Interactive Brokers Review 2024: Pros, Cons, Fees

Interactive Brokers has a wide product offering for millions of customers across 200 countries who can trade in over 150 financial markets. It is a reputable brokerage platform with a breadth of financial assets, research reports, calculators, educational materials, tools, and other products for domestic and international investors. It has powerful, award-winning trading platforms to suit every trader on desktop, web, and mobile devices. Interactive Brokers (IBKR) is often called the gateway for professional traders to the world’s financial markets, including stocks, futures, ETFs, options, and more. This Interactive Brokers Review will comprehensively detail all the features and functions traders can use on the platform, along with pros and cons, fee structure, types of accounts, and much more.

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Overall Summary

Official Website https://www.interactivebrokers.com/
Headquarters Greenwich, CT
Founded Year 1977
Regulated Yes
Product Offered Stocks, Options, Futures, Precious Metals, Indices, Mutual Funds
Minimum Initial Deposit $100
Maximum Leverage Yes
Islamic Accounts No
Demo Account Yes
MetaTrader 4 (MT4) No
MetaTrader 5 (MT5) No
Trading fees Yes
Inactivity fees Yes
Withdrawal fee One Free withdrawal per month
Supported currencies USD, AUD, CAD, CHF, CNH, CZK, DKK, EUR, GBP, & More
Customer Support 24/7 via Call, Email, FAQs, & Chat Support

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Pros and Cons

Pros Cons
 An unparalleled variety of investment assets, research tools, and investment choices  Difficult and time-consuming to reach customer support
 More than 19000 mutual funds available tradeable without transaction fees  High minimum investment required to earn interest
 Low margin rates and commissions with superior execution of trade orders Lacks the award-winning MetaTrader trading platform
 Convenient desktop and mobile trading platforms with an excellent web portal for both individual and institutional investors
Traders can engage in foreign market trading and hold several currencies

Features of Interactive Brokers

We have assessed several IBKR reviews to explore the exclusive features offered by Interactive Brokers. Here are some of the top features that traders can employ on the IBKR platform-

1. Global Market Access:

Traders on Interactive Brokers can trade ETFs, stocks, futures, and options and access global financial markets from one unified platform. Professional traders can take full advantage of industry-leading rates and commissions, including reduced margin rates across balanced tiers.

2. Professional Pricing Structure:

Interactive Brokers offers no investment costs and trading fees to increase traders’ overall return on investment. Registered users can earn high rates of interest of up to 4.83%.

3. Robust Trading Platforms:

Interactive Brokers offers award-winning trading platforms for all types of traders who can discover new trading opportunities with more than 20 free/premium global news and research providers. There are also free trading tools, order types, algorithms, sophisticated portfolio analysis, and comprehensive reporting across all trading platforms, which are compatible with desktop, web, and mobile devices.

4. Trustworthy Brokers:

Interactive Brokers is a trustworthy platform with a strong capital position, automated risk controls, and conservative balance sheets to safeguard all IBKR clients from big trading losses.

5. Wide Range of Offerings:

A mountain of asset classes is available for trading on Interactive Brokers with more than 40,000 mutual funds, options available across 30+ market sectors, various forex currency pairs (100+ plus trading pairs, 24 currencies), bonds, options, and futures.

Interactive Brokers Features

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Interactive Brokers Charges, Fees, and Commissions

Interactive Brokers provides two different pricing plans for professionals and casual investors. IBKR Pro is for professionals, while IBKR Lite is for casual investors. IBKR Lite fees are $0 for ETFs and US stock trades. However, option traders need to pay $0.65 per contract. Interactive brokers earn revenue from payment for order flow (PFOF) like any other zero-commission brokers. IBKR Pro fees start at $0.0035 per share for a minimum of $0.35 unless trades are more than $300,000 monthly. Other Interactive Brokers monthly fees include a $1 fee or more for every withdrawal if traders exceed one monthly withdrawal.

Interactive Brokers Account Opening process

Creating an account with Interactive Brokers is quick and straightforward, requiring only a few clicks and minutes to complete. Traders can open an account seamlessly with Interactive Brokers by following a few simple steps mentioned below –

Step 1: Go to the official website of Interactive Brokers and navigate to the red Open Account tab on the right-hand top corner of the landing page. 

