What is the point of introducing brokers?

[Baptiste Wicht]

Hi

I recently came across meintrade.ch, an introducing broker to Interactive Brokers. It's basically a broker on top of Interactive Brokers. It is used quite a lot in the US, but not so much in Switzerland.

So, I digged a little into it and looked at their fees, and it's basically a much more expensive version of IBKR. Put simply, it's Swiss fees on top of IB.

If you want to look at the details, I have added it to the broker comparison tool: https://thepoorswiss.com/broker-comparison-tool/

I do not see the added value of this service:
* It's more expensive than IBKR, so we might as well use IBKR directly
* It's only giving the illusion of Swissness since everything is held by IBKR, so we might as well use IBKR
* It's even more expensive than some other Swiss brokers, so we might as well use another Swiss broker

Am I missing something or is this kind of service only detrimental to users?

 

[gaijin]

Thanks for sharing. I did not know about this site. This is very interesting and not usual for Switzerland. I can understand why IB would provide such an interface/API and pay them a commission to any company that brings them business/customers. So I'm completely sympathetic with IB on this point.

However, I highly question the motivation of meintrade.ch To me this looks like fake advertising. Claiming to be a Swiss broker - while you are actually not - feels highly suspicious to me. Of course I understand if you would like to include them in your broker comparison page. Still, I would be careful to make very clear that IB is the brocker behind meintrade.ch . So there is nothing Swiss about the broker and terms like Schweizer Onlinebroker / Aus der Schweiz für die Schweiz misuse the brand of Switzerland.

 

[Baptiste Wicht]

However, I highly question the motivation of meintrade.ch To me this looks like fake advertising. Claiming to be a Swiss broker - while you are actually not - feels highly suspicious to me.

I agree. This is marketing entirely. The sad part is that I would expect they could make it much cheaper since they are using IB under the hood.

Of course I understand if you would like to include them in your broker comparison page.

The broker comparison is not a list of recommendations. It's good to have a mix of good and bad brokers there so that we realize the gap between the cheapest and the most expensive ones.

 

[gaijin]

The broker comparison is not a list of recommendations.

Makes sense to list brokers according to their fees rather than making recommendations.

With this new construct I am wondering if it actually fits the definition of a broker. After all, meinTrade does not provide any broker infrastructure. Of course, I'm aware that other companies also might not use their own backend (Yuh > Swissquote, Alpian > IB, Neon > Hypothekarbank Lenzburg). Still, I think meinTrade is a new level of simply providing a shell and a nice looking website. But I have to admit that I have not looked too deeply into meinTrade, maybe they offer more I assumed.