Brokers Investing

Why I’m NOT Investing In CSPX And Ireland-Domiciled ETFs

Disclaimer: All details in this post are accurate as of 14/5/21 and are not updated with the latest information. Check out the updated post here.

Recently, I wrote an article crowning CSPX as the best S&P 500 ETF to invest in for Singaporeans.  (P.S. This article is referenced heavily in this post, so it’ll probably be a good idea to check it out if you haven’t already!)

This was mainly due to CSPX being an accumulating ETF and the tax advantages it enjoys as an Ireland-domiciled ETF.

However, despite being the best S&P 500 ETF, I’m personally not invested in CSPX – or any other Ireland-domiciled ETFs – yet.

Here’s why.

Brokers Matter Too

In the article, the only factors that were evaluated were those related to the ETFs themselves.

Another aspect of investing that also plays a huge part in your investment returns is your broker.

The fees charged by your broker add up as investment costs and if you don’t pay attention to them, your returns can be thoroughly eroded.

This means that instead of looking to select only the best ETFs to invest in or the best broker to use, what really matters is the combination of both.

If you have the best investment vehicles but a ridiculously expensive broker, your returns may turn out to be just average, and vice versa.

LSE Is Expensive

Since CSPX is listed on the London Stock Exchange (LSE), in order to invest in it, you will need to use a broker that has access to UK markets.

In general, investing in UK markets is expensive because of the fees charged by the available brokers in Singapore.

The 3 cheapest brokers for this are Interactive Brokers (IBKR), Standard Chartered Online (SCO), and Saxo.

Assuming that investments are made every month into CSPX, here are the fees you can expect to incur.

Broker ibkr logo sc logo saxo logo
0.05%, min
1.70 USD
0.25%, min
10 USD
0.10%, min
~ 0.002%,
N/A 0.3%
10 USD / month,
waived with
> 100k
N/A 0.12% / year

*: 10 USD/month is inclusive of all fees incurred during the month, ie if incurred 3.70 USD from fees, the monthly fee will be reduced to 10 – 3.70 = 6.30 USD, for a total of 10 USD/month

You may have noticed that IBKR’s commission fees are actually extremely low. But the caveat here is the monthly fee of 10 USD for accounts with <100k USD (~135k SGD) in assets.

As a fresh grad, it’s going to take me a considerable amount of time before I’ll be able to amass a portfolio of that size.

Until that happens, it’s going to cost me 120 USD/year in fees for using IBKR – which is a large sum to be paying especially when my portfolio size is small.

Next, SCO charges a high minimum commission fee that is only waived if you have a portfolio size of $200k or more.

This is going to take me even longer to achieve, and until then, I’ll have to pay the high commission fees every month.

The final option, Saxo, also charges a high commission fee and makes things worse with an annual custodian fee.

I left Saxo for good earlier this year. If you’re interested, you can read about it here.


Despite the high fees involved in investing in the LSE, it is still desirable to do so because when you eventually accumulate a large portfolio, Ireland-domiciled ETFs will save you a lot of money as compared to US-domiciled ETFs.

Here are 2 strategies you can adopt to go about investing in CSPX or other Ireland-domiciled ETFs.

1: Quarterly, Not Monthly

Earlier, it was assumed that investments were made every month – so commission fees were incurred every month.

And if that works out to be too high of a fee, well, a logical solution would be to reduce the commission fees by investing fewer times.

If, for example, you invest every 3 months instead of every month, your commission fees would be slashed to a third, and suddenly the fees don’t look too high anymore.

Note that this is only applicable if you choose SCO or Saxo as your broker since IBKR’s monthly fee is applicable regardless of whether you invest that month or not.

While this may be a good way to reduce your investment fees, it does have its drawbacks.

By investing every quarter instead of every month, you will have a higher cash drag – more cash sitting in your bank earning low interest instead of being invested in the market with higher potential returns.

In turn, this means that you may miss out on a significant amount of returns simply because your money spends less time in the market.

So even though you save on commission fees, you could potentially “lose” it all (if not more) by missing out on market returns.

