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Interactive Brokers vs Firstrade
Compare Firstrade versus IBKR Lite/Pro - which is better in 2021? IRA/Roth accounts, online investing fees, stock broker mutual fund rates, and differences comparison.
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Overview
Should you select Firstrade or Interactive Brokers (IBKR)? Firstrade has the lowest overall pricing
schedule; while Interactive Brokers is the better firm for software and advanced trading
techniques.
Cost Comparison
| Broker Fees |
Stock/ETF
Commission |
Mutual Fund
Commission |
Options
Commission |
Maintenance
Fee |
Annual IRA
Fee |
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Firstrade
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$0
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$0
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$0 per contract
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$0
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$0
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IB
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$0
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$14.95
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$0.70 per contract
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$0
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$30
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Services Comparison
| Broker Review |
Cost |
Investment Products |
Trading Tools |
Customer Service |
Research |
Overall Rating |
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Firstrade
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IB
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Promotions
Firstrade: Get 2 FREE stocks and $0 commission in ALL trades!
Interactive Brokers: Use this referral link to get up to $1,000 of IBKR stock for free!
Firstrade Pros and Cons
Highlights that Firstrade customers will really like include:
- No per-contract options fees
- Excellent list of mutual funds
- Free access to security research from Morningstar
The broker’s downsides include:
- Software is rather weak
- Many assets aren’t tradable
Interactive Brokers Pros and Cons
IB’s strengths include:
- Multiple software platforms, some of which are professional-level
- Large list of tradable assets
- Many advanced trading features (discussed up ahead)
IB’s drawbacks are:
- Software can be hard to learn
- Per-contract option fees
Here’s how the two brokerage firms compare to each other in the most important investment categories:
Available Products
Firstrade customers can trade these investment vehicles:
- ETFs
- Mutual and closed-end funds
- Option contracts
- Equities
- Fixed-income securities
- IPOs
The broker-dealer’s list of tradable assets includes penny and over-the-counter stocks.
Interactive Brokers gives its clients the same list that Firstrade has plus these assets:
- Structured products
- Futures
- Currencies
- Precious metals (silver and gold plus others)
- Warrants
- Contracts for difference
IB also has a very extensive foreign security service that provides access to many overseas investments. Firstrade has no global investment service of any kind.
Winner: Interactive Brokers
Research and Education
The Interactive Brokers website is a good place to start if you need to learn the basics of trading and investing. Just click on the Education tab in the top menu and you’ll find a cornucopia of materials, including:
- Self-guided courses on a range of topics
- Live and recorded webinars
- Blog
- Glossary
- In-person events in Europe and Canada
The broker’s software has screeners and security profiles. We especially like free trade recommendations from several independent third parties, including Morgan Stanley and Deutsche Bank. And many more particulars are shown than just trade recommendations. These include dividend history, ESG ratings, and news articles.
Firstrade tries to compete with IB here by creating its own Education tab. However, it doesn’t contain the same amount of information. Articles are rather short, and we didn’t find any webinars or in-person events at all.
Security research is presented courtesy of Morningstar. This provides extensive details from the analyst, but there is no information from a second analyst. On the positive side, we did like Firstrade’s screeners, which are easy to use.
Winner: Interactive Brokers
Website Trading
Firstrade’s website is rather simple, but there is a trade bar that improves things somewhat. The tool can submit orders for equities, options, ETFs, and closed-end funds. It can also perform a small amount of research in case you don’t want to use the website for that. Charts are available on Firstrade’s website using either Morningstar’s format or TradingView’s.
At Interactive Brokers, traders get several web-based platforms. First is the client portal, which provides a lot of useful tools. Examples include:
- Basic charting
- Lots of research tools
- Advanced trade ticket with 6 order types
- iBot, an artificial intelligence
On top of the client portal, IBKR Pro customers (but not Lite customers) can use Web Trader. This is a browser-based platform. It has very rudimentary charts but manages to deliver trading in multiple asset classes with direct-access routing.
Winner: Interactive Brokers
Desktop Software
IB clients who don’t care for any of the browser-based trading platforms can instead use Trader Workstation, the firm’s desktop software. Available to both Pro and Lite customers at no charge, this professional-level software delivers an in-depth trading experience with many tools. Highlights include:
- Access to foreign exchanges
- Margin details on any entered ticker symbol
- Advanced charting
- Another appearance from iBot
Firstrade has no desktop program.
Winner: Interactive Brokers
Mobile Apps
Traders with lifestyles that make desktop or laptop trading all but impossible can instead use a smartphone platform with either firm in this challenge. Interactive Brokers’ app also functions on tablets; and the company has a platform for Apple Watch, too.
Highlights from IB’s mobile app include:
- Horizontal charting with many tools, such as Bollinger Bands
- Wheel order ticket in horizontal mode
- Regular order ticket in vertical mode
- Alerts
- Security screeners
- Option spreads
- Demo mode
Firstrade’s app doesn’t have a demo mode, but it does have horizontal charting with several technical studies. Missing on the platform are security scanners, alerts, option spreads, and a wheel order ticket system.
Winner: Interactive Brokers
Day Trading & Swing Trading
Margin: Interactive Brokers has very low margin rates, and its desktop platform displays margin details for a hypothetical trade. Firstrade’s software doesn’t do this.
Shorting: Only IB provides online short locating.
Extended hours: Both brokerage firms offer extended-hours trading. IB has more hours.
Level 2 quotes: Firstrade doesn’t offer these advanced quotes, but IB does.
Direct-access routing: Again, IB offers this service, but Firstrade doesn’t.
Routing fees and rebates: Same story here.
Winner: Interactive Brokers
Miscellaneous Services
Dividend reinvestment program: Both firms offer DRIP service, although IB only permits an entire account to be enrolled or not.
IRAs: Both firms offer Individual Retirement Accounts, but only Firstrade has the SIMPLE account.
Automatic mutual fund investing: A periodic mutual fund investing service is available at Firstrade, but not at Interactive Brokers.
Whole-dollar investing: IB offers fractional-share trading, but Firstrade doesn’t.
Winner: Firstrade
Recommendations
Long-term investors and retirement savers: We pick Firstrade for a larger selection of target-date mutual funds.
Beginners: Interactive Brokers has better educational materials, but Firstrade has simpler software. Toss up.
Stock/ETF trading: Interactive Brokers easily.
Small accounts: Firstrade or IBKR Lite.
Options trading: Firstrade offers OptionsPlay, a decent derivative trading platform. But IB offers many professional-level option tools on Trader Workstation, and these get our stamp of approval.
Promotions
Firstrade: Get 2 FREE stocks and $0 commission in ALL trades!
Interactive Brokers: Use this referral link to get up to $1,000 of IBKR stock for free!
Firstrade vs Interactive Brokers Results
Although Firstrade has the most appealing commission schedule, it does not offer all the bells and
whistles. Mutual fund investors, however, will do well there.
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