Ally Invest versus Interactive Brokers

Ally Invest vs Interactive Brokers


Compare IB versus Ally Invest - which trading broker is better in 2020? IRA/Roth accounts, online investing fees, stock broker mutual fund rates, and differences.



Overview of Ally Invest and Interactive Brokers


Ally Invest and Interactive Brokers are two financial companies that appeal to different types of investors. Ally attracts its banking customers, while IB caters to professional and advanced traders. Despite the latter firm’s emphasis on professional trading, Ally Invest may have some advantages.


Compare Costs


Broker Fees Stock/ETF
Commission
Mutual Fund
Commission
Options
Commission
Maintenance
Fee
Annual IRA
Fee
Ally Invest $0 $9.95 $0.50 per contract $0 $0
IB $0+ $14.95 $0.25+ per contract $0-$240** $30


Compare Services


Broker Review Cost Investment Products Trading Tools Customer Service Research Overall Rating
Ally Invest
IB


Promotions


Ally Invest: Up to $3,500 cash bonus + $0 commission trades.

Interactive Brokers: Open account and get $200 for a friend you refer.



Range of Investments


Ally Invest offers its clients the usual range of investments: stocks, bonds, and options. It also recently added binary options to this list. Mutual funds and ETF’s are also on tap. Ally Invest is one of the few online discount brokers to also provide trading in forex.

While Ally is pretty impressive in this category, Interactive Brokers actually does even better. The brokerage firm offers the usual range of securities plus structured products, warrants, forex, futures, options on futures, and access to foreign markets. This last offering opens up a large world of investment opportunities. We counted around 30 countries, 20 currencies, and 100 financial markets that were available to IB clients.


Mutual Funds & ETF’s


Both brokerage firms offer funds, including exchange-traded and mutual funds. We counted over 10,000 mutual funds at Interactive Brokers. Over 4,1000 of these products have zero transaction fees. Some of these funds will be no load. There are more than 40 ETF’s at IB that can be traded without paying any commissions. One of the great advantages of Interactive Brokers in this category is access to ETF’s that trade on foreign exchanges.

Ally Invest customers can trade 12,199 mutual funds. This list is larger than what is available at most on-line discount brokers. We found 2,287 funds with zero load. At Ally, every mutual fund has a cost. If it is no-load, the broker charges a $9.95 transaction fee, and this is applied to any type of transaction: buy, sell, or exchange. If a fund has a load, and obviously most will, there is no transaction fee. For ETF traders, Ally offers all ETFs commission-free.

While we liked Interactive Brokers’ selection of no-load, no-transaction-fee products, Ally Invest offers more mutual funds and all ETFs for free.


Ally Invest vs IB


Portfolio Management


Ally Invest has a robo-advisory service that is very competitive by industry standards. Its Cash-Enhanced Managed Portfolio charges incredible 0.0% annual management fee. Customers get a portfolio of low-cost ETF’s. There is a $100 minimum to start the computerized service, and this too is low by industry standards. A short online questionnaire needs to be filled out before enrolling in the program. While all of this sounds great, Ally Invest fails to offer any traditional financial advice.

Interactive Brokers doesn’t have a robo-advisory service and it doesn’t offer managed accounts per se. It does have a network of investment advisors who use IB’s resources to help people better manage their money. The broker does not offer any ability on its platform to search for or locate advisors who use the company’s software and other resources. We definitely prefer Ally Invest here.


Trading Tech


For the actual buying and selling of securities, Ally Invest provides Ally LIVE. This is a browser-based trading system. Although it’s not a desktop program, it does offer some very useful tools. For example, charting comes with several drawing tools. We counted more than 20. They include ellipses, pitchforks, and timecycles. A chart can also be detached and displayed full screen. There are roughly a hundred technical studies as well.

The trading ticket on LIVE comes with several order types, such as trailing and market on close. We were only able to submit a day order during our testing. Besides stocks and ETF’s, the trading ticket can also be used to buy and sell options and mutual funds.

LIVE comes with a host of other features, such as a market clock, funds transfer, index data, and account information.

Moving from Ally Invest to Interactive Brokers, we get a desktop platform. Called Trader Workstation, it offers much more than LIVE. One feature we really liked was direct-access routing, which LIVE of course does not have. Some of the venues we found include NYSE and EDGEA.


IB vs Ally


There are also many more order types available on Trader Workstation, and we found several time-in-force choices. When we entered a symbol in the software’s trading ticket, we found not only U.S. investments but also foreign securities.

Charting on TWS has a much more sophisticated feel to it. Right-click trading, for example, is possible on the platform, but not on LIVE. Active traders will most likely prefer Trader Workstation.

Besides laptop and desktop trading, both brokerage firms offer mobile apps. Ally’s has a check deposit feature, which IB has neglected to incorporate. On the other hand, the IB app has better features for trading, such as advanced order types.


Promotions


Ally Invest: Up to $3,500 cash bonus + $0 commission trades.

Interactive Brokers: Open account and get $200 for a friend you refer.



Customer Service


Ally Invest offers customer support over the phone 7am-10pm ET, 7 days a week. The broker-dealer’s online chat service has more limited hours. There is one phone number for customers travelling outside the United States. An e-mail address is also available for support purposes.

Interactive Brokers caters to global traders, and as such, it has many phone numbers for many nationalities. It does not offer 24/7 service for any of them, however. It does have an online chat feature. The IB website also has a chatbot that can answer some questions.

Neither broker operates a chain of branch locations. Adding some physical branches would be a welcome addition.


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Security Research and Financial Education


Both brokers provide financial education on their websites. Interactive Brokers has good videos and Ally Invest provides short articles. For fund research, we liked the resources on the Ally Invest website. Trader Workstation seems more suited to stock and option traders. The software has a variety of apps that can scan for these securities. For example, a volatility lab program analyzes a stock’s past price swings to help make better trading decisions.


Ally Invest vs Interactive Brokers Judgment


While Interactive Brokers excels at trading technology and range of investments, Ally Invest is the better choice for customer service and portfolio management. Ally is recommended broker for beginners and retirement investing while IB is our recommendation for traders.