Saxo Bank Review
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Saxo Capital Markets is a global service provider with clients across 170 countries, offering trades forex, CFDs, stocks, futures and ETFs.
The broker operates under Saxo Group, and is a subsidiary of Saxo Bank, along with 9 other legal entities. However, while Saxo Capital Markets is a broker, Saxo Bank has a banking licence, which makes it different from a broker.
- Demo Account: Yes
- Account Minimum: £500 for the base account
- Regulation: Highly regulated across 15 jurisdictions
- Asset Coverage: Stocks, Bonds, ETFs
- Best for: Active and professional traders
- Commissions & Fees: 5/10
- Investment Selection: 7.5/10
- Account Options & Features: 5/10
- Usability: 7/10
- Educational Resources: 6/10
- Customer Service: 4/10
- Overall: 6/10
As a whole, Saxo Group’s 10 subsidiaries are spread across 15 different jurisdictions, including the U.K, Denmark, and Singapore. This is important because, due to the lack of central authority, the Forex market is regulated by separate authorities.
This means that each subsidiary must comply with a different set of criteria/requirements. It makes sense then that the requirements for each subsidiary vary.
In this guide, we are going to:
- Take an indepth look at Saxo Group’s U.K entity, Saxo Capital Markets
- Highlight some major differences between Saxo’s subsidiary’s
- Answer some of your most asked questions
But first, we’re going to look Saxo Bank:
Saxo Bank, a Danish Investment bank, founded in 1992, and specializing in online trading and investment has since grown into a global brokerage spanning across 15 jurisdictions.
In 2001, the company obtained a banking license and changed its name to, solely, Saxo. This means the company functions as an online broker with a banking license, but does not offer traditional banking products. Instead, it offers forex, stocks, futures, CFDs, bonds, funds, and futures spreads.
Saxo Bank is headquartered in Copenhagen but holds offices in places including Paris, London, Zurich, Singapore, Dubai, India and Tokyo. Saxo has stated that it has clients in 180 countries, and a daily turnover of around $12 billion.
Overview and Summary
- Saxo Capital Markets is a global service provider with clients across 170 countries, offering trades forex, CFDs, stocks, futures and ETFs.
- The broker operates under Saxo Group, and is a subsidiary of Saxo Bank, along with 9 other legal entities.
- Saxo is considered safe as it is fully regulated, adhering to strict regulatory criteria across 15 different jurisdictions, including the UK, Denmark, Singapore and Australia.
- Saxo offers 3 account types. These are the Classic, Platinum, and VIP. The classic account requires only a £500 minimum deposit and is Saxos base account type.
- Saxo’s fees overall are competitive solely for traders with balances big enough to access the Platinum or VIP accounts, or for clients who make over 100 trades in a month.
- Saxo offers an informative support page covering numerous topics but traders looking for additional support outside of this are asked to submit a case via the trading platform, which isn’t available on the mobile app, yet.
Saxo Safety & Legal Entities
Saxo is considered safe as it is fully regulated, adhering to strict regulatory criteria across, as we mentioned above, 15 different jurisdictions, including the UK, Denmark, Singapore and Australia. This is important because the amount of compensation you will be eligible to receive varies drastically across these jurisdictions.
As the Forex market is the world’s biggest market there is no one regulatory authority governing it which has resulted in multiple authorities governing different jurisdictions. This means that each jurisdiction, naturally, imposes different regulations and guidelines on forex brokers with some being a lot more strict than others.
For example, Forex brokers in the U.S are heavily regulated by the Commodity Futures Trading Commision (CFTC) and the National Futures Association (NFA), while forex brokers in Australia, in comparison, are liable to less strict regulations.
The overall aim of each regulatory body is to protect forex traders from scams and maintain the integrity of the marketplace. Let’s see what body each of Saxo’s legal entities is regulated by and how each of these work to protect traders in the concerned jurisdiction.
Saxo clients in the UK are regulated by the FCA and protected by pretty strict regulations, including offering traders compensation of up to £85,000 if you have a protected claim against a firm that has failed.
