How to buy U.S. ETFs 🦅 from Europe?
In many countries, buying U.S. domiciled exchange traded funds (ETFs) is very hard or seemingly impossible to do. Are you also wondering how to buy U.S. ETFs from Europe/U.K.?
Like you, I was looking to spend some money on 🗽 liberty-containing financial instruments. Based on my findings, I have compiled a free and easy guide that will let you buy any U.S. ETF you like, such as:
- Vanguard VOO, VTI and VXUS
- ARK Invest ARKK, ARKQ, ARKW, ARKG, ARKX, and ARKF
- ProShares UPRO, TQQQ, SPXU, and SQQQ
- Direxion SOXL, DFEN, SPXL, and TECL
- Invesco TAN, CQQQ, QQQM, and QQQJ
- Covered call ETFs QYLD, QYLG, XYLD, RYLD, JEPI, KNG, …
Ways to buy U.S. ETFs
Despite all the boring 💤 regulation (PRIIPs) requiring specific documentation for ETFs (Key Information Document, or KID/KIID), there still are ways for Europeans to legally buy U.S. domiciled 📈 ETFs. It’s not even much of a hassle and has very little costs. Let’s have a look at the options.
Method #1: Buy ETFs cheap and easy via 🍒 Tastytrade (formerly Tastyworks)
Difficulty: 👶 Easy
Minimum: 💶 ~€2,000
Access: 💯 All ETFs
This method is by far the most accessible of all. It works by simply using a U.S. based broker instead of a European one. Besides offering ETFs, the broker has to support funding from Europe with low fees 💵 for this to be attractive. So far, I’ve found it works great with Tastytrade.
Tastytrade also doesn’t charge any fees for buying stocks and ETFs, a major advantage compared to most European brokers. Follow the steps below and you’re good to go.
Tastytrade also doesn’t charge any fees for buying stocks and ETFs, a major advantage compared to most European brokers. Follow the steps below and you’re good to go.
- Open a Tastytrade account here.
Click here for detailed instructions.
- Open a CurrencyFair account here.
Transfer €2,000+ for a €50 free bonus 🎁, click here for instructions.
- Transfer funds from your bank to Tastytrade.
Initiate cheap transfers via 💱 CurrencyFair, click here for instructions.
- You can now start buying U.S. ETFs! 🎉
Click here to read how to place an order on Tastytrade.
Still got questions? Place a comment below!
Method #2: Get U.S. ETF exposure 🌎 via CFDs
Difficulty: 👶 Easy
Minimum: 👛 ~€500
Access: 🛒 250+ ETFs
Though CFDs aren’t available for all U.S. ETFs, it may still be a good option if you’re mainly interested in the popular ones. The ease and low minimum deposit makes this an attractive option for people looking to buy common U.S. ETFs through a European broker.
Click this link to check out the simple guide I wrote to help you setup your eToro account, and get 🧠 informed about what CFDs are and how to use them to trade U.S. ETFs.
Method #3: Obtain 👨💼 professional investor status, trade unrestricted
Difficulty: 🧠 Medium
Minimum: 💰 ~€500,000
Access: 💯 All ETFs
Got a large (€500,000+) 💰 portfolio and want to stick with a European broker when buying U.S. exchange traded funds? In that case, obtaining professional status might be suitable for you. Find the instructions here, but be aware this method will only suit a very select group of people.
Method #4: Buy ETFs by exercising options, for experienced traders
Difficulty: 🤯 Hard
Minimum: 💳 ~€10,000
Access: 🔥 Most ETFs
Still work in progress…
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Thanks mate, super easy to follow and happy to say I can now invest in american ETFs 🙂
I did everything step by step and it worked perfectly.
Thank you for the clear explanation!
Are there any regulatory and or legal requirements that we should be aware of?
Hi Lucas, it depends on your country so I cannot go in detail for all of them. But generally you just list the account when filing taxes in your country of residence as you would with a local account and that’s it. You pay 30% tax on dividends by default, but—depending on your country—Tastyworks will automatically fill out your W-8 BEN and apply the treaty rate (if there is one—generally there is). E.g. for Netherlands the rate is 15%, so they lower it for you already and there’s no work required on your end.
Lastly, there is an estate tax, meaning that in case an account holder passes away, there will be a tax on balances over 60k, but there are treaties that address this as well. So if you deposit over 60k, you’ll have to look up the treaty for your country and find the rate (or absence thereof).
Hope this helps you out a little, I cannot really go in detail too much as I’m not a tax adviser.
maybe interesting…. message from 21.1.2021
“Britain’s IG Group to Buy U.S. Options Firm Tastytrade for $1 Billion ”
source:
https://www.wsj.com/articles/britains-ig-group-to-buy-u-s-options-firm-tastytrade-for-1-billion-11611244548
What about etoro? CFDs for ark etfs etc?
Hi James, thanks for your suggestion. This is indeed another option that I’d like to cover. Seeing as how holding CFDs is different from possessing actual stock, I decided to give this less of a priority, but I’m planning on writing instructions for this method sometime later this quarter. Hope you find the other methods useful as well though—I personally very much favor those over CFDs. Good luck!
why must we create a currencyfair account first, instead of depositing directly into out tastyworks account?
Hi Willem, it’s not strictly required but likely cheaper due to the exchange rates and wire fees charged by banks (which are often higher). Tastyworks also doesn’t process third party transfers (aside from CurrencyFair), so that also excludes some of the cheaper banks like N26, which uses TransferWise for wires in the backend. Hope this answers your question!
How about e*trade as an alternative to Tastyworks?
Also, how about transferring Funds und USD via TransferWise to minimize fx losses?
Thanks for your perspective!
Hi Ed, though E*Trade is a fine broker, they stopped accepting foreign clients. Therefore Tastyworks seems to be the best alternative at the moment. Tastyworks states that they do not accept TransferWise deposits, only CurrencyFair. Hope this helps! 🙂
FYI . I found out that e*trade US doe not allow me to trade ARK bec of PRIIPs.
Hey this is great work! The only issue is taxes for Italians on non-UCITS ETFs are simply ridiculous they can go all the way up to about 50% of your earnings
Thanks for your comment Rudy. I don’t advise on taxes, so I advise anyone to check their local regulations. For many countries (such as the Netherlands) it should not make a difference, but it is possible some countries treat non-UCITS products differently.
Yeah.Here in Spain it dosent make a difference. 15% if you invest in US domiciled or 15% if you invest in Ireland (UCITS) domiciled.
Thanks Ignacio, this will be very useful information for other people from Spain visiting this website. 🙂
Good day,
Both Tastyworks and Firstrade does not accept Lithuania (Europe) Is there any other broker that accepts Lithuanian clients, or is there another way to invest in ARK products. Or the only way is to invest in ARK alternative ETF’s?
Thank you
Hi August, that’s unfortunate to hear. You could check out my guide on using Trading 212 to replicate the ETFs. Otherwise, CFDs might be an option as well, I’ll be posting an article on this hopefully later this month. Good luck!
Hi, great article, very informative and helpful. Is there an alternative to Trading 212 as they are not allowing new accounts at the moment. Thanks Tony
Hi Tony, yes, there’s a temporary hold on new accounts. You can choose to be notified one it opens up again though. As for alternatives, you might want to check out my guide on using a U.S. broker to buy any ETF you like. Hope it works out for you!