If you want to start building a retirement portfolio, invest in different sorts of assets including stocks and ETFs, or just give trading a try, Interactive Brokers or IBKR Lite are probably already on your radar. The brokerage is highly rated by a variety of publications, is well respected in the industry, and has a global presence that most other platforms can’t even dream of matching.

This review is going to peel back the onion that is IBKR, explore what really sets it apart from other trading venues, show you how to use it, and clarify what you need to create an account.

Once you’re done, you should have a much better idea of what Interactive Brokers can really offer you, as well as how you can get the most out of this globally accessible platform.

What is Interactive Brokers?

Interactive Brokers was founded by Hungarian-born billionaire Thomas Peterffy, one of the 50 richest people in the world as of March 2024, and is one of the biggest stock broking firms in the world.

Also known by its stock ticker IBKR, Interactive Brokers is considered a discount brokerage in the United States and is the IEX exchange’s founding issuer. It’s the largest foreign exchange market broker in the US, and one of the largest prime brokers servicing commodities brokers.

Why investors choose Interactive Brokers

Interactive Brokers reportedly has over 3 million user accounts and processes around that same number of trades every trading day, with operations in 34 countries and 27 currencies. According to a 10K filed in 2024, more than half of the company’s customers reside outside the US, in around 200 countries and territories.

As a platform, IBKR isn’t considered very easy to use, but it does provide an extremely efficient, sophisticated system that caters to more advanced traders. In fact, traders on Interactive Brokers can expect an extremely professional trading system, as opposed to more simplified, gamified competitors like Robinhood that target novice traders.

IBKR also grants access to an unparalleled selection of assets across multiple categories and geographies, letting investors build the perfect portfolio for their own needs.

How to use Interactive Brokers

IBKR

What you need to get started

Interactive Brokers offers many different account types, but odds are you’re going to be looking at an individual or joint account, or perhaps even a small business account. It’s good to take a quick look at these different account types, because what you need to get started may differ depending on your account of choice.

However, the requirements are similar to most other brokerage platforms assuming you're a retail investor or non-professional trader.

The main thing you’ll need to furnish IBKR with before opening your account is identification and proof of your residential status. Other requirements, such as providing a Social Security Number or tax identification, will come into play depending on where you live.

Location

On that note, make sure that you keep an eye out for a warning like the one above. You’ll want to make sure you pick the right website for where you live, or else your account application may be rejected. 

Lastly, also make sure you have some of your financials in order. Not only will you need to prove and link your bank account, but you’ll also have to give IBKR some information about your tax class, annual income, and so on.

Among other things, these details will play a role in what assets or trading instruments you’ll have access to on the platform—there’s a minimum threshold for derivatives like options trading as well as features such as margin trading.

You may also need to provide some basic details about your employment including employer name, contact details and address.

Creating your Interactive Brokers account

Create account

Getting set up with Interactive Brokers is quite simple, and if you don’t want to dive right in, you can elect to begin with their free trial—free, because creating a standard account requires an initial deposit of funds which you can use to begin trading or investing once the transfer settles.

The free trial is a good idea because it allows you to get a feel for the IBKR interface and the different systems they offer while also paper trading using virtual funds. It’s a clever way to package a free trial and is very beneficial for you as a potential user since Interactive Brokers’ interface can be on the complex side.

Paper trading lets you get a good feel for how all their systems work, right down to the clicks and button presses needed for different trades, without risking real funds.

If you’re interested in creating a standard funded account right away, it’s just a matter of setting up a username and password, confirming your email address, and completing IBKR’s account application. You can also choose to fund your account via a bank transfer before approval, and those funds will be sent right back if there’s a problem with your application.

You can also choose ACAT (Automated Customer Account Transfer) as an initial funding method if you’re moving to IBKR from another broker, but application approval will have to be granted first before the ACAT transfer is processed—so this method could take a little longer.

Once you’re all set up, you’ll also want to ensure that your base currency is set correctly based on what you want for your statements and to determine margin requirements. You can change base currency at any time, and deposit as well as withdraw funds using non-base currencies. 

Buying stocks and ETFs on Interactive Brokers

Buying stocks

What you’re looking at in the above image is IBKR’s ‘Order Ticket’ which is easy to find—simply click on ‘Trade’ and then select ‘Order Ticket’. You’ll be prompted to enter the symbol for the asset you want to trade, with a menu above the symbol search box to choose whether it’s a stock or ETF, or a different asset class such as Options, Futures, Warrants, CFDs, Mutual Funds, Crypto, and so on. 

