ibkr reviews: A Comprehensive Guide to Interactive Brokers

Interactive Brokers, or IBKR, is a well-established online brokerage firm that offers a wide range of trading services. Their platform is known for being user-friendly and offering competitive pricing.

IBKR has been in operation since 1978, making it a seasoned player in the financial industry. They are a member of the Securities Investor Protection Corporation (SIPC), which provides protection for clients' accounts up to $500,000.

IBKR's trading platform offers a wide range of assets, including stocks, options, futures, forex, and more. They also offer a mobile app for on-the-go trading and account management.

Interactive Brokers has its share of advantages and disadvantages. Let's dive into the pros and cons.

One of the standout benefits of Interactive Brokers is its low fees. This can be a significant advantage for traders who want to save money on commissions.

The platform also makes it easy to move your account to another country, which is a plus for international traders.

Another perk is the ability to buy fractional shares, which can be a game-changer for investors who want to diversify their portfolio.

Interactive Brokers is also well-suited for trading US stocks, making it a great option for those looking to invest in the US market.

On the other hand, the platform's pricing can be confusing, which may lead to frustration for some users.

Additionally, Interactive Brokers is geared more towards experienced traders, making it less beginner-friendly.

You'll also need to handle your own taxes, which can be a burden for some users.

Here's a summary of the pros and cons:

It's free to create an account with Interactive Brokers, and there's no membership fee. You'll only pay a transaction fee for buying or selling something.

The fee structure is a bit complex, with two systems to choose from: fixed pricing and tiered pricing. Fixed pricing is relatively straightforward, with a fee of 0.05% of the trade value for stocks, ETFs, and bonds, with a minimum fee of €3.

For example, buying €1,000 of the iShares Core S&P 500 ETF costs €3, which is a flat fee.

Interactive Brokers has two account types: IBKR Lite and IBKR Pro. IBKR Lite is commission-free for retail trades, while IBKR Pro has fees of $0.005 per share for smaller volume trades, with a minimum cost of $1 and a maximum of 1% of the trade's total value.

Here's a breakdown of the fees for different account types:

It's worth noting that there's no monthly fee for either IBKR Lite or IBKR Pro accounts.

Opening an account with Interactive Brokers takes around 3 business days, which is a relatively quick turnaround time. You can start the application process and complete it later, which is a convenient feature.

The Interactive Brokers mobile app and web app are both available for users, and the web app is generally easier to use due to the complexity of the questions involved. The ease of use is rated 2 out of 5, indicating that it may not be the most user-friendly platform for beginners.

Interactive Brokers offers joint and business accounts, making it a suitable option for traders who want to manage their finances with others. However, it's worth noting that children accounts are not available.

Here's a summary of the account types offered by Interactive Brokers:

The desktop platform, Trader Workstation, is the most in-depth platform offered by Interactive Brokers, providing access to a wide range of tools and analytical charts. It's very intuitive, but may take some getting used to for beginner traders.

Setting up an account with Interactive Brokers can be done through their mobile app or web app, both of which are available for use. You can expect to spend some time answering a series of questions during the setup process, which can be a bit complex and is easier to do on a computer.

The account opening process typically takes around 3 business days, although you can start an application and complete it at a later stage, which is a convenient feature. You can also open a joint account or a business account, which is a great option for those who need to manage investments together or for companies.

Interactive Brokers offers two main account plans: IBKR Lite and IBKR Pro. IBKR Lite is not available for New Zealand-based users, whereas IBKR Pro is available and suitable for advanced traders and sophisticated investors.

Here's a summary of the account setup process:

Note that you can also open a company account on Interactive Brokers, which is a great option for businesses.

The desktop platform from Interactive Brokers is a powerful tool for traders, offering a vast range of tools and analytical charts.

For professional traders, this platform provides a high-level environment to invest, with a personal list of frequently used tools.

However, for beginners, it may take some time to get used to the platform's features.

The platform is very intuitive, making it easy to navigate for experienced traders.

But, as one user experienced, the desktop app can sometimes malfunction, leaving traders without access to their accounts.

