Interactive Brokers
in Brokers / Forex, Equities, Futures & Options
Successful traders and investors understand that superior technology and lower trading costs can result in greater returns. For 35 years the IB Group1 has been building electronic access trading technology that delivers real advantages to professionals worldwide.
Interactive Brokers Group and its affiliates' equity capital exceeds $4.6 billion. IB is the largest U.S. broker based on daily average revenue trades, executing 447,000 trades per day2. Discover some of the reasons why professional traders and investors choose IB.
Global Offerings
- IB provides electronic access to stocks, options, futures, forex, bonds, CFDs and funds on over 100 market centers in 19 countries from one account.
- IB maintains a global presence, with offices in the US, Switzerland, Canada, UK, Australia, Hungary, Russia, India, China and Estonia.
- Awarded a 4.5-star rating by Barron's magazine in the Best for International Traders category.3
- IB’s integrated approach makes it easy to trade global products on multiple exchanges and assets denominated in multiple currencies all from a single account.
Best Execution
- IB SmartRoutingSM is designed to search for the best price available at the time of your order, and to route and re-route all or parts of your order to achieve optimal execution.
- Based on independent measurements, the Transaction Auditing Group, Inc., (TAG), a third-party provider of transaction analysis, determined that Interactive Brokers' US stock and options price executions were significantly better than the industry4 during the second half of 2011.
- For combination orders routed via SmartRouting, IB undertakes the risk of partial executions.
- In the case of an exchange malfunction, IB SmartRouting AutorecoverySM re-routes options orders and IB undertakes the risk of double executions.
Low Cost
- IB has automated every aspect of the trade process in-house, allowing us to offer low5 commissions.
- Customers can choose Flat Rate or Cost Plus pricing structures to enjoy the lowest cost, based on their trading activity.
- Awarded a 4.3-star low cost broker rating by Barron's magazine. IB has been awarded four or more stars for eight straight years.6
- Our Portfolio Margin Accounts with real-time risk management can provide increased leverage with greater safety.
- 82% lower margin loan rates than the average of six of our top competitors.7
Risk Management & Control
- IB’s real-time margin system continuously enforces limits on an account-by-account basis, and allows customers to monitor their margin cushion directly in TWS.
- TWS provides sophisticated portfolio risk management via the IB Risk NavigatorSM, which is free to IB customers.
Superior Trading Technology
- Market-maker designed Trader Workstation (TWS) optimizes your trading speed with a single multi-product spreadsheet interface offering real-time streaming quotes and quick click order entry.
- Sophisticated TWS trading tools such as OptionTrader, FXTrader, BookTrader and Accumulate/Distribute provide product-specific order modules to accommodate any trading needs.
- Choose to connect to our trading system through the IB API or our industry-standard CTCI FIX interface.
- Advanced algo tools and order types help individual traders manage multiple large volume orders simultaneously and get the best execution.
- IB WebTrader offers a simplified trading interface to connect to our trading system.
- Awarded a 4.5 star rating by Barron's magazine in Best for Frequent Traders category.3
Comprehensive Reporting
- Customizable activity statements can be viewed as PDFs or in HTML format, and can be downloaded into a variety of third-party software, such as Quicken or MS Excel.
- Flexible download files available in text or XML format.
- Daily margin reports detail requirements by underlying.
- Custom reporting for advisors and brokers including advisor fee cap, daily client balances and performance, and broker exception reports.
Strength & Security
- On a consolidated basis, Interactive Brokers Group (IBG LLC) has over $4.6 billion in equity capital.
- IBG LLC’s owners are our public company, Interactive Brokers Group, Inc. (11.5%) and the firm’s employees (88.5%). Unlike at most other firms, where management owns a relatively small share, we participate substantially in the downside just as much as in the upside. Because of this vested interest, we run our business conservatively.
- We manage our brokerage and market making businesses in separate companies, which are registered with local securities and/or commodities regulators. We maintain strict systematic and procedural separation between the two business lines and we do not commingle or utilize customer segregated assets for proprietary operations. Our brokerage companies conduct no proprietary trading.