Step 2: Enter Start Application

Step 3: A registration field will appear on the screen that displays the instructions that users must follow carefully.

Step 4: Fill in the form with a valid email, address, username, password, and country of residence. 

Step 5: Enter Create Account. 

Step 6: A confirmation mail will be sent to the email address. Verify the email ID before Interactive Brokers can approve the account. 

Step 7: Upon confirmation, users must choose an account type and verify their identity by uploading proof of passport, ID card, or bank statement. 

Step 8: Fund the newly created account by transferring a minimum deposit. 

Step 9: Interactive Brokers minimum deposit requirement is $10,000 per upfront against commissions during the first eight months.

Interactive Brokers Accounts Opening Process

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Interactive Brokers Account Types

When it comes to account types, Interactive Brokers offers you various margin accounts and brokerage account for its users; the account minimum is charged as per the chosen account. More than 2.09M client accounts are there. Let’s discuss the below account types:

Individual Account and Joint Account

  • It is designed for single users and enables the trading of assets held in the name of a single owner. Interactive Brokers offers users access to all functions and can also issue a Power of Attorney for adding secondary users.
  • A Joint Account is designed for two or more users who could collaborate under joint tenancy or community property agreements. At least two owners hold the funds, and they get access to all features and can add more users with Power of Attorney.

Trust or IRA Account and Small Business Account

  • It is designed for legally established entities and retired US individuals ( IRA, i.e, Individual retirement accounts.) The remaining features are the same as above.
  • Small Business Account is offered to small-time traders and most people who are not professionally involved in investments. Such users are not compelled to pay high account fees and no transaction fee funds.

Interactive Brokers Deposit & Withdrawal Options

There are various methods used for depositing and withdrawing funds from IBKR Pro and the IBKR Lite platforms.

Deposit Options

On Interactive Brokers, minimum deposit requirements are not applicable. IBKR Lite users can deposit funds by using the following methods:-

  • Wire transfer directly from IB-supported banks is provided for traders and investors.
  • Deposit cash electronically from other brokers by using the Automated Customer Account Transfer Service (ACATS). This is also used for a position transfer.
  • Fund transfers from credit cards such as Visa and Mastercard.

For IBKR Pro users, the Account Management page also enables deposits via a debit card. However, a debit card deposit sends notifications to the user that they must make arrangements with the respective bank to deposit funds in the future. The cash management feature makes the process easy for investors. Thus IBKR pro and IBKR Lite provide you with a variety of deposit options.

Withdrawal Options

Money can be transferred from the platform into bank accounts with several options. To withdraw money from IBKR, the user can generate a withdrawal request or even create an internal fund transfer into a different IB account. The supported withdrawal methods are:-

  • Wire transfer
  • US-regulated ACH transfer (for US-based user accounts only)
  • Cheque under US currency (based on verified mailing address of US residents)
  • Canadian EFT transfer for Canadian users only
  • Single Euro Payments Area (SEPA)

Interactive Brokers Trading Platforms Review

Interactive Brokers is popular for its award-winning trading platforms that offer powerful features for both beginners and experienced traders – 

1. IBKR Trader WorkStation (TWS):

This is IBKR’s flagship desktop trading platform, developed for active and seasoned traders who trade several products, requiring flexibility and power. 

2. IBKR Desktop Platform:

This is more suited for beginners and intermediates who appreciate streamlined user interfaces. This simple and easy-to-use trading platform comes with excellent pricing, market data services, research, and order execution across 150 financial markets around the world. 

3. IBKR Mobile:

For advanced traders who require robust features for trading futures, bonds, currencies, options, and stocks, IBKR mobile platform has everyone covered with advanced trading tools and order types that can be used seamlessly. 

4. IBKR GlobalTrader:

For a more streamlined trading experience tailored to the needs of beginners, IBKR GlobalTrader is the best option available on Interactive Brokers. It comes with simulated trading accounts that can familiarize you with IBKR Global Trader features and functions before creating a live trading account. 

5. IBKR Client Portal:

This trading platform can be used by beginners, intermediate, and advanced traders who can access every feature they need while trading across a wide range of financial markets.

