International Investment Platforms

Interactive Brokers

An independent review of Interactive Brokers by our team of experts

Summary

Interactive Brokers Group, Inc. was founded by its chairman, Thomas Peterffy, and has grown into a major securities firm with billions of dollars in equity capital.

Headquartered in Greenwich, Connecticut, it employs thousands of people across offices in the Americas, Europe and Asia-Pacific, conducts its broker-dealer business across more than 135 market destinations worldwide and executes millions of trades a day. Interactive Brokers is regulated by the SEC, FINRA, the NYSE, the UK's FCA and other authorities.

It offers two service tiers: IBKR Lite, aimed at retail clients with commission-free trading on US-listed stocks and ETFs, no account minimum and no inactivity fees; and IBKR Pro, designed for sophisticated and active traders, with SmartRouting and volume-based pricing. Both tiers have a zero account minimum and offer fractional shares.

Pros

Open to international investors
Huge investment selection
Socially responsible investing options
Strong research tools
Low trading fees

Cons

Complex choice of instruments
No advice (execution only)
Dealing commissions (IBKR Pro)
Inactivity fees (IBKR Pro)
Complicated account opening

Our verdict

Interactive Brokers is one of the better low-cost trading platforms in the offshore market. On dealing charges it typically undercuts the likes of Saxo and DBS Vickers, the range of tradable instruments is vast, and for a capable self-directed investor it is a genuinely strong, cost-effective option.

Two cautions are important. First, tax: this is a US firm and securities are held in the United States, so it is worth checking with an international accountant that US withholding and estate taxes will not quietly erode your returns. Second, behaviour: a professional trading platform hands you the tools, the data and the constant prompts to act, and that is precisely the danger. The evidence is stark, the average individual investor underperforms the market by around 7 per cent a year, largely through trying to time it or chase returns. The platform makes trading easy; it does not make you disciplined.

So this route suits investors who genuinely know what they are doing and are content to own the consequences. Where it falls short is the same place every execution-only platform does: it gives you access, not a plan, and none of the structuring, coordination or behavioural discipline that actually drives long-term results.

If you would like your overall portfolio reviewed, and it is worth around GBP 500,000 or more, a no-obligation Second Opinion will show whether your money is working as hard as it could be.