- We hold no material positions in over-the-counter securities or derivatives. We hold no CDOs, MBS or CDS. The gross amount of our portfolio of debt securities, with the exception of U.S. government securities, is less than 10% of our equity capital.
- Our positions are marked to market daily and the resulting payables/receivables are reconciled to outside sources automatically.
- Our real-time margining system marks all customer positions to market continuously. All orders are credit vetted before being executed and positions in accounts with inadequate margin deposits are liquidated automatically.
- We have reported solidly positive earnings for the past 18 consecutive years.
- Interactive Brokers LLC is rated 'A-/A-2'; Outlook Stable by Standard & Poor’s.
[1] Includes Interactive Brokers Group and predecessor companies.
[2] Fourth Quarter 2011 Results.
[3] According to Barron's Cut the Cord - March 12, 2012, Interactive Brokers was awarded the highest 4.5 star rating for Best for International Traders, and 4.5 stars to qualify for the top two for Best for Frequent Traders.
[4] Source: The Transaction Auditing Group (TAG). Industry as a whole for the referenced periods according to TAG. For additional information refer to IB website.
[5] According to Barron's Cut the Cord - March 12, 2012, ranked Interactive Brokers with a 4.3 star rating for cost. Barron's is a registered trademark of Dow Jones & Company, Inc. Criteria included Trading Experience and Technology, Usability, Mobile, Range of Offerings, Research Amenities, Portfolio Analysis & Report, Customer Service & Education, and Costs.
[6] Low cost broker 2005 through 2012 according to Barron's online broker review.
[7] Based on IB's US Margin Loan Rates Comparison as of March 1, 2012. For additional information refer to IB website.
Country: United States
Member reviews
hard work
too complicated and awkward to log on to. i found IB hard work>.
Be careful of margin policy swings
One of the heavily advertised key advanatges of IB is their "generous" margin policy both in terms of level & interest rates. However as many customers found out in September/October IB can change policy suddenly removing margin completely on 100s of "small cap" stocks and ETCs that had previously required only 15% maintenace margin. Initially they were also going to remove margin on many ETFs and preferred stocks but have...we hope ...changed their mind.
Trading on margin one of course expects to make margin calls due to the market movements but NOT due to seismic and sudden changes in the brokers own margin policy !! Better not to offer margin in the first place rather have a volatile policy.
Trading on margin one of course expects to make margin calls due to the market movements but NOT due to seismic and sudden changes in the brokers own margin policy !! Better not to offer margin in the first place rather have a volatile policy.
Good overall for futures but one SERIOUS flaw
I'm a system futures trader and trade a variety of futures around the world. IB happens to be connected to so many exchanges BUT doesn't provide us any decent list of futures from each exchange to trade. For instance, IB is connected to Korea Futures Exchange and give us... only the Kospi 200 Futures. IB is connected to Sidney Futures Exchange, and give us... only the ASX 200. Come on IB, are you serious? We don't need another CFD-like-bucket-shop competitor, we need a SERIOUS professional CTA services. Sooner or later I'll have to change broker, not because IB isn't good overall, but just like Nokia these days, they're sleeping on the job.
Insufficient for option traders
Critical features like OneCancelAll, not available for option spreads / combos. eg could be in a spread at 1.00 debit, and want to sell at 2.00 and simultaneously set a stop at 1.50, so whichever executes first, it cancels the other. Critical for anyone who cant be at his computer screen 24/7.
OCA feature, available for single legs only. Anyone with even a little experience in trading options, would trade spreads / combos, rather than single legs. Suggesting only inexperienced option traders use IB.
IB only allow one option chain to be opened at a time rather than multiple.
RAM hogging software, even with nothing extra open and can take ~+10mins to open after log in details entered.
Commissions should always be leg, esp considering there are expensive cancellation fees ~>$1 per leg for single leg trades, lack of available features and facilities to trader.
This is not criticsim for the sake of criticism, but we want IB to be one of the top brokers for option traders. Currently, its average at best.
OCA feature, available for single legs only. Anyone with even a little experience in trading options, would trade spreads / combos, rather than single legs. Suggesting only inexperienced option traders use IB.
