FOREX.com vs. Interactive Brokers – Benzinga

This overview compares the companies of FOREX.com vs. Interactive Brokers, that are two of the best-known names within the on-line brokerage enterprise. Briefly, FOREX.com caters primarily to foreign exchange merchants, whereas Interactive Brokers caters extra to worldwide multi-asset merchants and buyers. Figuring out which on-line dealer would swimsuit you higher will rely in your buying and selling wants and preferences since each provide wonderful companies.

On this article, Benzinga presents you with all the main points you’ll want on each brokers to determine which of the 2 can be proper to your wants. For additional in-depth info on both dealer, you’ll be able to go to Benzinga’s FOREX.com overview and its Interactive Brokers overview.

What’s FOREX.com?

FOREX.com was based as a part of GAIN Capital Holdings to offer on-line brokerage companies for the retail foreign exchange and contract for distinction (CFD) markets within the U.S. and overseas. The FOREX.com dealer enterprise was acquired in 2020 by StoneX, an institutional-level monetary companies community with property of $10.9 billion that serves 32,000 business shoppers and over 330,000 retail accounts throughout 180 international locations.   

FOREX.com presently gives foreign exchange brokerage companies to 420,000 clients in 18 international locations throughout 5 continents. The dealer employs greater than 3,500 folks and averages a formidable 0.19 seconds for commerce executions. 

FOREX.com enables you to commerce in over 500 markets and gives an easy-to-use buying and selling venue for greater than 80 completely different forex pairs, widespread equities and inventory indices, commodities like silver and gold, all kinds of CFDs and chosen futures contracts via its FuturesOnline affiliate.  You can even open a free demo account so you’ll be able to assess and take a look at the dealer’s companies risk-free.  

Whereas FOREX.com doesn’t provide detrimental stability safety to U.S.-based merchants, if you’re based mostly in Europe, then you’ll be able to open an account with FOREX.com (U.Okay.) to reap the benefits of ESMA-mandated safety features like detrimental stability safety and assured stop-loss orders.

Greatest for: Foreign exchange and CFD merchants in any respect ranges

Cell App: FOREX.com’s spectacular cell app gained the Greatest Cell Platform App award from Funding Developments’ 2020 UK Leverage Buying and selling Report. The app gives a transparent interface that means that you can construct customized watchlists and regulate your entire favourite markets.

The app options different helpful buying and selling instruments together with Efficiency Analytics to look at particular buying and selling behaviors and habits and the Sensible Alerts sign generator software that alerts you to buying and selling alternatives recognized by FOREX.com’s unique buying and selling algorithms.

The absolutely customizable cell app additionally gives superior charts filled with useful options together with the flexibility to commerce straight from charts, 80 technical indicators, a number of chart sorts, 14 time intervals and superior drawing instruments. 

MetaTrader 4 (MT4) Compatability: Sure

MetaTrader 5 (MT5) Compatability: Sure

Yr Based: 2001

Headquarters: Warren, New Jersey, U.S.

Devices: FOREX.com provides you entry to commerce foreign exchange forex pairs, unleveraged spot gold and silver and a variety of CFDs. You can even commerce futures and choices on futures via its affiliate, FuturesOnline. FuturesOnline enables you to commerce futures on the Smalls Alternate, which presents standardized index futures contracts with smaller lot sizes than these of normal futures contracts. 

The varieties of CFDs you’ll be able to commerce via FOREX.com embrace:

