Interactive Brokers Review – A Solid Platform
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Fast Facts
Availability:
Across 220 countries
Products:
Stocks, mutual funds, ETFs, cryptocurrency and more
Cost:
Two pricing tiers: IBKR Lite and IBKR Pro
Account minimum:
None
Mobile app:
Yes
Service:
Open for international investors
American investors have many options when it comes to investing. From real estate and mutual funds to crypto and even collectibles, there’s no shortage of ways to grow your money. The pool of investment options seems to shrink for people who choose to live and work abroad or have a partner who’s not an American citizen.
However, Interactive Brokers may be just the solution you want in an online broker. As long as you live in one of the countries where IBRK operates, you should at least consider it as your entry to investing. And, since they operate in more than 220 locations, there’s a good chance that you can invest with IBRK.
As one of the best brokers for online brokers, they make it easy for investors to find and compare investments in the currency of their choice. And when it comes to investor education, you’ll find a comprehensive library of written and video content to teach you, no matter whether you’re a beginner or a seasoned investor.
In this article
What are Interactive Brokers?
Offering some of the lowest trading fees in the industry and a plethora of trading options, Interactive Brokers has been helping investors for four decades. With Interactive Brokers, you can put your money in various investments, including stocks, ETFs, Forex, Cryptocurrency, bonds, and futures. Users can spread out the risk and volatility of the markets with international trading.
Interactive Brokers is regulated by authorities, including the US Securities and Exchange Commission (SEC) and the UK Financial Conduct Authority (FCA), making it a safe platform through which you can invest from more than 220 countries and territories worldwide.
With the IBKR mobile app (available on Android and IOS), you can stay up to date on the market while you’re on the go. The online version is generally easier because so many features are better viewed on a larger screen. Still, there is plenty of functionality to engage in mobile trading easily and efficiently.
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How does Interactive Brokers work?
Signing up for Interactive Brokers is simple but does take more than five to ten minutes. After clicking the “open account” button, you can choose your location and see the specific documents and information you need to provide. At this point, you can also change the language. Besides English, you can use French, German, Spanish, Russian, Italian, Chinese, and Japanese.
If you’re unable to finish your application in one sitting, you can save your progress and complete it later.
Unsure which account is best for you? There’s a guide to help you choose the right one for your financial goals.
After you set up a funding source, you’re ready to start investing.
From the investor dashboard, you’ll be able to find the educational resources and analytics tools that can help you uplevel your investing experience.
How much does Interactive Brokers cost?
Interactive Brokers is a solid low-cost option for stock trading. There are no account minimums or account fees like annual and inactivity fees. There are no withdrawal fees either. Interactive Brokers offers two pricing tiers: IBKR Lite and IBKR Pro.
For IBKR Lite users, you get unlimited free trades on all stocks and ETFs listed on the US exchanges. With IBKR Pro, the cost to trade stocks is $0.005 per share, with a minimum of $1 and a maximum of 1% of the total trade value. An IBKR Pro account will give you additional investment options outside the US market.
Here’s how the IBKR Lite and IBKR Pro accounts compare.
IBKR Lite | IBKR Pro | |
Stocks/ETFs (tired) | $0 per share (US exchange) | $0.0005 to 0.0035 per share |
Stocks/ETFs (fixed) | $0 | $0.005 |
No Transaction Fee ETFs | $0 | $0 |
Fixed and tiered pricing
Tiered pricing is available for high-volume traders. Pricing depends on the amount you’re trading. Here’s an overview of how fixed and tiered pricing compare, where available.
