Last week, three different people emailed me the same question: should I let Interactive Brokers auto-convert my currency when I buy US stocks, or is it smarter to do the FX conversion manually first? Nobody really explains this clearly, so the same question keeps coming up, and it is a good one because currency conversion is the sneaky cost that most investors completely miss. The headline commission is tiny, but the FX spread on every deposit or trade can quietly drain hundreds of euros a year.
I am going to keep this short. I will give you the rule I actually use, show you the math, and point you to a longer guide if you want the full breakdown.
The Short Answer
Here is the rule, in three sentences. If you are converting less than roughly $6,667 in one go, just let IBKR auto-convert. If you are converting more than that, do it manually. That is genuinely it.
Why FX Fees Matter More Than Commissions
Most investors fixate on the headline commission. They will happily compare a $1 trade at one broker against a $0 trade at another, and pick the cheaper one. Meanwhile, both brokers are charging them 0.5% to 2% on the currency conversion that happens in the background every time they deposit or buy a foreign-currency asset. At a €10,000 deposit, the gap between a good FX rate and a bad one is hundreds of euros, and that hit repeats every time you add money.
To put it in context, Trading 212 charges 0.15% on FX, eToro bakes in around 1.5% in its spread, and high-street banks typically sit somewhere between 2% and 4% when you buy foreign shares through them. IBKR, at 0.03%, is in a completely different league. That is not marketing, it is just where the numbers land. If you want a broader view of broker costs, my best stock brokers for UK investors guide breaks down the full picture.
The $6,667 Rule Explained
On IBKR, you have two ways to move between currencies.
Auto-conversion happens when you buy an asset priced in a currency you do not hold. For example, you have euros in your account and you buy Apple, which trades in USD. IBKR handles the conversion automatically and charges roughly 0.03% baked into the rate. No minimum, no fixed fee, just a tiny percentage.
Manual conversion means you place an FX order yourself on IDEALPRO, the IBKR currency market, before buying the stock. The cost is 0.20 basis points (0.002%) on the amount, with a $2.00 minimum per order. The percentage is basically nothing. The catch is the $2 floor.
The breakeven is simple arithmetic: $2.00 divided by 0.0003 equals $6,667. Below that amount, the 0.03% auto fee is cheaper than the flat $2 minimum. Above that amount, the $2 flat fee beats a growing percentage.
How I Actually Do It
In the IBKR Client Portal, open the Order Ticket and click the Convert Currency tab. Pick your source currency (the one you already hold), pick your target currency, enter the amount, and submit the order. It takes about 30 seconds and settles almost instantly during market hours.
One thing to flag: this manual route requires the IBKR Pro pricing plan rather than IBKR Lite. For most investors outside the US this is already the default when you open an account, but it is worth checking your account setup before assuming. If you are already an IBKR user and want to separate strategies, my guide on opening a second Interactive Brokers account walks through that process.
Want The Full Breakdown?
I wrote a full deep-dive on this topic for MatchMyBroker, my broker comparison site. If you want the complete walkthrough including the tiered pricing table, a cost comparison at 7 different conversion amounts, and step-by-step screenshots of the manual process, read the full IBKR currency conversion guide on MatchMyBroker. For most people, though, the short answer above is genuinely enough.
If you only take one thing away from this, make it this: check the amount. Below roughly $6,667, stop overthinking it and let IBKR auto-convert. Above that, spend 30 seconds on the manual route and keep more of your own money in your pocket. The rule is that boring, and that reliable.
Frequently Asked Questions
Manual FX on the IDEALPRO venue is the cheapest method for conversions above roughly $6,667, where the $2 minimum commission beats the 0.03% auto-conversion spread. Below $6,667, auto-conversion is cheaper. Either way, IBKR is cheaper than almost any other retail broker for currency conversion.
No. Manual FX on IDEALPRO is an IBKR Pro feature only. IBKR Lite focuses on commission-free US stocks and ETFs and does not use the same tiered FX commission schedule. Most investors outside the US are automatically placed on IBKR Pro when they open an account, so this is usually a non-issue.
Settlement is T+2 for most major currency pairs. In practice, the converted currency appears in your cash balance straight away for trading, so you can place a US stock order immediately after the FX fills. T+2 only matters if you plan to withdraw the cash out of IBKR.
Yes, if you want access to manual conversion on IDEALPRO. Auto-conversion works on both plans at 0.03%, but the $2 minimum and 0.20 basis point tiered commission that make manual FX so cheap at scale are only available on IBKR Pro.
Disclaimer: Investing involves risk. The value of your investments can go down as well as up, and you may get back less than you invest. This article is for informational purposes only and does not constitute financial advice. This article contains affiliate links, meaning I may earn a small commission if you sign up through them, at no additional cost to you.
