Interactive Brokers Review

Interactive Brokers EU Review

Short description

I have been using Interactive Brokers for more than half a year and I think this is a good time to write down my review. Initially I started checking multiple brokers that suit me as an EU citizen, but I have landed on Lynx Broker and Interactive Brokers (IBKR). My initial idea was to work with Lynx as they had a lower monthly fee (5 instead of 10) and because they are a re seller of IBKR.

I registered at their site, but in the end, I decided to proceed with Interactive Brokers as they are the main source and because I wanted to use their platform. The overall registration was OK and as they removed the 10,000 limit, it was easy for me to start with only 5,000 as an initial deposit.

The overall security for the funds deposited with this broker are in-line with the US legislation. This mainly translates that the security is for 500,000 instead of the 100,000 which is for the EU.

They also offer an interest rate if you hold USD with them, but it depends a lot on the amount, thus any unused money that you have with them will still generate something and fight inflation. The low fees are also a plus on top of the fact that you have access to several exchanges.

If you would like to see which exchanges I personally use via interactive brokers, then you can check out my ETF desired portfolio as I list there several exchanges that I use.

If you are interested of using this broker, but also want to help me out, then please contact me so that I can refer you and earn a commission once you have over 1 year of experience with this broker with at least 10,000 invested. To do this, just go over to my contact form.

Registration

The initial registration was easy to do and as for my P2P platforms (Mintos and Crowdestate), I had to provide an ID when registering and everything was confirmed in a few days. Unfortunately I do not remember how long it took, but it was not long.

On top of this, I have the two factor authorization when logging it either to their website or the desktop platform and I somewhat grew fond of it once I set it for my fingerprint.

Interactive Brokers Review

As I am trying to convince my brother to start investing, I am looking at opening a second account where I will invest on his behalf until he will create his own portfolio. This is something easy to do with Interactive Brokers as I can create as many accounts as I want in my name and linked to the same user name and password. If you think there is a catch, then you are right, for each account I will have the pay the 10 USD monthly fee if the account value is under 100,000. For me this is OK as I plan to buy ETFs monthly, thus the commissions paid for those acquisitions will be deducted from the recurring payment.

Fund transfer

Adding money to my first account was easy, it took around 3 working days as per a SWIFT transfer from my bank. The overall process is simple, but will require you to issue a transfer from your bank as per the details specified from IBKR. Once my brother will start depositing into my personal savings account, I will initiate monthly transfers from there to the Interactive Broker platform so that I start investing also on his behalf.

From a withdrawal perspective, I can only state that they say it will also take 3 days. As I have not withdrawn anything, not do plan to withdraw anything in the near future, you may have to wait a while for me to share this experience.

How the system behaves

If you are new to my blog, you should know that my investment approach is for the long term, this is why I will not highlight, not complain like other daily traders in regard to the 20s to 1 min response time for market orders. This is not my objective, not my approach, thus I am not at all impacted by it.

My first trading experience was via the browser simple basic trader platform and I was not able to create a trade. There were not enough details on how I should manage it, what exchange I was using, that currency was the stock, nor other items like my country related restrictions to accessing some trades. This is especially accurate for ETFs or US funds, as I am mainly restricted as a retail investor towards the UCITS funds. Now I only use the browser based one for a simple account overview, but I mainly check out my portfolio high level view.

Interactive Brokers Review

The above mentioned challenge that I have with the Interactive Brokers browser, had me move into the direction of the desktop and mobile app, but to be frank, I only use the desktop app for trading and the mobile one just to see how things are doing. After spending some time with it and doing some basic configurations, I have reached my goal view for the platform. I can say that I really like this one, and once you get to know it, you will grow to like it.

If you are new and just want to check out their platform, I would recommend that you open a paper account so that you can proceed with your Interactive Brokers review and judge by yourself if the technology and platform they use suits your needs or not. Do not forget to also search some reviews for some insider experience if you want to move forward with daily trading as the market order response time can be a deal breaker there.

