Do you like software based brokerage services? Then Interactive Brokers might work for you! IB is reputed to be one of the best software based brokers whose fees and commissions are very competitive and the services isn't bad either. IB is one of the most active investors and traders in the market today. It offers a 'smart' trading platform to its investors along with commission rates that are hard to beat.
IB is meant for experienced and professional investors who are active trades and deals in a huge lot. It is not recommended for small time investors. Impressive margin rates, fast executions and a great trading account is what you can expect when you choose IB. They also offer a good range of investment products to its investors including Forex (Foreign Exchange), so if you are concerned about being limited when it comes to investments then you can chuck away your worries. The investment options of IB would leave you spoilt for choice. Interactive Brokers offers a huge list of different types of accounts that you can open. However the minimum amount for opening most of the accounts is $10000, which is a lot but if you have enough funds for this purpose, then it should not be a problem. The account opening process is fast and easy to understand too. You should not have a problem with it, even if you are not as savvy with online stock trading companies.
Fees & Commissions
The commissions of IB are: For stocks it is $0.01 for every share up to 500 shares, once you trade more than 500 shares it is only $0.005 thereafter! As for Futures it is $4.80 and options come at a commission of $1 for every contract. Interactive Brokers follow a pay-per-share commission system which means that the more you order the more you are likely to benefit. For instance, given the commission rate of IB, you will only have to pay $10 approx. for an order of 2000 shares, which makes it very cheap. And if you trade more, say 5000 shares then the commission would only be $25!
You can invest in ETFs, Futures, bonds, options, stocks, currency transactions (Forex). Since IB is only meant for the professionals or ones that deal in bulk, you should avoid dealing with IB if you are fairly new to the online stock trading concept.
The tools and software of Interactive Brokers aren't meant for common investors, they are designed for professionals. The user-friendliness of the features of IB is not that high because only a few who are not professionals can understand the complexity of some of the website's features. For newbies you might take some time to learn because it is very difficult to get used to it in the beginning since these tools are a little difficult to learn.
If you are a professional, then you should definitely go for IB because its trading workstation or platform is considered as one of the best in the industry. It is a type of platform meant for serious business only. You can enter multiple orders even when you don't have enough money to cover for it. In such a case, only the orders that are permitted would be executed and the others would be automatically cancelled. The workstation is entirely customizable and it has cutting edge research and charting features, tools for minimizing your risks, dynamic streaming quotes and a feature that allows you to place your orders directly to the market. You can use the software-based or web-based tools as per your needs.
The customer service of Interactive Brokers is not all that good as there have been a lot of complaints about it. There is a phone-line that the investors can call and also a live chat facility from Friday to Sunday. IB claim to take only a minute to answer their phone calls and they even claim that their customer care executives are very helpful and eager to solve the problems of the investors.
For beginner investors, it is best not to opt for Interactive Brokers because of the complexity of their trading tools and platforms. Even those who have an IRA account should stay away because there is monthly charging of fees, and so it is a better idea to invest with other IRA brokerages that do not charge fees. If you are looking for a brokerage company that offers professional platform, then you can opt for IB.
How Others Rate Interactive Brokers?
Here is how the most trustworthy external sources rate this broker. Best rating is marked with 5 orange stars, worst rating is marked with 5 grey stars, and if any feature is not rated you will see white stars with grey border.
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