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Interactive Brokers, In our 2023 assessment of online brokers, Interactive Brokers (often referred to as IBKR) has garnered prestigious accolades in various categories such as active and professional trading, international trading, platform technology, ESG investing, futures trading, and a cutting-edge category, sentiment investing. Professionals consistently turn to IBKR due to its utilization of an institutional-grade desktop trading platform, its commitment to providing top-tier trade executions, and its offering of highly competitive margin rates. However, it’s important to note that IBKR doesn’t solely cater to professionals; it also offers a range of features that everyday investors will find highly valuable, including a comprehensive suite of exceptional mobile applications.
Available investor protection to many users e.g.$500k (securities up to $500k & cash up to $250k) to US clients.
Rating
Trading platform
Minimum Deposit
$1
Regulation
Payment methods
Key Highlights
| TITLE | VALUES |
|---|---|
| Account Currency | USD, EUR, GBP, AUD, CAD, CZK, DKK, HKD, HUF, ILS, JPY, MXN, NZD, NOK, PLN, SGD, SEK, CHF, CNH |
| Minimum Deposit | Starting from just $1 |
| Leverage | Depending on the asset |
| Spread | From 0 pips |
| Instruments | Stocks, Options, Futures, Currency, Metals, ETFs, Bonds, Mutual Funds, CFDs, EPF, Robo-portfolios, Hedge Funds |
| Margin Call / Stop Out | Depending on the Asset |
Interactive Brokers Analysis
Interactive Brokers is a member of SEC, FCA and ASIC, ensuring that client funds are protected and reimbursed in the event of financial troubles.
1
Market Access:
Clients gain access to a broad range of markets, including securities, OTC trading, derivatives, and Forex instruments.
2
No Minimum Deposit:
Interactive Brokers does not impose minimum deposit requirements for cash accounts, making it accessible to a wide range of investors.
3
Innovative Trading Features:
Interactive Brokers continuously introduces new features and tools to enhance the trading experience for its clients.
| – | Advantages of Trading with Interactive Brokers: |
|---|---|
| – | Wide range of training materials. |
| – | Access to 135 markets in 33 countries. |
| – | A vast subset of trading instruments. |
| – | Disadvantages of Interactive Brokers: |
|---|---|
| – | Inactive account fees. |
| – | Support service is unavailable on Saturdays and Sundays. |
| – | Lengthy and complex registration procedure. |
| – | No cent accounts available for novice traders. |
Interactive Brokers (IBKR) offers a user-friendly onboarding process, allowing users to open an account and explore the platform without an immediate funding requirement. However, due to the platform’s extensive features, new investors may initially find it overwhelming. The site continually updates to enhance user navigation across the Client Portal, Trader WorkStation (TWS), and mobile apps. A range of support options, including FAQs, videos, phone customer service, and chat, is readily available to assist users.
Trading Platforms
Interactive Brokers supports multiple trading platforms, catering to diverse user preferences. These include:
- Client Portal: Ideal for monitoring and managing various aspects of an IB account, suitable for intermediate to advanced investors. Offers detailed quotes, advanced charting, news access, and trade ticket setup.
- Trader WorkStation (TWS): Designed for active traders and investors seeking flexibility and access to multiple products. Offers extensive trading, order management, portfolio management tools, fundamental and technical charting, and over 100 order types, including algorithmic trading.
- Mobile Apps: IBKR provides several mobile versions for both Android and iOS devices. These apps offer similar functionality to the web platform, making trading on the go convenient.
- IBKR GlobalTrader: Allows international trading, depositing funds in local currency, and trading stocks from mobile devices, offering access to 90+ global stock exchanges.
- Impact: Designed for ESG (Environmental, Social, Governance) investing, helping users align their investments with their values and contribute to causes like clean water and racial equality.
Range of Offerings
Interactive Brokers boasts an extensive selection of asset classes, making it one of the industry leaders. Key offerings include:
- Stocks (long and short)
- Over-the-counter bulletin board (OTCBB) penny stocks
- Exchange-traded Funds (ETFs)
- Mutual funds (with a vast marketplace)
- Bonds (corporate, municipal, treasury, CDs, international)
- Options (globally available on 30+ market centers)
- Futures and futures options
- Robo-advisory services through Interactive Advisors
- International trading across 150 exchanges in 33 countries
- Forex currency pairs (24 currencies and 100+ trading pairs)
- Fractional share trading on select U.S. stocks and eligible European stocks and ETFs
- Cryptocurrency trading through Paxos Trust, integrated into IBKR platforms (eight coins available)
Order Types
Interactive Brokers offers a flexible array of order types, with over 100 order types and algorithms on Trader Workstation. This includes one-triggers-other (OTO) and one-cancels-other (OCO) orders, providing traders with advanced execution options. Options traders can engage in single- and multi-leg options trades.
Trading Technology
IBKR employs advanced trading technology, including SmartRouting for optimal price execution, accumulate/distribute algorithms for large-volume traders, bracket orders for loss prevention, and price improvement features. Expert traders can define hotkeys for quick order placement.
Costs
Interactive Brokers’ pricing scheme can be complex, with distinctions between IBKR LITE and PRO accounts. IBKR LITE offers fee-free stock and ETF commissions but routes orders for payment for order flow (PFOF). PRO account holders may encounter fixed per-share pricing, tiered per-share pricing based on monthly order activity, and additional fees for various instruments. Margin interest rates for Pro customers are competitive.
How Interactive Brokers Generates Revenue
Interactive Brokers generates revenue through various channels:
- Interest on idle cash balances
- Payment for order flow (PFOF)
- Stock loan programs
- Price improvement on orders
- Portfolio margining
- Other behind-the-scenes revenue streams
Account and Research Amenities
IBKR provides a wealth of research tools, including screeners, calculators, idea generators, and professional-level investment analysis tools like PortfolioAnalyst. Users can access stock, ETF, mutual fund, options, and fixed-income screeners. The Fundamentals Explorer offers in-depth insights into company performance and industry comparisons. Additionally, the platform includes numerous calculators, such as options-related calculators and margin calculations.
Interactive Brokers offers a comprehensive suite of tools and resources to cater to a wide range of investors, from beginners to advanced traders, with a strong emphasis on research capabilities and trading technology.