Looking for smart ways to invest your money? Whether you’re looking for ETFs or a variety of funds and stocks, there are more and more investment platforms opening up in the UK. If you’ve been following my blog for a while, you’ll know that I’ve taken a close look at some of the bigger investment platforms out there for budding investors and stock traders. This time around, I’ll be comparing Interactive Investor vs Interactive Brokers – two very popular services offering a range of options and opportunities.
If you’re unsure about what you should be looking for in an ideal online broker or trading platform, I have plenty of posts and guides to help you get started. In the meantime, if you are keen to know which is better for you to immediately invest in – Interactive Brokers or Interactive Investor – read on, and I’ll break it all down for you. By the end of this guide, you should have a clear idea of whether Interactive Investor or Interactive Brokers will be best suited for you.
Interactive Investor vs Interactive Brokers
Don’t have time to read the full comparison? Here’s a quick breakdown:
- Interactive Investor is a simple, straightforward service with a handful of everyday stock and fund choices.
- Interactive Brokers is a long-standing, intensively detailed service with plenty of research tools and stacks of investment options.
- IB tends to offer more to users than II when it comes to choice and data availability, as well as news and analysis.
- II offers no inactivity fees, while IB applies hefty charges.
- II demands monthly fees, while IB does not.
- IB can be very complex to use, while II is best positioned towards beginners.
Who is Interactive Investor?
Interactive Investor has actually been around for longer than many people might imagine. It first started up around 1995, and at the turn of the 00s, it started emerging as an online platform for trading in a variety of stocks and funds. In fact, at the time of writing, it’s one of the premier UK stockbrokers, meaning from the off, it’s likely to appeal to new more experienced investors.
Interactive Investor is often referred to as ‘ii’. And the service benefits from a pretty secure backing, as well as a variety of investment options like ETFs. For additional services and markets, the platform lets you explore partners linked along the way, which is a nice touch. Therefore, regardless of what you are looking for from an online trading service, it might be a useful launchpad into bigger and better things.
Interactive Investor Investment Options
Of course, one of the main reasons you’re reading this review is to find out more about the different options available at ii. Interactive Investor currently lets you invest in stocks, bonds, funds, and ETFs. There’s a nice international overview, meaning that if you want to access US stock markets and those based further into the continent, you can. At the time of writing, there’s around 17 different stock markets for you to dip into. The number of ETFs weigh in at around 1,500, which is pretty competitive.
It benefits from having a good number of funds but do be aware that bonds available are likely to be limited to the UK. Therefore, if you want the international approach, you’re going to need to look at the stock markets on this particular trading platform.
You can take advantage of a handful of ISA options, such as junior ISAs, stocks and shares ISA accounts, general investment account services and SIPPs.
Is Interactive Investor Good for Beginners?
Overall, the interfaces and account management options at Interactive Investor are likely to appeal to many people just getting started with trading. There’s a good stock of knowledge available online, and if you’re really unsure what the whole investment game is about, it shouldn’t be too hard for you to find your feet. As one of the bigger names in UK broking, it’s hardly surprising that it’s firmly appealing to beginner traders and investors.
It’s very quick to set up an account with Interactive Investor – impressively so – and what might appeal further to beginners is the fact that you won’t have to pay in a minimum amount to get started. However, there does tend to be more of a UK focus here than you might find with other online brokers. You can explore some foreign markets, but if you’re a beginner looking to explore something like forex, you’re going to need to link through a partner.
It’s also pretty quick to start depositing with basic UK cards, which means it shouldn’t be too hard to hit the ground running.
How the Interactive Investor Platform Works
The ii platform works pretty straightforwardly, again, a plus point for any beginners looking to get involved in the investment game. You can access the platform through the web, or via mobile device as you prefer. It’s pretty responsive across all devices, and it’s nice and easy to search for companies and stocks you might be interested in knowing more about. You’ll also be able to filter down the types of investments you want to get involved in, which again, is going to appeal to beginners.
It’s fairly easy to manage your portfolio online, and you can make sure the system warns you about any changes to your searches and investments while you’re away.
Everything is clearly laid out and easy to find, even though some sources and experts feel there could be a little more to the alerts system. I have to agree in one way, but there is such a thing as over-complicating matters. You can filter orders out as you go, though other platforms will likely give you a more in-depth way of filtering and picking between.
If you want to trade in elements such as forex, for example, the platform will link you to an external partner – a nice touch, but something you’ll need to watch out for if you’re not expecting it.
Do Interactive Investor Offer Financial Advice?
