Interactive Brokers is a trustable online broker, operating from the US. It has a long operating history and has good financial audits as well. In this Interactive Broker review we’re going to focus on its workings and operations. Along with its pros and cons.
What is Interactive Brokers ?
Interactive Broker is an online brokerage providing wide range of investment opportunities. It is one of the biggest discount broker. The broker provide access to 135+ markets in 33 countries around the world. It allows you to invest in stocks, options, mutual funds, ETFs, futures, bonds, and currencies.
The firm offers low cost investment, market research, multiple trading platforms, and competitive customer services. Barron’s recently ranked it as No.1 online broker. Has its Headquartered in Greenwich, Connecticut.
Account Opening :
Account opening is fully digital but quite complex. They take long time to verify account. The minimum deposition for account opening is low.
What is the minimum deposit at Interactive Broker?
The minimum amount required to open an account is $0. However, minimum of $2000 is required if you want to trade on margin.
Interactive account types fall under two category :
- accounts for individual traders and investors
- accounts for institutions
Interactive Brokers Account Types
|Account Types||Short Description|
|Individuals||Account is owned and used by a single individual|
|Joint||Account is owned and used by two individuals|
|Trust||Account is held by a Trustee (separate legal entity) for your benefit|
|IRA||Individual retirement account, which is only available for US clients|
|UGMA/UTMA||Account for clients who are minors, which is only available for US clients|
|Friends and Family||Account for a client group of up to 15 members|
|Family Office||Account for an individual who is a Family Office Manager|
|Advisor||Account for an individual who manages both client administration and the client’s money|
|Small Business||Account for small corporations|
Besides these account types you can choose also choose between IBKR PRO and IBKR LITE, if you are a US resident.
Interactive Brokers Fees:
|US stock||$0.005 per share, min. $1, max. 1% of trade value. Free for US clients choosing IBKR Lite plan.|
|EURUSD||Trade value less than $1 billion: 0.2 bps * trade value; min. $2|
|Mutual fund||$14.95 per transaction or 3% of trade value, whichever is lower|
|Inactivity fee||$20 per month if you have less than $2,000 account balance and if you don’t generate minimum $20 in commissions. $10 for accounts having at least $2,000 account balance, while no inactivity fee for US clients choosing IBKR Lite plan.|
Deposit and withdrawal :
Interactive Brokers offer 22 base currencies. It offers one free withdrawal per month which is less compared to competitors. Also, it only allows deposit through bank transfer. No other means of deposition is supported by them. But if you are a resident of US, you have a little extra options like:
- Online bill payment
- Direct Rollover
Withdrawal is also same as deposit. First withdrawal is free of charge whereas later on charge some fee. Withdrawal fee depend on the country of the client. US residents can withdraw via ACH or Check as well.
Is Interactive Brokers Right for you?
Interactive Broker is the right platform if you’re an active day trader. It is not for someone who are looking for hands-off approach for wealth building. It offers trading, investing, retirement and cash management program. Along with it has 135+ stocks available for trading.
It has expanded accounting features for US residents. Introduced Interactive Brokers debit card and the Integrated Investment Management program. These include:
- direct debit card deposits
- paying bills without checks through Bill Pay
Interactive Brokers provide automated trading facilities but still it is heavily tailored for active traders.
Interactive Broker’s web and mobile trading platform is simple and easy to use. It is beginner friendly and has a lot of useful function. Whereas, on the other hand desktop trading platform is quite complex to use. It is for PRO accounts only and has good customizability and advance order execution. It is mainly designed for advance traders.
Interactive Broker platform score
Interactive Broker offer wide range of products to trade in.
IB’s product and availability
|Low trading fee||Complex desktop trading platform|
|Wide range of products||Inactivity fee|
|Free stock and ETF trading for US clients||Less active traders pay more for IBKR Pro|
|No minimum deposit for most account types||No 24/7 support|
|Several account base currencies||Credit/Debit card not available|
Is Interactive Broker Safe?
IB is safe as it is regulated by top tier US financial institutes. The clients come under SIPC is covered by $500,000 security amount. However, clients from all the countries are not come under such protection scheme. Its parent company is listed in NASDAQ.
Interactive Broker’s protection amount for different legal entities are:
- UK : £85,000
- USA : $500,000 ($250,000 cash limit)
- EU countries in Northern and Western Europe (incl. Italy and Spain) : €20,000
- Austria and Luxembourg : €20,000
- EU countries in Central/Eastern Europe & Cyprus & Malta & Greece : €100,000
- Canada : CAD 1,000,000
- Rest other countries : No protection
Interactive Brokers Customer Service :
Service Desk number and hours of operation
|Location||Number||Hours of operation (Time Zone)|
|United States||1 (877) 442-2757 Toll free|
1 (312) 542-6901 Direct dial
|14:00 (Mon – Fri) – 02:00 (Tue – Sat) (Europe/Berlin)|
19:00 (Sun) – 01:00 (Mon) (Europe/Berlin)
|Canada||1 (877) 745-4222 Toll free|
1 (514) 847-3499 Direct dial
|14:00 – 23:30 (Mon – Fri) (Europe/Berlin)|
|Europe||00800-42-276537 Toll free|
+41-41-726-9500 Direct dial
+44 207-710-5695 Direct dial (United Kingdom)
|09:00 – 18:00 (Mon – Fri) (Europe/Berlin)|
8-800-100-8556 Toll free
|08:00 – 17:00 (Mon – Fri)|
+852-2156-7907 Direct dial
|02:00 – 11:00 (Mon – Fri) (Europe/Berlin)|
|Australia||+61 (2) 8093 7300 Direct dial||00:30 – 10:00 (Mon – Fri) (Europe/Berlin)|
+91 22 61289888 Direct dial
+91 22 39696188 Direct dial
|02:30 – 14:00 (Mon – Fri) (Europe/Berlin)|
+86 (21) 6086 8586 Direct dial
|03:00 – 12:00 (Mon – Fri) (Europe/Berlin)|
|Japan||+81 (3) 4588 9700 Direct dial|
+81 (3) 4588 9710 Direct dial (English)
|01:30 – 10:30 (Mon – Fri) (Europe/Berlin)|
Bottom Line :
Interactive Broker has mixed services. On one hand it has low fees, variety of products and good quality educational tools. While on the other hand, it is quite complex to use and mainly designed for advanced traders. Its tools are created by keeping advance traders in mind.
If you’re looking for low cost trading platform and have experience of navigating through complex platform. Feel free to try Interactive Broker.