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Interactive Brokers (IB) review 2010
cheap, professional trading platform, $10 monthly fee and terrible customer service
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Brokerage Commissions and Investments Offered 2010
- Stock commission is $0.005 per share with $1 minimum per trade for SMART routed orders
- Options commission: $0.70 per contract plus exchange fees
- Mutual funds: not available
- Investment products: stocks, options, ETFs, bonds, futures, currency transactions
Interactive Brokers is one of the
pay-per-share brokers:
you pay $0.005 per share with $1 minimum per order. This makes all orders of less than 600 shares cheap,
orders of 2,000 shares around $10, and orders of 5,000 shares around $25!
Many stocks are lower than they were in 2008 and these shares
cost dearly with IB.
Opening an account with IB takes a while. Application forms are long, and after you register,
users need to verify two deposits Interactive Brokers makes into their bank account.
Once verified, IB mails users a letter with codes to enter before trading. Minimum amount to open account is steep $10,000.
Interactive Brokers Trading Platform Review
Interactive Brokers developed Trader Workstation, one of the best trading platforms of all
discount
online stock brokers. It lets users enter multiple orders even without money to cover all of them: if one
order is executed, and the account doesn't
have money to cover the others, the rest are automatically cancelled. Trader Workstation is customizable,
with cutting-edge charting and research services, dynamic streaming quotes, tools for risk management,
and the ability to place orders that go directly to the market.
Download Trader Workstation as a stand-alone application, or, run it from the browser (this
is slower). Both versions require Java installed on the user's computer. Users
can trade through the browser without
Trader Workstation, but it's poorly designed and is usable mainly when Trader Workstation is not available.
Unlike a trading platform, InteractiveBrokers.com is badly designed and hard to navigate and find
what you are looking for.
- Excellent
stock commissions for orders with fewer than 600 shares
- Professional trading platform
- Competitive margin rates
- $10,000 minimum to open most accounts
- $10/month minimum monthly commission requirement. Because of that it does
not make sense to have account with IB if you are not an active trader
- $10/month for IB market data feed (waived if trade commissions are more than $30/month)
- Trading platform designed for professional traders, not the best choice for
beginning investors
- It gets expensive to make trades with over 1,000 shares
- Many complains about snobby customer service (experienced it myself)
- No mutual funds offered
- $1.20 fee to modify or cancel an option order
- Merciless margin calls - IB doesn't care if you'll get completely wiped out
Interactive Brokers (IB) is targeting experienced, professional investors.
The firm is a good choice for very active traders who trade 600 shares or less on average per trade.
IB delivers excellent trading platform, fast executions and great margin rates.
Be careful when using margin: IB liquidates your
positions almost as soon as you get into negative
territory. The firm tightened margin requirements at the worst possible times in 2008-2009 and many people who
used margin got wiped out.
Interactive Brokers is not a firm for beginners. And IB is definitely not the way to go for
those who rarely trade, trade orders of over 1,000 shares, as well as people looking to invest in mutual funds.
There is a cheaper brokerage called
LightSpeed Trading
that is rated higher by investor surveys,
with commissions of $.00395 per share and 40 cents minimum per trade.
Options are $0.50 per contract, no minimum and no order charges. Read more about these guys in
LightSpeed Trading review.
Interactive Brokers Promotion Code: none right now
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