Interactive Broker ETF Review 2018 - Biggest U.S-based Brokerage Firm

Last updated & tested: 28.10.2018

Interactive Brokers LLC (IB), established officially in 1978, is an electronic brokerage company in the US. It gained first place among U.S brokerage firms in term of a number of daily average revenue trades and forex broker. The company headquarter is located in Greenwich, Connecticut and widespread in four cities.

Interactive Brokers has about 385 thousand client brokerage accounts operated, with US$86 billion in customer equity. The broker provides a comprehensive portal with more than 120 markets centers in 26 different nations. The customer can use IB to trade thousands of global instruments such as stocks, currencies, CFDs, ETFs, etc.

Highlights
  • IB is a U.S-based electronic brokerage firm established in 1978
  • It is the leading electronic brokerage firm in the US.
  • The company has 385,000 client brokerage accounts.
  • The company is an equity partner and founder of the Boston Options Exchange.
4.
of 14 ETF Broker
Interactive Brokers
interactive brokers experiences
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Risk warning: Capital can be lost. Terms and conditions apply.
Headquarters and regulation

USA (SEC, CFTC)

Number of ETFs with discount

45

Saving plans

Yes

Custody fee

$0

Trading from

$1

Mobile Trading & Apps

Demo account

Yes, free

Premiums

No

Minimum deposit

$ 10.000

Services & additional benefits

Live
Hotline
E-mail

1. Trading Offer

1.) ETF Trading Offers: 45 Commission-free ETFs

At Interactive Brokers, traders can trade with more than 20,000 ETFs. This is a large number of ETFs when compared to those of other brokers. Besides, there are about 45 commission-free ETFs that IB offers.

IB provides a wide range of accounts for individuals and institutions. These accounts are Individual, Trust, Joint, IRA, Friends and family group, UGMA/UTMA, Family office and Small business accounts. Not only that, traders can use the demo account to get used to trading activities in the platform.

20.223
ETFs
Number
45
ETFs with discount
Number
Yes
Saving plans

IB specifically offers custody account for institutions. The custody account is based on the co-operation between IB, the custodial bank keeping the assets of the customer, and the IB client. Assets are kept at a pledged account at the Custodial bank, presented in the clients IB trading account and applied to margin trades. The assets allowed for custody accounts contains long stock, government money-market funds, treasuries, and retail. The custody account supports traders to trade products in 120 market centers in 26 nations.

Trader Rating
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  • There are 45 commission-free ETFs available in the Interactive Broker
  • IB provides many types of accounts for individual and institution.
  • IB also delivers custody account for various institutions.
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Risk warning: Capital can be lost. Terms and conditions apply.
2. Costs

2.) Exchanges and Trading Centers: Direct Trade via Trading Desk

American traders can trade ETFs from the following stock exchanges: Chicago Stock Exchange (CHX), NASDAQ OMX BX (BEX), NYSE American (AMEX) and NYSE Arca (ARCA).

Besides, Interactive Brokers provides support for traders through educational channels that are online courses, webinars, educational video, glossary and other. By dint of these channels, traders can interact deeply with the support service, understand company products and get basic knowledge and skills about trading.

3
National
Trading venues
30+
International
Trading venues

Traders can make a direct trade with stocks & options through the phone call in the trading desk of IB. The trading desk is the best way for the traders to approach a trade while they are away from their mobile and computer devices. The brokers on IB trade desk accumulated 20 years of trading experience. They assist the trader’s trading activities, keeping an eye on trader’s orders and updating any movement on the market.

Trader Rating
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  • IB connects to several America stock exchanges: Chicago Stock Exchange (CHX), NASDAQ OMX BX (BEX), NYSE American (AMEX) and NYSE Arca (ARCA).
  • Interactive Brokers provides useful educational channels that are online courses, webinars, educational video, glossary and other.
  • Traders can make the direct trade with stocks & options through the phone call in trading desk of IB.
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Risk warning: Capital can be lost. Terms and conditions apply.
3. Account

3.) Trading conditions: Fair ETFs Trading Fee

Interactive Broker demands the considerably high account minimum- $10,000. The minimum for IRA accounts is $5,000.

