and with $500,000, you’d earn around $5,000 per year, which is still significantly lower compared to what Interactive Brokers offers. This difference makes Interactive Brokers a more attractive option for those who want to maximize returns on their idle cash.

For investors who prefer to keep a portion of their funds in cash for flexibility or risk management, the ability to earn a higher rate of interest can make a notable difference over time. It’s worth comparing the specific rates offered by both brokers at the time of opening an account, as these rates can change based on market conditions.

Interest Earned on Deposits

Another important consideration for investors is the interest earned on uninvested cash balances. Below is a comparison table showing the interest rates and the resultant earnings for different cash balances across both brokers.

The table clearly demonstrates how Interactive Brokers generally offers higher interest rates across different balance amounts, which can make a significant difference in overall earnings.

Interactive Brokers offers competitive interest rates on idle cash balances, which can be particularly appealing for investors who want to make the most out of their uninvested cash. As of October 2024, the interest rates depend on the balance amount and the benchmark rates. For balances up to $100,000, the rate is typically lower, but for amounts over $100,000, IBKR offers rates close to benchmark rates, minus a small spread. For example, if the benchmark rate is 5%, balances over $100,000 could earn approximately 4.08%, while smaller balances might earn less. For a balance of $150,000, this would translate to an annual interest of $6,120. The tiered structure means higher balances receive more favorable rates, making IBKR attractive for those with larger cash holdings.

SaxoTrader, on the other hand, does offer interest on cash balances, but the rates are generally lower compared to Interactive Brokers. The interest rate varies based on the account tier: Classic at 2.42% (earning $3,630 annually on $150,000), Platinum at 2.61% (earning $3,915 annually), and VIP at 3.61% (earning $5,415 annually). These rates are accurate as of October 16, 2024. Additionally, Saxo applies conditions on earning interest, such as adjustments based on bid/ask spreads and Net Free Equity (NFE), which can impact the effective rate. The final interest earned may be influenced by these adjustments, depending on the account tier and Net Free Equity (NFE). For example, if you have $20,000 in your Saxo account, the effective interest rate might be lower due to these adjustments, earning you only around $200 in a year. With $100,000, you might earn about $1,000 annually, and with $500,000, you’d earn around $5,000 per year, which is still significantly lower compared to what Interactive Brokers offers.

For investors who prefer to keep a portion of their funds in cash for flexibility or risk management, the ability to earn a higher rate of interest can make a notable difference over time. It’s worth comparing the specific rates offered by both brokers at the time of opening an account, as these rates can change based on market conditions.

SaxoTrader, on the other hand, does offer interest on cash balances, but the rates are generally lower compared to Interactive Brokers. The interest rate varies based on the account tier: Classic at 2.42% (earning $3,630 annually on $150,000), Platinum at 2.61% (earning $3,915 annually), and VIP at 3.61% (earning $5,415 annually). These rates are accurate as of October 16, 2024. Additionally, Saxo applies more conditions on earning interest, such as higher minimum balances. For example, if you have $20,000 in your Saxo account, the interest rate might be closer to 1%, earning you only $200 in a year. With $100,000, you would earn about $1,000 annually, and with $500,000, you’d earn around $5,000 per year, which is still significantly lower compared to what Interactive Brokers offers.

For investors who prefer to keep a portion of their funds in cash for flexibility or risk management, the ability to earn a higher rate of interest can make a notable difference over time. It’s worth comparing the specific rates offered by both brokers at the time of opening an account, as these rates can change based on market conditions.

Account Tiers and Differences Between IBKR Lite and IBKR Pro

SaxoTrader Account Tiers

SaxoTrader offers three account tiers: Classic, Platinum, and VIP. Each tier provides different benefits in terms of fees, commissions, and interest earned on cash balances:

• Classic: The entry-level tier with standard fees and features. Interest rates on cash balances are typically lower, such as 2.42% for USD balances of $150,000.
• Platinum: Offers lower trading commissions and slightly higher interest rates compared to the Classic account. For instance, Platinum users earn 2.61% interest on cash balances of $150,000.
• VIP: The highest tier, providing the lowest fees and the highest interest rates. VIP users can earn up to 3.61% interest on cash balances of $150,000. This tier is suitable for high-net-worth investors looking for premium service and the most favorable terms.

Interactive Brokers: IBKR Lite vs. IBKR Pro

Interactive Brokers offers two types of accounts: IBKR Lite and IBKR Pro.

