Interactive Brokers is an American stockbroker and financial markets service provider that was founded in 1978. Today, the company is listed on the NASDAQ stock exchange and offers a wide range of financial services to almost a million investors around the world, with billions of dollars under their portfolio. At Interactive Brokers, users get access to a wide range of assets, including stocks, forex, cryptocurrencies, ETFs, mutual funds, bonds, options, futures, and more.
This review gives you all the information you need about Interactive Brokers in order to help you decide if it’s the right broker for you.
Pros & Cons
What can I do with Interactive Brokers?
Interactive Brokers is one of the largest brokerage platforms in the world, offering financial market services to roughly a million customers around the globe. With Interactive Brokers, you can invest in stocks – both US and international – and you also have access to other financial assets such as ETF, forex, mutual funds, bonds, options, futures, CFDs, cryptos, indices, and commodities. Basically, Interactive Brokers is a one-stop-shop for virtually all asset classes.
Which assets can I trade?
- Stocks (U.S)
- International stocks
- Structured Products
Despite its global presence, Interactive Brokers currently only accepts bank transfers as a payment method, and is yet to integrate credit/debit cards and electronic wallets on its platform. However, Interactive Brokers support up to 23 base currencies, making it easier to deposit funds with fewer fees.
What devices can I use Interactive Brokers on?
Interactive Brokers is a multi-device trading platform, which means it is available on pretty much any device with an internet connection. The web platform can be easily accessed through browsers on computers, tablets, and mobile phones. Interactive Brokers also has a mobile app available for both Android and iPhone users, along with a desktop app that can be downloaded onto a computer.
- Computers: desktops and laptops
- Android phones
How easy is it to use Interactive Brokers?
Interactive Brokers’ platform isn’t the easiest to access and navigate, mainly because of the amount you can do and types of trades you can place, but improvements have been made in recent years and users now have an easier time trading. Once you sign up with Interactive Brokers, their ‘IBot’, an AI-powered digital assistant, will guide you around the site to help you get where you need.
Once you have got to grips with the platform, you can download the Traders Workstation (TWS). This is a powerful and extensively customisable downloadable platform. It comes with numerous creative features that make it easy for users to access their most-used trading tools.
In terms of education, Interactive Brokers houses educational videos and trading tutorials. They have various trading tools such as stock and other screeners, tools and calculators, news section, charting, third-party research, and more. With all these, Interactive Brokers is can be a bit daunting, but once you get used to the platform there is a lot to be discovered.
Interactive Brokers is a global investment and trading platform that is available in virtually all countries of the world. At the moment, Interactive Brokers can be accessed in all parts of the world.
Interactive Brokers are regulated by some of the major regulatory agencies in the world. In the US, Interactive brokers are authorised and regulated by the Securities and Exchange Commission (SEC). In the UK, they are regulated by the Financial Conduct Authority (FCA). In addition to these two major regulators, Interactive Brokers is also under the authorisation of regulators in Japan, Canada, India, Hong Kong, and Australia. Interactive Brokers is also listed on NASDAQ, which boosts its reputation as a trustworthy broker and comes with its own set of financial requirements.
Since Interactive Brokers is a regulated stockbroker, they comply with various regulations such as AML and KYC. Thus, the platform requires all clients to verify their accounts so they can access other operations. You will need:
- ID Verification: if you are a U.S resident, then your social security number (SSN) is enough to verify your ID. Non-U.S residents need to provide proof of ID such as a driving license or national I.D. documents.
- Other details: Interactive Brokers also asks for your employer’s name, and phone number.
- Proof of residency: to verify your address, Interactive Brokers needs a government-issued utility bill or other documents like bank statements from the past three months. It could also be a bank or 3rd party broker account numbers for funding purposes.
The customer support team at Interactive Brokers is active and very responsive. They are available during working hours and can be contacted using various means. Interactive Brokers has a swift response time and provides professional services.
You can reach the Interactive Brokers customer support via any of these channels:
- Live chat
Interactive Brokers has an intuitive and user-friendly trading platform, but it does take a little getting used to given how many different things you can do on the website. Their dashboard contains all the assets available to investors, and here you can also find information about their pricing and other services they offer. Interactive Brokers have both desktop and mobile apps, making it easier to use the platform on any device, and their ‘IBot’ will help guide you through all the trading options available to you.
Interactive Brokers is a global brand when it comes to financial services. Although they are based in the US, Interactive Brokers provides services to virtually every country in the world. You can trade US stocks and other international equities on their platform. For both US and non-US residents, registration for their platform is fully digital.
