IBKR - Interactive Brokers

[Dalal.Holdings]

Many years ago I had an idea that IBKR was a low cost broker with great execution that could maybe be the AMZN of brokerages.

 

They’ve done plenty to counter that thesis. Technology seems to be a major issue.

[muscleman]

Many years ago I had an idea that IBKR was a low cost broker with great execution that could maybe be the AMZN of brokerages.

 

They’ve done plenty to counter that thesis. Technology seems to be a major issue.

 

They cater a specific client base. Ones who can do research themselves and have reasonable self learning ability for their complex platform.

Other brokers all target the mom and pops.

 

With that said, I have no insights on whether IBKR's growth path is strong over the long term.

[boilermaker75]

Many years ago I had an idea that IBKR was a low cost broker with great execution that could maybe be the AMZN of brokerages.

 

They’ve done plenty to counter that thesis. Technology seems to be a major issue.

 

That was true several years ago. I am now thinking about closing my IB account because I prefer other platforms, like Schwab, for my trading and I no longer get better execution at IB. I never get a better price than the limit I put in and I used to often get a better price.

[aws]

Still down for me, 5 hours and counting.

[kab60]

Lucky day for their systems to suck. Mine has been working for an hour or something like that now. Could've cost a fortune during March.

[fareastwarriors]

Still down for me, 5 hours and counting.

 

On and off for me.

 

[KCLarkin]

Many years ago I had an idea that IBKR was a low cost broker with great execution that could maybe be the AMZN of brokerages.

 

They’ve done plenty to counter that thesis. Technology seems to be a major issue.

 

AMZN is not the right comparison. IBKR is more like Walmart or Costco. No frills low cost provider.

 

I don't see any indication that the thesis is not working? I've soured on IBKR because most of the value is going to clients and employees not shareholders. But if anything, the customer growth has accelerated.

[Dalal.Holdings]

Unlike AMZN/WMT/COST, IBKR lacks having a superior product that is free of headaches/glitches. Repeat basic problems—a lot in basic tech infrastructure and customer service.

 

They are not relentlessly customer focused like the 3 legendary retailers...

[TwoCitiesCapital]

Just to counter all this IB negativity, my Schwab account has also been down all day. Either it's pure coincidence or the problem that they're having exists outside of their sphere of control and is impacting multiple companies at the same time.

 

 

[KCLarkin]

Unlike AMZN/WMT/COST, IBKR lacks having a superior product that is free of headaches/glitches. Repeat basic problems—a lot in basic tech infrastructure and customer service.

 

They are not relentlessly customer focused like the 3 legendary retailers...

 

WMT and COST are customer focused in certain ways. And customer hostile in other ways. I would not describe WMT or COST as headache free. Both are unpleasant places to shop. Costco is bad, so I only go there every 3 to 6 months. Walmart used to be even worse and I refused to shop there at all.

 

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The core metrics over the last 5 years (accounts, DARTs, margin balance, deposits), show the strategy is working. But you set your expectations too high with the Amazon analogy.

 

If you want to take out a $100k margin loan, you'd pay (roughly):

 

IBKR PRO - $1000

Schwab - $7000

 

That takes relentless focus.

 

[KCLarkin]

Just to counter all this IB negativity, my Schwab account has also been down all day. Either it's pure coincidence or the problem that they're having exists outside of their sphere of control and is impacting multiple companies at the same time.

 

Sounds like RH was down too.

[Gregmal]

Margin rates are the only reason I use IBKR. If you own blue chippy, IE stable, high quality large caps, there's no other place I'd keep them, and margin them. For everything else, there's better options.

[KCLarkin]

For everything else, there's better options.

 

IBKR is also one of the best discount brokers for:

- Short selling

- International stocks / international traders

- Forex

- Cash balances

[Guest roark33]

My IB account is still down, i.e. can't access it on web or mobile. 

[gfp]

I recovered Trader Workstation desktop java access about two hours before market close today.  Very surprising it took that long.  What a day they must have had.

[TwoCitiesCapital]

Margin rates are the only reason I use IBKR. If you own blue chippy, IE stable, high quality large caps, there's no other place I'd keep them, and margin them. For everything else, there's better options.