Interactive Brokers has made efforts to improve customer service, with Client Services Teams available across the globe, accessible by phone, live chat, or ticket.

Interactive Brokers works with Plaid, so you can use them together.

To enable this, make sure to enable third-party services in the Interactive Brokers app.

Interactive Brokers has a complex customer support system, with various channels available to reach them. You can contact them via phone, live chat, email, or ticket, and they have Client Services Teams across the globe to assist you.

Their website claims to have significantly reduced wait times and improved assistance, but some users have reported poor support during onboarding and difficulty reaching customer care via phone. They have also invested in a new UI framework for their desktop platform, IBKR Desktop, which combines proven and new technologies to provide a sleek and speedy experience.

Interactive Brokers takes safety seriously, with a Securities Investor Protection Corporation (SIPC) coverage of up to $500,000 and an excess SIPC policy for up to an additional $30 million. This ensures that traders' money is protected up to a certain limit. They also have a robust security system in place to protect accounts and prevent theft.

Here are some key safety features and regulations that Interactive Brokers adheres to:

Interactive Brokers is listed on the Nasdaq, which means they have to meet higher requirements and transparency standards, providing a sense of safety for traders.

Interactive Brokers offers several options for customer support, but the experience can be hit or miss. The company has invested in customer service to reduce wait times and provide fast assistance to clients, but some users have reported difficulties reaching customer care via phone or experiencing long wait times.

The company has Client Services Teams across the globe that can be reached by phone, live chat, or ticket, but the hours of operation for phone support vary by location. You can find the hours of operation for phone support in your area on the Interactive Brokers website.

Some users have reported issues with customer support, including long wait times and difficulties reaching customer care. However, the company has a 24-hour online live chat customer service option that is available each business day. If you're unable to reach customer care via phone, this option may be a good alternative.

If you're experiencing issues with your account, such as a locked account or difficulty depositing funds, you can try contacting customer support via email or phone. However, be aware that the phone lines can be busy, and it may take some time to reach an agent.

Here are some contact options for Interactive Brokers customer support:

Keep in mind that customer support options may vary depending on your location, so be sure to check the Interactive Brokers website for specific information.

Interactive Brokers has a strong focus on safety, with multiple layers of protection in place to safeguard your investments.

The Securities Investor Protection Corporation (SIPC) provides a maximum coverage of $500,000, with a cash sub-limit of $250,000.

Interactive Brokers also has an excess SIPC policy that covers up to an additional $30 million, with a cash sub-limit of $900,000, subject to an aggregate limit of $150 million.

This means that your investments are protected up to a total of $150 million.

Interactive Brokers takes regulatory standards seriously, abiding by the Central Bank of Ireland and Central Bank of Hungary, among others.

The company has a number of fail-safes in place to ensure accounts are kept secure and money can't be stolen, including an insurance policy that covers each individual investor to a maximum of $500,000.

Here's a breakdown of the protection Interactive Brokers offers:

This combination of SIPC and excess SIPC policy provides a robust layer of protection for your investments.

Interactive Brokers offers a straightforward fee structure, making it easy to understand what you'll pay. There's no membership fee, and creating an account is free.

The fixed pricing model is simple: 0.05% of the trade value, with a minimum of €3.00 for stocks, ETFs, and bonds. This applies to most cases, but there are exceptions.

You can choose between smart routing and direct routing. Smart routing is the default option, which automatically routes your order for the best possible execution. Direct routing gives you more control, but it costs more.

Here's a breakdown of the fees for different account types:

There are no monthly fees or inactivity fees for either IBKR Lite or Pro accounts, which is a big plus.

Trading fees can be a bit of a minefield, but don't worry, I'm here to break it down for you. Interactive Brokers has two main fee structures: fixed pricing and tiered pricing.

With fixed pricing, you'll pay a flat fee of 0.05% of the trade value, with a minimum of €3.00. This applies to stocks, ETFs, and bonds. For example, buying €1,000 of the iShares Core S&P 500 ETF will cost you €3.00.