Below, we’ve laid out where each legal entity is, what organization it is regulated by, and how much compensation you could be owed in the event of insolvency.
|Jurisdiction||Protected up to||Regulated by||Legal Entity|
|UK||€85,000||Financial Conduct Authority (FCA)||Saxo Capital Markets UK|
|France||€100,000||Bank of France||Saxo Banque (FR) SAS|
|Switzerland||CHF 100,000||Swiss Federal Banking Commission||Saxo Bank (SW) (AG)|
|Italy||Not protected||Commissione Nazionale per le societa e la borsa (CONSAB)||BG Saxo|
|Other European Countries||€100,000 for cash & €20,000 for securities||Danish FSA||Saxo Bank A/S|
|Singapore||Not protected||Monetary Authority of Singapore||Saxo Capital Markets pte Ltd|
|Japan||Not protected||Japanese Financial Services Agency||Saxo Bank FX KK|
|Hong Kong||Not protected||Securities & Futures Commissions HK||Saxo Capital Markets HK|
|Australia||Not protected||Australian Securities & Investment Commissions (ASIC)||Saxo Capital Markets (AU) Pty Ltd|
Later, we’ll swing back around to Saxos different entities and highlight some other major differences between them. First, let’s take a look at some of the controversy that Saxo Bank has been involved in before looking at Saxo’s UK entity, Saxo Capital Markets, in more detail.
The Swiss Franc Currency Crisis and Saxo’s Cap Removal Controversy
On January 15th, 2015, the Swiss National Bank ended the franc’s cap on the Euro which resulted in the EUR/CHF value decreasing significantly. Following this, the firm stated that it was going to alter the filling price off any and all orders executed on the CHF currency pair during periods of lower liquidity.
This change caused unnecessary losses for many clients short selling the EUR/CHF as well as other CHF instruments and who had exited trades during periods of low liquidity, previously. Saxo Bank’s action resulted in lots of complaints.
On 29th January 2015 the FSA requested a comprehensive report of all changes made during the incident and by january 23rd 2015, Saxo Bank had lost US $107 million and by February more than 20 Saxo Bank clients began looking at filing a lawsuit against the firm in an attempt to recover the losses incurred following the unexpected removal of the CHF.
In July of that same year, the Danish FSA released a review of the situations in which it issued two reprimands for “failing to provide information about limitations for when the so-called “dedicated liquidity” applies” and for “not immediately providing information about significant difficulties in executing client orders to clients.
However, in relation to the stop loss orders and the changes to the transaction prices, the FSA concluded that it did not believe that Saxo Bank had acted against the best execution regulations. Furthermore, the Danish FSA ruled that Saxo Bank offered settlement prices for all clients affected contributes to quality of treatment and is unbiased towards the banks own interests.
Saxo Bank stated:
“We take notice that the FSA after a thorough investigation has stated that Saxo Bank’s handling of the events and the application of price adjustments has been consistent with the regulations on investor protection and that the Bank’s terms are not in conflict with the regulations that a financial intermediary must act honestly and professionally towards its clients.”
Previous to this, in 2010, the Bank was accused of manipulating stock currency prices, with a Portuguese Financial Institution claiming it has lost 10 million Euro. Saxo reacted by filing a lawsuit against the institution. Upon investigation in that same year, the Danish FSA found Saxo Bank’s automated trading system to be sufficiently transparent for users, among other things.
However, the FSA ordered an independent investigation, which concluded there were to be no further pursuits on the matter and is said to have cost the Saxo millions. This resulted in harsh criticism towards the Danish FSA with a professor of economic cal, Lars Bo Langsted calling the institute “aggressive”, and claiming that it reports companies to the police for more minor violations.
It was also suggested by The WeeklyFix column that the FSA was pressured to pursue Saxo due to the level of press reports. “There is no doubt the Danish FSA felt under pressure to act…This begs the question since when did financial authorities spring into action on the back of media speculation.”
Saxo Capital Markets
Saxo Capital Markets is Saxo’s UK entity and has operated there since 2006; offering clients a wide range of services aimed at investors, traders, professionals and institutions. Clients with smaller accounts will incur higher fees than competitors including surcharges for small trades and a lack of customer support options.
