Interactive Brokers Review

Interactive Brokers

Score: Good

  • Market-leading trading platforms, including Trader Workstation (TWS)
  • Well established and has a strong reputation in the trading community
  • Impressive range of instruments to trade
  • USD 4.83% on instantly available cash balances over USD 10,000, which is paid directly to client brokerage accounts, and eliminates the need for separate sweeps accounts

The Bull

Review from

The Bull
Score: Good
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About Interactive Brokers

Interactive Brokers is one of the big names in the broking sector. The firm offers a range of services that wouldn’t look out of place on the trading desk of an institutional investment firm. The approach combines powerful software tools and markets in advanced instruments with transparent reporting, easy-to-use functionality and cost-effective trading terms. It’s beginner-friendly but offers scope for clients to take their trading to the next level.

Also known as IBKR, Interactive Brokers was founded in 1977 and is headquartered in Greenwich, Connecticut, in the US. It has more than 2,900 employees based in offices in Australia, Canada, the UK, Ireland, Switzerland, Hungary, India, China (Hong Kong and Shanghai), Japan, Singapore and the US. It is regulated by Tier-1 regulators, including the SEC and FCA, and supports traders in more than 200 countries around the world.

The Australian branch of the global IBKR network is formed by Interactive Brokers Australia Pty Ltd (ABN 98 166 929 568). This firm holds an Australian financial services licence, no. 453554, and is a participant of the markets operated by ASX, ASX 24 and Cboe Australia and of the clearing facilities operated by ASX Clear and ASX Clear (Futures). Its registered Office is located at Level 11, 175 Pitt Sreett, Sydney 2000, New South Wales, Australia.

Thomas Peterffy, founder of Interactive Brokers, first took a seat on the American Stock Exchange in 1977. Since then, he has led the growth of IBKR Group by encouraging a pioneering approach and making high-grade trading services available to retail traders. Peterffy is still very much involved in steering the firm and holds the position of Founder and Chairman of Interactive Brokers (IBKR) Group.

Interactive Brokers about

While IBKR has certainly pushed the boundaries in terms of what products it offers its clients, the development of the business has been built on firm foundations. The firm is rated ‘investment grade’ by the leading credit agency Standard & Poor’s. Is Interactive Brokers safe to use? The firm’s creditworthiness is based on a corporate structure, which can give clients a degree of confidence that their assets are safe. Approximately one quarter of the firm’s stock is listed on the NASDAQ index where it trades under ticker (IBKR), with the other 75.2% of stock being privately held. This stock exchange listing means that the firm is obliged to comply with the NASDAQ’s rules and regulations in terms of investor reporting and corporate structuring. Further security is offered by the fact that it holds in excess of $9bn in regulatory capital and records daily average revenue trades of 1.991m.

Interactive Brokers has for some time been an obvious choice for a broker shortlist. Thanks to getting so many things right, it has 2.33 million client accounts. Acclaim from industry insiders has seen the broker pick up a range of awards, including the ‘Barron’s Best Online Broker’ award for the past six years. In the process of earning that title, it ranked in the number one position for trading, information, and supporting international trading and active clients.

Products and Trade Offers

IBKR offers a professional way to trade the global financial markets. There are more than 100 forex markets on offer in up to 27 currency pairs. The broker offers stock trading on more than 90 exchanges around the world and has the largest number of fractional US share markets in the broker sector at over 11,000. Those who use the IB Routing tool can take advantage of the lowest ETF financing rates in the industry and zero commissions on stocks and ETFs. The list of instruments on offer at IBKR sometimes feels endless, with options, bonds and futures being available to trade in markets across the globe.

There are obvious advantages associated with having access to such a wide range of markets, but IBKR also helps clients filter what is on offer, so you can build a strategy that suits your approach. Regardless of the asset class you are considering, it is possible to grade the potential investments by type. So, if sustainable and ethical investing is your priority, then it is possible to implement that in terms of investment decisions.

  • Powerful market-leading trading platforms
  • Strong regulatory and financial position
  • Extensive range of markets and instruments to trade
  • Professional-grade research and analysis
  • Excellent mobile trading apps
  • Management fee applies if trading quota not met
  • Complicated fee structure

Commissions and Fee Charges

The pricing schedules provided by Interactive Brokers do take some time to get to grips with. That’s not because IBKR is expensive, more that the different Interactive Brokers fees and commissions vary to a large extent depending on the market and instruments you are trading.

The firm offers markets in a wider range of instruments and more additional services than most other brokers, and fee rates are specific to each market. It is possible to pre-borrow stocks to be able to short sell them at a future date or send specific corporate action instructions to optimise returns. These services are not available at all brokers, and at IBKR they are charged for, which explains why the fee schedules are so detailed. When trading forex, spreads on trades are partly determined by the size of your account and levels of trading activity.

Looked at from a higher level, the pricing can appear complicated, but during our testing we were able to quickly get to the bottom of what trading costs would be in a specific market. Moving from trading options to mutual funds would then require more research, but gaining a full understanding of trading fees is a core part of strategy planning, and the bottom line is that IBKR does generally have competitive trading terms.

Trading spreads are variable rather than fixed, so widen and narrow according to market conditions and times of day. In the forex market, IBKR takes advantage of its large client base to trade at the heart of the market. It is able to access highly liquid pools found at the world’s largest currency exchanges, which results in the average bid/ask spread in EURUSD being around 0.2-0.3 pips (0.0002-0.0003). This is an all-in price – there are no added spreads and no further commissions. Traders should note that there are minimum commissions on trades, such as the $2 per trade fee that applies to accounts with a monthly trade value of below $1m.