Of course, it’s also possible that prices go down instead of up, in which case it’ll be beneficial for you because you get a larger sum of money into the market at a discount.

If you’re aware of the pros and cons of this strategy and are fine with it, by all means, go ahead with it.

But if you don’t quite fancy the idea of potentially missing out on returns, what can you do?

2: US First, Then UK

Another alternative is to invest in US-domiciled ETFs first, then switch to Ireland-domiciled ETFs.

This strategy aims to minimise investing costs throughout your investing journey.

How this works is that you start by investing in US markets first with a low-cost broker like Tiger Brokers/Moomoo.

After a few years, make the switch to Ireland-domiciled ETFs using IBKR.

The reason for this is that when you’re just starting your investing journey, your portfolio size is small and commission fees will make up the bulk of your investing costs.

Since broker fees for US markets are much lower than that of UK markets, you can save substantially on commission fees.

For example, the fees are only 1.99 USD with Tiger Brokers/Moomoo for US markets as compared to 10 GBP with SCO for UK markets.

That’s an 80% savings on fees for every trade you make.

But as your portfolio grows, investing costs such as dividend withholding taxes and ETF expense ratios will eventually outweigh commission fees.

The tax savings from Ireland-domiciled ETFs thus make them more cost-efficient as investments as compared to US-domiciled ETFs.

IBKR has the lowest commission fee for UK markets and its monthly fee will be waived earlier than SCO (100k USD vs 200k SGD), so IBKR is the broker of choice.

Furthermore, since costs will always be minimised with this approach, you don’t have to limit yourself to investing only every few months, and can instead invest monthly.

This allows you to minimise cash drag and maximise the amount of time your money spends in the market, thereby allowing you to maximise long-term returns.

My Pick: US First, Then UK

The strategy that I have chosen to adopt is #2, investing in VOO using Tiger Brokers with plans to eventually switch to CSPX using IBKR.

Personally, I think that time in the market is the best way to maximise long-term returns, so I want to invest the money that I don’t need ASAP – by investing monthly when I start drawing a salary.

This strategy allows me to do just that while also minimising investing costs along the way.

Even though VOO is less tax-efficient than CSPX, as mentioned earlier, this is not as important as commission fees at the start of my investing journey.

From my best S&P 500 ETF post, CSPX is more cost-efficient than VOO by only ~0.26%.

To put things in perspective, on a portfolio size of 10k USD, this works out to be a difference of 26 USD/year.

The fee incurred for buying VOO with Tiger is 1.99 USD.

For buying CSPX with IBKR, it is 10 USD.

Assuming I invest every month, this is a difference of 96 USD/year, which actually makes VOO cheaper than CSPX.

The turning point, theoretically, would be when the 0.26% difference between VOO and CSPX becomes > 96 USD, or at a portfolio size of about 37k USD.

At this point, the savings from CSPX over VOO becomes more substantial than the difference in commission fees, so it makes sense to switch from VOO/Tiger to CSPX/IBKR.

Of course, this is merely a theoretical value. In reality, other factors need to be considered, including:

  • commission-free trades with Tiger Brokers
  • FX losses with Tiger Brokers
  • Changing dividend yield of VOO & CSPX (assumed to be same as VUSD)

To summarise,

Finding the best ETF or stock to invest in isn’t all there is to investing – finding the best broker to invest with is just as important.

I am not investing in Ireland-domiciled ETFs for now because the broker fees are high.

It is possible to reduce these fees by either reducing your investing frequency or by investing in US-domiciled ETFs first and switching to Ireland-domiciled ETFs in the future.

Since my investment philosophy is to invest my money ASAP and minimise costs, I have decided to opt for the second approach.

Which strategy do you prefer? Or do you use a different strategy? Let me know in the comments below!

48 replies on “Why I’m NOT Investing In CSPX And Ireland-Domiciled ETFs”

Could you send me the comparison between voo and cspx, now that ibkr has removed the min activity order for monthly contributions?

Thanks much.

Hi TFS. I’m interested in the answer to Sylvia’s question too! Could you forward me the same email as well? Thanks!


