BUX: An in-depth review of a Dutch broker

Investing in the financial markets is an important step towards securing your financial future, and choosing the right broker is paramount to this endeavor. With a huge number of options available, choosing the most suitable one can be a daunting task. In this review, we will take an in-depth look at BUX, a Dutch broker, exploring its strengths and weaknesses, commission structure, ease of use, account creation process and security measures. By the end of the review, you will have a clear understanding of whether BUX meets your investment goals or whether another broker may better suit your needs.

Pros and cons of BUX

Before we dive into the details, let's take a look at the pros and cons of BUX:

BUX pros:

Fractional shares: Allows investors to purchase fractional portions of shares, allowing them to invest in expensive stocks with less capital.
Free trades via "Zero Orders": Offers commission-free trading thanks to its "Zero Orders" feature, where orders are executed at the end of the day.
Savings Plan: Automated savings plan that allows users to invest regularly without manual intervention.
Securities Lending: Engages in securities lending, facilitating profits and maintaining competitive transaction fees.

BUX cons:

Monthly service fee of 2.99 euros: Charges a monthly subscription fee, which may discourage inactive traders.
No itsme authentication: No itsme authentication, which may affect the convenience and security of account verification.
Trade Encouragement: Despite the subscription model, the platform may encourage trading activity, potentially leading to unnecessary risks.

Now let's delve into the intricacies of how BUX works.

BUX History

Founded in 2014, BUX has quickly become a well-known Dutch neo-broker offering a user-friendly trading app that facilitates commission-free investing. While BUX boasts a hassle-free investing experience, one can't help but notice the monthly service fee, which sets it apart from fully commission-free platforms. Despite this, BUX's expansion beyond the Netherlands into several European countries is testament to its growing popularity, with around 700 000 customers across the EU. In addition, the acquisition of BUX by ABN Amro in December 2023 is a testament to its growing importance in the financial world, which is subject to regulatory approval.

Commissions

Understanding the fee structure is crucial to assessing the cost-effectiveness of BUX. Although opening an account is free, the monthly service fee of 2.99 euros is noteworthy, especially for long-term investors. However, BUX offers competitive transaction fees and provides the opportunity to trade commission-free via "zero orders". Additional fees, such as a 0.25% currency markup on purchases of US stocks, and the fact that subscription fees are retained even during periods of inactivity, are noteworthy.

Convenience of BUX

The convenience of BUX lies in the variety of features including savings plans, fractional shares and competitive interest rates on uninvested cash. Despite the availability of customer support, some users have expressed concerns about accessibility and responsiveness. Moreover, BUX's encouragement of trading activity and promotion of risky investments such as virtual currencies merit cautious consideration.

Account Opening

The process of creating an account on BUX is relatively simple, although it does not involve authentication. Potential users can sign up via a mobile app or web platform, and verification is usually completed within a day. However, the lack of child accounts, joint accounts and business accounts may limit flexibility for some investors.

Is BUX safe?

Investment security is paramount, and BUX's compliance measures and investor protection are noteworthy. Regulated by the AFM in the Netherlands, BUX has a clean record with regulators. While the 20 000 euro investor protection scheme and the 100 000 euro deposit guarantee scheme provide a certain level of security, users should be mindful of securities lending practices and the risks involved.

BUX compared to other brokers

When comparing BUX to alternative brokers, its unique offerings, including fractional shares and competitive transaction fees, are noteworthy. However, users should evaluate their individual investment preferences and requirements to determine the most suitable platform.

Conclusion

In conclusion, BUX is an outstanding neo-broker offering a user-friendly platform with competitive features. While its subscription model and incentives for trading activity may not appeal to all investors, its convenience and regulatory compliance make it a viable option for many. Ultimately, by weighing the pros and cons outlined in this review, investors will be able to make informed decisions in line with their financial goals.

Questions you may have

Q: Can BUX be trusted?

A: Yes, BUX's regulatory compliance and investor protection measures are trustworthy despite certain associated risks.

Question: How does BUX make money?

Answer: BUX generates revenue through subscription fees, transaction fees, currency exchange mark-ups and securities lending practices.