Interactive Brokers is the US-based brokerage firm, which offers its services to active traders. Interactive Brokers has long been popular for offering its services to the advanced traders but in 2019 the company launched IBKR Lite which focuses mainly on casual investors.
IBKR Lite offers unlimited free trades of ETFs and Stocks which are listed on US exchanges, whereas, IBKR Pro is mostly for advanced traders. Both the account types have a $0 account minimum and offer fractional stock shares. IBKR Lite charges no maintenance fees and inactivity fees. IBKR Pro charges an inactivity fee which is easy to skip if you trade frequently.
Any Online Broker Charges Two Types of Fees:
- Trading Fees: Trading fees are the brokerage fees that one pays as a result of trading on the trading platform offered by the broker. A broker may charge either as a commission or as a spread. The commission is fixed and is based on traded value. A Spread is the price difference between buying and selling price. The financing rate or overnight rate is charged when a trader holds a leveraged position for more than a day.
- Non-trading Fees: These are charged as a result of certain operations that you do with your account like depositing and withdrawing funds etc.
Trading Fees of Interactive Brokers:
- Stock Fees and ETF Fees: For every $2000 trade, Interactive Brokers charge $1.0, $7.2, and $4.4 for US stock, UK stock, and German Stock respectively.
- Forex Fees: Interactive Brokers charges $17.9 as a EURUSD benchmark fee and $13.0 as a EURGBP benchmark fee for every $20,000 30:1 open position.
- Fund Fees: For a $2,000 fund, Interactive Brokers charges $15.0 for Mutual Fund and $4.4 for EU mutual funds.
- Bond Fees: For a trade of $10,000, Interactive Brokers charges the fees of $5.0 for US treasury bonds and $10 for the EU government bond.
- Options Fees: Interactive Brokers charges $6.5, $20.4, and $12.1 for US stock index options, UK stock index options, and German stock index options respectively. The fees mentioned here are stock index options fees of 10 contracts.
- Futures Fees: For US stock index futures, UK stock index futures, and German stock index futures, Interactive Brokers charges $2.5. $20.4 and $8.8 respectively.
- CFD Fees: For every $2,000 trade commissioned, Interactive Brokers charges $1.1, $3.9 and $3.4 for Apple CFD, Vodafone CFD and Germany respectively.
Non-trading Fees of Interactive Brokers:
Non-Trading fees include brokerage charges that are not related to buying and selling of the assets like withdrawal fees, deposit fees, account fees, and inactivity fees. Interactive Brokers don’t charge any withdrawal fee, deposit fee, and account fee.
The firm charges an inactivity fee which is $20 per month for the traders having less than $2000 account balance and if they don’t generate a minimum $20 in commissions. $10 are charged for the accounts having at least a balance of $2000. There is no inactivity fee for US clients of IBKR Lite plan.