The Lowest Bond Trading Fees. Brokerage With The Cheapest Bond Commissions (2020)



Ally Invest Bond Pricing


From its creation in 2005, Ally Invest offered some of the lowest trading commissions on bonds, stocks, mutual funds, options and ETFs. The firm grew rapidly over the years, becoming one of the top brokerage companies in the country. But their trading rates stayed at the very low levels. Currently, Ally Invest is charging $1 per bond with $10 minimum and $250 maximum. Treasuries have $0 commission. Certificates of Deposit (CDs) are $24.95 per transaction.


Ally Invest Advantages

  • One of the cheapest bond brokers in the industry
  • Accounts have no maintenance or hidden fees
  • Highly rated customer service
  • $0 fee IRAs
  • Low price professional portfolio management


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Ally Invest Bonds Review

With Ally Invest customers can search, analyze and trade online corporate, agency, municipal, strips & zero's, and new issue securities, all from one robust platform, and at Ally Invest's discount trading fees. The brokerage house offers nine search capabilities across 10 different bond types, and clients can customize their search to fit their bond investment strategy goals and bond criteria.

Each bond type has a query definition page where customers can define the search, a query result page that lists the bonds that match their criteria, and a bond detail page where clients can get more information about any bond on the list.

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Ally Invest Review


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Brokerage Bond Fees List


Broker Rating Broker Bonds Fee Corpo
rate
Munic
ipal
New Account Promotion
Ally Invest
Ally Invest rating

$1 per bond with $10 minimum, $250 maximumYesYes Up to $3,500 cash bonus + $0 commission trades.
TD Ameritrade
TD Ameritrade rating

Treasuries at auction: $25. All other bonds on a net yield basisYesYes$0 commissions + transfer fee reimbursement.
Charles Schwab
Charles Schwab rating

$1 per bond, $10 minimum, $250 maximumYesYesNone
Choicetrade
Choicetrade rating

NANANANone
Cobra Trading
Cobra Trading rating

NANANANone
Etrade
Etrade rating

$1 per bond, minimum $10, maximum $250YesYes Get zero commission on stock and ETF trades.
Fidelity
Fidelity Investments rating

$1 per bond, $250 maximum; $50 maximum if maturing in one year)YesYesNone
Firstrade
Firstrade rating

On a net yield basisYesYesGet $0 commission in ALL trades!
Interactive Brokers
Interactive Brokers rating

0.1%* Face Value (10 bps) if <= $10,000 Face Value; 0.025%* Face Value (2.5 bps) if > $10,000 Face ValueYesYesNone
Just2trade
just2trade rating

$15 + $1 per bondYesYesNone
Merrill Lynch/Edge
Merrill Edge rating

On a net yield basisYesYesNone
Muriel Siebert
Muriel Siebert rating

100 bonds or more - $2.50 per bond, from 50-99 bonds - $3 per bond, up to 49 bonds - $3.50 per bond; $35 minimum commission for listed corporate bondsYesYesNone
Robinhood
Robinhood Trading rating

NANANANone
Sogotrade
Sogotrade rating

NANANANone
TradeStation
Tradestation rating

$14.95 + $5 per bondYesYes Get $0 stock/ETF commissions + best trading tools.
TradingBlock
Trading Block rating

$30YesYesNone
Vanguard
Vanguard rating

On a net yield basisYesYesNone
Wellstrade
Wellstrade rating

$50 per transactionYesYesNone

  * NA means Not Offered.


What are Bonds?


Many financial planners advise that a basic element of any financial plan to grow one’s wealth should include bonds. A bond, simply put, is a loan that an investor makes to a company or to the government. Officially, bonds are one of the two major forms of securities, with the other one being stocks. Bonds are securities that are issued by an entity with the promise to repay the person holding the bond under specific terms, with interest, after a particular period of time has passed, on a certain date. The date is known as the bond’s maturity.


How are Stocks and Bonds Different?


From the aspect of being a security, bonds differ from stocks in a couple of ways. For starters, the holder of a bond is, for all intents and purposes, a lender to a company or to the government. Inversely, the holder of stock in a company is actually a part-owner in that company. Secondly, stocks can be held for an indefinite period of time, while bonds mature after a set time period.


Who Issues Bonds?


In the U.S., bonds can be issued by local, state, and federal governments, or by corporations. The federal government is a major bond issuer, and typically issues bonds as a way to generate money to cover deficits in the budget. Local and state governments also issue bonds, but usually in doing so they are looking to raise money for community projects, like building a park, for example. When a corporation issues bonds, it is to raise capital for expansion or for investment.


How Do Bonds Work?


Bonds are a reliable investment, in most instances, and they carry with them very little risk. In their simplest form, bonds have three important features: the maturity date of the bond, the interest rate, and the denomination. For example, if you have a $1K bond that is issued to you at 3.75% interest for fifteen years, you will be paid either simple or compound interest on the bond until it matures. The interest income that you derive as a bondholder is taxable in most instances. The purchase of bonds is usually done via a broker, who is basically a “middle man” who makes a commission by buying the bonds at a discount and selling them to you at a profit.


What are Municipal Bonds?


Municipal bonds are a type of bond that many investors are attracted to because any interest that is received while holding the bond is exempted from federal income tax, and oftentimes, from any state or local tax. Municipal bonds are often issued to raise money for projects like building hospitals, schools, sewer systems, and other municipal projects that improve daily life within a community.


Should I Invest in Bonds?


Smart investors will build a diversified investment portfolio that consists of stocks, bonds, and other types of investments. No matter what your investment goals may be, bonds are a savvy choice. Bonds pay interest twice each year, providing bond holders with a stream of predictable income. This income stream is one of the top reasons that people choose bonds as an investment, since this can help them to preserve their capital. If you are saving for a specific future need, like putting your children through college, or even buying a house, bonds can be the best investment vehicle to help you reach those objectives. Moreover, if you want to increase your retirement income, the interest income from bonds can be quite lucrative, especially if you purchase bonds that are exempt from federal income tax.