IBKR - Interactive Brokers

[Jurgis]

CEO recently asked why a lot of IBKR investors use another broker;

 

Horrible website, interface, reports.

 

Also with Fido I know that I only need to call and any complex issue will be cleared. I haven't had an issue with Fido phone (or Internet chat) support yet (fingers crossed). Even if they can't resolve it immediately, they dig until they can. Also Fido has solo 401(k) support.

 

This for me is worth a lot.

 

Ah, sorry, I am not IBKR investor. :)

[oddballstocks]

CEO recently asked why a lot of IBKR investors use another broker; having tried to sign up twice, I think I know why. It's such a fucking hassle compared to my other brokers. They've returned three different proofs of address with a generic comment. Oh well - guess it means there are some low hanging fruits.

 

People on here LOVE IBKR, so I decided today to try to roll over my wife's IRA from Vanguard.  The process restarted on me once and is extremely confusing.  I'm trying to get my money to them and they keep putting up blockades to do so.

 

I just quit, I spent 30m trying to open the account and finally gave up.

[doughishere]

CEO recently asked why a lot of IBKR investors use another broker; having tried to sign up twice, I think I know why. It's such a fucking hassle compared to my other brokers. They've returned three different proofs of address with a generic comment. Oh well - guess it means there are some low hanging fruits.

 

People on here LOVE IBKR, so I decided today to try to roll over my wife's IRA from Vanguard.  The process restarted on me once and is extremely confusing.  I'm trying to get my money to them and they keep putting up blockades to do so.

 

I just quit, I spent 30m trying to open the account and finally gave up.

 

 

#FirstWorldProblems

[Jurgis]

#FirstWorldProblems

 

Perhaps. But ultimately I pay Fido <0.5% of my assets for all the services they provide. Sure, I might pay IBKR only 0.1%, but it's not worth the headache for me. (The percentages are somewhat crude estimates. They are likely lower for Fido and possibly for IBKR).

[Liberty]

#FirstWorldProblems

 

Perhaps. But ultimately I pay Fido <0.5% of my assets for all the services they provide. Sure, I might pay IBKR only 0.1%, but it's not worth the headache for me. (The percentages are somewhat crude estimates. They are likely lower for Fido and possibly for IBKR).

 

One way to look at it: How long do you plan to invest and how much of a cumulative difference does that delta adds up to compounded over that period?

[pocoapoco]

CEO recently asked why a lot of IBKR investors use another broker

 

Buy 5000 shares of GM (where price execution will be equivalent due to high liquidity).

 

IB :  $25

Etrade:  $9

[Hielko]

I actually think the sign-up process for an IBKR account is extremely user-friendly and easy. You can do everything online, and it takes just a few minutes. But I only have experience with setting up a regular new account, perhaps an IRA is more difficult?

 

With other brokers you often (read: almost always) have to fill in a ton of paperwork, scan the filled in forms, email the forms (if that is even possible, sometimes you have to mail them physically) and then you often find out that they want even more filled in forms. I have opened accounts with a lot of brokers, and I think the process at IB is by far the fastest and easiest.

[Hielko]

Buy 5000 shares of GM (where price execution will be equivalent due to high liquidity).

 

IB :  $25

Etrade:  $9

Not actually going to do that trade, but estimated commission are between 0.51 and 33.51 USD (it matters on what exchange you execute your order and if you provide or take liquidity)

[Liberty]

CEO recently asked why a lot of IBKR investors use another broker

 

Buy 5000 shares of GM (where price execution will be equivalent due to high liquidity).

 

IB :  $25

Etrade:  $9

 

Buy those in more than 2 orders and IB is cheaper, though.

[pocoapoco]

Buy 5000 shares of GM (where price execution will be equivalent due to high liquidity).

 

IB :  $25

Etrade:  $9

Not actually going to do that trade, but estimated commission are between 0.51 and 33.51 USD (it matters on what exchange you execute your order and if you provide or take liquidity)

 

Assume taking liquidity.  I've generally seen about 1/2 cent per share at IB vs fixed all in commission for Etrade etc.  So my point is for higher share amounts (warrants, lower priced stocks etc) the commissions can diverge quite a bit.

