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I'm from 3rd world country in Asia and have been living in Germany for a year and I want to invest some money (few thousands Europe as total and few hundred per month) to what called ETFs (exchange traded fund). Because just keeping my money in the bank does not seem to be a good choice when the inflation increases every year. Currently, I have Commerzbank bank account.

I don't speak German yet (trying to learn though), so I'd ask from your experience, a good/trusted company could provide:

  • Various kind of ETFs / Index funds (not only investing for Germany's indexes for example but world indexes).

  • Low fee for buying / selling (not by percent but a fixed price, e.g: buy 1 ETF costs 0.03 Euro, buy 1000 ETF costs 30 Euro).

  • English support for the website and automatically tax calculated (I think they do it implicitly in Germany? e.g: If I sell my securities and gain 1000 Euro for 1 year then this year I only have to pay 1000 - 800 (exempted form tax yearly for capital gain) = 200 * 25% Tax = 50 Euro?)

My strategy is to buy all-in some ETFs / Index funds which I think can gain in long term next few years (I'm not an active trader) and the money is what I save

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    As a beginner look out, what Commerzbank offers. As an advanced investor try something like flatex.de/en
    – Bernhard Döbler
    Commented Apr 6, 2020 at 21:58
  • Questions seeking product/service recommendations are specifically off-topic here. Sorry.
    – Chris W. Rea
    Commented Apr 7, 2020 at 19:56

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Regardless of which broker you choose, you will have access to UCITS ETFs, many of which follow international indices. However, you cannot buy funds that are domiciled outside of the EU, at least not as a private investor. The website https://justetf.com has a database of ETFs and automatically applies availability restrictions based on country, and often has more up to date information than brokers. It also lists brokers that offer savings plans for each ETF.

All German brokers handle taxes automatically. You have a 800-something-€ tax-free allowance (Steuerfreibetrag) on capital gains per year, but you must expressly allocate all or part of this allowance to a bank (→ Freistellungsauftrag). If you make an error here, the proper tax can be calculated with your tax filings. Taxes are levied on gains like sales and dividends, but for accumulating funds also on part on unrealized gains. This means that the tax-optimal strategy is to prefer distributing ETFs until the dividend payments exhaust your Freibetrag. Beyond that point, accumulating ETFs defer more taxes until the sale, which is usually considered a good thing.

When comparing brokers you want to look at three kinds of fees:

  • fees for maintaining a brokerage account
  • fees for placing an order
  • fees for using a savings plan (x € per month are automatically invested)

For all of these, Commerzbank is not very competitive with online banks, except at very large volumes. Often, banks like DKB or Ing are recommended in this context, but they can be choosy with their customers and I'm not sure if their websites support English very well. Flatex used to be very good until the recent introduction of a 0,1% p.a. account fee. Under no circumstances go to the local Sparkasse.

Rough comparison (as of Apr 2020, no guarantees):

  • brokerage account fees:
    • Commerzbank: free if at least one order or savings plan per quarter, otherwise 0,175% p.a. min 4,95€ ← very expensive for buy and hold
    • Comdirect: free if at least two orders or one saving plan per quarter, otherwise 1.95€ per month
    • Flatex: 0,1% p.a. ← expensive
    • DKB, Ing: no additional fees, but associated checking account might not be free
  • order fees (excluding exchange fees):
    • Commerzbank: 4,90€ + 0,25%, min 9,90€
    • Comdirect: 4,90€ + 0,25%, min 9,90€, better conditions during first 12 months
    • DKB: 10€ if value below 10000€, else 25€
    • Ing: 4,90€ + 0,25%, better conditions during first 6 months
    • Flatex: 5,90€
  • saving plan fees (per monthly occurrence):
    • Commerzbank: 2,50€ + 0,25%
    • Comdirect: 1,5%
    • DKB, Flatex: 1,50€, some are free ← very cheap
    • Ing: 1,75%, some are free

These fees are per order / per savings plan execution and usually depend on the volume/value of the order (except DKB). The number of shares you buy is not directly relevant.

What is more important than chasing the lowest-cost trades is finding a good, low-cost ETF that you are comfortable with, as mentioned use JustETF for that. Since not all brokers offer saving plans for that ETF, the choice of fund may affect your choice of broker.

A good resource for further questions is the German finance subreddit https://reddit.com/r/Finanzen

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  • Does your commerzbank comparison also apply to Comdirect as a Commerzbank-owned Direktbank?
    – R.K.
    Commented Apr 7, 2020 at 8:32
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    @R.K. Comdirect has slightly different conditions than Commerzbank, I've added them to the overview. While costs per order are identical, the account cost and saving plan fees are significantly different. Comdirect is a competitive choice with a regular savings plan, but IIRC they offer fewer ETF saving plans than competitors. If OP wants a savings plan, they should first select the ETF and then a broker.
    – amon
    Commented Apr 7, 2020 at 9:52
  • @amon I've considered Commerzbank and ING. From your comparisons, I don't understand this "Commerzbank: free if at least one order or savings plan per quarter, otherwise 0,175% p.a. min 4,95€ ← very expensive for buy and hold" If I invest every month (e.g: via Saving plan), then this fee is not counted, right? It seems to me, if I invest a lump sump (like 30k Euro) to Commerzbank, the fee is acceptable (it costs me 80.0 Euro for order fee). Of course, compared with TradeRepublic 1 Euro order fee, this is a lot of money.
    – Bằng Rikimaru
    Commented Feb 4, 2021 at 14:44
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    @BằngRikimaru You'd have to look at the current T&Cs, I'm not keeping this answer up to date. At the time, the Commerzbank brokerage account was free if you regularly traded or executed a savings plan. But if you only held assets in your account, the percentage-based fee would kick in (e.g. a couple of months after a lump sum investment). Percentage-based account fees are expensive due to compound interest.
    – amon
    Commented Feb 4, 2021 at 15:16

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