Overall, Interactive Brokers is an excellent platform to trade stocks, funds, ETFs, forex, cryptos, options, futures, and other financial assets, but give yourself some time to look around the site and discover everything they have to offer.
What currency pairs can be traded?
Interactive Brokers supports forexand cryptocurrency trading. Here are the major trading pairs you can find on the platform:
- BITCOINXB (SFB)- Bitcoin Tracker One
- COINETH (SFB)- XBT Provider Ethereum
- COINETHE (SFB)- XBT Provider Ethereum
Are there fees for trading?
Interactive Brokers charges for some of its services. These fees depend on the financial instrument/asset you’re trading. Here is a quick summary of the fees you can expect to pay:
- Stocks and ETFs: $0 for US clients. Otherwise $0.005 per share, min. $1, max. 1% of trade value.
- Forex: Trade value less than $1,000 million: 0.2 bps.
- Mutual funds: $14.95 per transaction or 3% of trade value, whichever is lower.
- Inactivity fee: No inactivity fee for US traders using the IBKR Lite plan. $20 per month if the user has less than $2,000 account balance. $10 for accounts having at least $2,000 account balance.
- Futures: trading a single contract is $1. Trading 50 contracts is $32.50.
- Options: $0.65 per contract for options trades with a minimum commission of $1
What is the minimum Spread?
The minimum spread on Interactive Brokers is 0.1 pips. However, with Interactive Brokers the minimum spread is floating and usually changes over time. The minimum Spread depends on the total number of shares of an asset that are available for trading at that time. This means that market conditions help determine the minimum Spread of assets on Interactive Brokers.
Can I trade assets with leverage?
Yes, you can. Interactive Brokers allows users to trade with leverage. The maximum leverage on Interactive Brokers is 30:1, meaning you can place trades with a value of 30 times higher than the amount you stake.
We don’t advise trading with leverage unless you are experienced, however. While you can increase your profits if you call the market right, you risk racking up large losses quickly if you get it wrong – especially with volatile assets such as cryptocurrencies. Trading with leverage can be a useful tool, but only do it once you’ve learned the ropes.
What are the margins required?
A trader’s margin requirement on Interactive Brokers depends on some criteria such as their country of residence, the exchange where you want to trade, and the product(s) you want to trade. For example, for US traders trading US stocks, the margin required is 25% of the stock value (minimum of $2,000 or 100% of the purchase price, whichever is less).
Can I open long and short positions?
Yes, Interactive Brokers supports opening both short and long positions on assets like forex, crypto, stocks, ETFs, and more. Investors that are bullish on the price of an asset buy it and wait for it to increase. When that happens, it is called going long. Shorting is when an investor is bearish on the price of an asset and sells it in order to buy it at a cheaper rate later. In trading, having a long or short position means betting on an asset to either go up in value or drop value over time.
Are there withdrawal and deposit limits?
Interactive Brokers has both withdrawal and deposit limits on its platforms.
- Withdrawal limits:
- Regular: $50,000 per day and $100,000 in five business days
- SMS: $200,000 per day and $600,000 in five business days
- IB Key: $200,000 per day and $ 600,000 in five business days
- Deposit limits:
- ACH: $25,000
- Canadian Electronic Funds Transfer: $100,000
Summary of Interactive Brokers
Interactive Brokers is a one-stop-shop platform for trading various investment vehicles. They allow almost a million users around the world to trade stocks, funds, bonds, forex, crypto, ETFs, and more. The Interactive Broker platform is intuitive and user-friendly, making it easy for new members to use. They have a wide range of trading tools and an education center for those who wish to learn more about trading.
Interactive Brokers is fast becoming an investment platform of choice for traders around the world. While based in the US, Interactive Brokers have a global reach and make it easy for non-US residents to register on their platform and access the various financial instruments. Their customer support team is available only during working hours, but are responsive and can be reached via email, over the phone, and live chat.
This is one of the best-known brokerage platforms in the world, and for good reason. Pretty much every trader can find what they need on Interactive Brokers, and can access a wide variety of trades with affordable fees – especially if they’re based in the USA.
How to set up an account with Interactive Brokers
If you wish to get an account with Interactive Brokers, follow these steps:
- Visit the Interactive Brokers platform.
- Click on the ‘OPEN ACCOUNT’ tab and select the account type you wish to open.
- Insert details such as email address, username, password, and country of residence.
- Verify your account via the email you will receive.
- From there, you proceed to other stages where you are required to provide your name, phone number, date of birth, and more.
- After providing all the details, you need to provide relevant ID documents (proof of ID and proof of address).
- Your application will take a couple of days to be processed and then you can start trading.