Broker IBKR: Interactive Brokers Review in 2021

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Founded in 1993, Broker IBKR or Interactive Brokers (aka “IBKR”) has a streamlined approach to brokerage services that focuses on broad market access, low costs, and superior trade execution.

Customers can trade stocks, options, futures, forex, bonds, and funds on 135 markets from a single integrated account. In late 2020, the company launched its Impact Dashboard, which helps you evaluate assets with a socially responsible investing (SRI) lens.

Overall, ForexMedia News has consistently found Broker IBKR (Interactive Brokers) to be one of the best brokers for professional traders and sophisticated, active traders who want to take advantage of a powerful suite of tools and global access to a wide range of assets.

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We’ll take a deeper look at Interactive Brokers to help you decide whether it is the right fit for your investing needs. Aside from this Interactive Brokers review, we’ve also reviewed the Interactive Advisorsrobo-advisor service.

Who Interactive Broker IBKR Is For

broker ibkr

Broker IBKR (Interactive Brokers) is ideal for institutional investors and sophisticated, active traders who want a robust trading platform and access to a long list of asset classes.

The broker has attempted to broaden its appeal, introducing new products, services, and educational content aimed at less active traders and investors.

However, IBKR’s reputation as a professional-level platform may still scare off less-experienced investors. The company accepts clients from more than 220 countries and territories and supports trading on 135 markets across 33 countries, using 23 currencies.

Pros Explained

  • Broker IBKR (Interactive Brokers) supports an extensive lineup of trading products (including stocks, options, futures, forex, bonds, and funds) on 135 markets across 33 countries. In addition to direct access to global exchanges, IBKR supports a large inventory of fixed income products, including various European corporate bonds and Euro-denominated government bonds.
  • IBKR’s ‘SmartRouting’ software provides clients with the best price execution in the industry. It searches for the best firm stock, option, and combination prices available when you place an order and seeks to immediately execute your order. A third-party transaction analysis provider determined that IBKR has a net price improvement of $0.62 per 100 equity shares.
  • IBKR’s Trader Workstation (TWS) platform is powerful enough for professional traders but designed for retail traders and investors, too. You’ll find tons of technical analysis tools, Social Sentiment by Social Market Analytics, ESG scores from Refinitiv, and access to company fundamentals data on stocks and mutual funds through Fundamentals Explorer.
  • IBKR’s margin interest rates are significantly lower than the industry average. The company uses a blended rate based on tiers: For example, for a balance over $1 million, the first $100,000 is charged at the Tier I rate, and the next $900,000 at the Tier II rate.

Cons Explained

  • IBKR’s SmartRouter is not available to IBKR Lite clients. The Broker IBKR Lite order router prioritizes payment for order flow (PFOF), which IBKR does not share with customers. Additionally, IBKR Lite customers don’t have access to the IBKR Web Trader platform or IBKR APIs.
  • Interactive Broker’s powerful platform can be intimidating to less experienced and less active investors. IBKR offers a lot—products, tools, resources, services, and so on—and the steep learning curve can be overwhelming at first.
  • While broker IBKR is a very advanced platform, there are some gaps. Traders can’t currently backtest custom trading algorithms (algos) or automate trading with the standard IBKR software. Advanced traders looking for these features will need to use a third-party application programming interface (API).

Trade Experience

IBKR’s Client Portal is a good place to check on positions, get a real-time view of your accounts, and place basic trades. It’s easy to access a trade ticket and set up trade defaults. That being said, most investors who are looking to make the most of an Interactive Brokers account will be using Trader Workstation (TWS).

TWS offers a lot more functionality and is designed for active traders and investors who demand flexibility and trade multiple products. You can define hotkeys to place orders quickly, and you have the option to stage orders for later execution—either one at a time or in a batch.

You can set a date and time for an order to be transmitted or submit a conditional order that becomes active after specific conditions are met, such as when an existing order executes. You can even connect an application to TWS to place automated trades or subscribe to trade signals from third-party providers.

You can place, modify, and manage orders directly from the chart. You’ll find streaming real-time quotes, charting, and news across platforms—even if you’re using multiple devices simultaneously.

Mobile Trade Experience

You can trade the same asset classes and order types (including conditional orders) on IBKR mobile and TWS. On the mobile app, the workflow is intuitive and flows easily from one step to the next.

The mobile platform offers the same research capabilities as the Client Portal, including screeners and options strategy tools.

Trading Technology

IBKR’s SmartRouting technology incorporates both spray and sequential order routing methodologies, depending on the order and specific market conditions.

A third-party transaction analysis provider shows that IBKR has a net U.S. dollar price improvement of $0.62 for 100 shares, which is $0.47 better than the industry average of $0.15.

Interactive Brokers’ order execution engine reroutes all or part of your order to achieve optimal execution, attain price improvement, and maximize any potential rebates.

To help provide price improvement on large volume and block orders—and take advantage of hidden institutional order flows—IBKR includes eight dark pools in its SmartRouting logic. For options traders, SmartRouting represents each leg of spread orders independently and submits each leg at the best possible venue.

Keep in mind that IBKR Lite customers don’t have access to the company’s smart routing technology. Instead, the order router for Lite customers prioritizes payment for order flow, which IBKR does not share with customers.


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