Interactive Brokers
Monthly Fee
Minimum Deposit
Our Rating
APY Cash Account
Interactive Brokers (IBKR) is a prominent global brokerage firm renowned for its extensive range of investment products and advanced trading platforms.
Founded in 1978, IBKR serves a diverse clientele, including individual investors, institutions, and professional traders. The platform offers access to a wide array of asset classes, such as stocks, options, futures, forex, bonds, and cryptocurrencies, across more than 150 global markets.
IBKR is particularly favored for its low-cost structure, offering competitive commissions and fees, including tiered and fixed pricing models that cater to different trading volumes. The platform also provides powerful trading tools, including the Trader Workstation (TWS), which supports complex trading strategies with features like algorithmic trading and risk management tools.
Additionally, IBKR offers margin trading with some of the lowest rates in the industry, making it an attractive option for active traders
What markets can I access through Interactive Brokers?
You can access over 150 global markets, including stocks, options, futures, forex, bonds, and cryptocurrencies. This wide range of markets allows for extensive diversification.
What is the difference between IBKR Lite and IBKR Pro?
IBKR Lite offers commission-free trading on U.S. stocks and ETFs with no account minimums, while IBKR Pro provides access to lower margin rates, advanced trading tools, and tiered or fixed pricing for more active traders.
How does IBKR handle currency conversions?
IBKR provides competitive currency conversion rates, allowing you to convert funds at market rates with low spreads, which is particularly useful for international trading.
Can I trade cryptocurrencies on IBKR?
Yes, IBKR offers access to cryptocurrencies like Bitcoin and Ethereum, either directly or through crypto-related ETFs, providing a way to trade digital assets within the same platform.
How do I deposit funds into my IBKR account?
You can deposit funds through bank wire transfers, ACH transfers, check deposits, and more, depending on your location. The IBKR Mobile app also allows for check deposits.
Is my money safe with IBKR?
Generally, yes. The company is well-regulated by financial authorities such as the U.S. Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA).
In addition, IBKR clients' funds are protected by the Securities Investor Protection Corporation (SIPC) up to $500,000, which includes $250,000 for cash.
Pros | Cons |
|---|---|
Extensive Global Market Access | Steep Learning Curve |
Low-Cost Trading | Limited Wealth Management Services |
Advanced Trading Platform | $10K Minimum For High APY On Cash |
Comprehensive Research Tools | |
Cash Management Account |
Features I Mostly Liked
Here are the key features that I found most appealing in Interactive Brokers:
-
Great Selection Of Investment Options
Interactive Brokers (IBKR) offers a vast range of investment options, catering to diverse investor needs.
IBKR provides access to stocks and ETFs across numerous exchanges worldwide, including the U.S., Europe, Asia, and emerging markets.
Clients can also trade options, futures, forex, bonds, mutual funds, and cryptocurrencies across over 150 global markets.
The platform also provides access to commodities, precious metals, and international fixed-income products.
For sophisticated investors, IBKR provides access to alternative investments such as hedge funds and private equity through its Hedge Fund Marketplace.
-
Automated Investing With Interactive Advisors
Although I generally prefer to take a hands-on approach, I did like that Interactive Brokers has a low-entry-point robo advisor. Interactive Advisors is designed to make it easy to start investing with just $100.
Dozens of portfolio options are color-coded according to risk level, from cautious to speculative. I can filter the list of options by categories such as top-performing, socially responsible, or income-generating.
Interactive Brokers oversees the account and provides unlimited support, but I can still see and control the account. There are no trading commissions, but there is an asset management fee on these investments of up to 0.75% per year.
At any point, I can then choose to upgrade to a self directed portfolio. So, this is a nice way to get started with the platform if you’re happy to take a hands off approach.
-
Global Mutual Funds Marketplace
Likewise, Interactive Brokers also has a Mutual Funds Marketplace with over 43,000 funds worldwide. This includes over 18,000 funds that have no transaction fees. The other funds have no custody fees and Interactive Brokers is very transparent about the commission and trade charges.
Interactive Brokers remains neutral with no proprietary funds, so I can use the free search tool with confidence knowing that I’m not being recommended one fund over another because of fund family preferences.
I can search for funds by the fund type, fund family, residence country and commission charges.
-
Trader Workstation (TWS) & IBKR Mobile
Interactive Brokers (IBKR) offers one of the most powerful and versatile trading platforms in the industry, catering to both novice and experienced traders.
The flagship platform, Trader Workstation (TWS), is renowned for its advanced features, including customizable layouts, comprehensive charting tools, and support for complex trading strategies like algorithmic trading.
The platform's advanced order types, such as bracket orders, trailing stops, and conditional orders, allow traders to execute sophisticated strategies with precision.
In addition to TWS, IBKR offers a user-friendly mobile app, IBKR Mobile, which provides full trading functionality on the go. The mobile app includes features like real-time streaming quotes, charting tools, and push notifications for trade execution.
-
Global Bond Marketplace
Interactive Brokers has a solid selection of Global Fixed Income Securities. I can access corporate bonds, Treasury bonds, municipal bonds, CDs and there is even sovereign bonds from outside the US. There is a choice of approximately one million bonds across the globe.
The platform has a transparent commission structure with no built in spreads or mark ups and I can use the Bond Search tool to compare potential yields, maturity dates or quality.
The results of my search are presented in an easy to scan graph format with all the pertinent details displayed clearly.
The Bond Marketplace also includes a feature to compare Interactive Brokers’ prices vs quotes from my broker. This ensures that I don’t overpay when I purchase.
-
IB Universal Cash Management Account
The IB Universal Cash Management Account offers an integrated solution to manage your finances efficiently.