Fixed pricing | Tiered pricing | |
Futures | $0.85 per contract | $0.25 to $0.85 per contract |
Options | $0.65 per contract | $0.15 to 0.65 per contract |
Spot Currencies | N/A | $0.08 to 0.20 basis points per order |
U.S. Corporate & CDs | N/A | 0.025% to 0.1% |
U.S. Municipal Bonds | N/A | 0.0125% to 0.05% |
U.S. Treasuries | N/A | 0.0001% to 0.002% |
Cryptocurrency | N/A | $0.12 to 0.18 x Trade Value |
Mutual Funds | N/A | Lesser of 3% or $14.95 |
Trade desk commissions
For broker-assisted trading for US stocks, options, futures, and options trading, there is a minimum order of 10,000 shares or 100 contracts. Commissions range from $0.01 per share to $3 per contract. Minimums range from $95 to $300. Third-party fees may be charged for exchange, clearing, regulatory, transaction, and overnight fees.
Account minimums
There are no account minimums or inactivity fees for either of the account types at IBKR. There are, however, various fees depending on what asset classes you’re trading, the volume, and the country. Find the updated IBKR fee list here.
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Interactive Brokers features
Low trade cost
IBKR Lite clients enjoy $0 commissions on US-listed stocks and ETFs. Beyond that, commissions and fees are low for those who invest with IBKR Pro. Discounts are offered for investors with high trade volumes.
Vast range of investments
There’s something for every investor on IBKR. Among the investments you can choose are:
- Stocks
- ETFs
- Mutual funds
- Penny stocks
- Bonds
- Forex
- Cryptocurrency
- Futures
- Options
- Fractional shares
Mobile app
With the mobile app, you can research and make trades from anywhere. The app is intuitive and includes tools available online, including screening and strategy tools.
Research and data
Interactive Brokers offers various tools that will help you dig deeper into the investing world and get real-time data that you can use immediately.
There’s a stock screener that has 49 presets but allows you to create your own customized settings to use. Hundreds of data points are available, allowing you to make well-educated trading decisions. You can opt into daily emails that give trading ideas and analyst recommendations.
IBKR GlobalAnalyst
With the free IBKR GlobalAnalyst, you can explore new investment opportunities with its ability to compare prices and metrics on global stocks but in the same currency. Search filters include region, asset class, industry, currency, and market cap. You can also enter up to 25 stock symbols to track companies you already follow.
Your report will include a variety of ratios, with the weighted average at the top. All the data is easy to read since you can see all results in the currency of your choice. This makes it simple to compare companies from various regions with a common price. The weighted average helps you understand how each company compares to the others as an entire group.
PortfolioAnalyst
Free with a basic IBKR account, the PortfolioAnalyst is a feature you don’t want to miss. Link your investments and accounts, including savings, checking, annuities, and credit cards, to get a complete picture of your financial situation. This helps you make financial decisions now as you plan for your future.
For IBKR customers, the advanced features include real-time updates plus your internal rate of return (IRR) for your investments. The Tax Optimizer tool includes the ability to run “what-if” scenarios to test various strategies and maximize tax efficiency.
IB Trader WorkStation (TWS)
Available only to PRO clients, the IB Trader Workstation is a proprietary tool designed for both new and advanced traders. With TWS, various trading tools will help you find and analyze trades. The TWS can be downloaded on Windows, Mac, and Linux operating systems.
Traders can trade on more than 100 global markets from one account. This includes stocks, bonds, funds, Forex, options, and futures. The charts are customizable on many analytical tools, charts, and technical indicators. To get even more out of TWS, you can stage orders for execution later. Additionally, you can set a conditional order that is placed once specific conditions are met or connect third-party applications to TWS to place automated trades.
The Trader’s Journal allows you to create and save notes on any product for continued updating and future reference. Notes can be attached to trades and keep you organized with all relevant details at your fingertips.
Bonds Marketplace
With the IBKR Bond Marketplace, you can access more than one million bonds globally. These come with a low, transparent commission fee; you won’t find built-in spreads or markups.
Using the Bond Search tool, you can compare currently available yields and sort them by various criteria, including maturity date, yield, and coupon rate. When you find a bond you want to invest in, you can trade directly with other IBKR clients. You can negotiate an offer with the seller via the platform before purchasing.