On the bar at the bottom, you’ll see that the 'Buy' button is highlighted in blue, showing that you’ve currently got it selected. If you click on 'Sell', it’ll highlight itself in red, so that there’s no confusion. You can then set the number of shares you want to trade using the Quantity field—the default is 100, which is traditionally a complete lot when trading stocks.

You can then choose your order type, which in this case is 'Limit', meaning that you can also set the Limit price for this order.

And finally, there’s the time-in-force setting you want—you can set the order to be valid through the course of that trading day, or choose 'Good till Cancel' if there’s a specific price you think you’ll fill at some point during the next however many days or weeks.  

Trading

Buying an ETF works in exactly the same way, although we did point out trading permissions with IBKR—as you’ll see, the order information bar is blued out with a notification that this account holder needs to change some permissions on their account or submit certain documentation in order to trade ETFs.

You can trade all of Interactive Brokers’ different asset types using this Order Ticket interface, but make sure to check your quantities—stocks default to 100 as mentioned, while options default to 1, and each asset bears double-checking before you sign off on the order.

Even professional traders are known to “fat-finger” trades, and that’s not a mistake you want to make with your hard-earned cash.

How to buy foreign stocks on Interactive Brokers

Foreign stocks

We’ve just clicked on a sample account’s CD Projekt Red holdings, as you’ll see in the image below. CDR is a Polish company listed in Poland, but it’s a globally-known firm thanks to the development of the Witcher video game series—and if you want to add a company like this to your portfolio, IBKR is one of the best options as far as a brokerage or trading platform goes.

CDR

Simply clicking on the blue Buy or red Sell buttons allows you to trade this foreign stock, and we’ve chosen Buy. That opens up a sidebar that contains the same options as the Order Ticket interface, so you’ll simply have to enter things like order type and quantity before confirming your order.

IBKR gives access to stocks listed in 34 different countries across 150 markets, but the main practical consideration on the platform is the currency—to go ahead with an order like what we’ve entered in that image, you’ll have to first convert currencies and ensure you have enough Polish zloty in your account to complete the trade, along with a margin for error.

When researching a stock, however, you’ll always see the currency listed next to its price, such as with PLN next to the price of 196.40 in the above screenshot. You can also fill out the order ticket like we’ve done above to get an estimate of how much PLN you’ll need to have in your account to complete your planned trade.

How to trade options on Interactive Brokers

Trade options

You can trade options using the Order Ticket function as well, but many traders prefer to view the entire chain (pictured above) before making a decision. This view gives you a good idea of what’s going on when it comes to the options contracts available for a given security, and you can look at different expiration dates with a single click.

Once you find the options contract you wish to trade, it’s just a matter of clicking on it on the chain—a buy button will appear when you hover your cursor beside the selected entry. Then, all you need to do is enter your desired quantity and order type before confirming the order.

As we’ve noted previously, options require elevated trade permissions on Interactive Brokers.

To trade options, users need to fulfil certain criteria when it comes to minimum age and liquid net worth, and you’ll also have to sign off on your investment objectives, product knowledge, and prior experience.

Trading permissions

You can configure these and request options trading permissions via your IBKR client portal, but you should note that there are four different levels of options trading. You’ll find basic options strategies, such as long calls and covered puts, taken care of by level 2 permission, with just covered calls and buy write under level 1. 

Level 3 permission covers options with limited maximum potential loss, while level 4 corresponds to full permission. While these different levels (and availing yourself of them) can feel like jumping through hoops, they do represent a significant effort on IBKR’s part to prevent less advanced users from getting taken advantage of via high-risk plays.

And, unless you have level 4 permissions, you can be fairly confident that you’re not exposing yourself to outsized losses without your knowledge.

Withdrawing your money from Interactive Brokers

Withdrawing money

Withdrawing funds on Interactive Brokers is extremely easy, and that’s a testament to the fact that it’s a solid, globally recognized platform. Unlike a lot of neo-brokers, IBKR isn’t subject to as many horror stories of frozen funds or non-responsive customer service when trying to withdraw.

Granted, it could be argued that customer service is one of IBKR’s weaknesses, but money transfers both incoming and outgoing tend to be extremely easy.

The main thing to remember with cash withdrawals is that funds take a couple of days to settle. That’s a systemic thing, so if you make a bunch of cash off a trade, you’ll need to give your profits that T+2 settlement period before being able to pull the money off the platform.

When you click on 'Withdraw Funds' from the pictured menu, you’ll simply have to choose one of the linked accounts. Then, Interactive Brokers will show you how much settled cash you can withdraw to that account. If your funds are in a different currency, you can use the aforementioned Order Ticket interface to convert currency and change into a currency that matches your bank account.

How much does Interactive Brokers cost?