The platform does offer a good level of customer service support, however, there doesn’t appear to be much provision for advanced financial advice and guidance. However, if you are just getting started with stocks and shares, or investing in general, you should be able to take advantage of the wealth of support available through the demo account service, and online education tools.
That said, customer support at ii tends to be pretty quick on the ball. There’s no 24/7 approach to customer care, but you can still call to speak to a human if you want to. That’s got to be a pretty lucrative option in the modern age if I’m being honest.
Interactive Investor Research Tools
While the research tools on board Interactive Investor are nicely presented and offer you information on the absolute basics, some services will go a little deeper. There’s a nice news section which beginners will find useful.
There are a few nice ways to drill down into insights here and there, but if you’re really thirsty for some serious chart action, you will probably do better to look elsewhere. To each their own, of course.
What is the Minimum Investment Amount?
There’s no minimum deposit here. Which means that it’s likely going to appeal to those first-time investors who aren’t sure yet quite what they want or need from their online trading experiences! There are no fees to pay in or withdraw, either, which, naturally, are big plus points.
What Fees Do Interactive Investor Charge?
There are, of course, ways in which ii has to make money. Depending on the services you opt into, you will have to pay monthly subscription and service charges. If you have your heart set on investing for the foreseeable future, I don’t see this as being much of a bind. For example, if you want to set up at the absolute basic level – as an ‘Investor’ – you’ll need to pay £9.99 per month. This also comes with fees of £7.99 for shares and funds trading attached.
There are two more levels – the ‘Funds Fan’ level at £13.99, which has lower fund fees on each transaction, and the ‘Super Investor’ level, starting at £19.99 per month and which lowers fees to £3.99 per transaction.
Commission rates and bond fees tend to be fairly low here, and what’s more, you won’t have to pay fines if you leave your account inactive.
Is My Money Safe With Interactive Investor?
Yes. It’s one of the two biggest UK brokers around, and it offers full backing from the FCA. You’ll benefit from up to £85,000 in portfolio protection here.
Interactive Investor: Pros & Cons
- It’s very easy for beginners to use and to adjust to
- There are no deposit or withdrawal fees, and you won’t be charged extra if you leave your account inactive
- It’s one of the biggest brokers around
- It’s backed by the FCA up to £85,000, meaning your money is pretty safe
- There’s a good selection of investment options and services
- However, you will need to pay a monthly fee on top of trading costs
- What’s more, the research tools leave a fair bit to be desired
- The charts you receive in terms of analytics could do with being a bit more in-depth
- You’re limited to UK services for the most part, though you can also access international markets if you want to
Who is Interactive Brokers?
Interactive Brokers is immediately different to ii in the sense that it’s based in the US. However, it is available to UK investors and traders, meaning that it’s directly open for you to dabble in. It’s actually been around since the 1970s. Which makes it one of the longest-standing brokers of its kind.
Thankfully, the service has made the leap to online investing pretty swiftly and smoothly. This is to our benefit, of course. It’s well-regulated and has stacks of mutual funds for you to choose from. What’s more, it also seems pretty fair on the fees side of things, meaning that it should instantly appeal to anyone not wanting to risk too much capital.
Interactive Brokers Investment Options
This is where, in the battle of Interactive Brokers vs Interactive Investor, things start to get a little more interesting. IB offers a huge variety of services and options for you to invest in and play around with. Not only do you have access to scores of stocks and ETFs, but you have access to crypto trading, bonds, funds and even forex. It ticks plenty of boxes. With around 13,000 ETFs available at last count, the scope here is really staggering – and it’s clear why it remains a preferential engine.
It benefits from full stock exchange listing, too, and with over 60,000 bonds available for you to choose from, it’s safe to say that this platform is likely to be appealing to any budding traders who really want to wade into the deeper waters of online investments. But does that mean that Interactive Brokers is necessarily good for beginners?
Is Interactive Brokers Good for Beginners?
Opening an account seems to be easy enough, but for true beginners, things might get a little bit confusing. There are ten different account options available, meaning that right away, it might not be too simple to figure out exactly what you’re meant to sign up for.
For example, there are account levels for small businesses, families and for those acting on behalf of others. This scope is all well and good – it’s great that there’s such as defined approach to welcoming different types of users – but ultimately, modern investors and traders are likely to just want to keep things simple. And sometimes simplicity is the key to successful investing.
While the trading system itself is pretty easy to use on the whole – and you can manage it easily enough across mobile and desktop alike, as well as via web browser, things can sometimes get a bit overwhelming. For a platform with so many different facilities and services, I’d also expect there to be a bit more available in terms of customisation.
