I have cataloged the pricing for BiG, Atlantico (from a number of posts in this forum) and Bison (from my own experience) in the sheet below (on the Inputs tab) - I do not have confirmation on the lack of a fund setup fee at Atlantico though you are the second person to mention that they had not heard of one - that would be quite surprising however - and is probably a bigger cost than most people are optimizing on the exchange rate.
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To is directed to anyone with IBKR account. I am trying to take advantage of spike in USD vs EURO. With IBKR can I hold EURO and invest directly in EURO denominated funds to avoid negative interest rates? For example, could I buy a ETF in Euros and earn dividends in Euros?
If so , are capital gains calculated EOY on a 1099 form for US tax return for US citizen? I could invest in Europe directly but I am trying to avoid withholding in EU country and having to mess with filing tax return and paying taxes for some $500 a year gain.
Sure. IB marks everything back to USD for you as appropriate. Note that you canāt just buy SPY using EUR since SPY trades in USD - you have go find some fund that is actually denominated in EUR. Iām sure thereās some, but itās more work.
IB handles cap gain calculations for you, yes, same as for any other worldwide security you trade through them.
You may end up having EUR withholding for dividends paid in EUR since thatās a matter of the country the security is listed in. However you can generally just credit the withheld amount against your US taxes, and again IB just handles the accounting for you - though they donāt help you decide whether you need to file 1116 or just take the gimme credit or any such. However TurboTax can handle that well enough for normal purposes.
If you really only want to speculate in EUR, you could just buy FXE, the EUR/USD tracker. Or if you want shorter with more leverage, use 6E futures, though these arenāt exactly cost efficient. Iām long some 6E puts to hedge against future EUR strength against my GV investment; I know Iām losing ~1%/yr but I also know I wonāt get shafted by a 10%+ currency move. But youāre going to pay the interest rate differential one way or the other.
Can you make a post about how you use options to hedge against big USDEUR swings not in your favor? Iām very interested in that
All Iāve done is buy somewhat out of the money long-dated 6E puts in a roughly correct notional size, using an eyeball approach of āhow much do I want to lose on thisā versus āhow much of a swing do I want to protect myself againstā.
Thereās a lot that goes into it and Iām hardly an expert, not enough that Iād want to speak on it. There are a lot of online resources for options hedging strategies. The only real nuance Iām bringing to the matter is the use of options on futures; CME lists a EUR future (ā6Eā, though IB lists it as āEURā) that settles into 125k EUR, and you can buy/sell options on it. Works the same otherwise. However most people should just use options on FXE (the EUR tracker) as itās simpler; thereās mild tax advantages to using 6E but presumes knowledge of how futures work.
As things stand, oneās gone in the money, and weāre not far from the other two going ITM as wellā¦ never expected this. But whatever, thatās why I did it.
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Thank you. That is helpful. Yes, I keep coming back to the FXE as it is the most simple way to speculate without having to hire a foreign accountant to sort everything out at a cost probably exceeding my gains. 
Really appreciate your description of work with BiG. Iāve heard that US banks have a big markup on conversion. So if BiG is only .12%, that would be great. Like to know what you find out.
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Thanks for sharing this and Euro hedging is very important in my view. I think one of the more significant but less talked about risks is the Eurozone breakup risk, which I think is not insignificant over the GV investment horizon. This risk is greater than individual fund risk because any of the 19 members of the Eurozone can cause trouble, not just PT. A monetary union without the support of a fiscal union almost guarantees that the same problem we saw 8-10 years ago will come back again. I think itās critical to hedge that risk. Besides the options approach you mentioned, short FXE outright is also an alternative.
@luzudizi The FXE investment has its purpose but I donāt see it as a good long term solution here. Buying FXE will ensure that future weakness of USD will not materially impact ability to make investments down the road. Besides that, I donāt see that its very useful. Really, unless you have an aggressive timing strategy to shift money around in the face of strength or weakness of one currency or ther other, if the USD vs EUR just bounces as it has for the last few years you are merely tying up capital with no benefit to you.
In my case, I want to convert USD to EUR over the course of a period of time so that a future car purchase or home purchase in EUR is not devalued (or alternatively, if I can dollar cost average into USD strength) I can increase my purchasing power by 5-10% conceivably.
The best way to accomplish this is to shift USD to EUR when USD is strong. FXE can achieve this, but there is still a risk that EUR will regain strength. Therefore, I still need to have a second leg to this strategy which would be to make EUR denominated investments that generate income in EUR over time. That is the part that is more elusive due to PFIC and other considerations one needs to be careful how the investments are structured.
Its also worth noting that if USD gains strength consistently over the next 5 years then all this is moot because I would have been better off just holding USD. Of course, there are no guarantees but the current state of the US economy leads me to believe that scenario wonāt materialize. 
Hi Bret,
Copying the email response from my Big Bank Manager:
āYou understand everything correctly!