IB only allow one option chain to be opened at a time rather than multiple.
RAM hogging software, even with nothing extra open and can take ~+10mins to open after log in details entered.
Commissions should always be leg, esp considering there are expensive cancellation fees ~>$1 per leg for single leg trades, lack of available features and facilities to trader.
This is not criticsim for the sake of criticism, but we want IB to be one of the top brokers for option traders. Currently, its average at best.
Good or bad depends on what you are looking for.
I have been with IB since 1992. Most of the time I am not happy about this company. Then why do I still stay with IB? Because I use 4 brokers, IB is one of them. I use IB for scalping because of the low commission.
Pros:
1. Fast execution.
2. Low commission.
3. Customizable hot keys/mouse.
4. Security device or pass code protection.
Cons:
1. Lousy, unfriendly, arrogant CS staffs.
2. Over packed, confusing software TWS.
3. Very poor, related TWS documentation.
4. Cannot find help anywhere either from TWS software or web help.
5. TWS takes too long to start.
6. No one in IB cares about customers.
Pros:
1. Fast execution.
2. Low commission.
3. Customizable hot keys/mouse.
4. Security device or pass code protection.
Cons:
1. Lousy, unfriendly, arrogant CS staffs.
2. Over packed, confusing software TWS.
3. Very poor, related TWS documentation.
4. Cannot find help anywhere either from TWS software or web help.
5. TWS takes too long to start.
6. No one in IB cares about customers.
Best all-round futures broker for small UK professional trader
Overall 8/10 (9/10 if they get rid of 'cancellation charges')
Pros:
Wide selection of products available to trade on global markets
Competitive commissions eg. $4.02 per RT for S&P Emini. You can get slightly little lower (I've seen $3.30 per RT) with some US based discount brokers , but IB still blows away the abysmal $7 per RT offered by MF Global / GNI Touch, or other rip-off brokers. Shop around!!
TWS (Trader Workstation) trading platform is free, and very reliable, not buggy - it has many features if you dig deep, and you can also use a different front end if TWS is not to your taste. It suits me fine.
Free-ish data feed...provided you do a minimum level of activity...though not a 'pure' data feed as IB filters data in 250 ms packets, this is still good enough for the naked eye given the time it takes for a human being to react! During busier periods when activity is high (non farm payroll release) this probably makes the IB data feed more reliable than a pure data feed. You can pay for a different (pure tick by tick) data feed if you prefer, such as eSignal, etc. I don't feel the need, though for backtesting, automated trading you'd want this.
Many front end platforms compatible with IB. Large community base.
Universal account - others have reviewed this feature...
Website has a lot of documentation to explain details, and there are
also regular webinars to explain software, product releases, etc.
Big, profitable company, listed on exchanges, so I feel safer keeping my money with IB than other brokers.
Cons:
High cancellation charges in certain products (eg Eurex futures such as Bund, Bobl), whenever you amend/modify an order - this can double/triple your effective commission charges if you keep changing the price you are working! IB, please get rid of your stupid cancellation charges!!
Modest charting functionality - if you open too many charts it might slow or crash your PC. It's useable - I coped for two years - but I now pay monthly for dedicated charting offered by Sierra Chart and it complements IB TWS nicely.
Account statement is very detailed, but somewhat confusing (for me anyway!). Took me ages to work everything out in a spreadsheet.
TWS platform probably not too 'user friendly' for the inexperienced trader
Customer services had a bad reputation in the past, though I've personally had no problems, they have been helpful and polite. But IB is not into hand holding, so if you are a novice, probably better to look elsewhere and pay higher commissions for the better customer service.
Pros:
Wide selection of products available to trade on global markets
Competitive commissions eg. $4.02 per RT for S&P Emini. You can get slightly little lower (I've seen $3.30 per RT) with some US based discount brokers , but IB still blows away the abysmal $7 per RT offered by MF Global / GNI Touch, or other rip-off brokers. Shop around!!
TWS (Trader Workstation) trading platform is free, and very reliable, not buggy - it has many features if you dig deep, and you can also use a different front end if TWS is not to your taste. It suits me fine.