Interactive Brokers Review

As you can see, I keep it simple, 4 views are enough for me and I tend to check out via my watch list if a fund or ETF is restricted or not for me. It has become a habit for me to research and only look at for funds that are valid for me, as there were a lot of ones that I wanted to buy in to, but I was not allowed, so all that work in documentation was in vain.

Interactive Brokers Review

Trust me, I would love to buy me some Vanguard, but I can’t, at least not without over complicating it. This is the challenge for us Europeans, but we can survive and we will manage to move forward with our investments.

My setup of the system

Do not overdo it at start. Add gradually and check things out piece by piece. This will help you not be overwhelmed with all the options and functions that Interactive Brokers platform has to offer. The minimalist approach was the way forward for my, but you can spice things up once you read the material provided for their TWS platform.

From a trend analysis point of view, the IBKR tool offers you all that you need. I do not know how to use 99% of its capabilities, but I added some functions to help me out and help me better understand when to enter with a buy position. This is why I use Volume, MACD and DMI in order to get a slightly better view of the trends. I also compare them with some indexes that I look at, like S&P 500 and NASDAQ.

Interactive Brokers Review

The order function is simple and intuitive, but for me it misses one key point of information: the currency used for the transaction. Why is this critical for me? Well, it is because I buy from different stock exchanges and the same ETF or fund may be listed in either EUR or USD, based on the exchange. This is also on top of the fact that due to the current Brexit talks, I am not fond of holding GBP at all and I am trying to avoid funds that work in this currency. An example would be the iShares Core S&P 500 UCITS ETF (Acc) fund that is listed as CSP1 on the London Stock Exchange in GBP, but also as CSSPX at the Borsa Italiana in EUR.

Interactive Brokers Review

For me, the way around the currency topic listed above, but also, my way in watching my portfolio is via my ETF ant stock list. This is a similar function to the automatic portfolio tracking offered by IBKR, but it has all my desired stocks and a set of columns filtered in order to give me what I want to see instead of the default view. I have also grouped my stocks and ETFs in order to help me remember my equity distribution across them. If you are interested for more details on why I picked certain ETFs, either for myself or for my little brother, then you can check out my ETF portfolio or my guide on how to invest in your twenties for my little bro.

Interactive Brokers Review

Reports

Before I start discussing about the reports that are provided through the browser version of Interactive Brokers, I would like to share with you the account view. For me this holds everything that I need to know for this point in time. Although it does not offer me the actual P&L that is taxable and I must submit to my government for tax purposes, it gives me all I need to know on my cash and equity positions held with Interactive Brokers.

Interactive Brokers Review

As for the browser reports, I will add the sample to this review once I fill out my tax statements for 2019.

Fund withdrawal

I have not withdrawn any funds from this platform, nor do I plan to do so in the near future. I will let you know once I do this via an update on this page.

Profit & Loss

Although this is not linked to this platform, nor the broker, I have an unrealized profit & loss of over 21% in this current bullish market. Curious to see now if this will remain as is or if it will change in 1 year from now.

For those of you that want to see how I am doing via the VC and P2P investments, you can either check my portfolio or my latest monthly statistics.

Interactive Brokers Review

Conclusion

The main thing that I would highlight for this Interactive Brokers review is that this is the broker for me. It has some of the lowest prices across online brokers and it is easily accessible from Europe and with a good account security that even has the option to be upgraded for more than the default threshold.

I was able to find the ETFs that I wanted and to which I had retail investor access to from this platform and I even found some listed on different stock exchanges, which gave me the option to not only diversify across equity and currency, but also diversify across several stock exchanges in case some nightmare war starts somewhere.

If you are serious about starting to invest in the long run, then I would sincerely recommend that you try out Interactive Brokers. It will be a good use of your time and you can decide if you want to remain with this broker or if you would like to move somewhere else. If you are into day trading, please search for more reviews as I read some that stated that the market response time is not ideal for the day traders.

If you are interested of using this broker, but also want to help me out, then please contact me so that I can refer you and earn a commission once you have over 1 year of experience with this broker with at least 10,000 invested. To do this, just go over to my contact form.