Interactive Brokers Review: How Competitive Is This Brokerage?
Interactive Brokers Review: How Competitive Is This Brokerage?
ValueChampion Rating 
Pros
- Low cost platform
- Forex trading
Cons
- Not the lowest minimum fees in singapore
Interactive Brokers charges some of the lowest trading fees, especially when trading in international markets. It offers competitive access to international markets, and has a wide range of products you can trade. This makes it a great option for investors seeking a platform to trade international securities.
| Summary of Interactive Brokers' Online Brokerage |
|---|
| Lowest commission fees for international trading |
| Invest in 26 international markets |
| Premium pricing for high-volume traders |
| Large amounts of products to trade |
| Promotions: - |
Table of Contents
- What Makes Interactive Brokers Stand Out to Investors
- Investment Opportunities at Interactive Brokers
- Interactive Brokers Fees
- Investor Eligibility Requirements
What Makes Interactive Brokers Stand Out to Investors
Interactive Brokers could be the best brokerage to serve your investment needs. Interactive Brokers stands out due to its low trading fees and large scope of the global markets investors can trade with. In addition to this, the brokerage allows account holders to trade more products than other online trading platforms. To get a sense of how competitive Interactive Brokers' commission charges are, it is helpful to compare their fees to other online brokerages in Singapore.
Investment Opportunities at Interactive Brokers
Interactive Brokers offers several types of brokerage accounts depending on whether you are an individual investing or you are jointly investing. With their Individual Account, customers can trade cash, securities and portfolio margins. Moreover, the online platform gives access to comprehensive trading tools to trade stocks, options, futures, currencies, bonds, funds and more. One special feature Interactive Brokers has is that if an exchange provides a rebate, they will pass some of the savings directly back to the customer. So, whether you are a new or experienced trader, Interactive Brokers' individual account will give you everything you need to trade.
- Stocks
- ETFs
- Securities Options
- Futures
- Futures Options
- Fixed Income
- Spot Currencies
- Mutual Funds
- Stock Futures
- Indices
- Warrants
- Structured Products (Turbos and Certificates)
- Metals
- Callable Bull/Bear Contracts (CBBCS)
- Single Stock Futures
- Foreign Exchange Trading
Interactive Brokers Fees
Interactive Brokers charge some of the lowest fees in the market. For example, to trade in Singapore with Interactive Brokers, you will be charged a minimum fee of S$2.50 and a 0.08% minimum commission rate. To put that in perspective of the online trading market in Singapore, the average minimum fee is S$20, while the minimum commission charge can go as high as 0.275% per trade. The subsections below go into depth on the charges you could expect to pay.
Fee Comparison: Interactive Brokers vs Saxo Markets
| Interactive Brokers | Saxo Markets | |
|---|---|---|
| SG Stocks Commission Fee (Min. Fee) | 0.08% (S$2.50) | 0.08% (S$5) |
| U.S. Stocks Commission Fee (Min. Fee) | $0.005 per share (USD 1.00) | 0.06% (USD 4) |
| Hong Kong Stocks Commission Fee (Min. Fee) | 0.08% (HKD 18) | 0.15% (HKD 60-90) |
| Japan Stocks Commission Fee (Min. Fee) | 0.08% (JPY 80) | 0.15% (JPY 1000-1500) |
Foreign Exchange Fees
Interactive Brokers is also a great option for individuals seeking to conduct foreign exchange trades. This is because the online trading platform's forex spreads are typically the cheapest available in Singapore. While Interactive Brokers does charge a commission fee for FX trades, the fee usually works out to a few dollars, making it somewhat negligible.
Currency | Min. Spread | Industry Average |
|---|---|---|
| EUR USD | 0.1 | 0.7 |
| USD JPY | 0.1 | 0.7 |
| GBP USD | 0.3 | 0.9 |
| AUD USD | 0.1 | 0.7 |
| * figures based on min. advertised spreads advertised October 21, 2020 | ||
International Security Trading Fees
| Trade Volume (US Shares) | Commission Fee per Share |
|---|---|
| 300,000 or less | $0.0035 |
| 300,000 - 3 million | $0.002 |
| 3 million - 20 million | $0.0015 |
| 20 million - 100 million | $0.001 |
| 100 million+ | $0.0005 |
| Min. fee $0.35 per order, Max. fee 1% of trade value | |
| Monthly Trade Value (HKD) | HK Commission Fee | Min. Fee (CNH Denominated) |
|---|---|---|
| HKD 15,000,000 or less | 0.05% | CNH 15 |
| HKD 15 million - 300 million | 0.05% | CNH 10 |
| HKD 300 million - 900 million | 0.03% | CNH 7 |
| HKD 900 million - HKD 2 billion | 0.02% | CNH 5 |
| HKD 2 billion+ | 0.015% | CNH 3 |
| Monthly Trade Value (JPY) | Commission Fee | Min. Fee |
|---|---|---|
| JPY 150 million or less | 0.05% | JPY 80 |
| JPY 150 million - 3 billion | 0.04% | JPY 70 |
| JPY 3 billion - 9 billion | 0.03% | JPY 60 |
| JPY 9 billion - 20 billion | 0.02% | JPY 40 |
| JPY 20 billion - 100 billion | 0.015% | JPY 30 |
| JPY 100 billion+ | 0.010% | JPY 20 |
Investor Eligibility Requirements
To apply for an account with Interactive Brokers, you need to submit a copy of your identification card, your employer's name, address and phone number, and your bank account number to fund your account. You can expect to receive an answer within 1-3 working days.
Interactive Brokers gives individual investors a great platform to invest in international securities and the foreign exchange market. With some of the lowest fees, access to 26 international markets, and a wide range of products and services, those who invest with a high trade volume and large total value will benefit from trading with Interactive Brokers.
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Stephen Lee is a Senior Research Analyst at ValueChampion, specializing in insurance. He holds a Bachelor of Arts degree in International Studies from the University of Washington, and his prior work experience include risk management and underwriting for professional liability and specialty insurance at Victor Insurance. Additionally, Stephen is a former US Peace Corps Volunteer in Myanmar (serving between 2018-2020), where he continues to provide business development consulting services to HR companies in Asia Pacific.