A Wertpapierdepot is simply a securities account. It records and holds your investments, such as ETF units, individual shares and bonds. You generally need one to buy ETFs through a bank or broker. It's not your everyday bank account, and opening one doesn't mean you have to invest anything straight away. 12 Below we walk through how a Depot works, how to open one, what really happens to your investments if a broker fails, and what to check before you pick a provider.

The short answer

  • A Depot is the account in which your securities are recorded and held.
  • A broker lets you buy and sell. The institution that keeps your securities safe may be the same company or a separate custodian.
  • A Verrechnungskonto is the cash account that goes with it. Deposits, purchases, dividends and sale proceeds run through it.
  • ETFs and shares held in custody are not ordinary bank deposits. As a rule, your securities stay your property if the custodian goes bust. They can normally be returned or transferred, subject to legal and contractual conditions. 3
  • Eligible bank cash deposits are generally protected up to €100,000 per depositor per bank, but that is a different protection from the custody rights over securities. 3
  • A free Depot doesn't mean free investing. Order fees, spreads, exchange fees and fund costs can still apply. 4
  • Check whether the provider handles German tax withholding. Not every company operating in the EU does that for you. 56

So what exactly is a Wertpapierdepot?

A Depot is an account for Wertpapiere, or securities. Unlike a Girokonto (current account), it records investment positions: the shares and fund units you own.

For example, your Depot may show:

Security Holding What it means
A global equity ETF 8.4 ETF units You hold units in that particular fund
Shares in a company 3 shares You hold shares in that company
A bond €1,000 nominal amount You hold a debt security subject to its terms

These holdings are illustrative, not investment recommendations. Some platforms allow fractional units; the legal and transfer arrangements for fractions can differ from those for whole securities.

You do not typically receive paper certificates. The institution maintains electronic records, and most securities are held through custody and settlement systems. Your Depot statement (Depotauszug) lists what you own. 17

Three accounts, three jobs:

  • Girokonto = the bank account for everyday payments.
  • Verrechnungskonto = the cash account connected to investing.
  • Wertpapierdepot = the account where your investment holdings are recorded.

Isn't a Depot the same as a broker?

A Depot is an account. A broker is a service provider or intermediary through which you can place investment orders. A custodian is responsible for the safekeeping or administration of securities. They're often connected, and sometimes they're not the same company.

When comparing platforms, identify the legal entity that holds your account. The app's brand name is not enough.

Does a Depot automatically invest my money?

No. Opening a Depot isn't an investment in itself. You must place an order, set up a savings plan or otherwise authorize a service to invest on your behalf. Depending on your provider, the associated cash account may earn interest or have additional conditions; those terms are separate from the ETF's investment performance.

Tap through it

Follow €200 from your bank account into an ETF

Your bank account Girokonto

Your salary lands here. This is everyday money for rent, groceries and transfers.

Good to know: Eligible deposits at a bank in the EEA are generally protected up to €100,000 per person per bank.

The full story: what a Depot is and how it's protected

Your first €200 ETF purchase, step by step

Let's follow Alex, a hypothetical investor who lives in Germany and wants to make a €200 ETF purchase. The example assumes adequate available cash and ignores fees for simplicity.

Step 1: open a Depot. Alex completes an account application and identity verification with an eligible provider.

Step 2: connect or fund the cash account. Alex transfers €200 to the account used to settle trades, or authorizes a supported funding method.

Step 3: find the right investment. Alex searches for the ETF using its ISIN (International Securities Identification Number), checks its product documents and makes sure the correct share class is selected.

Step 4: place an order. Alex chooses a supported order type or schedules a Sparplan. Actual execution price and quantity depend on market conditions, product price, order instructions and fees.

Step 5: settlement and custody. The resulting ETF position appears in the Depot. Money used to settle the trade leaves the associated cash account.

Step 6: keep an eye on it. Alex can see the number of units, market valuation and transaction documents. Market value can rise or fall.

  1. Your bank accountYour everyday Girokonto.
  2. Cash accountVerrechnungskonto: money waiting to be invested.
  3. OrderYou buy, or a savings plan buys for you.
  4. Trading venueAn exchange or a trading partner executes the order.
  5. Your DepotThe units are recorded in your name.

Securities in custody

Your ETF units are your property. If the bank or broker fails, they are normally handed back or transferred.

Cash in the account

Eligible bank deposits are protected up to €100,000 per person and bank. That is a different protection.

Market risk

No scheme protects you when prices fall. A drop in value is investment risk.

From your bank account to your Depot, and the three separate kinds of protection. Source: BaFin.

What happens to your ETFs if the broker goes bust?

It's worth understanding this before you compare app designs or sign-up bonuses.