Interactive Brokers cost

Interactive Brokers is an award-winning platform with a stellar reputation, and it doesn’t cost an arm and a leg to use. IBKR Lite charges zero commissions for stocks and ETFs in the US, so that’s a great option for US residents interested in building a primarily stock and ETF-based portfolio.

For global users, IBKR Pro is the way to go, and you’re looking at a $0.0035 fee per share below 300,000 in monthly volume, up to a maximum of 1% of the total trade and a minimum of $0.35 per order (representing a whole ‘lot’ of 100 shares).

This doesn’t take a big chunk out of whatever trading strategy you’re trying to execute unless you’re trading very small amounts of penny stocks, so you shouldn’t have any issues there. There are third party fees in play as well, such as SEC fees and FINRA charges, but these apply no matter which broker you use.

Fees

When it comes to margin trading, the above table will give you an idea of where IBKR stands. The rates vary significantly depending on whether you have a Pro or Lite account, and the currency you choose will also play a role in what sort of rate you get for margin loans.

On the flip side, IBKR has a Stock Yield Enhancement Program which allows users to make a little extra income from their holdings. Many platforms offer this sort of feature, but be warned—irrespective of brokerage, what’s going on here is that you’re giving your broker permission to lend out your shares to short sellers.

It’s a point in IBKR’s favor that they actually ask you for permission (while spinning it as a positive) rather than just lend your stocks out without asking you. That being said, lending your stocks out means they may not be protected by SIPC—there’s a possibility your shares don’t get returned, although per SEC rules IBKR is supposed to provide you with collateral to the same value in that event.

Furthermore, by loaning out your shares, you’re also handing your voting rights over to the borrower. This may not seem to be a big deal, but think about it for a moment.

A short seller is betting against the company whose shares you own, and you’re also signing over your keys to the boardroom to them. Given the number of companies that have been taken down from the inside by short sellers, it’s wise to exercise a little caution.

If you do choose to lend out your shares, IBKR will pay you 50% of the market rate for stock lending, based on third party data as well as the rates IBKR borrows and lends shares at. On the other hand if you’re worried about stock lending and want to protect your right to corporate governance, IBKR allows you to register your shares with the company’s transfer agent in book entry with a minimum of fuss and a small fee via the Direct Registration System (DRS).

Is Interactive Brokers safe?

Trustworthy

2025 is Interactive Brokers’ 48th year of operation as a broker/dealer and it enjoys a strong reputation as a safe, stable platform with advanced execution. They did fall victim to a data breach in 2024 via an employee email account, but beyond this incident haven’t reported any high profile hacks or security failures.

On the compliance side, IBKR have only fallen afoul of regulators on two major occasions, which isn’t much by Wall Street standards. Their 2020 fine for $38 million relating to inadequacies in their anti-money laundering program, for instance, pales in comparison with HSBC’s $1.25 billion fine for in fact aiding in the laundering of millions in drug-related finances or BNP Paribas’ $8.9 billion penalty for processing transactions on behalf of sanctioned nations.

In 2018, IBKR was fined $5.5 million over allegations that the firm broke federal rules related to naked short selling—a practice where, unlike with the short selling we mentioned earlier in IBKR’s yield program, an institution sells a share short without actually obtaining said asset beforehand from a lender or even ensuring it can be borrowed.

Given that the stocks that are traded today are just entries in a ledger at the Depository Trust and Clearing Corporation (DTCC) and not actual physical assets (unless they’re in certificate form) it’s even possible that the share is never obtained and delivered to the buyer within the required timeframe. This is called a Fail to Deliver (FTD), of which there are significant numbers practically every trading day.

As you might imagine, selling something to a buyer without actually having it or being sure you can get it feels a little illegal, and indeed it is in many markets including South Korea which is stepping up penalties against naked short selling including lifetime prison sentences for anyone caught doing so.

In the US, although the SEC’s “Regulation SHO” attempts to combat abusive naked short selling, the regulation does contain certain exemptions allowing naked shorting for market makers and broker dealers like IBKR—but tellingly, the main exemption at play here is known as the “Madoff exemption” in reference to infamous Ponzi schemer and market maker Bernie Madoff.

As interesting and systemically relevant as the regulatory fines IBKR has paid are, it’s worth repeating that they’re few and far between, and also extremely small in the greater scheme of things. There are much bigger offenders out there, such as JP Morgan Chase which has clocked almost 300 violations since 2000, with total fines of over $40 billion.

Is Interactive Brokers worth it?