Interactive Brokers Multiple Trading Platforms

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Interactive Brokers Mobile App Review

The Interactive Brokers offers an app available on Android devices (Google play store) and iOS devices (Apple app store). With the help of various Interactive Brokers APIs, this mobile app has almost every functionality of the TWS and Client Portal web platforms. The trading apps are not ideal for pro investors as they may consume the processing power of the mobile device. However, the bottom line is when compared to the TWS desktop platform, the IBKR mobile app is easier to follow and has all available asset classes properly arranged for executing trades for professional traders like stocks, ETFs, options, and more along with trading shortcuts.

The app enables mobile watch lists. Interactive Brokers offers a feature that helps create and share data across web and desktop platforms in the form of real-time streams. Streaming market news services and a vast majority of research providers on the mobile app is also possible with watch lists integrated streams from Bloomberg TV or IBKR Traders Insight, mostly the update is carried out by the chief strategist (watch list syncing). Fundamental research on the mobile app is effective. The charting tool on the impact app is also suitable for quick market overviews. It also supports a suite of technical indicators that will be useful for professional traders. However, there are no drawing tools available on the Interactive Brokers mobile app.

This mobile app also creates an intuitive workflow, thanks to the Interactive brokers research team’s development and its gathering of valuable data points, which has some extra when compared to the desktop version. All trades can flow effortlessly from the app by following one step to the next. Data streams on the mobile app are available in real-time. A one-at-a-time approach is enabled to help traders focus on one stream instead of a multi-device approach that distracts the trading workflow.

Traditional trading sessions can be done with the app’s single interface. This mobile platform also unlocks higher research capabilities for users on the Client Portal and provides smooth ease of use. It provides numerous screeners and options, strategies, fundamental analysis, smooth commission free trades of stocks, ETFs, drawing tools, and technical analysis tools. All this is extra compared to the desktop platform version.
Interactive Brokers Mobile App

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Interactive Brokers Leverage

The broker offers stock trading with low fees and low commissions, but not a commission free trading. However, the Interactive Brokers platform leverages its services to make money for its customers.

Stock Loan Programs

  • One of the features interactive brokers provide is Stock loan programs that are good revenue streams for brokers.
  • IBKR holds the stocks of users in their accounts and loans these to other traders and hedge funds. This helps in creating a purposeful level on short stocks.
  • Interactive Brokers shares this leverage with the user through a 50-50 stock loan program.

Price Improvement

  • IBKR uses its smart order router to identify the (interactive brokers pricing) improvements before other brokers.
  • It attains good leverage on these improvements and makes an average profit of $0.62 per 100 shares.
  • IBKR also receives volume discounts and its passed to clients as savings or price improvement depending on order routes.

Portfolio Leverage

Unlike IBKR Lite, the IBKR Pro clients can qualify for portfolio leverage. In this, the platform enables portfolio builder margining tools and lowers the margin interest rates to mitigate the overall calculated high degree risks. Typically, this type of leverage works best for traders invested in derivatives and inherently risky equity positions.

Interactive Brokers Margin

  • The Interactive Brokers margin rates range is low on almost every trade value (margin trading). With Interactive Brokers, stock trading and crypto trading becomes a low cost-effective affair. Margin traders can benefit from IBKR as these low rates translate into higher profits.
  • IBKR Pro customers, in particular, can enjoy a maximum marginal rate of 1.5%, which is very low compared to every other broker review, even platforms like TD Ameritrade have reasonable rates.
  • IBKR Lite has the lowest margin rates of 2.5% per order (minimum charge). These low rates apply only to funds between $0 and $100,000. These rates drop even lower at higher balances, and the broker does not charge much on million-dollar trades.
  • Interactive Brokers has an integrated cash management feature, which helps active investors to borrow funds at low margin rates via low-interest credit cards such as Mastercard.

Interactive Brokers API

  • As per our review process, the new trading apps are used on a desktop web platform and a mobile trading platform. Hence, the Interactive Brokers API is dynamic.
  • The IBKR trading APIs are built to support custom trading applications, and they can integrate trading into existing third-party applications and create intuitive front-ends.
  • The APIs also support commercial trading software development. With the IBKR APIs, users can access trading products like stocks, options, futures, and currencies across 135 global markets in more than 33 countries from a single integrated account.
  • API features the IB SmartRouting SM that helps search for the best firm stock trading and options trades at low prices and easy availability. In such ways, the Interactive Brokers APIs are used by individuals, proprietary trading organizations, hedge funds, and amateur brokers.
  • The registered investment advisor services also use these APIs for large corporations and third-party software developers.