That said, customer service is pretty solid, and you’ll be able to get a reply from an advisor over live chat fairly sharpish. As with ii, you can also call to speak to a member of the team if you want to, as well. There’s also a nice demo account service, and plenty of education available once you’re a full member.
How the Interactive Brokers Platform Works
Overall, the platform at Interactive Brokers is very intuitive. Just as you might expect, you can easily search by company name, as well as asset types as you wish. The interface is laid out well, and as you might expect, there are scores of different features and facilities for you to pool through at your leisure.
It might get a bit overwhelming to some people, but those who are a little more used to the wild and woolly world of trading will likely find so much account and market management a breath of fresh air.
Simply search for the assets you’d like to trade in, and you’ll be given the chance to set up orders in a variety of ways. You can take part in day trading and set up various time limits, too. There are around eight different order types available, including trailing stops, which immediately puts the service ahead of ii.
It’s easy for you to manage your portfolio and charts on one screen. I’d like the notifications system to be a little more intuitive, but you can at least see everything that’s going on without having to go too far from one screen and interface.
Do Interactive Brokers Offer Financial Advice?
Interactive Brokers actually offers platforms for financial and stocks advisors, so that appears to be a firm ‘yes’. As mentioned, customer advice is up to scratch, and if you want to educate yourself, there are plenty of courses you can dip into. However, as mentioned, you’re going to need to make sure you are a full member before you can take part. That’s a little bit restrictive, but honestly, it’s not unheard of.
Interactive Brokers Research Tools
Research at Interactive Brokers is extremely in-depth. This means that you have access to a wide array of third party charting options as well as volatility tracking. Beyond this, you have a sprawling morass of a news feed, which means that it might take you a little time to adapt. In fact, compared to ii, the news ticker and the various research tools here could get a bit confusing for newer investors.
The site has its own news service, which should go some way to show you how extensive their coverage actually is. Thankfully, there are a few shortcuts you can set up to help you along the way. However, do be careful, as there are a few third party tools on board here which might expect you to pay in.
What really lets this side of things down is – despite the scope – it really isn’t as nice on the eyes as it needs to be. It’s going to be massively confusing for beginners, and that’s a real negative.
What is the Minimum Investment Amount?
As with ii, there are no minimum investment demands with Interactive Brokers. There’s also no fees for withdrawals. However, it is worth looking into the banking side of things here. As – for example – there doesn’t seem to be any kind of provision for credit card deposits. So that may be worth considering, depending on how you plan to fund your account.
What Fees Do Interactive Brokers Charge?
There are no monthly fees here, however, you should make sure to take a look at the charges offered on trading in general. They are actually pretty low on the whole, with reasonable commission rates on US stock – which tend to get higher if you look into UK stock. There’s a cap of around 1% per trade on US stock, for example, with 3% applied to mutual funds, unless $14.95 works out higher.
However, it is the inactivity charges which you will really need to look out for. Leave your account idle with less than $2,000 – and if you make less than $20 in a month – you can expect to have to shell out $20 for each month this occurs. This halves if you have more than $1,000 available, but even so, it’s still enough to be shelling out!
Is My Money Safe With Interactive Brokers?
Yes. Not only are you protected by the FCA through Interactive Brokers, you will benefit from a full stock market listing. The fact that the service is more than 40 years old should also give you some indication as to how steadfast you can expect your experience to be. Again, FCA regulation will ensure you are protected up to the value of £85,000.
Interactive Brokers: Pros & Cons
- There are scores of different options and investment opportunities available
- Research tools are amazingly in depth
- There are no monthly fees
- There are plenty of account types available
- The platform is smooth and detailed, with tons of data for you to crunch
- You’re well-protected thanks to the stability of the service, and its FCA backing
- However, many will likely find the service to be very confusing in places
- There are high fees if you leave your account inactive – be careful
- It’s unlikely to be a great platform for beginners
Interactive Investor vs Interactive Brokers: Verdict
Interactive Brokers or Interactive Investor? Which UK investment platform is best? While the services may sound similar, they are pretty different in their approach. Interactive Investor is a great beginner’s platform, with a simple interface and a nice selection of investment options for you to get into. However, Interactive Brokers offers a lot more in terms of choice, as well as solid backing and support.
IB also benefits from incredible research tools – even if they can get a bit complex. Ultimately, the choice here really does depend on what point you’re at in your investment journey. In the battle between Interactive Brokers vs Interactive Investor, both have strong merits and are worth considering.