TradeStation vs. Interactive Brokers: Which Is Right for You? | The Ascent by Motley Fool (2024)

Both of these brokers offer $0 commission stock and ETF trades. Interactive Brokers has a volume-based options commission structure. On the other hand, TradeStation uses a flat rate that is in-line with peers.

TradeStation and Interactive Brokers have the same standard $14.95 mutual fund commission, but Interactive Brokers has thousands available on a no-transaction-fee (NTF) basis, while TradeStation does not. TradeStation's account transfer fee is one of the highest we've come across, making it rather costly to move your assets to another broker.

There are a few key differences between these two brokers for investment availability.

For starters, TradeStation doesn't facilitate fractional share trading, while Interactive Brokers does. The latter could also be the better choice for mutual fund investors. Not only does Interactive Brokers have thousands of fee-free mutual funds to choose from, but with more than 48,000 mutual funds on its platform, it has the best selection of any broker on our radar.

Another big difference is cryptocurrency trading. Not long ago, both of these brokers would have been on a level playing field. However, TradeStation decided to discontinue cryptocurrency trading in February 2024, so while Interactive Brokers only offers a few major cryptocurrencies on its platform, it's the only choice if that is going to be part of your strategy.

Both of these platforms offer futures and foreign currency (forex) trading, and both allow investors to buy fixed-income securities, or bonds.

Both allow brokers for joint investment accounts, both offer margin privileges, and both have IRAs (including SEP IRA and SIMPLE IRA accounts) and custodial accounts available. And neither platform offers traditional banking products, such as savings or checking accounts.

There are two major differences to note. First, if you're looking for a robo-advisor, Interactive Brokers has one with its Interactive Advisors platform. TradeStation doesn't offer a comparable automated investing option.

Second, while neither broker offers savings accounts, it's important to mention that Interactive Brokers pays an APY on uninvested cash that is comparable to what you'd expect from a high-yield savings account. But TradeStation doesn't pay interest on cash balances.

TradeStation offers three different platforms. Its TradeStation Web Trading is a browser-based platform that enables investors to simply log in and place trades, check prices, and more. The TradeStation 10 is the desktop trading platform with tons of charting tools, customizable indicators, and much more. And the TradeStation mobile app is designed to enable complex stock, options, and futures trades on the go.

Interactive Brokers offers two mobile and two desktop trading platforms. The IBKR Desktop platform is the newest one, and is designed to make it easy for beginners to buy and sell stocks, while still meeting the needs of experienced investors and traders. There's also the IB Trader Workstation (TWS), which is a high-powered platform for advanced stock, option, and futures traders.

On the mobile side, the IBKR GlobalTrader app is an extremely user-friendly platform for investors of all experience levels, while the IBKR Mobile app is better suited for experienced traders.

The bottom line is that both of these platforms offer quite a bit, and were both designed with active investors in mind. If you're a beginning investor, these are two highly functional platforms that could certainly work, but you might be better off with a platform that was designed with beginners in mind.

If you're an active investor or trader, either of these could be a good fit for you. Both brokers offer a demo, or play money, account mode, so the best course of action could be to test drive both platforms to see which is a better fit for you.