There are three separate questions here: custody of your securities, protection of your cash, and investment risk.

1. Securities held in custody

Shares and fund units held for you by a custodian are generally not assets of the custodian available to ordinary creditors. Under normal conditions, you can demand their return or transfer if the custodian becomes insolvent. There can be complications if assets cannot be returned, if they were used as collateral, or if the product is not actually a conventional security held in custody. 3

For qualifying investment funds, the assets inside the fund are also subject to a distinct legal separation from the fund management company's own assets. That fund-level segregation is not the same rule as the customer's custody rights against a broker. 8

2. Cash awaiting investment

Eligible deposits at an EEA bank are generally subject to deposit-guarantee rules. In Germany, the statutory standard is €100,000 per depositor per bank; separate conditions and exceptional temporary balances can apply. 3

But not every balance an investing app shows as 'cash' is a straightforward covered bank deposit. Some cash products may involve different arrangements, including money-market investments or omnibus accounts. Check what legally holds your cash and which protection scheme applies.

3. Investor compensation if assets cannot be returned

If a securities institution cannot fulfil certain obligations to return clients' assets or funds, an investor-compensation scheme may apply. Under the relevant German statutory scheme, eligible claims are generally covered for 90% of the claim up to €20,000, subject to its conditions. This is not a €20,000 cap on the value of securities you are allowed to own. 3

What none of this protects you from

These protections do not pay you back when:

  • a stock market falls;
  • your ETF loses 30% of its market value;
  • an investment underperforms expectations;
  • you choose a risky or unsuitable product.

A €50,000 ETF portfolio could fall to €35,000 in a market downturn. That €15,000 decline is investment risk, not an insured bank-deposit loss.

In short: the legal protection of your holdings and how your investments perform are two separate things.

Want the nerdy details?The rules, the exact numbers and the edge cases. Open it whenever you're curious.
  • Branch bank, direct bank or app? The types of Depot
  • If the Depot is free, where do the costs show up?
  • Opening a Depot: what you'll be asked for
  • How does Germany tax what's in your Depot?
  • Can you switch brokers later?

Branch bank, direct bank or app? The types of Depot

Provider model Typical experience Questions to ask
Branch bank (Filialbank) In-person service may be available What are custody and per-order fees?
Direct bank (Direktbank) Online banking plus securities services Which ETFs and savings plans are supported?
App-first broker (Neobroker) Mobile-first buying and savings plans Who is the contractual entity and custodian? What are spreads and execution venues?
Cross-border broker Access through an EU/EEA or other foreign legal entity Does it accept German residents, and what is its actual German tax-handling arrangement?

Common names encountered in Germany include Trade Republic, Scalable Capital, ING, DKB, comdirect, Consorsbank, flatex, finanzen.net ZERO, SMARTBROKER+, Trading 212, DEGIRO and Interactive Brokers. Our Broker Comparison shows each of them with conditions read from the provider’s own price list and the date we checked it. It has no ranking. Providers may use different legal entities and onboarding arrangements.

Before signing up, check the institution's legal name, applicable authorization and whether it accepts your residency and circumstances. BaFin publishes company information and warnings; cross-border services may involve supervisors elsewhere in the EEA. 9

Want to compare them? Our Broker Comparison shows fees and German tax handling, each value linked to the provider's own price list with the date we checked it. No rankings.

If the Depot is free, where do the costs show up?

'Free Depot' usually means no regular account fee under a particular pricing plan. It doesn't mean buying and holding an ETF costs nothing.

Cost German term When it can matter
Account/custody fee Depotführungsgebühr Recurring provider charge
Buy/sell order fee Ordergebühr Buying or selling securities
Savings-plan execution fee Sparplangebühr Automated contributions
Spread Geld-Brief-Spanne Difference between quoted purchase and sale prices
Trading venue / third-party fee Handelsplatzentgelt / Fremdspesen Depending on venue and provider
Currency exchange Währungsumrechnung If a transaction requires currency conversion
ETF ongoing charges Laufende Fondskosten / TER Costs inside the fund, not usually a separate broker invoice

Trading costs and ongoing fund expenses are different. An ETF's TER is normally reflected in its fund value over time and is not a fee debited separately with each monthly contribution. The total cost of owning an ETF may extend beyond TER alone. 48

Why a €1 fee matters more on small amounts

A hypothetical €1 execution fee represents:

Purchase amount Fee Fee as share of purchase
€50 €1 2.0%
€200 €1 0.5%
€500 €1 0.2%

These figures are examples, not actual fees charged by a named broker. Compare the current price list (Preis- und Leistungsverzeichnis) and check whether any promotional price is temporary. 4

What about spreads and execution times?