For ETFs, stocks, and warrants of US, Interactive Brokers charges $0.005 per share and $1 minimum commission per order and maximum of 1% of the trade value. The broker also charges the fee for services containing brokerage commission and yearly management cost that varies from 0.08 to 1.5%.

Otherwise, the broker has some unrelated trading fee. It sets $10 a month for activity fee, meaning that the traders have to pay $10 a month in commission no matter what happens. However, the broker doesn’t apply custody charge and deposit charge. The withdraw charge for bank transfer can be free in the first month but costs $10 for the subsequent months.

$5.000
Saving plans
From
$1
Trading
From
$0
Custody fee
$ 10.000
Min. deposit

For IRA accounts, Interactive Brokers requires no fee for IRA account setup but requires $30 annual fee for IRA account operation.

Trader Rating
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  • Interactive Brokers charges $0.005 per share for ETFs, stocks, and warrants of US.
  • Traders do not have to pay custody fee and deposit fee but have to pay for withdrawing fee and IRA account fee.
  • The platform also charges a $10 minimum monthly activity fee to all users.
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Risk warning: Capital can be lost. Terms and conditions apply.
4. Platform

4.) Trading Platform: A Browser Platform for Advanced Trader

Interactive Brokers has the main platform that is Trader Workstation. The Interactive Brokers platform provides the deep experience for active, advanced investors with many useful functions such as advanced charting, heat schemes of the sector and stock performance, and paper trading. Its mutual fund replicator helps the user to clarify ETFs that resemble the operation of a selected mutual fund- a tremendous fee-slashing function.

IB integrates Trader Workstation on computer devices that are PCs and Macs. The system is considerably fast and delivers many practical features for traders including real-time quotes, the alerts set-up, customizable watch lists, the mapped-out dashboard that tailors traders desire.

Interactive Brokers provides multiple mobile applications, which contain TWS mobile trading app available on iOS devices and Android items. Mobile apps deliver a trading on-the-go feature that brings unique experience for traders.

MT4
metatrader
IOS
Android

Although traders often assume that the trading activities in the mobile app are fewer than that of desktop, the mobile app of IB demonstrates an opposite point. Traders can access a wide spectrum of features generated on the desktop program from live streaming data to fully-fledged order entrance and portfolio management. Traders can establish fundamental or sophisticated stock trades and complex research right on the app.

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  • Trader Workstation offers ETF Replicator- a useful fee-slashing feature.
  • The platform can work on many devices, containing PCs and Macs.
  • The Interactive Brokers app can provide a full range of features as the desktop program does.
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Risk warning: Capital can be lost. Terms and conditions apply.
5. Usability

5.) Usability of the Website: Colorful and Orderly Display

The website looks beautiful. There are light-colored background photographs that are set behind the black headings and red buttons across the website. The color combination is harmonious and orderly.

The menu bar located at the top of the website, containing several main items that are WHY IBKR, FREE TRIAL, PRICING, PRODUCTS, TECHNOLOGY, EDUCATION. Besides, there is the “Integrated Investment Management” box navigating traders to the introduction of the accounts offered by the firm in the center of the website. As most of the traders visit websites to open accounts, the easy-spot location of this box can quickly tailor that need.

Below the box lies other contents, containing Careers at Interactive Broker, Investors’ Marketplace, IBKR Community and a short video clip about IBKR.

