Interactive Brokers Review 2023 – Still One of the Best Online Brokers?
Finding the right online broker to suit your investing needs can be challenging. Between the wide range of platforms, account types, tradable assets, and fees – how do you decide? One broker that often tops the list is Interactive Brokers (IBKR). With its advanced trading platform, extensive product offerings, and low commissions, it appeals to active traders and investors.
But how does Interactive Brokers stack up for 2023 compared to other top brokers? In this hands-on review, I’ll share my experience using IBKR as an individual investor and provide an updated look at its pros, cons, pricing, and more.
Key Takeaways from My Interactive Brokers 2023 Review
- With advanced platforms and competitive pricing, IBKR targets active traders
- Excellent desktop and mobile experiences for technical traders
- Commission-free ETF trades available under IBKR Lite pricing
- Commission-free stocks trades available
- Commission-free options trades available
- Among the lowest margin rates in the industry
- Access to extensive markets and asset classes globally
- Accounts can be tailored for needs of individuals or pros
- Consider IBKR if value low-cost trading and platform power
Overview of Interactive Brokers for Beginner Investors
Founded in 1978, Interactive Brokers pioneered electronic trading and now services over 1 million clients globally. They offer trading across a wide range of assets:
- Stocks, ETFs, mutual funds, bonds, forex, and CFDs
- Options, futures, metals, and over 100 international markets
- Cryptocurrencies like Bitcoin, Ethereum, Litecoin
- Fractional share investing starts at $1
For beginners, IBKR has an intuitive web-based platform and mobile app. But the broker is best known for its highly-configurable Trader Workstation (TWS) desktop platform tailored to active traders.
Low margin rates, advanced trading tools, and direct market access complement the platform technology. But does IBKR still make sense fees-wise today?
Interactive BrokersCommissions and Fees Reviewed
Broker fees are always a top consideration for cost-conscious investors. Here’s an overview of IBKR’s fee structure:
Stocks and ETFs
- $0.0035 per share, minimum $0.35
- 0.05% of trade value for OTC stocks
- $3 minimum up to $24 depending on fund
- $0.65 per contract, no base fee
- Various exchange fees plus $0.85-$2.15 Interactive Brokers clearing fee per side
- Variable spread markup starting around 0.2 pips average
- 0.75%-1.59% for <$100K, down to 0.5%-0.75% over $2M
Compared to other discount brokers, IBKR’s stock and ETF trade commissions are extremely competitive. Options fees are average.
Margin rates are among the industry’s lowest, especially for larger accounts. Overall, Interactive Brokers still has a clear advantage on costs for active traders.
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The Trading Platform Technology
Beyond fees, IBKR stands out for its trading platforms and tools.
Trader Workstation provides a fully-customizable desktop experience ideal for technical traders. Charts, scanners, algorithmic trading, market depth tools, and more.
Client Portal offers a robust web experience accessible anywhere. Streamlined yet still powerful.
IBKR Mobile has full trading functionality in iOS, Android, and web apps.
For casual investors, the web and mobile experiences may provide enough functionality. But active traders will appreciate TWS and its API capabilities.
How Account Types and Offerings Compare
Interactive Brokers structures accounts across two tiers:
IBKR Lite accounts offer commission-free stock and ETF trades, with $0.65 per options contract. Other assets incur fees. Perfect for buy-and-hold investors.
IBKR Pro accounts enable unlimited trades across all tradable asset classes and exchanges with the lowest published pricing. Made for active traders.
IBKR also supports:
- Individual, joint, retirement, trust, and other account types
- Smaller account sizes starting at $0
- Paper trading to test strategies with simulated money
- Impact app for socially responsible investing
Account offerings are flexible enough for most individual investors. Businesses and advisors have additional options.
Final Thoughts on Using Interactive Brokers
Based on testing their platforms and experiencing the account offerings, here are my key takeaways on Interactive Brokers in 2023:
- Trading costs among the lowest in the industry
- Powerful desktop, web, and mobile trading platforms
- Access to extensive global trading products
- Accounts tailored for every trading style
- Advanced TWS can intimidate casual investors
- Limited portfolio building tools and research
- Higher minimums for margin vs competitors
While not ideal for total beginners, Interactive Brokers excels at serving active traders who value superior technology and low commissions.
Frequently asked questions
Q: What is Interactive Brokers?
A: Interactive Brokers is an online brokerage company that offers a wide range of financial products and services, including stocks, options, futures, forex, and more.
Q: Does Interactive Brokers charge commission fees?
A: Yes, Interactive Brokers charges commission fees for trades. The commission structure varies depending on the type of trade and the volume of trading.
Q: Can you provide a review of Interactive Brokers?
A: Interactive Brokers is considered one of the best brokers in the industry. They offer a wide range of trading products, competitive commissions, and advanced trading platforms.
Q: Does Interactive Brokers have a mobile trading app?
A: Yes, Interactive Brokers offers a mobile trading app called IBKR Mobile. It allows you to trade and monitor your positions on the go.
Q: What are the commissions and fees charged by Interactive Brokers?
A: Interactive Brokers has a transparent fee structure. They charge commissions for trades and may have additional fees for certain services or accounts.
Q: What is the margin rate offered by Interactive Brokers?
A: The margin rate offered by Interactive Brokers depends on the type of account and the amount of leverage you use. It is important to review the current rates before trading on margin.
Q: What is IBKR Pro?
A: IBKR Pro is a trading account offered by Interactive Brokers. It provides access to all the trading products and features of Interactive Brokers with a lower commission structure.
Q: What are the benefits of using Interactive Brokers as a brokerage?
A: There are several benefits of using Interactive Brokers as a brokerage, including access to a wide range of financial products, competitive commissions, advanced trading platforms, and global market access.
Q: What is the best broker for trading?
A: Many experienced investors consider Interactive Brokers as one of the best brokers for trading due to their comprehensive offerings, competitive fees, and advanced platforms.
Q: What are the features of the Interactive Brokers trading platform?
A: The Interactive Brokers trading platform, called Trader Workstation, offers advanced trading tools, real-time market data, customizable charts, and access to multiple global exchanges.
Is Interactive Brokers Right for You?
Interactive Brokers stands out as one of the best brokers for:
- Active stock, options, and futures traders
- International and multi-market investing
- Algorithmic and high-volume trading
- Low margin rates and borrowing costs
For more casual investors, the technology learning curve and lack of guidance may be cons. Competitors like Fidelity, Vanguard, or Charles Schwab may be easier to start with.
But if you prioritize trading costs and platform power, definitely consider Interactive Brokers. The pricing and tools are tough to beat.
I hope this detailed Interactive Brokers review for 2023 provides useful insights to guide your brokerage choice! Please leave any questions below.