• IBKR Lite: Designed for casual investors and those looking for a simpler, more cost-effective trading experience. IBKR Lite offers commission-free trading on US-listed stocks and ETFs, making it attractive for those who prioritize cost savings. However, IBKR Lite users may receive slightly lower interest rates on idle cash compared to IBKR Pro users.
• IBKR Pro: Geared towards active traders and professionals who need advanced tools, lower margin rates, and access to more complex financial products. IBKR Pro users benefit from tiered or fixed pricing, allowing for lower trading costs for high-volume trading. The interest rates on cash balances for IBKR Pro are typically higher and more aligned with benchmark rates, making it an appealing option for investors who hold significant cash balances.

The key differences between IBKR Lite and IBKR Pro come down to pricing structure, access to advanced tools, and interest rates. IBKR Pro offers greater flexibility, better pricing for high-frequency traders, and higher interest on idle cash, while IBKR Lite provides a simple, low-cost option for those primarily trading US-listed securities.

Trading Fees

Trading fees are a crucial aspect to consider when evaluating brokers, as they can significantly affect the profitability of your investments. Below, we compare the trading fees for SaxoTrader and Interactive Brokers, focusing on fees such as currency conversion, buying stocks, ETFs, and options.

SaxoTrader charges trading commissions that vary depending on the account tier and the specific asset being traded. Here are some common fees:

• Stock and ETF Trading: Saxo charges a commission for trading stocks and ETFs, which varies based on the region. For example, the fee for trading US stocks is typically around $4 per trade for Classic accounts.
• Currency Conversion: SaxoTrader applies a currency conversion fee of 0.5% when converting between different currencies, which can add to the overall cost of international trading.
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Interactive Brokers, on the other hand, is known for its competitive fee structure, especially for high-frequency traders:

• Stock and ETF Trading: IBKR offers tiered or fixed pricing for trading stocks and ETFs. For US stocks, the commission can be as low as $0.005 per share, with a minimum fee of $1 per trade.
• Currency Conversion: Interactive Brokers offers favorable currency conversion rates, typically around 0.002% to 0.003%, which is much lower than Saxo’s 0.5% fee.
• Options Trading: IBKR charges fees based on the volume of contracts traded, with rates starting at $0.15 to $0.65 per contract, depending on the trading volume.

To illustrate the differences in trading fees, here is a comparison table showing estimated costs for various trading activities at both brokers:

As seen in the table, Interactive Brokers generally offers lower trading fees compared to SaxoTrader across various activities. This can make a significant difference for active traders or those investing in international markets.

Custody Fees

Custody fees are another important aspect to consider when choosing a brokerage, as they can significantly affect your investment returns, especially if you are holding assets long-term. Below, we explore the custody fees for SaxoTraderand Interactive Brokers, and provide examples of how much investors might lose due to these fees.

SaxoTrader charges custody fees that vary depending on the account type and the assets held. Typically, Saxo imposes a custody fee of 0.12% per year on assets, with a minimum monthly fee of around €5. This fee is charged quarterly and applies to most account tiers, making long-term holding more costly compared to other platforms.

Interactive Brokers, in contrast, does not charge custody fees for IBKR Pro accounts, which is a significant advantage for investors aiming to minimize costs. However, there may be other associated fees, depending on the services used.

To better illustrate the impact of custody fees, below is a comparison table for both brokers based on different investment amounts.

As seen in the table, SaxoTrader‘s custody fees can become substantial as the investment amount increases. For instance, an investor with $500,000 in assets would incur $600 annually in custody fees with SaxoTrader, whereas Interactive Brokers charges no custody fees for IBKR Pro accounts. These custody fees can add up over time and may even exceed the cost of some ETF management fees, making SaxoTrader more expensive for long-term investors.

Securities Lending and Potential Earnings

Securities lending is another feature that investors should be aware of when choosing a brokerage, as it allows you to earn additional income by lending out your securities to other market participants. Below, we compare how SaxoTrader and Interactive Brokers handle securities lending and what investors can expect to earn.

Interactive Brokers Securities Lending

Interactive Brokers offers a program called the Stock Yield Enhancement Program. This program allows IBKR clients to lend their fully paid shares to other traders or institutions looking to borrow. In return, the investor earns a portion of the interest paid by the borrower. Typically, the revenue split is 50-50 between Interactive Brokers and the account holder, which can result in attractive earnings depending on the demand for the securities.