A provider can advertise low commissions and still execute at prices that vary by trading venue and time of day. Compare the all-in cost, not only the headline order charge. A limit order can help set a maximum purchase price or minimum sale price, although it may not execute. 4

Opening a Depot: what you'll be asked for

Every provider is a bit different, but a normal online application usually goes like this:

  1. Check residency and acceptance rules. Confirm that the provider serves people living in Germany, including any restrictions tied to nationality, tax residency or US-person status where relevant.
  2. Prepare identification. A valid passport or national ID and sometimes residence documentation or address verification may be requested.
  3. Provide personal and tax details. You may be asked for your German tax ID (Steueridentifikationsnummer), tax-residence details, address, occupation and investment experience.
  4. Complete identity checks. A provider may offer video identification, app-based identification or another legally accepted process.
  5. Set up the payment connection. Confirm the reference bank account and/or Verrechnungskonto.
  6. Read the fee schedule and custody information. Check actual legal entities, account terms, protection scheme and execution policy before placing money.
  7. Learn the tax settings. If the provider supports German Freistellungsaufträge, understand how to allocate your allowance.
  8. Secure the account. Enable available strong authentication, use unique credentials and keep transaction records.

Some providers ask for an Anmeldung, a residence permit or a German IBAN. That's their rule, not a legal requirement for every broker. The broker's rules and verification process control the actual documents needed. 2

How does Germany tax what's in your Depot?

For a person who is a German tax resident, ordinary investment income can be subject to the German capital-income tax system. The standard Kapitalertragsteuer rate is 25%, plus a 5.5% solidarity surcharge on that tax, and church tax if applicable. Without church tax, that basic combined rate is 26.375% before applicable allowances and fund-specific adjustments. 5

That doesn't mean 26.375% of your whole portfolio is taxed every year. Taxes relate to taxable investment income or gains, applying the legal rules for the particular asset and event.

Does your broker take the tax off, or do you report it?

Providers handle German taxes differently:

  • Some providers automatically withhold applicable German capital-income tax and can accept Freistellungsaufträge under their German tax setup.
  • Others may not withhold German tax for your account, meaning you may need to calculate and declare relevant investment income yourself.

The deciding factor is the specific account and legal/tax infrastructure, not simply whether the brand sounds German or has its headquarters elsewhere. A cross-border platform may have special German withholding arrangements, while a different foreign account may not.

Don't assume a PDF tax report means the provider has already paid anything to the Finanzamt.

What is a Freistellungsauftrag?

For 2026, the Sparer-Pauschbetrag is €1,000 per eligible individual and €2,000 under qualifying joint assessment. A Freistellungsauftrag tells a participating institution to apply your allowance to relevant capital income when withholding tax, to the extent available. Allowances assigned across institutions must not exceed the permitted total. 6

For example, if you have accounts with two institutions, you may split an individual €1,000 allowance into €600 and €400. The total across all institutions stays at €1,000. These allocations are illustrations; actual eligibility and application depend on the tax situation.

What about accumulating ETFs?

Accumulating ETFs can also be subject to the Vorabpauschale mechanism under German investment-tax rules, even if you have not sold units. Qualifying fund classifications may benefit from Teilfreistellung. These concepts belong in separate, detailed guides. 10

And a foreign broker?

For investment-fund income not subject to German withholding, Germany's tax-return guidance identifies Anlage KAP-INV for relevant investment income and Anlage KAP for other required capital-income information. The correct forms depend on the holdings and tax year. 10

Can you switch brokers later?

Often, yes. You can ask to transfer eligible securities between depots (Depotübertrag). You keep your units and do not need to sell and buy again.

Key points:

  • Confirm that the new institution supports the specific ISINs and custody arrangements.
  • Ensure acquisition values (Anschaffungsdaten) and relevant tax information are transferred correctly when applicable.
  • Understand whether fractions of securities can be transferred; some may need special handling or sale.
  • Review consequences if the transfer involves a change in beneficial owner, a gift, an international move or a different tax jurisdiction. These are not the same as a simple own-name transfer.
  • Retain purchase and transfer statements and verify your new Depot balances.

BaFin's supervisory guidance states that a transfer should generally be completed within three weeks, with information duties when a transfer takes longer; cross-border custody can create exceptions. 11

Don't confuse a simple transfer between your own accounts with a sale. The tax consequences can be very different. 12

Seven mistakes we'd love to help you skip

1. Assuming all assets displayed in an app are covered like cash deposits. Securities, cash, derivatives and other products can have different legal protections.

2. Choosing based only on '€0 trading'. Compare actual order costs, spreads, savings-plan fees, holding costs and execution arrangements.

3. Believing that the broker's country determines your income-tax obligations. Your German tax residency and the tax rules still apply. Withholding is about who does the admin, not whether you owe tax.