Free-ish data feed...provided you do a minimum level of activity...though not a 'pure' data feed as IB filters data in 250 ms packets, this is still good enough for the naked eye given the time it takes for a human being to react! During busier periods when activity is high (non farm payroll release) this probably makes the IB data feed more reliable than a pure data feed. You can pay for a different (pure tick by tick) data feed if you prefer, such as eSignal, etc. I don't feel the need, though for backtesting, automated trading you'd want this.
Many front end platforms compatible with IB. Large community base.
Universal account - others have reviewed this feature...
Website has a lot of documentation to explain details, and there are
also regular webinars to explain software, product releases, etc.
Big, profitable company, listed on exchanges, so I feel safer keeping my money with IB than other brokers.
Cons:
High cancellation charges in certain products (eg Eurex futures such as Bund, Bobl), whenever you amend/modify an order - this can double/triple your effective commission charges if you keep changing the price you are working! IB, please get rid of your stupid cancellation charges!!
Modest charting functionality - if you open too many charts it might slow or crash your PC. It's useable - I coped for two years - but I now pay monthly for dedicated charting offered by Sierra Chart and it complements IB TWS nicely.
Account statement is very detailed, but somewhat confusing (for me anyway!). Took me ages to work everything out in a spreadsheet.
TWS platform probably not too 'user friendly' for the inexperienced trader
Customer services had a bad reputation in the past, though I've personally had no problems, they have been helpful and polite. But IB is not into hand holding, so if you are a novice, probably better to look elsewhere and pay higher commissions for the better customer service.
Best Broker for UK Based Futures Traders
I would agree with all the points in DTs review below (damn you beat me to it!) I'll therefore try to add some information that you may find useful if you're considering giving IB a try.
The Universal A/c is particularly useful if you want to trade instruments denominated in different currencies. You simply select a base currency on joining (which you can change at any stage if your an ace FX trader!) then trade any instrument you wish. When you first try to trade a new instrument you must enable the data feed for it through 'Account Management'. This is a simple enough process although some may incur a small monthly fee. Be aware that any profits/losses are accrued in the currency of your traded instrument and if there are losses IB will charge you interest when these are not in your base currency. As DT said the process for paying losses off is a bit 'fiddly', it has to be done through IBs own 'ideal' platform, however I have found Customer Services very helpful here as they will talk you through the procedure whilst you do it online. It is v difficult to actually clear your debt exactly as the price is moving around, but IB will normally waive a few pence/cents if you cant get it spot on.
Esignal users should not miss out on the CME Fee Waiver tie up with IB. Full details on the eSignal/Interactive Data website, but basically if you have a live IB account then sign up, log in in the required manner once a month and your CME Globex fees are waived. This includes CBOT/Nymex/Comex, but for any contract which is both electronic and pit traded, such as Gold GC and Oil CL you must use =1 after the symbol to receive the data.
IB has a reputation for poor CS yet I have always found it pretty good. It is useful to remember when talking to them that you may be conversing with someone in a different timezone to your own, which can lead to much confusion if you're refering to the timing of a trade!! I have also used 'Tech Support' both telephone and online, where they have always been knowledgable and helpful. If you are UK based and want to talk to the London office then you'll find the telephone number on the Interactive Brokers thread here on Trade2Win, they often answer questions here too.
IB s website may not be the best, but if you're prepared to put in a bit of time the tabs near the top of the home page contain huge amounts of information and will answer most questions.
IB has recently reduced some of it's commissions. ES/YM/NQ are now $4 a round turn, pretty competitive imo. Margin requirements are somewhat higher than many of the other US discount brokers. This may put some people off, whilst others may argue that it is a good thing!!
TWS (Trader Work Station) is not the most intuitive piece of software but just like the website if you take the trouble to learn it's features you may be pleasantly surprised. A good starting point is the TWS Guide, if you type this into the search bar on the IB home page then a comprehensive document is available to help you get started. In addition to this IB runs a number of Webinars every month to help in specific aspects of TWS. These can be found from the Education Tab,-Webinars. You dont need to wait for the next one as there are recordings of old ones available which you can play and repeat at your leisure.