Interactive Brokers also offers a tiered pricing model, which charges a lower percentage of the trade value, but with additional exchange, clearing, and regulatory fees. However, sticking with fixed pricing is often the easiest option.

The fees for Interactive Brokers' account types differ. IBKR Lite is geared towards beginner investors and retail traders, while IBKR Pro is for more experienced traders.

Here's a breakdown of the fees for both account types:

It's worth noting that IBKR Lite has no commissions or fees on listed stocks and ETFs, making it a great option for retail traders.

Interactive Brokers doesn't charge a monthly fee for either IBKR Lite or IBKR Pro, so you won't have to worry about that extra expense.

There are no inactivity fees for either IBKR Lite or Pro, which means you can keep your account open without worrying about being charged for not using it.

Payment for Order Flow is a type of fee charged by some brokerages.

This fee is paid by the brokerage to the exchange for directing client orders to them.

For example, Robinhood charges this fee to its clients, which is then passed on to the exchange.

As a result, the client pays a higher trading fee, which can range from $0.000115 to $0.000032 per share.

TD Ameritrade also charges this fee, which can be as high as $0.006 per share.

The exact amount of the fee varies depending on the brokerage and the type of trade being executed.

In some cases, the fee can be as high as $0.01 per share, which can add up quickly for frequent traders.

The payment for order flow fee is a common practice in the brokerage industry.

Interactive Brokers' mobile app is available on both iOS and Android, making it accessible to a wide range of users.

The app is a powerful platform for experienced traders who want to stay connected with the markets on the go. It can be linked to the browser and desktop platform, allowing seamless access to new metrics and watch lists.

The desktop platform, Trader Workstation, is the most in-depth platform offered by Interactive Brokers. It provides a vast range of tools and analytical charts.

For experienced traders, the desktop platform is a perfect environment to invest at a high level. It's also very intuitive, allowing users to easily access their favorite tools.

I've seen firsthand the reliability of Interactive Brokers, with one user sharing a positive experience of never having access issues, unlike their previous broker, Schwab. This level of dependability is a major plus for traders.

Interactive Brokers' ease of use is a bit of a mixed bag. The desktop platform, Trader Workstation, is very intuitive and allows traders to access a massive range of tools and analytical charts. However, for beginner traders, this may take some getting used to.

The platform is designed for professional or experienced traders, and its complexity can be overwhelming. For example, one user had trouble with the desktop app, which wasn't working, and had to deal with a bot that couldn't help resolve the issue. Thankfully, the company has since invested in customer service to reduce wait times and provide faster assistance.

Another issue with Interactive Brokers is its customer support. Some users have reported slow response times, especially in time-sensitive situations. In one case, a user had to wait two weeks for a simple issue to be resolved.

On the other hand, the company offers a free trial account with all of its trading platforms, allowing users to learn how to use the tools and services without risking real money. This is a great way to test the waters and get a feel for the platform.

Here's a summary of the pros and cons of Interactive Brokers' ease of use:

Overall, while Interactive Brokers has its strengths and weaknesses when it comes to ease of use, it's essential to weigh these factors against the company's other offerings and decide if it's the right fit for your trading needs.

The IBKR mobile app is available on both iOS and Android, making it accessible to a wide range of users.

It's one of the strongest mobile apps on the market, but it can be quite tricky for new traders to get to grips with.

The app is essentially halfway between the browser and the desktop platform, which can be both a blessing and a curse.

For experienced traders who want to keep in touch with the markets on the go, the app is a very powerful platform.

It can also be linked to the browser and desktop platform, allowing for seamless integration and synchronization of data.

Any new metrics or watch lists created on the app will automatically be sent over to the browser and desktop platform each time you log in.

Interactive Brokers' mobile app is available on both iOS and Android, making it a convenient option for traders on the go. The app is a powerful platform, but it can be tricky for new traders to navigate.

One of the standout features of the app is its ability to link to the browser and desktop platform, allowing users to access their watch lists and metrics from any device. This seamless integration is a major plus for experienced traders.