4. Buying the wrong ETF share class. Similar names can refer to different indices, distribution policies or currencies. Verify the ISIN, factsheet and KID.

5. Forgetting taxes on a foreign Depot. The absence of withholding does not automatically mean the income is tax-free.

6. Confusing a savings plan with guaranteed returns. Automatic monthly purchases do not remove market risk.

7. Treating a broker's promotional content as independent advice. Marketing is not an appropriate substitute for understanding product risks.

Questions people often ask about Depots

Can a non-German citizen open a Depot?

Often yes, if the provider accepts the person's country of residence, identity documents, tax status and other eligibility conditions. Citizenship alone does not determine eligibility, and not every broker accepts every applicant.

Do I need to speak German?

Not necessarily. Interfaces and support languages differ by provider. However, official documents, tax notices or contractual material may still be supplied in German. Check the languages available for the actual account.

Can I have more than one Depot?

Generally yes. Multiple depots are possible, but you should track tax allowances, costs, records and overlapping investments across providers.

Can I use my normal bank account instead of a Depot?

A normal current account is not itself a securities custody account. Some banks offer both banking and investment services within the same app, but the underlying accounts remain functionally different.

Is an ETF Sparplan the same thing as a Depot?

No. A Sparplan is a recurring instruction to invest. The Depot is where the resulting ETF position is held. 1

Does deposit insurance protect me if my ETF loses value?

No. Statutory deposit insurance protects certain cash deposits, not normal stock-market losses. 3

Are ETF units protected if my broker fails?

Under normal custody arrangements, securities can generally be returned or transferred in insolvency. But check the actual product, custodian and terms, particularly for fractional units, derivatives or collateralised arrangements. 3

Can I keep my Depot if I leave Germany?

That depends on your broker's cross-border customer policy and your new country of residence. Tax obligations may change substantially when you move, and keeping the account does not itself settle those obligations. Tell your provider before you move and check the tax rules of your new country.

Is it better to use a German broker or a foreign broker?

There's no answer that fits everyone. Compare tax handling, custody arrangements, investor protection, fees, products, ease of use and whether they accept your residence. Our broker comparison shows verified facts. It doesn't recommend a broker for you.

German words you'll see on your Depot

German English explanation
Wertpapierdepot / Depot Securities custody account
Broker / Depotbank Broker / securities-account bank
Verrechnungskonto Cash or settlement account associated with trading
Depotübertrag Transfer of securities between custody accounts
ETF-Sparplan Recurring ETF purchase instruction
ISIN / WKN Security identification codes
Freistellungsauftrag Instruction to apply a qualifying capital-income allowance at an institution
Sparer-Pauschbetrag Annual German savings allowance for eligible capital income
Kapitalertragsteuer German withholding tax on capital income
Depotauszug Depot holdings statement
Anschaffungsdaten Acquisition information, including purchase cost basis
Preis- und Leistungsverzeichnis Provider's fee schedule

Check yourself

Your broker goes bust. What generally happens to the ETF units in your Depot?

Video lesson · In the makingWhat is a Depot?

Official sources

  1. Verbraucherzentrale Niedersachsen: In ETF investieren – so geht’s. What a Depot is; settlement accounts; identity verification
  2. Verbraucherzentrale NRW: Geldanlage und Altersvorsorge. Depot accounts and savings-plan context
  3. BaFin: Einlagensicherung und Anlegerentschädigung. Detailed distinction between custody rights, bank deposit insurance and investor compensation
  4. Verbraucherzentrale: Welche Vorteile und Nachteile haben ETFs?. Order fees, price lists, venues and savings plans
  5. German Federal Ministry of Finance: Abgeltungsteuer. German investment-income tax guidance
  6. Berlin Senate Finance Administration: FAQ Freistellungsaufträge. Allowance, splitting instructions and validity
  7. Verbraucherzentrale: Wertpapierdepot: So führen Sie es, so können Sie es wechseln. Statements and transfers
  8. Verbraucherzentrale: ETF-Kauf: Auf diese Kriterien sollten Sie bei der Auswahl achten. ETF structure, accumulation and distributions
  9. BaFin: Warning about unauthorized providers. Check authorization and legal entity, not marketing
  10. ELSTER: Tax return guidance: Anlage KAP-INV. Investment-fund income not subject to domestic German withholding
  11. BaFin: Wertpapiergeschäft (brochure), Depotübertrag. Supervisory transfer timeframe and delays
  12. German Federal Ministry of Finance: Einzelfragen zur Abgeltungsteuer (14 May 2025), transfer scenarios

Last checked:

We explain how the German rules work in general. This isn't personal financial, tax or legal advice. Investments can lose value.

Where to go from here

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