The bottom of the website contains information about Interactive Brokers Entities from different countries such as Canada, Australia, India, Japan, …

Trader Rating
Interactive Brokersreview_summary_group_5_image
  • The website looks nice and lively with background light-colored photographs and colorful headings and buttons.
  • The edge of the website has the menu bar that contains detail information about company products and services.
  • The center of the website places an “Integrated Investment Management” box that directs traders to the information of accounts offered by the firm.
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Risk warning: Capital can be lost. Terms and conditions apply.
6. Support

6.) Customer Support: Professional Service

Phone call:
At IB, traders can access 24-hour customer service via Client Services Centers around America, Europe, and Asia.
The phone number for traders in the US: 1(877)422-2757 toll- free, 1(312)542-6901 direct dial
The phone number for traders in Europe: +41-41-726-9500 direct dial, +44 207-710-5695 direct dial for the United Kingdom

Chat:
IB provides online chat service to both current and future clients with a secure manner. Current traders can use chat service when accessing to Account Management. Meanwhile, the prospective customers have to experience some complex steps, they have to do the application first and access “Help Me!” set within the application.

E-Mail
Telephone
Live-Chat
On the spot

Email:
The platform does not support inbound communications through commercial E-mail because of security issue. Thus, current and prospective customers can put in inquiries through the Message Center in Account Management. A response will be made within 24 hours via email provided.

Trader Rating
Interactive Brokersreview_summary_group_6_image
  • The Customer Service offers client phone call around America, Europe, and Asia.
  • The Chat Service serves both current and prospective customer and operates 24 hours from Monday to Friday.
  • The customer can submit inquiries via the Message Center and a response will be given via email provided.
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Risk warning: Capital can be lost. Terms and conditions apply.
7. Payment

7.) Method of Payments: Numerous Choices for Traders

Traders can choose from the variety of withdrawal options: Wire transfer, Check, Canadian ETF transfer, SEPA, internal transfer from one Interactive Brokers account to another.

The minimum deposit for traders who use Individual Accounts, Trading Group Masters, and Broker Masters is $10,000. Besides, traders who use IRAs account can deposit no less than $5,000 and traders who under 25 can deposit no less than $3,000. Meanwhile, traders who obtain ACH, Canadian EFT and SEPA are confined to a minimum withdrawal of 5,000,000 USD.

  • banktransfer
  • creditcard
  • paypal

Interactive Brokers applies no cost for the first extraction in a month. Nevertheless, the system charges the withdrawal fee for following withdrawals. Interactive Brokers strictly stipulates that traders must keep adequate funds and equity in excess of the margin requirement.

Trader Rating
Interactive Brokersreview_summary_group_7_image
  • Interactive Brokers offers a wide range of funding and withdrawal options.
  • The investor doesn’t have to pay any fee for the first withdrawal but has to do so in the following withdrawals.
  • The minimum deposit for those traders that who use Individual Accounts, Trading Group Masters, and Broker Masters is $10,000.
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Risk warning: Capital can be lost. Terms and conditions apply.
8. Offers

8.) Additional Offer: No Promotion Program

There are nearly no promotions in this broker. We only found one small benefit program is that customer under 25 can open an account with the minimum requirement of $3,000.

However, Interactive Broker provides demo account for fresh traders. They can easily set up demo accounts by simply accessing the IB official website and choose “Open an Account” option. This account is free and provides no commitment. The traders can just submit their email, username and password to operate the account.

Demo Account
Premiums / Promotions
Change of Custody Account

As an Interactive Brokers user, a trader can access to plenty of forms of training, such as online courses, webinars, educational videos, glossary and other. Those forms of training help traders to approach directly and indirectly with broker experts and informative e-book, video clips, and glossaries related to trading activities. Interactive Brokers paves the way for traders to ramp up knowledge about trading. Traders can also select courses based on the trading professionalism and participate in a session engaging to the usage of IB’s trader.

Trader Rating
Interactive Brokersreview_summary_group_8_image
  • The broker provides many educational materials, including online courses, webinars, educational videos, glossary.
  • The IB provides no promotion program for traders.
  • The IB does offer a free demo account for traders to get used to the platform.
Go to Broker
Risk warning: Capital can be lost. Terms and conditions apply.
9. Regulation

9.) Regulation & Deposit Protection: A Member of SCE and SICP Protection System

The USA customers can feel comfortable about trading security as the IB US is under the sphere of SCE (Securities and Exchange Commission) and SICP protection system. Interactive Brokers Group is named on the New York Stock Exchange and doesn’t own a banking background.