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Resources Offered by Interactive Brokers

For extensive trading, the offerings interactive brokers have are a plethora of research tools, a volatility lab, hours of year testing, the Interactive Brokers research materials, video content, social sentiment analysis, and educational materials and its spread around 135 market centers.

Traders on Interactive Brokers can navigate to the Education segment to find various resources that can be helpful in their trading journey. It offers webinars, a trader’s glossary, a trader’s calendar, a student trading lab, blogs, podcasts, and a dedicated Trader’s Academy, where beginners can find various financial courses.

These resources help invest in the best mutual funds. Besides mutual funds, these tools are packed with credible information for ETF trades and futures with IBKR ATS support that enables you to trade discreetly. They also have trading labs that teach students via instructors computer science and finance.

Stock Screener

Under the Mosaic interface on the TWS platform (trader workstation), the user can access a market scanner called Stock Scanner. This tool scans and lets you dive deep into hundreds of data points (in depth data profile) based on criteria set for global options traders and equities. It is also a predefined scanner and can run custom scans on different markets. This screener has the same feature as the interactive brokers called Fundamentals Explorer tool, used on TWS and Client Portal to get insightful data points and analyst ratings from the TipRanks web platform. This stock scanner tool is powerful on Client Portal and TWS both.

ETF Screener

The ETF market scanner is used in the Mosaic mode to specify ETF trades based on their asset class. This is a predefined scanner but also runs custom scans with varying capabilities. The Fundamentals Explorer of this scanner is used to evaluate ETFs. This tool also has the Mutual Fund Replicator, which is used for identifying ETFs and finding the matching funds of a specific mutual fund. It is best used for generating high-liquidity trades on mutual funds at a lower cost. Additionally, the IBKR clients can get free access to a proprietary Hedge Finder by AltaVista. This tool is an ETF Screener alternative to detect and find similar ETFs.

Options Screener

Options Strategy Lab is a unique tool that allows users to get lucrative spreads on their trades based on the market research outlook. With this tool, users can compare up to five spreads and run profitability analysis on them before entering a trade per order directly from this tool with TWS. Thus Options strategy lab offers a lot of positives for users and sees potential profit or loss.

Mutual Funds Screener

This mutual funds Scanner tool is available on TWS and helps in screening around 170 variables of mutual funds. This screening tool is also set to be added to the Client Portal and mobile platforms in the coming days.

Fixed Income Screener

Bond Scanner is an integrated tool on TWS and helps in exploring IBKR fixed-income inventory. This inventory is very huge and the tool is efficient in searching options based on asset classes, specific industries, and state-specific munis. This tool is currently not available on IBKR mobile app.

Calculators

In addition to these screen tools, the platform has various calculators. They are available on all IBKR platforms. The options-related calculators are used for calculating the margin based on order quantity and interest rate.

Trading Idea Generator

Idea generators used on IBKR are Refinitiv Significant Developments, well capitalized, Benzinga, and IBKR Market Signals. They are regularly updated with market-related blogs and contain new investors trading ideas and strategies.

Is Interactive Brokers Regulated & Safe?

Yes, Interactive Brokers is a regulated broker for stocks and ETFs (the exchange traded funds). It is licensed in the US as Interactive Brokers LLC. The firm is regulated by NYSE SIPC FINRA (financial industry regulatory authority) under the Hong Kong SFC. It is also regulated under the Australian authority – ASIC, registered under ARBN 091191141, AFSL 245574.

To diversify its operations as a broker for stock and ETF investors, Interactive Brokers is also regulated in Canada under Interactive Brokers Canada Inc. For these Canadian forex brokers, the Investment Industry Regulatory Organization of Canada (IIROC) is the key regulator in this network. The firm also is also protected by the Canadian Investor Protection Fund.

In Europe, foreign stocks and ETFs can be traded on this platform under the regulation of the Financial Conduct Authority. These UK forex brokers are registered under the FCA at 208159. In central Europe, the firm allows trading for stock and ETF trades for investors under Interactive Brokers Central Europe Zrt., a licensed and regulated entity under Magyar Nemzeti Bank, the Central Bank of Hungary. So if you were thinking earlier, is Interactive brokers safe for trade, then the bottom line answer would be yes.

