For the last several years we've been using a few different stockbrokers but our main account has been with Interactive Brokers, for two simple reasons
- Their commission rates cannot be beaten, and
- They offer some of the best free software (can either be run online through a Browser or the program is installed on your PC). Note however that their cheap commissions come at a price, that being there's virtually no telephone support, although online support is good.
Who Are Interactive Brokers
A massive American brokerage company with equity capital exceeding $1.9 billion. See this Google Finance link for more background information.
They are also one of the most financially secure brokerage companies in the world because they don't let clients owe them money by means of margin calls. So if you don't have enough money to fund your positions overnight they will be automatically liquidated before the close.
The Downsides Of Interactive Brokers (IB)
IB is very much an internet broker with little customer telephone support or the ability to place trades via the phone (unless their software breaks down).
If they did experience software problems and you had to get out of a trade there is the option of calling. But be aware that as they don’t employ telephone brokers it may well take more than 20 minutes to get through.
To the company’s credit though it makes this information clear to clients when they sign up. By not offering these kinds of services is the main way that commissions can remain so competitive.
Summary
Interactive Brokers is generally considered as the broker of the professional trader and the service they offer is designed for active traders because cheap commissions are important the more volume one does.
We suggest that if you do trade more than a few times a week in the stockmarket then keep your present broker, but also open an account with IB to test them out.
Finally, don’t let the negatives of a lack of telephone support put you off because in the 5 or so years that we’ve been using them we haven’t had to call them once.
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