The individual investor of today is not short of brokerages to choose from. But in the face of a monster platform like Interactive Brokers (IBKR), being spoilt for choice is both a blessing and a curse.
IBKR is commonly regarded as one of the most comprehensive online brokerage platforms, boasting a wealth of assets, tools, and resources. And we’d admit it, it’s pretty tough to cut through the clutter.
In this review, we demystify IBKR’s capabilities and how it fares against other popular brokerages—particularly Saxo Markets and Tiger Brokers.
Contents:
- What is Interactive Brokers?
- What are the Interactive Brokers Singapore fees, products, and platforms?
- What are the Interactive Brokers Singapore commission fees?
- What happened to the Interactive Brokers inactivity fee?
- Interactive Brokers vs Saxo—which is better?
- Interactive Brokers vs Tiger Brokers—which is better?
- A final overview—IBKR vs Saxo vs Tiger Brokers
- How do I start trading on Interactive Brokers?
- Which is better—IBKR Lite or IBKR Pro?
What is Interactive Brokers?
Interactive Brokers is an American brokerage firm that also operates in Singapore. It is currently one of the US’s biggest trading platforms and also has a strong presence in Asia.
The company is listed on NASDAQ, so if you want to be really meta, you can even trade IBKR shares on your Interactive Brokers platform.
Interactive Brokers’ platform lets you invest in stocks, options, futures, currencies, bonds and funds in over 150 markets worldwide, including our good old Singapore Exchange.
More importantly, it’s also one of the cheapest trading accounts available at the moment.
- Min. Commission Fee US Stocks
- US$1
- Min. Commission Fee SG Stocks
- $2.50
- Min. Funding
- $0
What are the Interactive Brokers Singapore fees, products, and platforms?
Here’s an overview of Interactive Brokers’ fees, trading products, platforms, and more.
| Trading products | Stocks, ETFs, bonds, options, futures, FX, mutual funds, metals, cryptocurrencies |
| Minimum commission fee (SG stocks) | 0.02% – 0.05% SGD (0.9 – 1.60 SGD minimum) under Tiered pricing; 0.08% (2.50 SGD minimum) under Fixed pricing |
| Minimum commission fee (US stocks) | 0.0005 – 0.0035 USD per share (0.35 USD minimum) under Tiered pricing; 0.005 USD per share (1 USD minimum) under Fixed pricing |
| Minimum funding amount | None |
| Stock Holding Type | Custodian |
| Trading platforms | Trader Workstation, Client Portal, IBKR Mobile and IBKR APIs |
| Payment method | Bank transfer and cheque |
| Inactivity fee | None |
What are the Interactive Brokers commission fees?
Psst, life hack: When you sign up for an IBKR account, you’ll be automatically put under the Fixed account tier. Go to your account settings to switch it to Tiered—it’ll likely be cheaper for you, as you’ll see below!
For Singapore shares, Interactive Brokers charges a fixed commission fee of 0.08%, with a minimum commission of 2.50 SGD under the Fixed account tier. If you’re trading 2,500,000 SGD or more, switch to a Tiered account to get rates between 0.02% to 0.05% instead, with a minimum commission of 0.9 to 1.60 SGD. Even if you aren’t trading such a large volume, the Tiered account gives you the exact same 0.08%, 2.50 SGD minimum rate for trades below 2,500,000 SGD, and lower rates for everything else, including on the US stock market. So it’s a good idea to make the switch.
For small trades on SGX, IBKR’s minimum commissions are one of the lowest in the market, with bank brokers like DBS Vickers or OCBC Securities charging as much as S$25 per trade. And Interactive Brokers is certainly cheaper than Saxo Markets, which charges a $5 minimum commission for their $1/month Bronze plan.
However, if you’re trading a small volume on the SGX, you can a lower minimum commission fee at moomoo and Tiger Brokers. Compare the cheapest brokerages for Singapore stocks here.
For US stocks, Interactive Brokers charges between 0.0005 to 0.0035 USD per share depending on the share volume, with a minimum of 0.35 USD under their Tiered account tier. Under their Fixed account tier, the charge is 0.005 USD per share, subject to a minimum of 1 USD, for any trade volume. For most people, the Tiered pricing is going to be much cheaper, so go ahead and switch your account to Tiered in your account settings if you’re keen on US stocks.
