Introduction and General Overview
This review will aim to present the advantages and downsides of trading through Interactive Brokers, presenting its main features.
Forty years long, Interactive Brokers (IBKR) has been developing a platform specialized in customized international trading in various financial instruments. It covers 24 countries and more than 100 market centers, focusing primarily on professional traders and institutions. Serviced provided by this broker mainly appeal to the experienced investor, dealing with the minimum of $10,000 (or $110,000 in case of portfolio margin accounts).
IBKR has shown a formidable record of competitive and indeed attractive commissions. In addition to this, it is an industry leader in terms of low margin rates. These range from 1.60% to an impressive 1.15% for clients holding $1 million or more. When handling small-sized orders, measured by hundreds of shares, Interactive Brokers offers excellent deals. Namely, new investors will find that options such as $.70 per contract without minimums are exercised and assigned practically free. This notwithstanding, as a new investor you should also bear in mind the fact that IBKR will charge various fees and minimums.
Features and Tools
Interactive Brokers’ Trader Workstation (TWS) platform has been designed to trade practically everything. Its main target group includes experienced traders. The platform’s default setting is the Mosaic. However, as a client, you can also access the Classic TWS, namely its original version.
Interactive Brokers has developed an approach that enables the user to enter a symbol for any stock. Thus, he or she can view a summarized version of securities available. Their watch lists cover a wide range of options (equities, warrants, forex – the list goes on). All in all, the Mosaic view proves to be very efficient. Still, there are users who tend to go for the Classic TWS. It will eventually boil down to the user’s need and ease of use.
Watch lists generated by TWS include as many as 338 completely customizable columns, a feature offered by no other broker. However, what comes as a potential disadvantage for the non-professional user, the variety of options displayed may be too consuming.
As far as charting is concerned, if you are a technical trader, you will find 124 different studies that you can add to a chart. The charts provide an ease of use which ranks them highly among all TWS-tools. Also, TWS charts offer all the necessary essential functionality: a display of alerts, comparisons, historical trades, etc.
TWS also features a number of tools. These include Options Strategy Lab, Algo trading, Risk Navigator, Volatility Lab, Market Scanner, Portfolio Builder and Strategy Builder. This further shows that TWS satisfies the needs of professional traders. The 63 different types of order available are second to none in this line of business.
Another option provided by IB is its WebTrader, a good solution for clients on the road. Or for those simply viewing their watch lists, monitoring their portfolios, or placing trades. The WebTrader also provides an in-depth summary of balance requirements and percentage of marginable securities. It does so with a full-range order ticket, supporting trading in all classes of assets.
Mobile TradingÂ
The main requirements you should set for your mobile trading are functionality, quickness and versatility. In that regard, Interactive Brokers will satisfy your needs as a mobile trader. It supports all major devices.
For example, a test of the iPhone app has proven to cover all bases for successful trading. You will be able to manage your portfolio quickly and efficiently. Still, in terms of usability, there are some flaws. The inflexibility of the charts is chief among them. This means that you will have a daily chart display covering a given period. In order to change the parameters, you will have to readjust your settings. And, despite the support for Touch ID login, it will only work through an auxiliary IB Key app. Another disadvantage of this platform includes a lacking stock/index comparison in charting, and the home screen cannot be customized.
On a positive note, the mobile application offers same rarely-included options such as customized screening and/or scanning and after-hours charting.
A weak spot
Customer service represents a weakness among the features offered by Interactive Brokers. Testing has identified support as a consistent weak spot throughout the different usage platforms, including telephone, live chat and email. In that department, IBKR ranks rather low: second to last among the 16 companies that were tested.