• Foreign exchange: Foreign money pairs you’ll be able to commerce through CFDs embrace AUD/USD, EUR/GBP, EUR/CHF, EUR/JPY, EUR/USD, USD/CAD, USD/CHF, USD/JPY, XAU/USD, GBP/JPY, GBP/USD and NZD/USD. 
• Indices: You possibly can commerce CFDs on the Australia 200, China 50, EU Shares 50, France 40, Germany 40, Hong Kong 50, Italy 40, Japan 225, Netherlands 25, Singapore Index, Spain 35, Switzerland 20, UK 100, US Small Cap 2000, US S&P 500, US Tech 100 and the Wall Road Index. 
• Shares: You possibly can commerce CFDs from the lengthy or quick facet in over 5,500 shares of the highest firms on this planet commission-free through a FOREX.com account.  You can even commerce within the aftermarket and pre-market in addition to throughout customary inventory market buying and selling hours. 
• Commodities: FOREX.com enables you to commerce commodities like espresso, U.Okay. and U.S. crude oil, corn, cotton, heating oil, cocoa and sugar. You can even commerce 4 treasured metals and 6 gold forex pairs resembling XAU/AUD and XAU/CHF.
• Cryptocurrencies: You possibly can commerce CFDs on Bitcoin, Ethereum, Litecoin and Ripple through FOREX.com.

Complete forex pairs: 80+

Minimal preliminary deposit: $100

Minimal commerce quantity: Relying on the account kind you choose, FOREX.com helps buying and selling in customary lot sizes of 100,000 base forex models, mini a number of 10,000 base forex models and micro-lots of 1,000 base forex models. 

Regulators: FOREX.com has been a registered Retail International Alternate Seller (RFED) and a registered Futures Fee Service provider (FCM) with the U.S. Commodities Futures Buying and selling Fee (CFTC) since 2004, in addition to being a member of the U.S. Nationwide Futures Affiliation (NFA) working beneath NFA ID quantity #0339826. 

Lively dealer or VIP low cost: Sure

Professionals:

• Big selection of tradable property with a deal with foreign exchange
• MT4 and MT5 help 
• NinjaTrader help
• Quick executions 
• Lively dealer program 

Cons:

• No detrimental stability safety for U.S. merchants
• Restricted cryptocurrency CFD choices 

What Is Interactive Brokers?

U.S.-based Interactive Brokers, Inc. (IBKR) is a multinational dealer/supplier with workplaces within the U.S., Canada, the U.Okay., Hungary, Eire, Hong Kong and Shanghai in China, Japan, Singapore, Australia, and India.  Based in 1977 by dealer Thomas Peterffy as T.P. & Co, Interactive Brokers accomplished its forty fifth yr in 2022 as a dealer/supplier with over $10.6 billion in consolidated fairness capital. 

Interactive Brokers gives direct entry to over 150 completely different worldwide markets. The dealer is represented on many main world inventory and commodity exchanges, and it presents buying and selling in foreign exchange, shares, futures, listed choices, bonds, gold and cryptocurrencies. 

The proprietary buying and selling platforms supplied by Interactive characteristic its flagship desktop Dealer Workstation (TWS) and its web-based Shopper Portal. Different platforms obtainable at Interactive embrace the IBKR EventTrader and IMPACT, an funding app for shares, choices and cryptocurrencies.  You can even get entry to Interactive’s cell functions IBKR Cell and IBKR GlobalTrader.

Via Interactive’s FXTrader, you get entry to an optimized buying and selling interface with the suitable instruments for forex markets. These instruments embrace real-time streaming quotes, up and down indicators, pending trades, positions, buying and selling quantity and common value plus revenue/loss situations. 

Interactive presents its merchants a few of the finest margin charges and narrowest foreign exchange dealing spreads within the enterprise, with some spreads as little as 1/10 of a pip. The dealer presently has no minimal deposit for a retail dealer to open an account, though it requires different brokers to deposit a minimum of $10,000 initially to open a dealer account. 

Greatest for: Multi-asset merchants and worldwide buyers

Accepts U.S Purchasers: Sure

Cell App: Sure

MetaTrader 4 (MT4) Compatability: No

MetaTrader 5 (MT5) Compatability: No

Whereas Interactive doesn’t actively promote or provide different platforms or add-on software program of out of doors distributors, the TWS operates with an open software programming interface (API). The API permits third-party distributors to create scripts for the TWS. MetaQuotes Software program presents the oneZero Hub Gateway that enables MetaTrader 5 for use to commerce IBKR accounts. oneZero will not be obtainable for particular person accounts. 

Yr Based: 1977

Headquarters: Greenwich, Connecticut, U.S.