Mutual Funds Marketplace
As with bonds, mutual funds come with low-cost, transparent fees. More than 19,000 are free of transaction fees. Search the 48,000 funds to find the best funds for your portfolio with the free Mutual Fund Search tool. You can sort funds by the commission charged, the fund type, the fund family, or country of residence.
You’ll find mutual funds from 480 families, including American Funds, Fidelity, Invesco, PIMCO and BlackRock.
The Fundamentals Explorer shows information on performance and expenses, so there’s no need to search elsewhere to find these details.
No-transaction-fee ETFs
All IBKR Lite clients pay $0 ETF commission fees. For Pro clients, the Commission Rebate Program offers a fee waiver on transaction fees for more than 150 ETFs. The program works only with select funds and shares held for at least 30 days.
Funds that are part of the rebate program include WisdomTree, GlobalX, KraneShares, and Pimco. The commission-free program includes ExponentialETFs, Cambria, Hull Tactical, Legg Mason Global Asset Management, and Realty Shares.
Investors’ Marketplace
New investors looking for a service provider or brokers looking to advertise their services can do so on the Investors’ Marketplace. Nearly 2,000 service providers are listed in the areas of hedge funds, research, advisor and brokers, technology, and administrators.
This part of the website is easy to navigate. Choose the description that best describes you—investor, broker, advisor, or hedge fund—then choose from the menu of service options to find providers in that field. Each person or business has a digital business card. Click on it to learn more about them, their fees, and their contact information.
Short securities availability
Search for sortable securities through your client portal to find a way with the securities loan Borrow (SLB) system. Updated throughout the day, you can use this searchable tool to discover several data points, including quantity available, the number of lenders, the current borrowing rate, and the historical borrowing rates.
You can search for securities by their symbol and exchange on which they’re traded, the ISIN number, the CUSIP number, or their credit rating (for bonds). You can upload bulk request files to search for multiple securities at once, and then you can download the lists of securities organized by country.
SmartRouting
Another IBKR trading tool must be mentioned in SmartRouting, which is available to Pro clients. It helps boost your earnings by searching for the best available prices for your stock orders and options. Smart tech considers each portion of the trade, which aims to get you the best price improvement on your trade.
Unlike other brokers, your order won’t be forgotten; it’s always been analyzed to achieve the best results. Also, the IB SmartRouting Autorecovery will re-route your order if there’s a malfunction on the exchange. In this situation, IBKR bears all risk of the order being placed twice.
ESG investing
Use the Impact Dashboard to invest your money in companies aligning with your values. Based on concrete data, you can see companies' environmental, social, and governance ratings and evaluate your purchases and watchlists. The dashboard analyzes your portfolio according to your values, which you select from more than a dozen options, including clean air, racial equality, and gender equality. Use this information to reallocate your investments or make new trades based on the results you receive.
Cash management
For U.S.-based clients, funds are transferred between a U.S.-bank account and IBKR easily through ACH transfer. Depositing funds via checks is simple and fast with the mobile app. A recurring automatic payroll deposit is another easy way to add cash to your account.
You can get an Interactive Brokers Debit Mastercard to access your account funds. There’s no monthly minimum payment or late fee to worry about, so you can dip into those funds at low margin rates wherever Mastercard is accepted worldwide.
When you need to take money out for bills, you can access funds through your account to send electronic payments. Need to send a paper check? No problem! IBKR can print one.
No interest is paid on cash balances, so unless it’s just sitting idle for a short time, consider a high-interest savings account.
Third-party integration
Interactive Brokers makes it easy to seamlessly integrate with several third-party software applications to give you a better trading experience.
Third-party Management Software: IBRK can be used with nearly 70 portfolio management platforms to report your trading data. A basic data file is available to report data to other software programs that aren’t on the list.
Order Management Software: This tool helps to execute orders effectively and track the order’s status. It can be used with more than 20 OMS providers.