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Interactive Brokers Security Measures

The top priority of Interactive Brokers is to maintain robust security by employing biometric login for mobile app users. Several two-factor authentication (2FA) processes are also enabled at critical trading levels. The IBKR Mobile Key is one of the best security features that ensures that the mobile app is unlocked only with a combination of fingerprint and PIN verification.

Interactive Brokers also holds SIPC insurance, provided by Lloyds of London. With this, the users can get protection on their funds up to $150 million. For IBKR Pro clients, complete SIPC protection is provided under Lloyd’s policy, which protects another $30 million on your account balance. The FDIC insurance for all ownership categories is $250,000 per program bank.

As per the Identity Theft Research Center, there has been no significant data breach at any IBKR user end-point location. Money has not been fraudulently looted or misplaced on the platform. The IBKR Securities Class Action Recovery is a valuable security solution launched in May 2020. It runs automated security features that create a service that removes the administrative burden involved in securities class action lawsuits. With this service, all users can file company claims for risks undetected by IBKR.Interactive Brokers Customer Support

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Our Verdict

According to this online IBKR review, we have rated this platform high due to its market competence. Customers can comfortably add money and expand their diversified portfolio analysis on IBKR Robo advisors platforms. Interactive Brokers continue to put great effort into amalgamating technology with mass-market trading needs. It has an overwhelming wealth of other tools (even the traders academy helps educate the financial professionals and achieve their financial goals), which can deliver high-volume guaranteed profits to the users when used precisely and with investment advice.

FAQs

Here are some answers to common concerns about Interactive Brokers.

Is Interactive Brokers Trustworthy?

Yes, the IBKR community has been growing for years and has not cited any illegal use or fraud. The platform is protected by top-end security measures. It is regulated by multiple authorities from the US as well as the UK securities and exchange commission. On top of that, the money held by Interactive Brokers is protected with fund insurance by the Lloyd’s of London banking institution.

Is Interactive Brokers Good for Beginners?

No, Interactive Brokers is best for experienced traders. It can be overwhelming for beginners. The platform has dozens of tools that are capable of running complex algorithms. However, beginners can start with IBKR Lite before using the full-scale platform under IBKR Pro.

Do Interactive Brokers Charge a Monthly Fee?

IBKR does not charge any monthly fee. However, it does charge interest to hold money in inactive accounts. This can be considered as a monthly fee for such inactive traders. These charges are called inactivity fees.

Is My Money Safe with Interactive Brokers?

Money held by Interactive Brokers is completely safe and protected by leading fund insurance companies. The withdrawal options are robust and provide no leeway for hackers to run malpractices. Moreover, as per the reviews, the platform also helps its users to withdraw as much money as they want. This way, the money can be transferred into different IBKR accounts. Internally and externally, the fund transfer on Interactive Brokers is highly secure. Hence, every user can safely keep money with Interactive Brokers.

How Much Money Do You Need to Open an Interactive Brokers Account?

There are no minimum deposit requirements placed by the company. However, if the balance remains zero for more than a period of 90 days, Interactive Brokers has the right to suspend the account. Besides this, the users must make deposits using the fiat currencies supported by the regional IBKR entities. Based on those policies, IBKR Pro users are recommended to deposit funds at some specific levels.

What is the minimum amount to deposit in Interactive Brokers?

While Interactive Brokers (IBKR) technically has no minimum deposit, things get nuanced when you want to start trading. To actually buy and sell, you’ll need at least $100. If margin trading interests you (borrowing to amplify gains), the bar jumps to $2,000. Market data subscriptions also have region-specific minimums, ranging from $500 for new Indian accounts to $100 for maintenance.

Does Interactive Brokers have margin trading?

Yes, Interactive Brokers (IBKR) does offer margin trading. In fact, IBKR is renowned for its competitive margin rates, often cited as the best in the industry. They provide access to margin for a wide range of instruments, including stocks, options, futures, and forex.

Disclaimer: This page does not solicit or recommend investments, nor does it provide trading or financial advice. Before investing in cryptocurrencies or engaging in securities trading, you should conduct thorough due diligence, including consultation with a certified financial advisor. We accept no liability for any financial losses incurred.

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