 

[Jurgis]

#FirstWorldProblems

 

Perhaps. But ultimately I pay Fido <0.5% of my assets for all the services they provide. Sure, I might pay IBKR only 0.1%, but it's not worth the headache for me. (The percentages are somewhat crude estimates. They are likely lower for Fido and possibly for IBKR).

 

One way to look at it: How long do you plan to invest and how much of a cumulative difference does that delta adds up to compounded over that period?

 

Another way to look at it: how often IBKR can give you a stroke or a heart attack because something is screwed up?

You might not survive to enjoy your cumulative difference.

 

#qualityoflifematters

[doughishere]

#FirstWorldProblems

 

Perhaps. But ultimately I pay Fido <0.5% of my assets for all the services they provide. Sure, I might pay IBKR only 0.1%, but it's not worth the headache for me. (The percentages are somewhat crude estimates. They are likely lower for Fido and possibly for IBKR).

 

At the risk of getting into an internet flame war(especially in a forum that i admire and respect).....What i was getting at was that I think we should re-evaluate what we think our problems are if we are complaining about transferring our IRAs....we should feel fortunate that a problem we have to deal with.

 

But yes you are right. At some point the value of your time spent switching over exceeds the benefits of actually switching over.

 

[Hielko]

#FirstWorldProblems

 

Perhaps. But ultimately I pay Fido <0.5% of my assets for all the services they provide. Sure, I might pay IBKR only 0.1%, but it's not worth the headache for me. (The percentages are somewhat crude estimates. They are likely lower for Fido and possibly for IBKR).

 

One way to look at it: How long do you plan to invest and how much of a cumulative difference does that delta adds up to compounded over that period?

 

Another way to look at it: how often IBKR can give you a stroke or a heart attack because something is screwed up?

You might not survive to enjoy your cumulative difference.

You have never used IB right? If there is a broker where almost everything almost always works and is processed correctly it is IB.

[Liberty]

#FirstWorldProblems

 

Perhaps. But ultimately I pay Fido <0.5% of my assets for all the services they provide. Sure, I might pay IBKR only 0.1%, but it's not worth the headache for me. (The percentages are somewhat crude estimates. They are likely lower for Fido and possibly for IBKR).

 

One way to look at it: How long do you plan to invest and how much of a cumulative difference does that delta adds up to compounded over that period?

 

Another way to look at it: how often IBKR can give you a stroke or a heart attack because something is screwed up?

You might not survive to enjoy your cumulative difference.

 

Never had a problem with them. Ymmv.

[rmitz]

Another way to look at it: how often IBKR can give you a stroke or a heart attack because something is screwed up?

You might not survive to enjoy your cumulative difference.

 

#qualityoflifematters

 

Hyperbole.  I’ve certainly never found any issues that would cause concern like that.  The interface isn’t great, and there is opportunity for other companies to come in and use their back-end services while providing a more friendly front-end.  While some have had issues with their customer service, they’ve always dealt with any of my questions or issues well.

 

I also like their approach to security.  They do take it quite seriously.

[Jurgis]

You have never used IB right? If there is a broker where almost everything almost always works and is processed correctly it is IB.

 

Wrong. I have an account with IBKR. Like I said before: awful.

 

I only have it because it's managed by someone else and they rely on IBKR's platform to do this (this was covered in the thread about separately managed accounts).

To be honest, even though performance of person managing it is great, I have periodic thoughts to close the account because of IBKRs horribleness.

So far I endure.

Edit: Ask me again at tax time - I expect the online Turbo Tax nightmare. Perhaps I will be surprised on the bright side. This does not apply to you as you are not in USA.

Perhaps this also answers to Liberty regarding the pain threshold of delta compounding. ;)

[thepupil]

Jurgis, can you be more specific?

