So you want to get started investing?
Why these two? Easy:
You’re not going to find a better investment platform if you have 10k+ to drop in. They have some of the lowest commissions around, and arguably one of the best platforms.
IB also has everything available to invest. This broker is hands-down your best bet if you have a large amount of cash to get started with.
On top of that, they are the absolute leader for access to international markets, and have some of the lowest margin rates in the country. You’ll never get bored with the order types, either.
When dealing with brokers, one of the things that will eat you alive quickly are those commission fees. Avoiding them nets you a much larger gain (or much smaller loss – hopefully).
Their options are also ridiculously cheap. So keep that in mind.
Not to forget their workstation (TWS – Trader Workstation) has literally everything. Whether you’re an emotional trader or a technical trader, everyone can find their niche with IB.
The only downside is that you need to have and maintain a high balance to transact with them. The commissions are able to be low because they only deal with the big players.
IB is not suitable for the casual investor. If you want that, stick with an index fund (avoid managed funds like the plague).
My personal opinion: IB is the best for the hardcore, serious traders. Or for people looking to really dedicate themselves to the stock market. I’ve used it before, but have since cashed out because their inactivity fees and the fact I started to like Robinhood a bit more.
So, let’s chat Robinhood.
Robinhood is one of the newest players in the game.
It was originally only a mobile app (which I had tested and still use well post-beta).
The biggest perk of Robinhood?
Yeah, you heard that right. No commission.
So if you want to buy a wide selection of stocks, options, crypto-currency, and ETFs, Robinhood is a suitable contender.
Similar to IB, Robinhood comes built-in with real-time market data. As should any broker. Unlike IB, Robinhood does not require a minimum. You could put $50 in it and suffer no fees or consequences.
Obviously, because of Robinhoods age it lacks certain services. It doesn’t come with a trading platform, so you’ll have to stick with the basics or outsource it. And it doesn’t offer forex (yet)
But remember: It’s all free. And no signup fee. And no inactivity or annual fee.
Robinhood is easily the best option for someone new to investing, day traders, or for people who want to support a new way for the average person to invest in the stock market.
My personal insight: I love it. It’s a great cause – opening up the world of stocks to anyone and everyone to be able to build their own portfolio and invest. Plus, it will force the competition to start lowering their commission prices as Robinhood grows. Why pay the $7 per trade charge when you can trade the same exact stock or option, for free, on Robinhood?
Interactive Brokers and Robinhood are the industry leaders, in my opinion. Regardless of the type of investor you are, you should stick to one of these two investment platforms for your trading.
The heavy hitters should lean IB, whereas the new entrants or cost-minimizers should lean toward Robinhood.
Regardless of which you choose, you won’t be making a mistake by choosing one of these guys.
And as always: be safe investing. Don’t invest more than you can reasonably lose.
Disclaimer: These are my personal opinions. I am in not affiliated with IB or Robinhood, nor is this a paid posting.