Interactive Brokers pricing

If you’re looking to withdraw AUD funds from your account, then there are no Interactive Brokers fees charged on transactions made using wire transfer or Bpay and transactions take less than two days. Wire transfers incur a $15 charge.

One of the big plus points for many who use Interactive Brokers are the margin and leverage rates on offer. Margin rates can be as low as 4.454%. The full details are laid out in a clear schedule, which breaks down margin rates into Initial Margin, Maintenance Margin and NFA Margin, as well as giving a total figure. This kind of extra detail is welcome because understanding the mechanics of the leverage process can help you plan how strategies will play out over time.

In some jurisdictions, local regulators require different and/or higher margin rates. If local rules mean that margin rates are higher than IBKR’s default setting margin rates, then the margin rates required by local regulators will apply.

What Others Say

The Interactive Brokers review carried out by AskTraders outlines how the firm remains committed to expanding the quality and range of trading tools it provides to clients:

“Interactive Brokers has gone all-in when it comes to the adoption of technology. The most popular include advanced analysis tools and features, automated trading and algorithms.”

They also took particular interest in some of the tools on offer:

“Within the FXTrade tool, the broker had integrated several order management and market analysis features. The platform, for instance, supports over 20 order types including such risk management prompts like the stop limit, trailing stop limit, one cancels all, and limit if touched. The trading pairs are also presented in the form of individualized boxed-grids that feature market information for easier monitoring and order management.”


Industry research site LeapRate delved into the details of the IBKR financial statements to check out the stability of the firm and came back with good news regarding the firm’s growth prospects.

“Compared to last year, client accounts soared by 19% to 2.33m, representing a minor increase of 2% from the previous month. Although the MoM increases are marginal, they mirror the upward trend evidenced in the YoY reports. Interactive Brokers continually investigate new investment opportunities to boost its growth and investor interest.”


Interactive Brokers awards

Customer Service

The 24/5 customer service provided by Interactive Brokers is of the highest level. Clients can call trading desks to place phone trades, and other queries can be directed to IBKR staff using phone, live chat and email. During our testing, we found the support team to be very well informed on a variety of technical and procedural issues. Our questions were answered to our satisfaction during the first interaction.

One section of the broker’s site, ‘Find Answers Fast’, is based on an FAQ format, but provides immediate answers to many commonly asked questions. There is also an opportunity for clients to give feedback and suggest upgrades via the ‘Features Poll’ service.

Platform Features and Tools

IBKR provides clients with a choice of several high-end trading platforms. They are packed with a range of powerful software trading indicators and advanced analysis tools.

The flagship platform Trader Workstation (TWS) has functionality that is, on its own, enough to persuade many to set up an account with Interactive Brokers. It is designed to support intermediate and experienced traders and is ideal for those who have a diverse selection of instruments in their trading portfolio. It is powerful and flexible and an ideal way for active traders to access the markets and execute trades with confidence.

Interactive Brokers trading platform

The TWS service can be upgraded by using it in conjunction with the IBKR APIs service. This allows clients to use the same data centres as professional traders to host their trades. The IBKR Client Portal is a web-based trading platform that allows traders to keep up with their trading from anywhere there is an internet connection.

Mobile Trading

A selection of different IBKR mobile apps can be downloaded for free to iOS and Android devices:

  • IBKR Global Trader – A mobile app with straightforward functionality that will appeal to beginners. It covers an impressively wide range of asset groups, including stocks from 90+ of the world’s exchanges.
  • IBKR Mobile – An app that allows fans of the TWS desktop platform to trade with the same functionality and services while on the go. It offers comprehensive coverage of more than 150 financial markets, including options, futures, stocks, forex and bonds. This handheld platform is packed full of powerful trading tools and archives of institutional-grade research.
  • IMPACT – An app that captures the current trend for more ethical investing. It focuses on assets that rank highly in terms of ESG and CSR criteria, so investors can combine making a capital return with making a difference to how the economy is run.

Robo Trading

Research and Learning Section

Research material provided by IBKR offers you the chance to improve your market understanding regardless of what market you are trading. There is material that caters to all standards of trader – this is a welcome change from other brokers, which tend to focus on beginners and entry-level strategies.

Education courses are presented in a variety of formats. Webinars, blogs, podcasts and short video tutorials complement written materials that cover every angle of the markets, ways to trade, and news events.

The Traders’ Insight area of the IBKR site isn’t necessarily groundbreaking in terms of the material covered, but it does demonstrate the IBKR approach. It’s informative, up to date and insightful. It provides traders with everything that they need to follow the global financial markets.

Regulatory Details

Interactive Brokers Australia Pty. Ltd. is licensed and regulated by the Australian Securities and Investments Commission and is a participant of ASX, ASX 24 and Cboe Australia.

The Australian branch of the global IBKR network is formed by Interactive Brokers Australia Pty Ltd (ABN 98 166 929 568), which has registered offices at
Level 11, 175 Pitt Street, Sydney NSW 2000. The firm holds Australian financial services licence no. 453554 and is a participant of the markets operated by ASX, ASX 24 and Cboe Australia and of the clearing facilities operated by ASX Clear and ASX Clear (Futures).


Powerful market-leading trading platforms

Score: Good

The impressive, high-quality features of the Interactive Brokers platform make it a natural home for traders looking for institution-grade trade execution and analysis. Beginners are also catered for but will have to invest some time getting to grips with the complex and powerful tools on offer. However, once that is done, the IBKR platform is a trading base that is almost impossible to ‘grow out of’.

There is a lot on offer, and pricing schedules are complex in nature as a result. However, this also reflects the way that the IBKR platform has been designed and created with the view that even when offering a staggeringly wide range of markets, details are important.