Otherwise, IB applies other secure layers such as 2048-bit EV Certificates, TLS 128 bit and higher encryption to ensure an unassailable connection and integrity of data and information provided between customers and IB. IB constrains all website traffic to apply encryption for a safety issue. Besides, automated monitoring scheme is utilized to assure an inviolable encryption algorithm.

SEC, CFTC
Regulatory Authority
$500,000
Dep. Protection

IB also has strict trading regulation with age requirement. For an account requiring “Cash” trading permission, the minimum age required for a holder of the account is 18. For an account requiring “Margin” trading permission, the minimum age required for a holder of the account is 21.

Trader Rating
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  • IB US is under the operation of SCE (Securities and Exchange Commission) and SICP protection system.
  • IB also applies 2018-bit EV Certificates and TLS 128 bit to deliver a secure connection and protect the customer data.
  • The broker sets specific age requirement for some trading activities.
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Risk warning: Capital can be lost. Terms and conditions apply.
10. Awards

10.) Awards: A Great Collection of Awards

Interactive Broker, in 2018, gained many great rewards from prestigious websites and magazines.

Specifically, in the annual review of Stockbrokers.com, IB hit 1st rank in 4 categories: Commissions and Fees, Offering of Investments, Active Trading, and International Trading, and received a “Best in Class” in other 4 categories: Platforms & Tools, Mobile Trading, Order Execution, and Options Trading.

In the annual review of ForexBrokers.com, IB hit 1st rank in Professional category, gained 5 stars for Offering of Investment, and received the best class in Mobile Trading.
Besides, IB received Fund Technology and WSL Awards for “Best trading platform overall” and “Best options trading platform-broker”.

As can be seen from the trader’s perspective, IB does deserve those awards. The broker is ideal for active traders as its platform, Trader Workstation, provides many advanced features such as advanced charting, excitement lab, heat schemes of the sector and stock performance, and paper trading. Many traders regard IB as the best ETF broker as IB provides a great number of ETFs – more than 20,000 ETFs. This is considered a huge number of ETFs when compared to those of rivals like DEGIRO or Saxo.

Trader Rating
Interactive Brokersreview_summary_group_10_image
  • Interactive Brokers gained great recognition from Stockbrokers.com.
  • The broker also received high points from the evaluation of ForexBrokers.com.
  • It added to its award collection 2 Fund Technology and WSL Awards, along with many certifications from other institutions.
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Risk warning: Capital can be lost. Terms and conditions apply.

Conclusion: An Ideal Broker for Advanced Traders

Interactive Broker is a large brokerage company as it contains 385 thousand customer accounts and possesses $86 billion in customer equity. The platform operates in 120 market centers in 26 different nations.

The broker provides a significant number of ETFs- more than 20,000 ETFs. The fee is 0.05$ per share for ETFs, stocks, and warrants of US. Traders also have to pay $10 minimum monthly activity fee.

IB is well-known for its advanced platform, Trader Workstation (TWS); the platform integrates many sophisticated and useful features for traders.

IB works under the sphere of SCE and SICP, two protection systems that ensure the trading security for IB customers. Besides, IB implements 2048-bit EV Certificates and TLS 128 bit to assure the confidentiality and integrity of information of the customer.
For all those reasons, it is no doubt that IB is one of the best brokers for active traders in today’s age.
Want to learn more about other ETF brokers? Visit our ETF broker comparison page now.

Strengths

  • Low commission
  • Wide range of investment choices
  • access to international market
  • useful desktop trading
  • safe and secure broker

Weaknesses

  • high amount of mimimum opening depost
  • high margin rates
  • non-trading fee
  • high broker-supported trade fees
Test result
Total

Ratings
0
Broker
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Risk warning: Capital can be lost. Terms and conditions apply.
Interactive Brokers
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Risk warning: Capital can be lost. Terms and conditions apply.

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