TWS has a number of sub applications which are worth investigation. Spot Forex traders may like the look of 'FXTrader', if you prefer trading direct from a chart then there is 'ChartTrader'. If you prefer an order entry ladder type system then 'BookTrader' is available, but currently one click ordering is suspended due to a patent dispute with TT.
Through IBs API then other front ends such as Ninja/Zeroline can be used but my experience suggests TWS may have what you need, you just need to delve!!
TWS has some basic scanners, but also the ability to write your own parameters. I haven't tried but Stock traders may find this particularly useful.
Any of these facilities can be tested in a paper trading account, but remember you must ask for a 'paper' account otherwise they will only open a live account for you.
In summary I would say serious traders should give them a try, but minimum $10000 to open an account.
I would have given them a 9/10 but the loss of 'BookTrader's one click ordering is a particular disappointment to me so we'll call it 8!
Hope you found something useful!!
The Universal A/c is particularly useful if you want to trade instruments denominated in different currencies. You simply select a base currency on joining (which you can change at any stage if your an ace FX trader!) then trade any instrument you wish. When you first try to trade a new instrument you must enable the data feed for it through 'Account Management'. This is a simple enough process although some may incur a small monthly fee. Be aware that any profits/losses are accrued in the currency of your traded instrument and if there are losses IB will charge you interest when these are not in your base currency. As DT said the process for paying losses off is a bit 'fiddly', it has to be done through IBs own 'ideal' platform, however I have found Customer Services very helpful here as they will talk you through the procedure whilst you do it online. It is v difficult to actually clear your debt exactly as the price is moving around, but IB will normally waive a few pence/cents if you cant get it spot on.
Esignal users should not miss out on the CME Fee Waiver tie up with IB. Full details on the eSignal/Interactive Data website, but basically if you have a live IB account then sign up, log in in the required manner once a month and your CME Globex fees are waived. This includes CBOT/Nymex/Comex, but for any contract which is both electronic and pit traded, such as Gold GC and Oil CL you must use =1 after the symbol to receive the data.
IB has a reputation for poor CS yet I have always found it pretty good. It is useful to remember when talking to them that you may be conversing with someone in a different timezone to your own, which can lead to much confusion if you're refering to the timing of a trade!! I have also used 'Tech Support' both telephone and online, where they have always been knowledgable and helpful. If you are UK based and want to talk to the London office then you'll find the telephone number on the Interactive Brokers thread here on Trade2Win, they often answer questions here too.
IB s website may not be the best, but if you're prepared to put in a bit of time the tabs near the top of the home page contain huge amounts of information and will answer most questions.
IB has recently reduced some of it's commissions. ES/YM/NQ are now $4 a round turn, pretty competitive imo. Margin requirements are somewhat higher than many of the other US discount brokers. This may put some people off, whilst others may argue that it is a good thing!!
TWS (Trader Work Station) is not the most intuitive piece of software but just like the website if you take the trouble to learn it's features you may be pleasantly surprised. A good starting point is the TWS Guide, if you type this into the search bar on the IB home page then a comprehensive document is available to help you get started. In addition to this IB runs a number of Webinars every month to help in specific aspects of TWS. These can be found from the Education Tab,-Webinars. You dont need to wait for the next one as there are recordings of old ones available which you can play and repeat at your leisure.
TWS has a number of sub applications which are worth investigation. Spot Forex traders may like the look of 'FXTrader', if you prefer trading direct from a chart then there is 'ChartTrader'. If you prefer an order entry ladder type system then 'BookTrader' is available, but currently one click ordering is suspended due to a patent dispute with TT.
Through IBs API then other front ends such as Ninja/Zeroline can be used but my experience suggests TWS may have what you need, you just need to delve!!
TWS has some basic scanners, but also the ability to write your own parameters. I haven't tried but Stock traders may find this particularly useful.
Any of these facilities can be tested in a paper trading account, but remember you must ask for a 'paper' account otherwise they will only open a live account for you.
In summary I would say serious traders should give them a try, but minimum $10000 to open an account.
I would have given them a 9/10 but the loss of 'BookTrader's one click ordering is a particular disappointment to me so we'll call it 8!