The bigger your equity, the lower the trading costs and the more benefits you will receive, but higher tiers begin at £50,000, which may be a bit out of reach for many.
Saxo Capital Markets offers an impressive product range including forex, commodities, indices, options, futures, and bonds, all of which can be bought or sold short through its CFDs, forward contracts, and/or direct ownership.
Unfortunately, Saxos fee schedules and hidden costs can be confusing to dismantle. The research offered is comprehensive, but trader education, on the other hand, is lacking.
Overall, none of this is surprising because Saxo’s business objectives really prioritize bigger and professional traders over the small guys.
Commission and spread disclosures can be contradictory, with different quotes for similar or the same instruments. With this, the hidden cost can quickly empty your bank account, with markups, interest rates, and carrying costs for forex, futures, shares and other products.
The varying fees and costs between contracts, CFDs, and direct sale of identical instruments is not well outlined, which contributes towards the lack of transparency that can be found throughout the firm’s platforms and websites.
- Excellent news and research
- Highly customizable desktop platform
- Advanced charting
- Fees, commissions and spread are not transparent
- No cryptocurrencies
- Lack of security features
Saxo bank is considered low-risk and is authorized by six tier-1 regulators, one tier-2 regulator, and no tier-3 regulators. Saxi Bank is authorized by the Australian Securities & Investment Commission (ASIC), Japanese Financial Services Authority (JFSA), Securities Futures Commission (SFC), Swiss Financial Market Supervisory Authority (FINMA), Monetary Authority of Singapore (MAS), and the Financial Conduct Authority (FCA).
Saxo Capital Markets is licensed through the Financial Conduct Authority (FCA) and its clients will be protected if the broker goes bankrupt for up to £85,000 through the Financial Services Compensation Scheme (FSCS).
The firm’s web, desktop and mobile app offer no particular security settings which could increase the risk of unauthorized access. The company’s web disclosures include procedures to ensure the best executions possible, held up by a varied range of direct market access, aggregated and in-house liquidity providers.
However, clients will have no access to guaranteed stop-loss protection, which makes accounts vulnerable to unlimited losses during volatile market conditions, like the Swiss Franc currency crisis in 2015.
Offering of Investments
Traders will gain access to a huge product catalog range through Saxo Capital Markets, including 180 currency pairs, 3,000 ETFs, 5,000 bonds, 200 plus index and community markets, and a list of forex and listed options. Traders can also trade CFDs on over 9,000 products, including stocks, indices, and commodities, to name a few.
Saxo Capital Markets does not offer any cryptocurrencies. Quite a few instruments can be traded through several different venues and order routing techniques, offering a splendid diverse range, although some of these venues will cost you more than average.
Those looking for the basic account can open one for a cool £1,500 which is high in comparison to some other brokers in the UK. Saxo also offers ISAs (Individual Savings Accounts), Joint, SIPPS (Self-Invested Personal Pension), Corporate, and Trust accounts to qualified UK residents. While there is a £0 minimum account requirement on an ISA account, SIPP accounts have an even cooler minimum balance of £10,000.
Withdrawal and Inactivity Fees
Clients will appreciate that they won’t be charged any withdrawal fees, but anyone considering this broker should make sure that they will be staying active or be prepared to face aggressive inactivity fees. Let’s look at all Saxo Capital Markets fees and commissions in more detail.
Commissions & Fees
Saxo offers 3 account types. These are the Classic, Platinum, and VIP. The classic account requires only a £500 minimum deposit and is Saxos base account type.
The second-tier platinum account requires a £200,000 minimum deposit, and the third-tier VIP account requires clients to make a very high (to say the least) deposit of £1,000,000 big ones. The platinum and VIP accounts come with discounted trades.
Saxo clients spreads go down and benefits go up at higher tiers, but they all come with a commission, not to mention a spread on most instruments, including forex.
Specialized accounts and all-inclusive spreads are offered, but comparisons and disclosures are limited to the three accounts based on volume.
Buying and selling UK-listed physical shares will require new clients to default to Saxo’s Classic Pricing Plan. This base pricing allows UK traders to buy shares at 0.10% per trade (a minimum of £8). UK traders trading on foreign exchanges are subject to various commission charges which will depend on the exchange. For instance, traders looking to trade stocks on the Irish Stock Exchange will pay $12 (about £10.5).