Interactive Brokers pros

  • Zero commissions with IBKR Lite
    IBKR Lite is only available for US residents, but if you are one, you can take advantage of commission-free stock and ETF trading to go with all of the other benefits that Interactive Brokers offers.  
  • Massive, global selection of assets
    One of Interactive Brokers’ biggest selling points is the access to a variety of global markets and assets that you may not otherwise be able to invest in. Crypto is also now available on IBKR, courtesy of Paxos.
  • Free trial with paper trading
    You can trial IBKR’s services and platform without making an initial deposit via their free trial, which also opens up paper trading—and this is great since it’s an unlimited opportunity to trial their complex systems and get used to how things work without using real cash.
  • Research and tools
    IBKR also has excellent research resources and trading tools, available for every trade-able asset with just a click. While you may want to use your own indicators if you want to go above and beyond, IBKR has plenty to serve the average trader’s needs.

Interactive Brokers cons

  • UI isn’t beginner-friendly
    Interactive Brokers is full featured and powerful, and the interface can feel like piloting a plane versus riding the tricycle that some neo broker interfaces resemble. For some users this isn’t a con at all, but IBKR’s systems and trading UI can take some time to learn and get comfortable with, especially with all of the alerts and information that gets thrown at you when making a trade.

Interactive Brokers alternatives

If you’re not quite on board with Interactive Brokers just yet, make sure to check out this guide to the best free stock trading apps out there today. Alternatively, here are three different options that might suit different needs:

1. Fidelity

IBKR is a multi-billion dollar corporation and enjoys a reputation as one of the top brokers in the world. Fidelity, however, turns the dial up to 11 and also adds a few zeros at the end. Worth several trillion, Fidelity is a financial juggernaut, and is considered by many to be the top broker in the US.

It gives you similar wide-ranging access to a number of asset classes including mutual funds which most neo-brokers can’t provide, and while it doesn’t quite have the same global reach as Interactive Brokers, Fidelity matches up nicely in most other regards including zero commissions on US stocks and ETFs.

Fidelity’s fees for options are similar to those levied by Interactive Brokers, and they’re just as good when it comes to services like corporate actions and asset transfers—and if you’re worried about things like corporate governance or short selling, Fidelity sits right next to IBKR atop the pyramid of brokers that make DRS easy.

2. Webull

Webull is one of many brokerage platforms that’s considered a neo-broker, but what that means is a combination of free trading and convenience when it comes to its app platform and an easy user interface. 

What makes Webull a good alternative, however, is not the fact that it’s any sort of watered-down option—Webull in fact takes trading tools and analytics to the next level, with over 60 indicators for you to add to your charting game. The platform has a Lite version that’s good for beginners, but the full product packs a punch.

What puts Webull behind trading venues like Fidelity and IBKR is the fact that it’s a small and relatively new firm, without a long track record to analyze when it comes to safety and security. Webull is also a Chinese firm, which offers additional complications when it comes to data security and regulatory purview.

3. Robinhood

We compared IBKR’s interface to piloting a plane earlier, and in that analogy, Robinhood is the tricycle. It’s an extremely simple platform to use, and while the gamification elements could annoy an advanced user, it can help to build up some enthusiasm and interest in trading for younger or newer traders.

That being said, it’s worth using Robinhood with caution as, unlike IBKR, it puts some very advanced and high risk trading avenues such as options at beginner investors’ fingertips, and here the gamification isn’t a good thing—newer traders could lose a lot of money using this app if they accidentally bite off a lot more that they’ve got the skill and knowledge to chew.

Robinhood’s charting is extremely simple and easy to read too, and while transferring assets off the platform can get really expensive and corporate actions aren’t much of a thing, Robinhood could be your broker if you want to just throw fifty bucks onto a platform and learn how basic trading works before moving onto a full-featured venue like Fidelity or IBKR.

Get expert trading tools and learn how to implement advanced trading strategies with Whop

whop trading

If you create an account on Interactive Brokers and start using the platform, you’re teeing off on the same course as hedge fund managers, trust funds, other brokers, investment advisors, money managers, and a whole host of other professionals. So how do you compete, especially given that trading isn’t always a level playing field?

The answer to that question lies in education, and training yourself to become a highly skilled, efficient, composed trader with a solid understanding of the market and how it works. Most experts have decades of experience, so you might need to go for the next best thing—learning from those same expert traders.

Whop is home to some of the internet’s top expert-led trading communities where you can learn from them, interact with them, use their tools and indicators, and even watch and listen to them as they trade in real time. Many of them will even use Interactive Brokers, so you can see for yourself how they navigate the platform and all its features.

You can also check out Whop’s selection of stock trading courses, and give yourself the best possible chance of success. Pair your newly acquired skills with a top stockbroking platform like IBKR, and you’re good to go.