Hope you found something useful!!
Executions, commissions and forex spreads unbeatable
I think IB have probably the best retail forex operation because I haven't seen better spreads, but I think they probably rely on this reputation and don't bother to give decent customer service or useable access to historical data. I have to use a 3rd party datafeed to get historical data for NinjaTrader.
Best broker for various reasons...
I'm going to give IB thumbs up. Fast execution, huge range of markets, little slippage and easy to set up. Withdrawals & deposits are done with ease.
The best benefit in my opinion is the universal account. Let's say you day trade US futures and you have a $100k account. You probably don't use all of that $100k + associated margin when trading. This allows you to park all or part of the $100k in stocks/ETFs yet still day trade the margin on the $100k in the daytime. Effectively you can get a return on your money twice. This is something you can't get as a futures trader with a futures-only broker or a broker that segregates accounts by market (e.g. Tradestation).
In terms of platform - TWS is not the simplest by far BUT you can plug it into other platforms such as Ninja, which I do for day to day use. If you primarily trade one type of market (e.g. futures) but make the occasional trade in another type of market, then TWS is perfect for the occasional trade outside of your main market. This means you can focus your platform fees on the area in which you specialize.
Where IBs platform does excel over most is in the account reports. Some of the small futures brokers have dire account reports. IBs reports are comprehensive.
Data is effectively free; including depth but you can't get a proper Time & Sales from IB as it is sampled. Tape readers will need to look elsewhere for their data. TWS also has some scanners which you can use to look for opportunities during market hours but they are pretty basic and I haven't had much use for them.
I haven't had cause to use IBs telephone support but I have found their on-line support very helpful and always available.
The fees of IB are on par with most other brokers for the services I use. Certainly it's considerably cheaper than Tradestation. It is a little more expensive than a deep discount futures broker.
For Shorting stocks, IB has a good inventory of stocks to short. With Tradestation, I was forever getting "unavailable" messages when attempting to short which is a real pain if you have been focused on a stock with intent to open a short position. I have not yet seen this with IB.
My only real complaint with IB is that trading across other currency markets is somewhat 'fiddly'. If you have a US dollar denominated account and you earn profits in Euros, the process of converting the Euro's back to dollars is cumbersome.
The best benefit in my opinion is the universal account. Let's say you day trade US futures and you have a $100k account. You probably don't use all of that $100k + associated margin when trading. This allows you to park all or part of the $100k in stocks/ETFs yet still day trade the margin on the $100k in the daytime. Effectively you can get a return on your money twice. This is something you can't get as a futures trader with a futures-only broker or a broker that segregates accounts by market (e.g. Tradestation).
In terms of platform - TWS is not the simplest by far BUT you can plug it into other platforms such as Ninja, which I do for day to day use. If you primarily trade one type of market (e.g. futures) but make the occasional trade in another type of market, then TWS is perfect for the occasional trade outside of your main market. This means you can focus your platform fees on the area in which you specialize.
Where IBs platform does excel over most is in the account reports. Some of the small futures brokers have dire account reports. IBs reports are comprehensive.
Data is effectively free; including depth but you can't get a proper Time & Sales from IB as it is sampled. Tape readers will need to look elsewhere for their data. TWS also has some scanners which you can use to look for opportunities during market hours but they are pretty basic and I haven't had much use for them.
I haven't had cause to use IBs telephone support but I have found their on-line support very helpful and always available.
The fees of IB are on par with most other brokers for the services I use. Certainly it's considerably cheaper than Tradestation. It is a little more expensive than a deep discount futures broker.
For Shorting stocks, IB has a good inventory of stocks to short. With Tradestation, I was forever getting "unavailable" messages when attempting to short which is a real pain if you have been focused on a stock with intent to open a short position. I have not yet seen this with IB.
My only real complaint with IB is that trading across other currency markets is somewhat 'fiddly'. If you have a US dollar denominated account and you earn profits in Euros, the process of converting the Euro's back to dollars is cumbersome.
Fast Executions, Great Prices
IB has super fast executes, extended trading, great trading platforms for BlackBerry, Web, and Desktop.
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