 

I'm an IBKR fanboy and don't understand how one can come to your conclusion. Everything seems very cheap and easy on IB.

[Jurgis]

thepupil: I'd have to sit down with you and show the stuff that grates me on their website. I don't think I can express it easily with text. Sorry.

 

The tax worries are still in the future. This is right now second-hand info. AFAIK they support Turbo Tax, but not Turbo Tax Online. I'd be very happy to hear differently. (Also I am concerned about the foreign currency tax importing, but this would be the same for any broker).

 

I did not call their customer service - as I said, I don't have my main account there - so this is only second-hand info. Perhaps they are comparable to Fido. From what I hear, they are not.

 

I am pretty sure they don't support solo 401(k)s like Fido.

 

Edit: Do they allow buying individual bonds? I do that on Fido. Not a huge deal possibly.

 

I agree that their two-factor authentication is great and that commissions are great if you manage to setup things in the right way and you don't fall into one of their "beware" holes (so far I only saw "minimal monthly fee" because of too few trades or something like that).

 

Hope this helps.

[benhacker]

Edit: Do they allow buying individual bonds? I do that on Fido. Not a huge deal possibly.

 

Yes, they do (both US and globally)... limitation exists still on convertible bonds generally, so that is a problem.

 

On the upside, they allow you to place limits that are exposed on Bonddesk unlike FoK orders for bonds at Fido and all other retail brokers that I'm aware of.  This exists at IB because their model isn't to profit by being a dealer in bonds, only on transaction volume / commish.

 

As said before, I think there probably should be two brokers - Fido (SCHW is good too) and IBKR.  It's telling that everyone is arguing over those two, not whether the literally dozens of other mediocre brokers should exist.  Lots of consolidation is going to happen in this industry.

[Hielko]

I guess that's a good point, I'm very happy with IB, but since I'm not based in the US I can't use Fido (or SCHW).

[kirkomi]

Based in Switzerland. IB is hands down the best. Have had several interactions with the customer service, was always satisfied.

 

Don't like the web platform, use their TraderWorkStation (TWS) client in the simple form. Quite effective.

[theasiareport]

I've used IB since 2014, and have no complaints. Its the best broker I've used by far - although the interface takes a little time to get used to. Still, it isn't harder then using a Bloomberg terminal.

[frommi]

I've used IB since 2014, and have no complaints. Its the best broker I've used by far - although the interface takes a little time to get used to. Still, it isn't harder then using a Bloomberg terminal.

 

Same here, and after calling the support i was pleasantly surprised. When someone has problems with the interface i can only advise to use the iphone or ipad apps, they are very easy to use.

In europe there is nothing that comes even close to IB`s stability, security and pricing.

[ABM]

Anyone consider the credit risk embedded on the margin loans ?  My thesis relies on continued margin debt growth but as a % of net equity capital it is already the highest amoung peers.  It posted a 34% CAGR (2011-2014) vs. peer average of 14% growth.  I believe they want to hold excess capital  to absorb ST losses on its loan book in the events of severe market turmoil similar to the Swiss surprise revaluation in January. 

 

I compared them to SCHW, AMTD, and ETFC.  As of Q2 2015, it looks like for every dollar of capital they 3.63 dollars of loans compared to 1.77 at their peers.  I understand everyone's mix is a bit different as SCHW has a banking business but in terms of margin loans it still interesting.

 

Margin Loans - % of Equity Capital

               

2012   2013   2014 Q2 2015 Schwab         140% 134% 133% 130% TD Ameritrade 195% 192% 245% 258% Etrade           118% 131% 143% 142% IBKR           205% 267% 329% 363% Average         165% 181% 212% 223%

 

Anyone worried ?

[rpadebet]

Look up what IB does when customers hit margin limit and compare that to what others do...

I think that limits credit risk and that's why they can afford to have capacity to lend more...risk management.

 

The more I dig into this company, the more I like it. It is potentially the geico of our investing careers. All we need now is a regulation requiring everyone own a brokerage account and trade stocks. That would be perfect.