I just would like to inform you that in the fees there are some taxes (from our tax authority) so:
For a ā¬ 350k investment, the cost will be:
-
Buy/sell of the fund: 0,15% (1+4%) * 350k = ā¬ 525 + ā¬ 21 -
Custody: 0,10% per year + VAT (23%) = ā¬ 350 + ā¬ 80,50 per yearā
First, I eire 2000 euros to open account ( I will have to pay whatever USAA requires). After the euro account is open, I can open a sub-account in dollars and transfer directly in dollars. I will keep you kerp upu posted on the real transaction details.
Maybe it was a good move to share a bottle of tequila with her when visiting Portugal 
Roger
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The challenge you have is the carry cost, imposed thanks to the ECB. You lose money holding EUR, and the low cost of EUR makes all yields smaller as well. Then too, either you hold securities in your IB account, or you pay a professional money manager and theyāll take a percent or two and yields suck. Youāre basically talking about a timing strategy, and those only work out sometimes, versus you having to fight a 1-2% annual drag; will it really come out?
As an off the wall idea, you might just talk to BlueCrow. At the end of the day, until all this GV kerfluffle, their primary business was that of wealth management, and the Growth fund was really just their āconservative fund playā for their WM customers, as weāve discussed. Itās open to anyone, and if you want to just buy a handful of units, they might well accommodate you. Well, that is, after theyāve figured out what to do with all the rest of their cash. Anyway, Portugal is not Switzerland, and the account minimums for wealth managers might not be that bad.
(Indeed, itās one of the things that went through my mind in my fund choices - a longer term relationship with BC might be more generically useful for money management, just as my choice of lawyer involved a certain amount of realizing that this is someone youāre going to have a very long term relationship with, wouldnāt it be a good idea if they were a bit more than a one-trick pony. Saves having to go find a real estate lawyer when I finally do buy property, etc.)
That said, on a 5-year scale, currencies do tend to trend. Unfortunately it isnāt possible to buy options dated past a year; LEAPs only exist on the US indices, AFAIK.
Got the following from Interactive Brokers yesterday, I emailed their support team with my plan (basically, put money in as USD, convert to EUR, withdraw via sepa to invest) and am waiting to hear back.
During a routine review of your IBKR account, our Compliance Department detected that your brokerage account is being primarily used to transact foreign currencies. While currency conversion is offered on our platform, the service is intended to facilitate trading on international markets, but it is not intended as a mechanism to trade foreign currencies. IBKRās brokerage accounts are offered for the purpose of trading financial instruments. Our company does not offer brokerage account currency conversion and withdrawal only services.
IBKRās compliance team will continue to monitor your account and if the current volume of currency conversion and withdrawal activity continues, we may be forced to take action on your account to prevent such activity.
This was after I made one small (few thousand dollar) test conversion + SEPA withdrawal to pay for lawyer stuff
Iām really not surprised. Itās not a business they want to get into. Itād be too much like being a bank. Thereās simply no money in it for them versus the regulatory rigamarole involved. Iāve had an IB account for a decade now, so one major transaction in the grander scope of things isnāt meaningful.
Iāve been wondering if they would actively flag this (people getting accounts just to transfer money cheaply).
I was considering moving the rest of my portfolio there but if they want to shaft me on this Iāll probably avoid them
I suspect they have an automated system that checks if you have over a certain percentage of your transactions as currency conversion or something like that, which I obviously tripped
Yikes! I was considering something similar and now I need to rethink this approach.
I wonder if it was the third-party payment that flagged it? Iāve transferred Euros twice to personal accounts now (including my big 350k one), and havenāt received any email.
everything about IB is automated. it saves on customer service, which they are fundamentally terrible at.
it may also be the transfer to the third party as Laura suggested. But they still arenāt in the business of moving your money around.
The great news is that I now have a BiG Portuguese bank account - it took about 2 weeks to get via my attorneyās assistance.
I am now facing a language barrier. I am unable to find a BiG app in English (on iOS platform), and (unless Iām just missing it) do not see a button/link on the PC interface to switch the website to English. I tried pasting the URL in Google Translate but this only works for the non-secure ppages of the website. Once you login, you cannot paste the secure URL into Google Translate - it reverts back to the login page.
I appreciate any suggestions you may have, if you have used BiGā¦ otherwise I will just have to wait and speak with my Bank manager, Ana, who has been VERY responsive to my emails.
Time to start cultivating patience and learn that Portuguese
That is surprising. I have now done many transfers to my SEPA account after conversion and did not trip a flag. I think it is driven by the third party transfer.
It does say while you are doing the transfer that this is supposed to be only to your account (or something to that effect). It is possible that a audit found something that made it apparent that this was not your account?
I didnāt have this problem with my first few FX iterations. I have recently started using my IBKR account for investing as well so hopefully itāll keep them from worrying about this if itās a new compliance concern. In any case, I havenāt used IBKR SEPA transfers for any purpose other than moving Euros to my own overseas bank accounts.