Recently, many novice investors have been asking the same question: how exactly do I buy U.S. stocks? Actually, many people don’t understand what a cross-border agency order is, so I’ll organize my understanding here.

In simple terms, a cross-border agency order means you place orders for overseas stocks through a Taiwanese brokerage. You don’t need to open an overseas account yourself, nor handle remittances; everything is handled by the domestic broker who forwards your order to their overseas partner broker for execution. The whole process is like this: you place an order via the Taiwanese broker’s app, the broker then transmits your order to an overseas broker registered on a U.S. exchange, after the trade is executed, the result is reported back to the Taiwanese broker, and finally your account is updated. It sounds a bit complicated, but it’s basically an intermediary agent concept.

Why is it called a cross-border agency order? Because the order isn’t placed directly with the overseas broker, but is transferred through the Taiwanese broker, hence the name. This method is actually quite convenient for long-term investors, allowing settlement in TWD, dividends to be directly transferred back to the domestic account, and tax issues handled by professionals.

However, while cross-border agency orders seem convenient, the costs aren’t as attractive. The commission fee is about 0.1% to 1%, with a minimum fee usually starting at $25 to $50 USD. In addition, there are transaction fees, TAF fees, and other miscellaneous charges, which can add up to a higher total cost compared to directly using an overseas broker. If you trade frequently, these fees can eat into your profits significantly.

To open an account, you need to prepare two forms of ID, a seal, a bank account copy, and then sign a contract at a branch or apply online. Anyone over 18 years old who is a Taiwanese citizen can open an account. When opening, choose the settlement currency—usually TWD is the most convenient.

Currently, the main cross-border agency brokers in Taiwan include Fubon, Yuanta, Cathay, E.SUN, and KGI. Their fees are roughly between 0.5% and 1%, but Cathay recently reformed and eliminated the minimum fee, offering the biggest discount. Honestly, the fees among these are quite similar, and you can negotiate. But compared to opening an account directly with an overseas broker, cross-border agency orders are still more expensive.

There are a few trading rules to note with cross-border agency orders. First, only limit orders are allowed; you cannot place market orders for immediate execution. Your account must have sufficient funds; otherwise, the order won’t go through. U.S. stock trading hours are from 9:30 a.m. to 4:00 p.m. U.S. time, which is 9:30 p.m. to 4:00 a.m. Taiwan time during daylight saving. After a trade, buying is settled T+1, and selling is settled T+3.

Cross-border agency orders are suitable for investors who don’t trade frequently and want to hold long-term. If you want low costs and simplicity, you might consider U.S. stock CFDs, which have rates as low as 0.01% to 0.015%, suitable for high-frequency traders. But if you truly want the lowest costs, opening an account directly with an overseas broker is the most cost-effective choice, though the entry barrier is higher, and most interfaces are in English.

Overall, a cross-border agency order is a compromise. It’s convenient, safe, and easy, but the fees are relatively high. If you have a large amount of capital, trade infrequently, and are willing to hold long-term, a cross-border agency order is actually sufficient.