Post-Trade Allocation: Use the IBKR tool to allocate your US stocks, options, and US corporate bonds to pre-approved clearing brokers.
Compliance Software: EmployeeTrack provides data for ten compliance reporting systems.
Interactive advisors
Get started investing in a preselected or customized portfolio for just a $100 minimum deposit with the Interactive Advisors service. It’s convenient because IBKR provides the framework with transparency, and you maintain control. Fees range from 0.10% to 0.75% per year, and no trade commissions exist. At any point, you can upgrade your account to begin trading stocks, options, futures, bonds, and ETFs on your own.
Choose from among the following portfolio themes:
- Lending institutions
- Undervalued companies
- Growth
- Better planet
- Social justice
- Small cap
- Technology
- Or create your own
IBot
Get answers to your questions from the AI-powered IBot service. Ask any question in plain English, and you’ll get an answer without waiting on hold for live customer service.
For those times when you need to speak with a human, telephone support is available 24 hours a day, six days a week. Can’t wait on hold but don’t want to lose your spot in the virtual queue? Request callback service and you’ll be called when it's your turn. Or chat with a live agent through the website or trading platform. And for important but not urgent questions, there is a secure message center to ask your question or request help.
Educational tools
Every account gets a paper (or demo) account funded with “play money,” so you can test your investing strategies to see how well they fare in the current market. Various online courses are available to account holders, and there are frequent webinars, plus on-demand videos to watch. The news feed is updated regularly so you can see the latest world events impacting the investing world.
The Traders Academy offers courses for all level investors, plus blog posts and newsletters you can get delivered to your inbox. There's something for everyone, with nearly 40 courses and over 200 lessons.
Courses are in the areas of:
- Investment Products
- Trading & Investing
- Manage Your Portfolio
- Trading Tools
- Financial Planning
Other educational content includes:
- An interactive glossary that helps you learn the lingo of the investing world
- Regular webinars you can attend in real time
- A podcast that you can listen to online or via your favorite podcast app
- Short videos that explain and teach about using the TWS. These are in multiple languages, including Spanish, French, Dutch, German, Chinese, Japanese, and Italian.
- Course on trading Forex and options
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Who is Interactive Brokers best for?
Two main groups of investors may find that IBRK is best for them: advanced and international investors.
Advanced investors
Advanced investors will be thrilled to have so much data at their fingertips thanks to the robust array of research and analytical tools available on IBRK. Active traders should choose IBRK Pro for access to all of the features, some of which are unavailable to IBRK Lite customers.
International investors
Since many US-based trading platforms don’t allow non-residents to invest with them, even US citizens working abroad, this gives those folks an easy and convenient way to invest.
Who shouldn’t use Interactive Brokers?
Beginning investors are really the only group who IBRK may not best serve. This is mostly because the platform is more advanced than a new investor needs. The slight clunkiness of the client portal, plus the abundance of tools available, might put you into analysis paralysis—being so overwhelmed by your options that you just do nothing.
Opening an account is not as simple and intuitive as on other platforms paired with less customer support; it’s all too easy just to give up if you get hung up in the process. While many tools are very robust, it’s easy to get intimidated by them and not use them, even though they are useful.
Pros and cons
As with any investing platform, Interactive Brokers has its pros and cons. Here’s a closer look at what they are so that you can make the right decision for your investing needs.
Pros
- Large selection of investments. With IBRK you can trade investment products including stocks, options, forex, futures, bonds, and funds across 135 markets in 33 countries.
- Free stock and ETF trades. Traders who use IBRK Lite get unlimited, free trades on stocks and ETFs that are listed on the US exchanges.
- Powerful trading tools. Both the SmartRouting software and Trader Workstation make it easy for both new and experienced investors to find the best trades and execute on them instantly.
Cons
- The website can be difficult to navigate. The website can be clunky and hard to navigate at times. It’s not as intuitive as others and there’s a learning curve to being able to move through it swiftly.