 

What about access to foreign exchanges? I regularly trade foreign stocks on IB for commissions ranging from $0-10 where I'd have to pay as much as $50/trade elsewhere.

 

And it's been awhile since I tested, but 2-3 years ago I was still getting better and more consistent fills on orders for illiquid securities at IB than either Scottrade or Schwab.

 

Seems like a lot of good @ IB for people who are beyond the typical buy/hold US blue chip crowd.

 

Full Disclosure: never owned the stock. Always thought it was pricey and difficult to understand the structure and what I own with the stock. But I've been a happy customer for 5 years, but customer service has been lacking the 1-2 times I needed it.

[Gregmal]

I do also agree on foreign listed stocks. I just dont own a lot of that stuff so its a less of a focus for me.

[bizaro86]

Margin rates are the only reason I use IBKR. If you own blue chippy, IE stable, high quality large caps, there's no other place I'd keep them, and margin them. For everything else, there's better options.

 

What about access to foreign exchanges? I regularly trade foreign stocks on IB for commissions ranging from $0-10 where I'd have to pay as much as $50/trade elsewhere.

 

And it's been awhile since I tested, but 2-3 years ago I was still getting better and more consistent fills on orders for illiquid securities at IB than either Scottrade or Schwab.

 

Seems like a lot of good @ IB for people who are beyond the typical buy/hold US blue chip crowd.

 

Full Disclosure: never owned the stock. Always thought it was pricey and difficult to understand the structure and what I own with the stock. But I've been a happy customer for 5 years, but customer service has been lacking the 1-2 times I needed it.

 

Not being an American is also a good reason to use IB. I've bought foreign stocks for commissions in that $1-$10 range, where my Canadian broker would have charged $200 (plus a 25 minute phone call).

 

Of course, the margin rates are way better as well, as is the execution (imo).

 

I think the comparison to Costco is apt. They are really good at some things and pass lots of value on to their customers. But they have some customer unfriendly aspects. For costco, that's standing in a second line when you leave the store for someone to check they aren't stealing from you.

 

Long COST and IBKR

[boilermaker75]

Just to counter all this IB negativity, my Schwab account has also been down all day. Either it's pure coincidence or the problem that they're having exists outside of their sphere of control and is impacting multiple companies at the same time.

 

I logged in to my Schwab account before the open and it has been connected all day. I gave up trying to use IB today.

 

I only trade US stocks and I don't use margin. So the advantages I used to have with IB are not there anymore. I do want to have at least two different brokerage accounts for situations like today when I can't log into one of them.

[Dalal.Holdings]

Yes, the margin rates are low and international trading unparalleled, but I am trying to comprehend such outages happening with other businesses...say Google/Gmail shut down for as many hours. Or the App store. Or Facebook.

 

These kind of things just should not happen anymore with a business at IBKR's scale. There isn't much of an excuse, it's 2020. There are lots of other problems with IBKR account tools being down routinely after hours for maintenance. A lot of companies have figured out how to get around routine maintenance/down time. It seems IBKR has not. The technology is not that hard.

 

Lots of signs they are operating technology from a different era...

 

If they got a handle around their technology (operated on something robust on the order of AWS), they could be a force to be reckoned with. For now, their user experience leaves a lot to be desired.

[KCLarkin]

I am trying to comprehend such outages happening with other businesses...say Google/Gmail shut down for as many hours. Or the App store. Or Facebook.

 

These kind of things just should not happen anymore with a business at IBKR's scale. There isn't much of an excuse, it's 2020. There are lots of other problems with IBKR account tools being down routinely after hours for maintenance. A lot of companies have figured out how to get around routine maintenance/down time. It seems IBKR has not. The technology is not that hard.

 

Lots of signs they are operating technology from a different era...

 

If they got a handle around their technology (operated on something robust on the order of AWS), they could be a force to be reckoned with. For now, their user experience leaves a lot to be desired.

 

Google just had a major outage on Youtube/Play store last month. AWS regularly takes down large swaths of the internet:

https://www.theverge.com/2020/11/25/21719396/amazon-web-services-aws-outage-down-internet

 

[LC]

Yes, the margin rates are low and international trading unparalleled, but I am trying to comprehend such outages happening with other businesses...say Google/Gmail shut down for as many hours. Or the App store. Or Facebook.

