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Investing & Retirement

Stock Exchange Fees and Trading Taxes Explained

March 10, 2023 - Felix Oeschger

Which fees and charges do stock exchanges and governments take when you buy and sell stocks using a Swiss bank or stock broker? Get informed about applicable taxes and stock exchange fees in this moneyland.ch guide.

Buying and selling stocks in Switzerland generates a number of different costs. In many cases, the brokerage fees charged by your stock broker are the biggest expense. But on top of brokerage fees, you also pay taxes (stamp duties, for example), stock exchange fees, and currency exchange costs.

Costs are not always transparent

When you give your stock broker an order to buy or sell shares, the order is normally passed on from your broker to the relevant stock exchange. The stock exchange on which the transaction is made charges your broker a fee. In many cases, brokers pass on these stock exchange fees to you as the customer.

Unlike brokerage fees, most of which are openly published, Swiss stock brokers and banks often do not make information about stock exchange fees available on their websites.

One reason for this is that stock exchange fees are very complicated. They can vary depending on the stock exchange used, the kind of security being traded, and the size of the trade. Additionally, these fees can change on an ongoing basis.

Many Swiss stock brokers will not even provide stock exchange fees upon specific request. That is why this cost cannot be accounted for in the unbiased moneyland.ch stock broker comparison. But the details pages corresponding to the stock brokers in the comparison show whether stock exchange fees are covered by brokerage fees, or charged separately.

The situation is similar with taxes such as stamp duties and financial transaction taxes. Information about the taxes which are levied when you make trades is seldom found on the websites of Swiss stock brokers and banks.

Do you pay the stock exchange fees?

The size of fees varies hugely between stock exchanges. The stock exchange fees charged by an exchange can also vary depending on the specific agreement between the exchange and your stock broker. Stock exchanges may give discounts to stock brokers which pass on large volumes of trades.

Most Swiss banks and brokers charge you stock exchange fees on top of their brokerage fees. Swissquote, for example, charges exchange fees separately for trades on the SIX Swiss Exchange, but not for trades on the New York Stock Exchange (NYSE).

Stock brokers like Cornèrtrader, which only pass on exchange fees for trades on less-widely-used stock exchanges, are the exception.

The stock exchange fees passed on to customers also often differ depending on which type of security you are transacting (a stock or a bond, for example), the size of the transaction, and the kind of order you use (whether you use a limit order or a market order, for example).

Taxes levied when you buy and sell securities, on the other hand, are generally charged to you separately no matter which stock broker you use.

Fees charged by Swiss stock exchanges

The SIX Swiss Exchange, Switzerland’s primary stock exchange, charges its participating stock brokers a number of different fees, including membership fees, sign-up fees, and recurring annual fees. But the stock exchange fees which are relevant for you as an investor are primarily the transaction fees, and the value-added fees. The fee charged depends on the kind of security, the size of the trade, and the number of transactions required to fill your order.

Many Swiss stock brokers pass on these SIX exchange fees to their customers. Typically, the fee is charged as a percentage of the transaction, and ranges between 0.001 and 0.01 percent. Often, and additional flat fee of up to several francs applies on top of the rate-based fee.

For example, when you buy SIX-listed stocks using the Zürcher Kantonalbank, you pay a stock exchange fee of between 0.005 and 0.01 percent (minimum 1.50 francs, maximum 65 francs).

Swiss stock brokers which do not add a separate charge to cover SIX Swiss Exchange fees include Cornèrtrader and Trade Direct.

Fees charged by German stock exchanges

The fees of German stock exchanges are also charged separately by many Swiss stock brokers.

For example, if you trade on the XETRA exchange using the Zürcher Kantonalbank, you are charged separate stock exchange fees of up to 0.20 percent.

However, there are also some Swiss stock brokers – like the Aargauische Kantonalbank (AKB), Cornèrtrader, St. Galler Kantonalbank (SGKB), and Trade Direct – which do not charge XETRA exchange fees on top of their brokerage fees.

Fees charged by US stock exchanges

Whether or not you pay separate stock exchange fees for trades on NASDAQ or the NYSE also depends on which Swiss stock broker you use.

For example, the Zürcher Kantonalbank passes on a separate stock exchange fee of up to 0.04 percent for trades on the NASDAQ and NYSE exchanges.

Swiss stock brokers which do not pass on stock exchange fees from US exchanges include the Aargauische Kantonalbank (AKB), Cornèrtrader, St. Galler Kantonalbank (SGKB), Swissquote and Trade Direct.

Good to know: When you sell shares on US stock exchanges, a tax called the SEC fee is levied. Currently, this tax is relatively low, at 0.0008 percent.

Real-time prices

Major stock exchanges like the SIX Swiss Exchange and US stock exchanges normally publish prices after a 15-minute delay. Smaller stock exchanges often only publish the closing prices from the previous trading day. Accessing real-time prices – when they are available – often costs money.

For example, Swissquote charges a markup of 85 centimes per transaction to provide you with real-time prices. You also have the option of getting paid subscriptions for real-time data. For example, the subscription fee for real-time prices on Eurex is 108 francs per year.

Swiss stamp duties

When you trade a security using a Swiss stock broker, you are charged a Swiss stamp duty. The vast majority of Swiss stock brokers charge you this stamp duty on top of their brokerage fees. The Swiss stamp duty is automatically accounted for in the moneyland.ch online trading comparison.

Foreign stamp duties

A UK stamp duty of 0.5 percent applies when you buy (but not when you sell) UK stocks on the London Stock Exchange (LSE). The Hong Kong Stock Exchange (HKEX) is another example. Trades on that exchange are subject to a stamp duty of 0.13 percent.

Additionally, other taxes totaling 0.0085 percent also apply to stock trading. Most Swiss stock brokers pass these taxes on to you as the customer.

Financial transaction taxes

Countries like France, Italy, and Spain have a financial transaction tax. In France, this tax is 0.3 percent and is levied when you buy (but not when you sell) large-cap stocks. The stock exchange charges this fee to your stock broker, regardless of whether the shares are bought on a French or a foreign exchange. When you buy and sell on the same day, the tax is only levied on the net amount.

These taxes too are generally passed on to customers by Swiss banks.

Conclusion

The stock exchange fees of major stock exchanges are negligibly low. This is true even when you have to pay for them separately.

But when you make trades on smaller stock exchanges, it can be beneficial to ask your stock broker about the exact fees which apply in order to avoid unpleasant surprises.

Taxes, like stamp duties and financial transaction taxes, can have a much bigger impact on the cost of trades. The costs of these taxes vary broadly depending on the countries where the stock broker and the stock exchange are located, and the kinds of securities you are trading.

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Expert Felix Oeschger
Felix Oeschger is an analyst and expert at moneyland.ch. He is responsible for several core topics.
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