Comprehensive Analysis of US Stock Investment Costs | 2025 Custody and Overseas Broker Fee Comparison Guide

Investing in US stocks from Taiwan: choosing the right trading channel directly impacts your final investment returns. Many investors are not fully aware of the fee structures of sub-brokerage services and overseas brokers, leading to higher costs than expected. This article will break down the fee components of the two main US stock trading methods to help you quickly assess which approach better suits your investing habits.

The Two Main Trading Channels for US Stocks

If you want to trade US stocks in Taiwan, there are basically two options: through domestic brokers’ sub-brokerage services or by opening an account directly with an overseas broker.

Sub-Brokerage: The Convenient Choice for Taiwanese Investors

Sub-brokerage (Sub-Brokerage), officially known as foreign securities trading entrusted to domestic brokers, allows investors to open dedicated accounts with qualified domestic brokers, who then act as agents to buy US stocks or ETFs on behalf of the investor. Since the order passes through both domestic and foreign channels before execution, it is called “sub-brokerage.”

Core advantages of sub-brokerage:

• Entirely settled in New Taiwan Dollars, no need for self-foreign exchange; domestic brokers handle currency conversion automatically
• Simple account opening process—just provide basic info in Taiwan, avoiding the hassle of overseas account setup
• Regulated and protected by Taiwan’s Financial Supervisory Commission, with dispute resolution available through domestic financial institutions

However, this convenience comes at a cost: fees typically range from 0.15% to 1% of the transaction amount, which is significantly higher than overseas brokers.

Overseas Brokers: Lower-Cost Direct Trading

Trading US stocks via overseas brokers is more straightforward: similar to buying Taiwanese stocks through a broker, but the underlying assets are US-listed companies. Investors skip intermediaries and place orders directly on US stock exchanges.

Most mainstream brokers now offer zero-commission or very low commission models, especially friendly to frequent traders. However, investors must handle the currency exchange from NTD to USD themselves, adding operational complexity.

Key features of overseas brokers:

• Commissions as low as zero; some still charge minimal fees
• Fast order execution with real-time trading support
• Wide range of financial instruments available, including stocks, options, funds, etc.

Complete Fee Components for US Stock Trading

Fee Structure for Sub-Brokerage

When trading US stocks via sub-brokerage, costs include two main categories: direct fees and implicit costs.

Direct fees charged by brokers:

Trading commissions are the primary cost component. Domestic brokers’ rates range from 0.25% to 1%, with most setting minimum charges between $25 and $100 USD. For example, buying US$1,000 worth of stocks at a 0.3% rate would cost US$3, but if the broker’s minimum fee is US$25, the effective rate jumps to 2.5%.

Other service fees (usually negligible) include remittance fees, paper statement charges, long-inactive account fees, etc., depending on each broker’s policies.

Third-party costs embedded in fees:

SEC (U.S. Securities and Exchange Commission) transaction fees are only charged on sales, at a rate of 0.00051% of the transaction value. FINRA (Financial Industry Regulatory Authority) transaction activity fees (TAF) are also only charged on sales, at $0.000119 per share, with a minimum of $0.01 and a maximum of $5.95. These costs are typically integrated into the broker’s fee quote, not itemized separately.

Fee Components for Overseas Brokers

Using overseas brokers involves a more complex fee structure across multiple stages:

Trading-related costs:

• Trading commissions: most major brokers now offer zero commissions, but some still charge fees
• Margin interest: borrowing costs when using margin accounts
• SEC and FINRA fees: same as sub-brokerage, applicable on sales

Fund transfer costs:

• Currency exchange fees: converting NTD to USD incurs a fee of about 0.05% of the amount, usually with a minimum of NT$100–600
• Remittance fees: transferring funds from Taiwan to the overseas broker account costs NT$100–900 per transaction
• Withdrawal fees: some brokers charge US$10–35 when withdrawing funds

Additionally, for any trading method, dividends paid on stocks are subject to a 30% withholding tax.

Fee Comparison Table: Sub-Brokerage vs Overseas Brokers

Major Domestic Sub-Brokerage Fees

Major Overseas Brokers Fee Comparison

Bank Currency Exchange & Remittance Fee References

Actual Cost Calculation: Sub-Brokerage vs Overseas Broker

To illustrate the cost differences more intuitively, we select the most cost-effective institutions for calculation:

• Sub-brokerage: Fubon Securities (0.25% commission, no minimum fee)
• Overseas broker: Mitrade (zero commission)
• Currency remittance: Bank of Taiwan (0.05%, NT$100 minimum, NT$200 telegraph fee)

Assuming an exchange rate of NTD:USD = 30:1, here are cost estimates for different investment amounts:

Key insight: When the single transaction amount exceeds US$6,000, the cost advantage of overseas brokers begins to emerge.

Note that this calculation assumes only one transaction. In reality, multiple trades increase costs for sub-brokerage significantly. For example, four trades (buy 2 times, sell 2 times) on US$10,000 would incur US$100 in fees (US$25×4) with sub-brokerage, whereas the zero-commission overseas broker would still cost about US$11.67, a nearly 9-fold difference.

Recommendations: How to Find the Most Suitable Solution for Yourself

Based on the above analysis, investors should adjust their choice according to three key factors:

Suitable for sub-brokerage:

• Smaller capital (single trade under US$6,000)
• Low trading frequency—only a few trades per year
• Preference to use NTD throughout, avoiding currency exchange
• Value regulation protection and dealings with domestic financial institutions

Suitable for overseas brokers:

• Larger capital (single trade over US$10,000)
• More frequent trading, requiring flexibility
• Willing to learn basic currency exchange procedures
• Cost-sensitive over the long term, seeking optimal costs

Among overseas brokers, Mitrade is especially suitable for new investors due to its zero-commission model and no minimum trading amount. It is regulated by the Australian Securities and Investments Commission (ASIC) (License No.: 398528), with comprehensive investor protection.

The account opening process is straightforward: fill in basic info, submit the application, and with a minimum deposit of only US$50 (supporting NTD transfers), you can start exploring US stock investments.

Summary and Recommendations

Core insights:

• Taiwanese investors mainly access US stocks via sub-brokerage or overseas brokers, each with pros and cons
• Sub-brokerage’s main advantage is simplified remittance, but at a cost of 0.25%–1% in fees
• Overseas brokers offer near-zero trading costs but require handling currency exchange and fund transfers

Practical tips:

• For small capital and infrequent trades, sub-brokerage is more economical
• For larger capital and frequent trading, overseas brokers are more cost-effective in the long run
• When single trades exceed US$6,000, switching directly to overseas brokers is recommended
• For frequent traders, costs can be reduced by over 70%, with significant savings

Final reminder: The fee standards above are based on market data as of June 2025; policies may change at any time. Always verify the latest fee schedules of relevant institutions before actual trading to ensure accurate decision-making.