With one of the lowest minimum commissions for US stocks, IBKR is only behind brokers like Moomoo, Webull and TD Ameritrade.
With IBKR’s low minimum commissions, you can go right ahead and make itty bitty trades without worrying about losing money to hefty commission fees.
What happened to the Interactive Brokers inactivity fee?
In the past, Interactive Brokers was known for having one huge drawback: inactivity fees unless you fulfilled certain criteria.
Basically, you had to generate at least 10 to 20 USD worth of commissions in a calendar month in order to avoid inactivity fees every month.
But as of 9 July 2021, IBKR has finally gotten rid of the inactivity fee. Now we need not worry about being forced to trade in order to avoid the fee. Hurray!
Interactive Brokers vs Saxo Markets—which is better?
Saxo Markets is another established online brokerage brand that is popular in Singapore, and is known for its affordable trading fees.
- Min. Commission Fee US Stocks
- US$1
- Min. Commission Fee SG Stocks
- S$1
- Min. Funding
- S$0
[Online Brokerage]
Get $100 Cash via PayNow within 1 month* when you fund a minimum of S$3,000 or equivalent and execute 1 trade within 14 days of first deposit with your new Saxo account! T&Cs apply.
Let’s compare Interactive Brokers and Saxo.
| Interactive Brokers | Saxo | |
| Trading products | Stocks, ETFs, bonds, options, futures, FX, mutual funds, metals, cryptocurrencies | Stocks, ETFs, bonds, options, futures, FX, mutual funds, commodities, CFDs, cryptocurrencies |
| Minimum commission fee (SG stocks) | 0.08% (2.50 SGD minimum) | 0.03%-0.08%(1-5 SGD minimum) |
| Minimum commission fee (US stocks) | 0.005 USD per share (1 USD minimum) | 0.02%-0.06%(1-4 USD minimum) |
| Minimum funding amount | None | S$3,000 (Bronze account plan) / S$0 (other plans) |
| Stock Holding Type | Custodian | Custodian |
| Trading platforms | Trader Workstation, Client Portal, IBKR Mobile and IBKR APIs | SaxoInvestor, SaxoTraderGO, SaxoTraderPRO |
| Payment method | Bank transfer and cheque | FAST, PayNow, MEPS, internet bank transfer or credit/debit card |
| Inactivity fee | None | None |
| Custody fee | None | 0.12% per annum on stocks, ETFs/ETCs or bonds that are outside SGX |
In terms of commission fees, Interactive Brokers is generally cheaper to use than Saxo Markets, especially if you only get Saxo’s most basic account plan.
For SG stocks, Saxo’s minimum commission fees are higher than IBKR’s unless you’re on Saxo’s Silver plan (the second-lowest) or higher. For US stocks, IBKR charges lower minimum commissions than Saxo even if you pay for Saxo’s top-tier Diamond plan. Clearly, IBKR is the cheaper choice for small and frequent trades.
What about larger, less frequent trades? Unfortunately, Saxo charges an annual custody fee of 0.12% on your holdings outside the SGX. So if you’re more of a buy-and-hold investor, this fee will add up over time.
Interactive Brokers vs Tiger Brokers—which is better?
If you’re a cost-conscious investor, you’d have heard of Tiger Brokers. Though not as established as IBKR, Tiger Brokers is a new brokerage that has IBKR as one of their investors.
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- Min. Commission Fee US Stocks
- US$1*
- Min. Commission Fee SG Stocks
- 0.03% of Trade Value*
- Min. Funding
- $0
when you sign up via MoneySmart!
*T&C apply.
Tiger Brokers is known for dangling some very attractive welcome offers, such as free shares, up to 60 commission-free trades, and rewards in the form of Tiger coins.