 

These kind of things just should not happen anymore with a business at IBKR's scale. There isn't much of an excuse, it's 2020. There are lots of other problems with IBKR account tools being down routinely after hours for maintenance. A lot of companies have figured out how to get around routine maintenance/down time. It seems IBKR has not. The technology is not that hard.

 

Lots of signs they are operating technology from a different era...

 

If they got a handle around their technology (operated on something robust on the order of AWS), they could be a force to be reckoned with. For now, their user experience leaves a lot to be desired.

 

I was also very critical of IBKR management around the negative oil price fiasco. Petterffy shifted blame when it was 100% his fault that they cheaped-out on risk management systems. The only reason I use IBKR is margin rates - if any other large broker could match these rates, I would jump in a heartbeat.

[TwoCitiesCapital]

Just to counter all this IB negativity, my Schwab account has also been down all day. Either it's pure coincidence or the problem that they're having exists outside of their sphere of control and is impacting multiple companies at the same time.

 

I logged in to my Schwab account before the open and it has been connected all day. I gave up trying to use IB today.

 

I only trade US stocks and I don't use margin. So the advantages I used to have with IB are not there anymore. I do want to have at least two different brokerage accounts for situations like today when I can't log into one of them.

 

I dunno. I was able to log-in to my Schwab account, but no trades in any stocks could be made until after 2 PM. It kept telling me the system was down and gave me a number to call. Even after single stock name trading was restored, I received the same notice for all attempted options trades into the close.

 

 

[Spekulatius]

Yes, the margin rates are low and international trading unparalleled, but I am trying to comprehend such outages happening with other businesses...say Google/Gmail shut down for as many hours. Or the App store. Or Facebook.

 

These kind of things just should not happen anymore with a business at IBKR's scale. There isn't much of an excuse, it's 2020. There are lots of other problems with IBKR account tools being down routinely after hours for maintenance. A lot of companies have figured out how to get around routine maintenance/down time. It seems IBKR has not. The technology is not that hard.

 

Lots of signs they are operating technology from a different era...

 

If they got a handle around their technology (operated on something robust on the order of AWS), they could be a force to be reckoned with. For now, their user experience leaves a lot to be desired.

 

I have been with IB for ~15 years and this was the longest partial outage I have experienced with them. IB is typically rock solid even on extremely high volume days when other websites from Wells Fargo, Etrade and Fidelity were unresponsive.

 

Yes, their customer service is crappy, but I had much better luck with chat than I had on the phone. I do business with them because of the international trading and margin/interest on cash balances.

 

If Fidelity comes up with better international trading, then I would probably move my accounts over.

[Dalal.Holdings]

Yes, the margin rates are low and international trading unparalleled, but I am trying to comprehend such outages happening with other businesses...say Google/Gmail shut down for as many hours. Or the App store. Or Facebook.

 

These kind of things just should not happen anymore with a business at IBKR's scale. There isn't much of an excuse, it's 2020. There are lots of other problems with IBKR account tools being down routinely after hours for maintenance. A lot of companies have figured out how to get around routine maintenance/down time. It seems IBKR has not. The technology is not that hard.

 

Lots of signs they are operating technology from a different era...

 

If they got a handle around their technology (operated on something robust on the order of AWS), they could be a force to be reckoned with. For now, their user experience leaves a lot to be desired.

 

I have been with IB for ~15 years and this was the longest partial outage I have experienced with them. IB is typically rock solid even on extremely high volume days when other websites from Wells Fargo, Etrade and Fidelity were unresponsive.

 

Yes, their customer service is crappy, but I had much better luck with chat than I had on the phone. I do business with them because of the international trading and margin/interest on cash balances.

 

If Fidelity comes up with better international trading, then I would probably move my accounts over.

 

All the things you list are well known advantages of IBKR. They are the low cost provider (like AMZN) with things that truly matter--margin rates, etc (not dumb "free commissions" whilst selling your order flow).

 

IBKR as a business would be unstoppable--on an AMZN level--if they got their act together in customer service and technology. Their evening outages of account tools is routine and an unnecessary nuisance.

 

Sure, cater to high end traders initially, but if you upgrade the UI, service, backend then the masses will come. IB has not been able to transition to this. Eventually some tech outfit may figure out how to do it better.