Interactive Brokers Pricing: Is Opening an IBKR Account Free?

Opening an Interactive Brokers (IBKR) account is free and no account opening fees are required.

Interactive Brokers (IBKR) has long been a top choice for savvy investors, offering access to global markets with a reputation for low fees and tools. But what does it cost to open an IBKR account and how do its pricing models stack up against the competition? Whether you're a day trader, a long-term investor or somewhere in between, knowing the fees involved can make or break your experience with IBKR. Let’s breakdown the costs and see if IBKR lives up to its low-cost reputation.

Opening an IBKR Account

Good news: opening an IBKR account is completely free. There’s no account opening fee, but you must deposit at least $0 to start trading on IBKR Lite or $100 if you sign up for IBKR Pro. The platform’s flexible deposit options make it accessible to various investors, whether just dipping your toes into the market or looking to jump in with both feet.

IBKR Fees and Commissions

IBKR offers two pricing models: IBKR Lite and IBKR Pro, each tailored to different types of investors. IBKR Lite is great for casual traders, offering commission-free trading on U.S. stocks and ETFs. IBKR Pro, on the other hand, is designed for more active traders with tiered or fixed pricing and lower margin rates. Your choice between the two will heavily influence the fees you pay, so it’s important to understand what each account offers.

For US-based investors, fees and commissions can vary depending on the asset class and whether you're on Lite or Pro.

Stocks and ETFs

On IBKR Lite, U.S. stocks and ETFs are commission-free. But on IBKR Pro, you’ll encounter either tiered or fixed pricing:

• Tiered: Starting at $0.0005 per share with volume discounts.
• Fixed: $0.005 per share with no additional volume discounts.

For example, buying 500 shares on IBKR Pro under the Tier pricing model costs around $1.75 in commissions. Compare this with competitors like E*TRADE, which charges $0.005 per share on some trades and Schwab, where many trades are also commission-free.

Options 

Trading options on IBKR Lite costs $0.65 per contract, while IBKR Pro offers tiered pricing starting at $0.15 per contract with lower rates for high-volume traders.

For example, buying 10 options contracts at $0.65 per contract on IBKR Lite would cost $6.50 in fees. On IBKR Pro, the cost could be as low as $2.50, depending on your trading volume.

Compared to Tradestation and Charles Schwab, which charge $0.60 and $0.65 per contract respectively, IBKR Pro can be cheaper for high-volume traders.

Futures

Futures trading on IBKR Pro comes with a tiered commission structure starting at $0.25 per contract, placing IBKR’s futures pricing among the most competitive.

For instance, if you trade 5 futures contracts at $0.25 each, your total commission would be $1.25 on Pro. Compare this with E*TRADE, where futures contracts cost $1.50 each or NinjaTrader, which charges $0.35 per micro and $1.29 per standard contract for the Free plan.

Bonds

For U.S. bonds, IBKR Pro offers commissions starting at 0.1% of the face value with a $1 minimum. In comparison, Schwab charges $1 per bond, while E*TRADE charges $1 with a $10 minimum.

Spot Currencies

Spot currencies on IBKR Pro have a tiered pricing model starting at 0.08 basis points. For a $10,000 trade, you’d pay $2 in commissions, making IBKR highly competitive in the forex market compared to FOREX.com, which typically charges higher spreads.

Mutual Funds

Interactive Brokers offers over 43,000 mutual funds, including thousands of no-load, no-transaction-fee funds. There’s no commission for no-transaction-fee funds, while other mutual funds carry a $14.95 fee per trade.

Unlike Fidelity, which offers similar no-fee options and Vanguard, where commissions are often waived for their funds, IBKR is on par for mutual fund investors.

Margin

IBKR’s margin rates are a standout feature, particularly on IBKR Pro. Rates start at 7.330% on Lite and 6.330% on Pro, possibly even lower rates for higher borrowing amounts. If you borrow $10,000, you’d pay about $683 per year in interest on Lite versus E*TRADE’s rate of 11.2%.

Inactivity and Withdrawal Fees

IBKR doesn’t charge inactivity fees. Withdrawal fees are $10 for bank transfers and $4 for checks, which is fairly standard across the industry. Schwab and Fidelity offer no withdrawal fees, making them slightly more appealing in this department.

Is Interactive Brokers Worth It?

Interactive Brokers' pricing is a dream for active traders who want access to global markets, low margin rates and low commissions, particularly on IBKR Pro. If you’re a casual investor, IBKR Lite provides commission-free trading on U.S. stocks and ETFs, making it a no-brainer for hands-off, long-term investing. In short, active traders and frequent investors benefit the most from IBKR’s low fees while casual investors may appreciate the cost-saving features of IBKR Lite.

Is IBKR Right For You?

Interactive Brokers’ pricing is one of the most competitive in the industry, especially for high-volume traders or anyone looking for low margin rates. Whether you’re a seasoned pro or a rookie investor, IBKR offers flexible pricing that can fit your style. Pick the account type that aligns with your trading frequency and financial goals.

Frequently Asked Questions