Let’s compare the fees and charges for Interactive Brokers and Tiger Brokers.
| Interactive Brokers | Tiger Brokers | |
| Trading products | Stocks, ETFs, bonds, options, futures, FX, mutual funds, metals, cryptocurrencies | Stocks, ETFs, REITs, indices, metals, treasury, energy futures |
| Minimum commission fee (SG stocks) | 0.08% (2.50 SGD minimum) | 0.03% (0.99 SGD minimum) |
| Platform fee (SG stocks) | None | 0.03% (1 SGD minimum) |
| Minimum commission fee (US stocks) | 0.005 USD per share (1 USD minimum) | 0.005 USD per share (0.99 USD minimum) |
| Minimum funding amount | None | None |
| Stock Holding Type | Custodian | CDP |
| Trading platforms | Trader Workstation, Client Portal, IBKR Mobile and IBKR APIs | Tiger Brokers desktop app and mobile app |
| Payment method | Bank transfer and cheque | FAST, PayNow, Internet Bank Transfer or Credit/ Debit Card, MEPS, Wise |
| Inactivity fee | None | None |
| Custody fee | None | None |
Tiger Brokers charges a lower commission fee than IBKR. Like IBKR, they also don’t impose any minimum funding amount, inactivity fee or custody fee.
That said, bear in mind that Tiger Brokers is still a more new entrant. Its track record isn’t as good as IBKR’s, which is one of the most established brokerages out there. Just last year, one Singaporean lost about S$15,000 on the Tiger Brokers platform following an increase in their transaction fees with no fee cap. Tiger Brokers implemented a fee cap after the incident.
Both IBKR and Tiger Brokers are more suited to beginner investors than Saxo. While IBKR and Tiger Brokers have practically no minimum funding requirements, Saxo requires an initial deposit of $3,000.
A final overview—IBKR vs Saxo vs Tiger Brokers
| Interactive Brokers | Saxo | Tiger Brokers | |
| Trading products | Stocks, ETFs, bonds, options, futures, FX, mutual funds, metals, cryptocurrencies | Stocks, ETFs, bonds, options, futures, FX, mutual funds, commodities, CFDs, cryptocurrencies | Stocks, ETFs, REITs, indices, metals, treasury, energy futures |
| Minimum commission fee (SG stocks) | 0.08% (2.50 SGD minimum) | 0.03%-0.08%(1-5 SGD minimum) | 0.03% (0.99 SGD minimum) |
| Platform fee (SG stocks) | None | None | 0.03% (1 SGD minimum) |
| Minimum commission fee (US stocks) | 0.005 USD per share (1 USD minimum) | 0.02%-0.06%(1-4 USD minimum) | 0.005 USD per share (0.99 USD minimum) |
| Minimum funding amount | None | S$3,000 (Bronze account plan) / S$0 (other plans) | None |
| Stock Holding Type | Custodian | Custodian | CDP |
| Trading platforms | Trader Workstation, Client Portal, IBKR Mobile and IBKR APIs | SaxoInvestor, SaxoTraderGO, SaxoTraderPRO | Tiger Brokers desktop app and mobile app |
| Payment method | Bank transfer, cheque | FAST, PayNow, MEPS, internet bank transfer or credit/debit card | FAST, PayNow, Internet Bank Transfer or Credit/ Debit Card, MEPS, Wise |
| Inactivity fee | None | None | None |
| Custody fee | None | 0.12% per annum on stocks, ETFs/ETCs or bonds that are outside SGX | None |
How do I start trading on Interactive Brokers?
You can apply for an Interactive Brokers account through MoneySmart.
- Min. Commission Fee US Stocks
- US$1
- Min. Commission Fee SG Stocks
- $2.50
- Min. Funding
- $0
You will need to divulge information about your income, which can be done quite easily if you log into MyInfo using your SingPass.
Once your account has been approved, you can simply transfer money via internet banking and start trading right away.
Which is better—IBKR Lite or IBKR Pro?
If you’re a Singapore resident, you don’t have a choice—you’ll be automatically assigned an IBKR Pro account as IBKR Lite is not available in the country.
IBKR Lite—a simplified version of their trading platform which offers commission-free, unlimited trading of US stocks and ETFs—is only for US-based investors.
Don’t be fooled by the name. You don’t have to be a pro to use a Macbook Pro, and the same goes for the IBKR Pro platform. It’s just a normal trading platform that’s more “complete” than the dumbed-down IBKR Lite.
Found this article useful? Share it with anyone who’s considering an IBKR account.
Cover image: Nicholas Cappello on Unsplash
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