Questions to ask your broker regarding international trading

Which markets and which financial products on those markets can I access?

You may need (or prefer) to use different service providers for different markets.

What other parties are involved in providing the service?

Are orders being placed through a related stockbroking firm in the overseas market or is a third party (including online trading services and electronic trading networks (ECNs) involved? Check the licensing and regulation of each party and any other protection available to you.

How do I pay?

If you prefer to deal in Australian dollars it is important to ask when and how currency conversion takes place. In addition to the timing, check the typical Buy/Sell spreads and whether there are any additional fees for conversion.

Do I need to set up a cash account?

The answer to the previous question will affect the answer here. If you do need to set up a new cash account, check whether interest is paid and any other features including the reporting of foreign currency interest for Australian tax purposes.

How and when can I place orders?

The ability to trade online may mean you can place orders while overseas markets are open, if you are a night owl. Alternatively, the stockbroker may operate a night desk. Other brokers will take your orders during the Australian Business day and queue your orders to be entered into the overseas market when it opens. Remember to ask whether your stockbroker will resubmit any unexpected orders.

Where are my financial products held and how are they registered?

The answer to this question will affect how easily you can sell any financial products or borrow against them, participation in corporate actions, reporting and access to you account information.

Is there a minimum transaction amount?

This affects your ability to diversify your holdings and take advantage of different opportunities as they present themselves.

What is the brokerage?

Your broker will advise on fees and charges. Just as levels of service and pricing differ from broker to broker for domestic trading services, so too will the level of service and associated pricing of trading international financial products.  

Are there any custody fees or other fees and charges?

This can vary per market and per exchange.

What research do you provide?

Various sources of resaerch information are avialable.

Do you provide access to any other investments (including unlisted managed funds)?

This may or may not be of interest to you.