- Overwhelming resources for beginning investors. With all the features to make better investing decisions and educational resources, IBKR can be overwhelming to new investors.
- No backtesting feature. Advanced traders who enjoy testing out new investing strategies with backtesting can’t do so with IBKR, as no feature exists currently.
Interactive Brokers vs. competitors
There are many investing platforms to consider, and while Interactive Brokers is great for the advanced investor, let’s see how other platforms compare.
Platform | Account minimum | Commission-free stocks | Types of investments | Mobile app |
Interactive Brokers | $0 | Yes | Stocks, bonds, mutual funds, ETFs, crypto, futures, Forex, options | Yes |
E*/Trade | $0 | Yes | Stocks, bonds, options, mutual funds, ETFs, CDs, bonds | Yes |
Vanguard | $0 | Yes | Stocks, bonds, ETFs, mutual funds, index funds, CDs | Yes |
E*Trade
Now part of the Morgan Stanley family of investment products, E*Trade offers a variety of investment products for the beginning investor. Trades within a certain limit (currently up to 30 per quarter) are free for stocks and ETFs on US exchanges. Active traders will find this a more expensive way to execute trades. No minimum balance is required to open an E*Trade account, but you should maintain a $1,000 balance to avoid fees.
E*Trade customers can open accounts for trading, investing for retirement, and small business savings. You also have the option to open joint and custodial accounts with your spouse or for your children. Among the investment options are stocks, mutual funds, ETFs, CDs, bonds, and futures.
Vanguard
A household name trusted by millions of customers, Vanguard is a solid choice for investing. Opening an account is easy, and there are no account minimums. Some funds will have a minimum initial purchase price, but once you’ve started investing, you can add funds in any amount.
Vanguard’s fees are transparent, and most are flat, so it makes better financial sense to invest as much as possible per transaction. Among Vanguard's investment products are stocks, bonds, CDs, mutual and index funds, and ETFs. They do not offer Forex, crypto, or futures.
Various account types are available, including joint accounts, IRAs, 529 savings plans, UTMA and UGMA, and small business retirement accounts.
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- Over 100 Stock Picks with 100%+ Returns
- Averaged Stock Pick Return over 593% (vs. 165% for the S&P)
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- 30-Day Membership-Fee-Back Guarantee
- Joy Wallet Reader Deal: The Motley Fool is offering 50% off its top stock-picking service for new members (Limited Time)
FAQs
Is Interactive Brokers safe?
Yes, Interactive Brokers uses the latest technology to keep your data safe. Additionally it maintains and exceeds regulatory requirements across the world. To further ensure the safety of your money, IBRK Pro users can participate in the Bank Deposit Sweep Program which allows account holders an additional amount of insurance, plus the opportunity for passive income.
Does Interactive Brokers offer cryptocurrency?
Yes, you can invest in Bitcoin, Ethereum, Litecoin, and Bitcoin Cash through your Interactive Brokers account.
Can international investors use Interactive Brokers?
Yes, IBRK is open to residents of 220 countries and territories. Brick and mortar offices are in more than a dozen countries including, the United States, the U.K., Australia, Japan, India, Hong Kong, Ireland, and Switzerland.
The bottom line
Overall, Interactive Brokers is a solid, user-friendly platform for any investor who wants to continually learn. Use the wide range of educational components and charting tools to analyze stocks and funds, and soon you’ll invest more confidently.
People new to investing would be best starting with the Lite version but upgrading to Pro when they feel the need for the extra tools only for Pro members. Both domestic and international investors will appreciate the ability to access various investment options easily.
Advanced investors who appreciate the tools available at Interactive Brokers will be well served by it. For those who want something simple and intuitive with fewer decisions, another investing platform might be better for you.
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Writer
Charlotte Edwards is an educator-turned-freelance writer based in Beijing, China. She writes personal finance and parenting content for both digital and print publications around the world.
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