The app is also a great option for traders who want to keep up with the markets from anywhere. With the app, you can stay connected and make trades on the go.

The app's design is a bit of a hybrid, falling somewhere between the browser and desktop platform. This can make it a bit confusing for new users, but experienced traders will appreciate the flexibility.

One of the most convenient features of Interactive Brokers is its support for fractional shares. This means that you can buy and sell a portion of a share, rather than having to purchase a whole share.

Here's a breakdown of some of the key convenience features of Interactive Brokers:

The lack of a chat feature may be a drawback for some users, but the availability of email, phone, and FAQ support makes up for it.

Interactive Brokers has had issues with regulators, specifically the SEC, FINRA, and CFTC, related to its anti-money laundering practices.

The SEC found that Interactive Brokers failed to file over 150 Suspicious Activity Reports (SARs) for U.S. microcap securities trades.

Interactive Brokers was fined a total of $38 million by FINRA and the CFTC for similar AML failures.

Your assets are protected by the Securities Investor Protection Corporation (SIPC) up to $500,000 in the event of bankruptcy.

Interactive Brokers has had issues with regulators due to its anti-money laundering (AML) practices. The Securities and Exchange Commission (SEC) fined the firm $11.5 million for failing to file Suspicious Activity Reports (SARs) for U.S. microcap securities trades.

The SEC found that Interactive Brokers failed to file more than 150 SARs over a one-year period, even when suspicious transactions were flagged by its compliance personnel. This lack of reporting led to a significant penalty.

In parallel actions, the Financial Industry Regulatory Authority (FINRA) fined Interactive Brokers $15 million for similar AML failures. The CFTC also fined them another $11.5 million.

Interactive Brokers' failure to adequately monitor its customers' wire transfers and investigate suspicious activities led to these penalties. The firm also did not establish proper policies and controls for reporting suspicious transactions as required by the Bank Secrecy Act (BSA).

Your assets are protected under the European Investor protection scheme up to €20,000. This is a significant safeguard for your financial security.

The Securities Investor Protection Corporation (SIPC) provides additional protection for Interactive Brokers customers, covering amounts up to $500,000 in the event of bankruptcy.

This level of protection is a lot more comprehensive than the €20,000 limit under the European scheme, offering greater peace of mind for investors.

Interactive Brokers' usability is rated 6 out of 10, which suggests that while it's not the most user-friendly platform, it's still accessible to most users.

The company's customer service and help is exceptional, with a rating of 9.5 out of 10. This is a major plus for investors who value timely and effective support.

Tools and resources are rated 7.5 out of 10, indicating that while they're not the most comprehensive, they're still a valuable asset for investors.

Here's a breakdown of Interactive Brokers' ratings:

Keep in mind that these ratings are just a snapshot, and your experience may vary depending on your individual needs and preferences.

Interactive Brokers' rating is a mixed bag, with some areas standing out more than others. The usability of their platform is somewhat lacking, with a rating of 6/10.

Customer service and help, on the other hand, are top-notch, with a rating of 9.5/10. This is a huge plus for investors who may need assistance with their accounts.

The tools and resources available to investors are decent, with a rating of 7.5/10. This includes research and education materials, which are rated 8.5/10.

Commissions and fees are also relatively reasonable, with a rating of 8/10.

Here's a breakdown of the ratings:

Interactive Brokers offers a free trial account with a paper trading value of $1,000,000, allowing you to practice using their tools and services.

You can choose from various trading platforms, including Desktop TWS, IBKR Mobile, and the client portal, which enables account management.

The platform's fee structure is geared towards frequent and large traders, with a fixed and tiered pricing plan that varies depending on the exchange used.

To get a better understanding of the fees, you can test out the platform using a paper account.

Interactive Brokers provides extensive tools, such as charting and market information, but may seem overwhelming for beginners.

Some features might not be available to you when you open an account, as a precaution to prevent significant losses from financial products like options and margin trading.

Here's a comparison of the fees for different platforms:

Interactive Brokers is best suited for active traders, offering huge discounts for high-volume trading.