2025 US Stock Full Commission Fee Analysis | When Investing in US Stocks, Choose Full Commission or Overseas Brokers?

Taiwanese investors looking to trade US stocks face the first question: which method is the most cost-effective? Factors such as US stock cross-border agency fees, currency exchange costs, and trading frequency all play a role. A small misstep can lead to unnecessary expenses. This article will analyze the cost structures of two mainstream US stock investment methods to help you make the most informed decision.

Two Paths for Taiwanese Investors Trading US Stocks

If you want to buy US stocks in Taiwan, there are essentially two channels:

Option A: Through Domestic Brokers’ Cross-Border Agency

The full name is “Trustee Buying and Selling Foreign Securities Business.” Simply put, you open an account with a domestic broker (like Fubon, Cathay, etc.), and this broker acts as your agent to place orders in foreign markets. Since the order passes through the domestic broker, it’s called “cross-border agency.”

The obvious advantage: you trade directly in New Taiwan Dollars (NTD), and the broker handles currency exchange, so you don’t need to manage foreign currency accounts yourself. But the downside is that the process is more complex, and the fees are not cheap—generally between 0.15% and 1%.

Option B: Opening an Overseas Broker Account Directly

Skip the domestic middleman and open an account directly with a US stock broker. It’s as simple as buying Taiwan stocks through a local broker. Currently, major overseas brokers have lowered trading commissions significantly, with some offering zero-commission trades.

However, this approach has costs: you need to convert NTD to USD yourself and transfer USD abroad. Banks will charge currency exchange fees and remittance fees during this process. For small transactions, these hidden costs can outweigh the cross-border agency commissions.

The True Composition of Cross-Border Agency Fees

When trading US stocks via cross-border agency, your actual costs include two parts:

Part 1: Fees directly charged by the broker

1. Trading commission: The main component. Rates typically range from 0.25% to 1% of the transaction amount, varying by broker. But beware of minimum charges—most brokers charge at least $25 to $100 per order.

   Example: Buying $1,000 worth of US stocks at 0.3% would cost $3, but with a minimum of $100, the actual fee becomes 10%. This significantly impacts small trades.

2. Other service fees: Remittance fees, account maintenance fees, etc., are relatively minor.

Part 2: Hidden costs embedded in the fees

1. Exchange fee: The US Securities and Exchange Commission (SEC) charges a fee, deducted only when selling, at a rate of 0.00051% of the transaction amount, collected and remitted by the broker.

2. Transaction Activity Fee (TAF): Collected by FINRA, also only on sell orders, calculated per share at $0.000119 per share, with a minimum of $0.01 and a maximum of $5.95.

These two fees are usually incorporated into the broker’s total fee and are not itemized separately.

Cost Structure of Overseas Brokers

Trading US stocks via overseas brokers involves a completely different fee structure:

Broker-side costs:

• Trading commissions: Most mainstream brokers now offer zero commissions, but some still charge fees.
• Margin interest: Only incurred when using margin to buy stocks.
• Currency exchange fees: When converting NTD to USD at the bank, typically around 0.05%, with minimum fees of about NT$100–NT$600.
• Remittance fees: Banks charge NT$100–NT$900 to transfer funds abroad.
• Withdrawal fees: Some brokers charge $10–$35 when withdrawing funds.

Market-side costs:

• Exchange fees and TAF are similar to those in cross-border agency but have less impact because trading commissions are often zero.

Additionally, for any method, dividends are subject to a 30% withholding tax.

The table below summarizes the fee items for both methods:

Major Cross-Border Agency Broker Fee Rates (2025)

Major Overseas Broker Fee Comparison

Bank Currency Exchange and Remittance Fee Comparison

Practical Comparison: Cross-border Agency vs. Overseas Broker

Calculating with the lowest-cost setup. Assumptions:

• Cross-border agency with Fubon Securities (0.25% commission, no minimum)
• Overseas broker with Mitrade (zero commission)
• Currency exchange via Taiwan Bank (0.05%, minimum NT$120)
• Exchange rate: 1 USD = NT$30

Key insight:

When a single transaction exceeds $6,000, the cost advantage of overseas brokers begins to show. But this comparison assumes only one transaction.

If you trade frequently, the situation changes dramatically. For example, with $10,000 split into 4 trades (2 buys and 2 sells):

• Cross-border agency cost: × 4 =
• Overseas broker cost: × 4 + NT$11.67 (one remittance) = NT$11.67

The difference becomes significant.

How to Choose? Investor Decision Guide

Based on the above analysis, your choice should consider:

Scenario for choosing cross-border agency:

• Capital between $1,000–$6,000
• Very few trades per year (a few times)
• Don’t want to hassle with currency exchange
• Prefer safety and domestic regulatory protection

Scenario for choosing overseas brokers:

• Single trade exceeds $6,000
• Frequent trading (multiple times a month or more)
• Don’t mind handling currency exchange yourself
• Want more investment tools and faster execution

For large investors: Once capital exceeds $20,000, the disadvantages of cross-border agency fees become obvious. Choosing an overseas broker can save substantial trading costs.

Summary

US stock cross-border agency fees seem simple but involve multiple layers of costs. Regardless of the method chosen, the key is to decide based on your trading habits and capital size, not just on a single fee rate. Small investors and frequent traders have very different optimal solutions—find the path that suits you best.