It allows you to earn interest on cash balances and provides competitive borrowing rates. The account can be managed on my phone via the app and this includes features such as mobile check deposit and direct deposit from my main bank account.
Additionally, the account includes a Bank Deposit Sweep Program that extends FDIC insurance coverage up to $2.5 million, adding to the standard SIPC coverage for a total of $2.75 million in protection.
However, there is a caveat. I need to have at least $10,000 to gain the highest rates regardless of whether I have a Lite or Pro account.
-
Trading Assistant
Essentially, the Interactive Brokers Trading Assistant is a group of notifications that I can customize to stay on top of market activity even when I’m on the go.
I can set notifications for market pricing, positions, trades and even account details by email or SMS according to my preferences. I will then receive a notification as needed. Here’s an example:
I found this to be a helpful part of the overall “Trading Toolbox” layout of the platform.
Additional Features That Helped Me
Besides the main features I use regularly, there are additional features for investors:
-
Tax Optimizer
Interactive Brokers has a built-in Tax Optimizer tool that allows me to try seven different automated match methods to see the potential profits and losses according to the selected method.
This is broken down further by short and long term gains or losses.
While this has the potential to save a few dollars with a modest investment fund, if you have a more significant portfolio, this could be extremely helpful.
-
IBKR Global Analyst
One of the main challenges I’ve encountered when studying global markets is calculating my investments in multiple currencies.
However, one of the key features of Interactive Brokers is its IBKR Global Analyst. This tool allows me to view everything in the world screener using the same currency.
As you can see in this screenshot, I can narrow down stocks by industry, price, PE ratio and more.
Additionally, if I already have a shortlist of companies that I’m interested in, I can enter up to 25 into this tool to analyze the details.
Image: stock trading data example, Interactive Brokers app.jpg
-
PortfolioAnalyst
While many trading platforms allow you to consolidate your accounts, Interactive Brokers has perhaps one of the most comprehensive.
The PortfolioAnalyst features allows me to consolidate my accounts and track each one’s activity and performance. This dashboard provides a single view of my accounts and I can use widgets to create a tailored view.
Additionally, PortfolioAnalyst includes reporting with up to 35 performance and measurement factors. I can tailor my reports with different metrics to have a complete overview of my current financial situation.
Within PortfolioAnalyst, I can set allocation goals and track my progress to ensure I remain on track.
This includes a retirement planner that considers my retirement preferences, current monthly expenses, current and future employment expectations and other potential additional income sources.
-
Market News
Even if I’m completely confident in my trading strategy, it is still important to keep track of what is happening in the market in case I need to pivot.
What I found helpful with Interactive Brokers was that the Market News feature was frequently updated, so the stories were in real time.
As you can see in the above screenshot, I can check performance by sector, but there are also news lists by asset and other metrics.
This means that I don’t need to scroll through pages of news, as I can pick and choose what I want to look at.
-
Shortable Search
Shorting stocks is a more advanced trading strategy, but I like that Interactive Brokers has a dedicated feature that I can explore. This is a fully electronic feature that allows me to search for shortable stocks and bonds, updated periodically throughout the day.
I also appreciate that Interactive Brokers understands that shorting can be daunting for the less experienced trader, so there is a short sale cost calculator that I can use to determine if it is a good fit for my investing strategy and risk profile.
-
Third Party Research Tools
The platform supports integration with numerous third-party research tools and platforms, offering users additional flexibility in their research and analysis.
While many of these are a paid subscription, Interactive Brokers’ clients can get a discounted rate. However, what I found particularly helpful was that I could filter the list of third party tools by free options.
This is a decent list of options that can allow me to conduct my research without needing to pay a cent.
What Can Be Improved
No platform is perfect and there are a few areas where Interactive Brokers could make some improvements. These include:
-
No Personal Wealth Management Options
While Interactive Brokers (IBKR) allows customers to consult with advisors, it falls short in providing comprehensive personal wealth management services specifically tailored for high-net-worth individuals.
Unlike competitors such as Fidelity, Vanguard, or Morgan Stanley, which offer dedicated wealth management services, including personalized financial planning, estate planning, tax strategies, and a more hands-on advisory approach, IBKR primarily focuses on self-directed trading and investment.
-
High Minimum to Earn Interest on Cash Account
While it is nice that Interactive Brokers offers an impressive rate on funds in a cash management account, you do need to have at least $10,000 to qualify.
It would be nice if those with a smaller fund could still earn interest, even if this was a tiered structure.
-
Learning Curve
With so many features, it is unsurprising that there is a bit of a learning curve to using Interactive Brokers.
However, the team has been making some improvements to make some of the features more accessible to less experienced traders.
-
No IPOs
Initial Public Offerings can be a good way to get in at the ground floor when a company is going to start being publicly traded on the exchange.
However, since Interactive Brokers is not an underwriter, you’re not likely to be able to express interest in any current or upcoming IPOs.
Which Type of Investor is Best To Interactive Brokers?
Interactive Brokers does have something to offer everyone, but there are some types of investor who are likely to get the most from the platform. These include:
- International Investors: If you don’t want to limit yourself to the US market, Interactive Brokers provides a simple way to access multiple markets. Everything can be viewed using one currency, so you can more easily evaluate traders to streamline the process.
- Advanced Traders: If you’ve already built your trading confidence, you are more likely to find the extensive feature set of Interactive Brokers useful. You can access a variety of resources and you’ll even find third party services available at discounted rates.
- Deep Dive Researchers: If you’re the type of trader who likes to take a deep dive into every aspect of a trade before you make a decision to buy, you’re likely to appreciate the wealth of research and analysis tools on the Interactive Brokers platform.