Outside of standard share-dealing fees, Saxo clients will pay a few other account fees that it’s good to be aware of. These include inactivity fees, custody fees and market data subscription fees. Here’s a brief outline of each:
Saxo may be charged a £25 inactivity fee after one quarter of inactivity. For example, if there are no trades in October, November, December then a £25 fee may be charged in April.
Saxo charges a custody fee of 0.12% per annum for any accounts holding either an open stock, ETF or bond position, with a minimum fee of €10 charged every month. (or the equivalent in pounds.
Market Data Subscription Fee
Traders can pay a fee to the exchange each month in order to receive real-time market data. For example, the London Stock Exchange standard streaming quotes cost £6 each month. Similarly, to access the US exchanges (NASDAQ and NYSE) you can pay $7 per month.
Overall for Fees
Saxo’s fees overall are competitive solely for traders with balances big enough to access the Platinum or VIP accounts, or for clients who make over 100 trades in a month. Apart from that, the standard £8 minimum charge per trade is average at a push when compared to competitors such as IG and Interactive Investors.
Saxo’s documentation, more often than not, contradicts itself with its fees and trading account for similar and identical products and positions. The fine print adding a separate surcharge on small trades is easily missed and increases the possibility of misunderstandings between clients and the broker.
Platforms & Tools
Saxo offers traders two platforms, the web-based SaxoTraderGo and the desktop-based SaxoTraderPRO. SaxoTraderGo is the more popular platform of the two and receives a high rating overall. SaxoTraderPRO has some useful features and updates that won’t let you down though, so let’s look at the desktop experience first.
Desktop Experience: SaxoTraderPRO
Saxo offers its own trading platform with some major improvements and upgrades in comparison with the MetaTrader4 and 5, which only offers access through an API interface. This platform is wonderfully customizable and the web version lets users access and organize news, research, charts, and watchlists according to specific strategies, as well as monitoring space requirements.
It also provides access to full-featured charting and technical indicators where users can customize their time management.
A wide selection of buy, sell and stop orders are available that easily outnumber competitors, and be accessed on all platforms, including the mobile app.
SaxoTraderGo offers traders a clean design that’s easy to use. It’s highly advanced, and all watchlists are clearly laid out. The highlight of this platform is probably the fact that it’s fast and simple, which might not sound like a lot, but, believe us, it’s hard to come by.
Users can flawlessly go from charting indicators to the stock overview. Nothing there is for show, or unnecessary, like tabs, or extra steps in the process, which can be a part of other UK brokers platforms.
In terms of charting, there are 49 technical indicators and 17 drawing tools. There’s also the option to customize time-period views. The customization offered here lets users easily identify trades in a time-efficient way.
The mobile app offers everything the desktop platform does. Placing and monitoring trades is a simple task, watchlists and price alerts all synchronize to the desktop platform, a really useful feature.
When selecting a stock users will be shown all the fundamentals, trading signals, and a chart on a smaller pop up menu. There is a short indicator list but it’s still quite comprehensive, and real-time news and research can be accessed in just a few swipes.
Ultimately, users won’t have to worry about not having something on the desktop and not the mobile platform because everything transfers over, apart from some research like the broker forecasts. When all is said and done, traders in the UK planning on utilizing trading apps should give this one serious consideration for share dealing.
Research & News
Saxo offers an impressive bank of in-house analysts providing consistent market updates, commentary and ratings, going above and beyond with its research on both SaxoTraderGO and its social-trading website, TradingFloor.com.
Traders can access research tools through either the website or the platform, but its small archive and poor search functionality make it hard to navigate and find exactly what you’re looking for. The Youtube page has a subset of analyst videos but there aren’t many materials available in the research section.
It lacks an economic calendar on the web-based platforms, but you do offer direct access through these platforms.
Any traders looking to analyze global markets will appreciate the in-depth breakdown of each exchange that you can find in the equities section on the research platform. Investing focusing on technical analysis will enjoy the chart patterns that show trading signals, offered by Autochartist.
