Interactive Brokers Review: Comprehensive and low-cost platform

TL;DR

• Interactive Brokers is a low-cost digital investment platform that gives users access to 150 markets, including the US, Singapore, Hong Kong and London stock markets. 
• What users may like about Interactive Brokers: Comprehensive market access, multiple trading platforms, and competitive fees 
• What users may not like about Interactive Brokers: More limited customer support and no major sign-up rewards.
• Fees for US stocks: US$0.005 per share, with minimum fee of US$1 under fixed pricing model
• Fees for Singapore stocks: 0.08%, with minimum fee of S$2.50 under fixed pricing model

What is Interactive Brokers?

Interactive Brokers is a stock brokerage with a premium set of features, offering low cost, multi-platform trading for support for almost 150 markets across the world with a single account. 

You can trade stocks, options, futures, currencies, and bonds with no minimum balance and no account maintenance fees.

Interactive Brokers is one of the largest brokerages in the US. It has a long operating history going back to 1978, and is listed in the US.

What users may like about Interactive Brokers

#1 – Comprehensive market access

You can invest in almost any market in the world with Interactive Brokers.

The following products are available for trading:

• Stocks and ETFs
• Options and Warrants
• Futures and FOPs
• Spot Currencies
• Cryptocurrencies
• US Spot Gold
• Bonds
• Mutual Funds
• Hedge Funds

Find a complete list of markets available for trading.

#2 - Wide array of platforms for trading

Interactive Brokers support multiple platforms to place your trades and invest globally.

Client Portal

A web application serves as your one-stop destination to check quotes, place trades, see account balances, P&L, and key performance metrics, funding, reporting, and more.

Trader Workstation

A desktop platform designed for active traders and investors who trade multiple products and require power and flexibility.

IBKR Mobile

Easily trade and monitor your IBKR account on the go from your iOS or Android device. Trade on-the-go with intuitive, cutting-edge tools such as option spread grid and the order entry wheel.

IBKR GlobalTrader

Easily trade global stocks (individual, mutual funds, and ETFs) and cryptocurrencies from your iOS or Android device (tablet or smartphone) with the streamlined GlobalTrader interface.

IMPACT

IMPACT is an app that makes it easy to put your money where your heart is and invest in companies that share your values, options or cryptocurrencies.

In terms of supported investment products, IBKR Traderworkstation, Mobile and API support the largest variety of products. The Client Portal is also very comprehensive, but lacks structured product support.

For traders who enjoy trading options, the Trader Workstation would give you the most features for analysis and planning. For example, having option analytics would let you model the rate of change of an option's price with respect to a unit change in each of a number of risk dimensions.

The rest of the other platforms except the API are quite similar and offer basic options trading interfaces.

Frequent traders would like the Trader Workstation and Mobile as well, which comes with advanced trading features like algorithms, smart routing orders, and BookTrader - which lets you create, modify and transmit orders for a single instrument from within the book price ladder.

For most investors, we think the mobile app (IBKR Mobile) is sufficiently powerful enough for long-term investing.

#3 - Competitive fees

Interactive Brokers comes in two different pricing models – fixed pricing and tiered pricing. 

For fixed pricing, you will pay a fixed fee per share traded or a fixed percentage of the value of your trade, with a minimum and maximum fee applied. This is similar to what most other brokers offer.

For tiered pricing, you will incur other third party fees such as exchange fees and clearing fees. This makes the pricing more complex as the total fees may vary depending on the exchange you are trading on. 

Trading Fees (US markets)

For trading in US markets, you can expect to pay a minimum fee of US$0.35 per order based on the tiered pricing. 

Under the fixed pricing model, you will pay a fee of US$0.005 per share, with a minimum fee per order of US$1.00 

When trading in low volumes, you can expect to pay less with the tiered pricing structure on US markets.

Trading Fees (LSE)

LSE fees have 3 options, including a direct routing fixed tier where trades bypass Interactive Brokers’ SmartRouting technology for execution. 

The tiered model is usually the cheapest, with a low minimum per order of US$1.70 and commission charge of 0.05% of trade value (US$5 per $10K trade value excluding third party fees).

Trading Fees (SGX)

Trading in SGX is more expensive than LSE and US markets, where it costs 0.08% of trade value excluding third party fees, with a minimum of S$2.50 per order. Similarly, tiered is cheaper than fixed.

A full list of commissions can be found on their pricing page

What users may not like about Interactive Brokers

#1 – More limited customer service support

Retail investors who are used to extensive customer support may find more limited options to get immediate assistance while using Interactive Brokers. 

Existing or recently approved clients can access a chat function accessible within the Client Portal. 

More recently, Interactive Brokers set up an office in Singapore to service customers based here. You may choose to contact Interactive Brokers through its general hotline number +65 6923 5600. 

However, you are less likely to see Interactive Brokers at a physical branch or at a roadshow at your neighbourhood shopping mall.

#2 – No attractive sign-up promo

For users who are used to attractive broker sign-up promos, Interactive Brokers does not reward new sign-ups with attractive deals currently. 

Referred accounts will receive $1 in IBKR shares for every $100 of value (cash or other assets) added to their account for up to $1000 worth of IBKR shares. 

The average balance must be maintained for at least 1 year for the shares to vest and be accessible.

If you are keen on this opportunity to receive IBKR stock, you can sign up via the referral link here. 

You can find more details about the referral programme here. 

Final verdict on Interactive Brokers

With its low-cost trading and foreign exchange fees and multi-platform connectivity, Interactive Brokers has built up a good reputation over the years.

Interactive Brokers offers comprehensive market access and trading features for investors. 

In particular, it is one of the few investment platforms that offer access to the London Stock Exchange, which makes it a popular choice amongst investors looking to buy Irish-domiciled ETFs such as the VWRA. 

However, retail investors who are used to extensive customer support may find more limited options. In addition, there are no attractive sign-up promos for Interactive Brokers.

You can sign up for Interactive Brokers via this link. 

To find out how IBKR compares to other online brokerages in Singapore, check out our guide to the best trading platform in Singapore.