Can I get the details as well?

Consider to whether buy into CSPX or VOO through IBKR.
Also, do you know whether fractional shares is allowed if we purchased through LSE?


Hey Lovro,

Thanks for checking out my blog and leaving a comment! As requested, I’ve sent you an email of the reply. I’ve also responded to your additional query about the 4 USD commission for CSPX 🙂

Hi there.. interest with this topic and fhe maths behind too.. could share me a copy as well? Much appreciate

Hey Peppe,

Thanks for the comment!

From what I see, you’re right that there are no exchange fees, but that’s not exclusive to Standard Chartered – it simply means that the Swiss Exchange SIX generally does not charge exchange/clearing fees for trading on SIX. However, this is not the same as commission fees. Trading on SIX with Standard Chartered will still incur commission fees, and trading on SIX with any other broker will also not incur any exchange fees.

In other words, it is not any cheaper to invest in CSSPX via SIX with Standard Chartered than it is to invest in CSPX via LSE with IBKR, especially after IBKR’s recent removal of their monthly fee. Rather, it is actually more expensive, since Standard Chartered’s minimum commission fee is 10 USD while IBKR’s is only 1.70 USD.

Hope this clears things up for you!


Thanks for the interesting post.
Do you have a follow up article for the latest fee removal of IBKR & FSMOne Fees changes?
I’ll be looking forward for the follow up article.


Greatly appreciate this insight, I just started my portfolio (SGD 10,000) through IBKR with the bulk of them in US-domiciled ETFs and I have been trying to figure out if it is worth it to switch to Irish-domiciled alternatives. Considering the other factors such as fees, trade volume, bid-ask spread and expense ratio among others.

It seems that the US withholding tax is a Boogeyman, frightening non-us investors, but I’m unsure if the trade offs of changing to Irish-domiciled ones are worth the effort. I am aware of the estate tax but wouldn’t it be as simple as liquidating the portfolio upon retirement or transferring it to Singaporean instruments as I’d assume a retiree’s risk appetites would be much lower and amazing returns might not be the main priority

Will read up more on dividend yield, are there any other terms that you’d recommend I should look into in order to make an informed decision? Thank you!

Hi PK,

Thanks for checking out my blog and leaving a comment!

I think it’s great that Syfe now gives investors the option to customise their very own portfolios with Syfe Select, in a way that is similar to Kristal.AI. It is a good way for people who are already investing with Syfe to try out DIY investing.

Personally, though, it wouldn’t be my choice of investment. Even though there are no commission fees/FX fees, the Syfe management fee still applies. The %-based fee is something that works against investors because the better your investments do, the more your portfolio grows, and the more you end up paying in fees.

This is especially so because IBKR now presents investors a relatively cheap way to invest in CSPX. One of the few cases I think Syfe Select would be useful for is a beginner investor who has extremely small capital and the Syfe management fee ends up being less than the commissions + FX fees from IBKR. But then again, Syfe’s management fee is recurring while IBKR’s fees are a one-time occurrence, so it also depends on the investor’s time horizon.

I came across your blog & article. I’ve been investing in VOO via FSMOne and saw the 10USD fee removal of IBKR. I’ve been thinking if it’s really worth it to switch. Are you able to share that math behind your analysis? Would really appreciate it.

By the way, what are your thoughts on CSPX available now on Syfe Select?

Thanks a lot & take care.


Thank you for your insightful article.
I’m also interested in this topic, do you mind sharing your thoughts via email?


Beginning 1 July 2021, IBKR already waive off $10 monthly fees.
I think it is the lowest and attractive to get Ireland domicile ETF for sg investor.

Hi Bon,

Thanks for checking out my blog and leaving a comment!

Yes, I am aware of the changes to IBKR’s fees. I have an updated version of this article which you can find here.

I agree that it’s one of the best brokers for SG investors!

Hi frugal student, thanks for your article. is there a minimum transaction fees for each US trade? syfe trade – 2 trades per month is free. so what other fees would be incur?

Hi Toh,

Thanks for checking out my blog and leaving a comment!