Saxo offers an informative support page that covers numerous topics including, video guides, account opening, funding and withdrawals, trading products, trading costs, and how to use its platforms. The search function more often than not does not bring up some basic info.
Traders looking for additional support outside of this are asked to submit a case via the trading platform, which isn’t available on the mobile app, yet.
To do this clients can:
- SaxoTraderGO: Navigate to Account > Other > Contact support
- SaxoTraderPRO: Navigate to Menu > Contact support
- SaxoInvestor (only available in Denmark and Singapore): Navigate to the Settings icon > Contact support
There’s also a list of numbers to call per country. But apart from this, there is only a chat-bot that fails to answer basic questions such as how to open an account. The trading platforms themselves have online chat boxes but its ability to converse in the local language is limited to those with higher-tier aka the classic or VIP account which many probably won’t have the funds to go for.
To add to this, the chat is not supported on the demo account which means that anyone looking to enquire more into this broker will need to call or email. Saxo can be found on both Facebook and Twitter but it does not deal with any service inquiries there.
Education: Saxo Academy
Saxo’s educational material primarily covers its products and platforms in the shape of tutorials. There are not so many skill focused resources and no information on fundamental or technical analysis.
There are 21 interactive courses overall through Saxo Academy which finishes off with a quiz to see how much you’ve learned. For example, the course on CFDs titled, CFDs – An Introduction rounds up its 21 video lessons with a summary video and a quiz.
In addition, clients can sign up for weekly (on average) webinars and see all the archived webinars whenever suits, on-demand.
The site offers no glossary, which is a nuisance for lower-skilled clients. This does point towards the overall theme of this broker which aims its service away from smaller and lower-skilled traders. All in all, although there is some thorough content, there is limited education material.
Saxo Capital Markets does gear its services towards more active and professional traders with accounts more benefits for those with bigger equities and higher tiers beginning at £50,000, which will probably be out of reach for most of you.
The brokers offer extensive research facilities, discounted fees which could help clients increase returns but the commission fees are not transparent and spread schedules are not the most competitive, depending on the instrument you are trading.
Smaller and newer traders will be more suited to other brokers, including CMC Markets and IG, due to the surcharges for small trades, lack of educational material, and higher minimum balances, not to mention the lack of support options offered.
A Brief Guide to Saxo: Frequently Asked Questions
Last but not least, below we’re going to answer some of your most frequently asked questions briefly, and to the point. Just how we like it.
Is Saxo Bank a Market Maker?
Saxo Bank may act as a market maker in its products and services. The broker’s disclaimer states the following.
“The Saxo Bank Group may act as a market maker in all products and services not traded on an exchange (i.e. OTC products such as foreign exchange and CFDs) and may, therefore, be the counterparty in any trade conducted by customers in these products. The Saxo Bank Group does not engage in corporate finance activities.”
How Do You Use a Saxo Trader?
Saxo offers a good range of video tutorials on its platforms. To get started, or get an idea of the platform’s features and usability, take a look at the broker’s setting up your workspace video, hosted on YouTube.
How Much Does it Cost to Open a Saxo Account?
Saxo offers 3 account types. These are the Classic, Platinum, and VIP. The classic account requires only a £500 minimum deposit and is Saxos base account type.
The second-tier platinum account requires a £50,000 minimum deposit, and the third-tier VIP account requires clients to make a very high (to say the least) deposit of £1,000,000 big ones. The platinum and VIP accounts come with discounted trades.
Is Saxo Highly Regulated?
Saxo is considered safe as it is fully regulated, adhering to strict regulatory criteria across 15 different jurisdictions, including the UK, Denmark, Singapore and Australia. This is important because the amount of compensation you will be eligible to receive varies drastically across these jurisdictions.
How can I Fund my Saxo Account?
Note: Saxo does not accept payments from accounts that are not on your name (3rd party payments).
Saxo clients can fund their account by taking the following 3 steps, as stated on Saxo’s support section.
- Click on the box Funding Instructions.
- Select the currency for the transfer.
- Select the Saxo account ID you want to fund.
Clients can fund their account in one of the following ways:
- Credit / Debit card
- Funding Instructions for a bank transfer
- Securities transfer (stock transfer).