For example, if you hold $100,000 worth of highly sought-after stocks, you could potentially earn up to 2-3% annually on the value of those shares, translating to $2,000 to $3,000 per year. However, the exact earnings depend on the demand for your specific securities and prevailing interest rates in the lending market.

SaxoTrader Securities Lending

SaxoTrader offers a securities lending program that allows retail investors to lend their fully paid shares to other market participants. Investors earn income from the interest paid by borrowers, which can be an attractive way to generate additional returns on idle investments. The exact earnings depend on the demand for specific securities, much like Interactive Brokers’ program.

Comparison Table: Securities Lending

Impact of Securities Lending

For investors looking to maximize the returns on their existing portfolio, Interactive Brokers offers a significant advantage through its securities lending program. The ability to lend out shares and earn additional income is especially beneficial in a low-interest-rate environment or for those holding onto stocks with high borrowing demand.

However, it’s important to note that securities lending is not without risk. When you lend out your securities, you take on counterparty risk—the risk that the borrower may default on their obligation. While brokers like Interactive Brokers and SaxoTrader mitigate this risk by requiring collateral, it’s still a factor to consider. Additionally, if a borrowed security is recalled or the borrower fails, there could be delays in reclaiming your shares, which might impact your ability to sell them if market conditions change suddenly.

SaxoTrader‘s program also allows investors to benefit from securities lending, but the potential earnings can vary significantly based on demand. Investors need to weigh both the potential returns and the risks involved when deciding whether to participate in such programs.

Additional Fees: VAT, Inactivity Fees, and Others

Apart from the typical trading, custody, and commission fees, investors should also be aware of various additional fees that may apply, such as VAT, inactivity fees, and other service-related charges. Below, we provide a comparison of these fees for SaxoTrader and Interactive Brokers.

SaxoTrader Additional Fees

• VAT: VAT is applicable on some of SaxoTrader’s services, particularly those related to custody fees and managed account fees, depending on your country of residence. This can increase the cost of using the platform.
• Inactivity Fees: As of the 2024 fee overhaul, SaxoTrader has eliminated inactivity fees entirely. This was previously one of the platform’s biggest drawbacks (€100 per quarter), so this is a welcome change.
• Other Fees: Saxo also charges withdrawal fees for non-EU/EEA bank transfers and potential platform fees for certain advanced features. Depending on your use of additional services, these fees can accumulate.

Interactive Brokers Additional Fees

• VAT: Similar to SaxoTrader, some fees at Interactive Brokers may be subject to VAT depending on your country. This typically applies to certain service-related fees.
• Inactivity Fees: Interactive Brokers does not charge inactivity fees for IBKR Pro accounts, which is a significant advantage for investors who prefer to take a less active approach to trading.
• Other Fees: IBKR may charge additional fees for specific services, such as data subscriptions, which are optional but may be useful for more advanced traders seeking in-depth market information.

To summarize the differences, here is a table comparing these additional fees:

Impact of Additional Fees

With the elimination of inactivity fees in 2024, SaxoTrader has closed one of the biggest gaps between itself and Interactive Brokers. Both platforms now charge no inactivity fees, which is good news for long-term investors. However, withdrawal fees and VAT on various services can still increase the total cost of using SaxoTrader compared to Interactive Brokers, which offers free withdrawals in most cases. VAT may still apply to certain services at either broker depending on your location.

These additional fees can significantly influence the overall cost of using a brokerage, especially when considered over several years. Investors should take these costs into account along with the trading, custody, and commission fees when deciding which broker best fits their needs.

Conclusion

While both SaxoTrader and Interactive Brokers offer advantages to European investors, Interactive Brokers consistently stands out for its cost efficiency, extensive market access, and advanced trading capabilities. SaxoTrader has become more competitive following its 2024 fee overhaul (lower commissions, no inactivity fees, no minimum deposit for Classic accounts) and the March 2026 acquisition by J. Safra Sarasin Group, which brings Swiss banking stability and over $460 billion in combined client assets. SaxoTrader might be a suitable choice for beginners who prioritize a more user-friendly experience, but for most investors, especially those with global ambitions and a focus on minimizing fees, Interactive Brokers is likely the superior choice. Before deciding, consider factors such as fees, market access, and the overall user experience that best fits your investment goals.

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