For tiered pricing on IBKR, there’s a minimum commission fee of 0.35 USD/trade. I believe there are also SEC clearing fees that are chargeable regardless of which broker you use, since this is charged by the US exchanges.

Syfe Trade is indeed a good alternative to IBKR now, but you might want to take into account the FX conversion rate. IBKR has the best rate as far as I know, but at a fixed fee of 2 USD. Syfe doesn’t charge any FX fee, but the conversion rate is usually worse than IBKR’s, which results in an implicit fee. The last I checked, I believe it’s ~0.2/0.3%. If you’re converting a large sum of SGD to USD, this can be a significant amount.

Hope this helps!

Hi Frugal student,

What is the current conversion rate of IBKR as compared to Syfe Trade? I am seriously considering Syfe Trade as I only trade at most 2x a month.

Hi Jay,

Thanks for checking out my blog and leaving a comment!

If I’m not wrong, the last time I checked, the FX conversion rate for Syfe Trade is ~0.2-0.3% worse than IBKR’s. This is a pretty reasonable conversion rate, comparable to and even better than Tiger/Moomoo, especially with the free trades. If you’re only looking to invest in US equities, Syfe Trade is indeed a good alternative to IBKR.

I’m actually going to have a post on Syfe Trade soon, so keep a lookout for that!

Hi, thanks for sharing the very helpful comparison to fellow Singaporeans. I don’t get the part on how to switch from investing in VOO to CSPX. If I already have some position in VOO, does a switch from VOO to CSPX mean sell away my positions in VOO and then use the money to DCA CSPX? That would be re-starting from ground 0?

Hi hynavian,

Thanks for checking out my blog and leaving a comment!

Yes, switching from VOO to CSPX would involve selling off your VOO. However, the idea is not to slowly DCA into CSPX using your capital from VOO.

Instead, the switch involves a lump-sum investment into CSPX. This is to maintain the amount of capital you had already invested in the market so that your portfolio’s performance wouldn’t be stunted by a lack of capital.

Essentially, it’s a lateral shift of your funds from VOO into CSPX.

Hope this helps!

You haven’t addressed the main issue here and that’s savings of the 30% withholding tax and at what point it’s more profitable to switch from VOO to CSPX and at what point would the savings in taxes make it worth it. Thx

Hey Nick,

Thanks for checking out my blog and for leaving a comment!

You’re right, I didn’t mention the 30% withholding tax in this post, but that’s because I already touched on it in a previous post that I referenced at the start of this post.

Also, I did cover this point in an updated post that I linked at the start of this post as well.

Hope this helps!

I am currently investing in VTI in MooMoo
I understood that there is a Withholding tax 30% as well as estate tax – 40% if I were to passed on.

Should I switch to IB and start investing in CSPX ?

Hey Roy,

Thanks for checking out my blog and for leaving a comment!

You’re right that investing in a US-domiciled ETF like VTI exposes you to a dividend withholding tax of 30% and estate tax of 40%. Ireland-domiciled ETFs like CSPX, on the other hand, only have a dividend withholding tax of 15% and no estate tax.

In the long run, investing in an Ireland-domiciled ETF will result in savings because of the reduced withholding tax rate, though the brokerage costs of investing in Ireland-domiciled ETFs are higher than that for US-domiciled ETFs.

Personally, I think the end goal should always be to invest in Ireland-domiciled ETFs, and I’ve personally stopped investing in US-domiciled ETFs already.

Hope this helps!

one thing u omitted is the exoense ratio. voo is 0.03% yearly vs 0.07% for cspx.. once u put that in, the calculations will be different again

Hey Louis,

Thanks for checking out my blog and leaving a comment!

Actually, I didn’t omit the expense ratio. Yes, I didn’t mention it in the post you commented on, but what I did say is that I wrote a previous post comparing all the ETF-related costs of VOO and CSPX, and found that net of everything, CSPX was ~0.26% cheaper than VOO. I based the calculations using this information at the time 🙂

Of course, things are different now that IBKR has reduced the fees for investing in LSE. You can check out this post for more updated information.

Hope this helps!

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