Interactive Brokers vs TradeStation 2024

Comparison of Interactive Brokers vs TradeStation

Overall, both Interactive Brokers and TradeStation are well-regarded online brokers with competitive pricing and advanced trading platforms. Interactive Brokers is known for its low commissions and wide range of tradable assets, while TradeStation is popular among active traders for its customizable trading platform and extensive charting tools. Investors should consider their own needs and preferences before choosing between these two brokers.

Assets Offered 

Interactive Brokers and TradeStation are known for their diverse offerings, but what sets them apart from each other?

TradeStation is an excellent choice for investors who want to trade stocks, ETFs, options, futures and IPOs from desktop or mobile platforms. However, it’s important to note that ‘equities account’ must be selected from the dropdown menu before placing trades since equities, crypto and futures trade on separate platforms.

On the other hand, Interactive Brokers allows investors to fund their accounts with one of 24 currencies and trade any product in a different currency. IBKR also supports trading in fractional shares which can be very useful when investing smaller amounts.

Customers can trade nearly 46k mutual funds through either platform; about 18k are no-transaction-fee funds. Additionally, both TradeStation and Interactive Brokers offer an all-in-one integrated account option for flexibility.

When comparing these two trading giants side by side it is clear that Interactive Brokers has an edge due to its expansive range of offerings. 

Fees and Commissions 

When it comes to choosing a brokerage firm, one of the most important factors that traders consider is cost. After all, every penny saved on fees and commissions can add up over time and significantly impact profitability. In this section, we’ll compare TradeStation and Interactive Brokers, in terms of their pricing structure.

TradeStation offers commission-free trading on all accounts, including stocks and ETFs with $0 commission as well as stock options with $0 commission + $0.60 per contract and futures with $0 commission + $1.50 per contract, per side. 

On the other hand, Interactive Brokers’ commissions vary depending on the type of account and country from which the client is trading but offer low commissions with no added spreads or platform fees across 150 global markets. IBKR Lite charges 2.5% for less than $100,000 (Pro 1.5%) while TradeStation charges 12.50% for amounts under $50,000 and 11.50% for amounts between $50,000 and $499,000.

So which broker wins when it comes to costs? It seems like Interactive Brokers takes home the prize due to lower starting ranges and margin rates compared to TradeStation’s higher percentages charged on smaller amounts.

Overall, both brokers have their own unique advantages when it comes to pricing structure but it ultimately depends on individual trader preferences based on their investment goals.

Regulation and Security 

One of the most important elements within both brokers is the regulations and security measures. Both companies have implemented advanced security measures to ensure their clients’ investments are safe from unauthorized access.

TradeStation has recently implemented two-factor authentication through Auth0 Guardian app, Google Authenticator app, and SMS text messaging. This means that users must provide an additional layer of verification before accessing their accounts. Additionally, biometric login is available for mobile devices which allows users to log in using face or fingerprint recognition or passcode.

To protect websites and applications from cyber threats, TradeStation uses 256-bit data encryption technology which makes it virtually impossible for hackers to break into their systems. They also have advanced hardware and software firewalls in place to prevent unauthorized access.

In terms of insurance coverage, TradeStation carries excess SIPC insurance provided by Lloyd’s of London with an aggregate limit of $300 million. The maximum amount for any single customer is $24.5 million with a cash limit of $900,000 per account.

Interactive Brokers (IBKR) requires all users to be two-factor authenticated as well as offering biometric login options on its mobile apps just like Trade Station does. Their internet-facing servers are protected from access through firewalls and/or other security devices while critical servers reside on isolated networks that have no direct internet access.

Encryption technology is employed for data transmissions across public networks as well as portable media devices ensuring client accounts at Interactive Brokers LLC are protected by the Securities Investor Protection Corporation (SIPC) up to $500k with a cash sublimit set at $250k. Excess SIPC coverage provides up to an additional $30 million, with a cash sublimit of $900,000.

Overall, both TradeStation and Interactive Brokers have excellent security measures that go above industry standards. Investors can rest assured that their investments are safe and secure with these two companies.

Customer Support

When it comes to trading, having access to reliable customer service is crucial. Both TradeStation and Interactive Brokers (IBKR) offer various forms of client services and technical support, but how do they compare? Let’s take a closer look.

TradeStation provides phone or live chat support from Monday to Friday, 8 a.m. to 5 p.m. Eastern Time (ET). While this may not be ideal for traders who work outside these hours, there is access to TSbot – an online chat bot that can provide pre-programmed answers to basic questions.

On the other hand, IBKR offers 24-hour customer service each business day via regional Client Services Centers located throughout America, Europe, and Asia. Quick Tips are also available through a chat bot designed to answer basic client questions with guidance towards resources if needed.

Both companies have limitations when it comes to inbound communications sent via commercial email due to security concerns; however, formal inquiries submitted via Message Center or email link on the support page are supported by both companies.

In terms of extended trading hours for stocks/options and futures, Trade Desk has got you covered while crypto trading is available 24/7 except on the second weekend of each month when the company is closed from Friday at 6:00 p.m. ET until Saturday at 5:00 p.m ET.

Lastly, IBKR offers live online chat services for current and prospective clients around-the-clock from Monday through Friday as well as Sundays from 1 p.m.-7p.m ET.

Overall, while both companies offer some form of customer service around-the-clock; TradeStation’s scope of service during traditional business hours compared with IBKR providing broader coverage in this category makes them stand out differently depending on your needs as a trader.

Conclusion

Both Interactive Brokers and TradeStation are elite companies in the online brokerage world. While TradeStation is more of a pure technical trading platform, Interactive Brokers gives you the fundamental tools with the technical ones. When it comes to technical trading, they are very evenly matched. Ultimately, it comes down to what you’re looking for in a trading platform and your personal preferences.