Devices: Providing maybe one of the best collection of tradable property and funding merchandise of any on-line dealer, Interactive Brokers will swimsuit the wants of retail {and professional} multi-asset merchants and buyers worldwide.  

Buying and selling and Funding merchandise:

• Foreign exchange: You possibly can commerce spot currencies in 100+ forex pairs.
• Cryptocurrencies: Interactive provides you entry to commerce and maintain Bitcoin, Bitcoin Money, Ethereum and Litecoin with commissions as little as 0.12% to 0.18% of the commerce’s whole worth. You possibly can commerce and maintain extra digital tokens supplied by the Paxos Belief Firm. 
• Shares:  You possibly can commerce shares globally on over 90 completely different market facilities with a few of the lowest financing charges within the enterprise from USD 4.33% to USD 5.33%. You pay $0 commissions for inventory transactions utilizing Interactive’s IB SmartRouting. You can even commerce fractional shares that allow you to make investments no matter inventory value.  
• Alternate-Traded Funds (ETFs): Interactive not solely enables you to commerce ETFs for $0 commissions, however you may as well take part in its Fee Rebate Program. The dealer’s no transaction charge (NTF) program presents 150 ETFs that reimburse IBKR shoppers for commissions paid on ETF shares held for a minimum of 30 days. 
• Choices: Commerce choices globally in over 30 market facilities. Commissions of $0.15-0.65 per contract apply to U.S. fairness choices transactions. Interactive Brokers doesn’t provide OTC foreign exchange choices, however you’ll be able to commerce foreign exchange choices on the seven currencies supplied by the Nasdaq PHLX (previously the Philadelphia Inventory Alternate) that embrace AUD, GBP, CAD, EUR, JPY, CHF and NZD versus the U.S. greenback.
• Futures: Via Interactive, you’ll be able to commerce futures on currencies, cryptocurrencies, fastened revenue, rate of interest, metals, vitality, comfortable and agricultural commodities and volatility and fairness indices. Commissions for futures vary from USD $0.25 to $0.85 per contract, along with alternate, regulatory and carrying charges. 
• Occasion Contracts:  The IBKR EventTrader platform permits merchants to purchase and promote occasion contracts which have a payout based mostly on a given end result. These binary option-like contracts are based mostly on the short-term end result of an occasion and are solely good for the buying and selling day the place was initiated on. An instance of the kind of occasion that you may commerce an occasion contract on consists of whether or not the S&P 500 Index or another tradable asset will shut above or under a sure degree. 
• Commodities: US Spot Gold  (USGOLD) may be traded in portions as little as 1 ounce. Commissions for USGOLD at IBKR are 1.5 foundation factors (bps) of commerce worth for as much as $500,000 value of gold, 1.0 bps for $500,000 – $1,000,000 and 0.7 bps for gold orders over $1 million in worth. 
• Bonds: Interactive enables you to commerce over 1 million completely different bonds globally with no markups or built-in spreads. You possibly can commerce 26,280 company bonds, over 1 million municipal securities, 22,630 certificates of deposit and non-U.S. sovereign bonds.  You can even use the dealer’s Bond Search software to check obtainable yields, and you may commerce bonds with different IBKR clients. Benzinga has rated Interactive Brokers because the “Greatest On-line Dealer for Bonds.” 
• Mutual Funds: With Interactive, you’ll be able to commerce over 46,000 mutual funds listed in IBKR’s Mutal Fund Market. IBKR’s low clear commissions on mutual funds contained in the U.S. value the lesser of $14.95 or 3% of the commerce worth. Exterior the U.S., commissions are EUR 4.95 or the native forex equal. 
• Hedge Funds: In the event you meet the eligibility necessities that embrace an account minimal of $25,000 and are accepted into this system, you’ll be able to spend money on 50 hedge funds listed in IBKR’s Hedge Fund Market through a password-protected space on the IBKR web site. You possibly can obtain hedge fund info, and you may simply switch funds from the hedge fund to your IBKR account after subscribing to this system.

Minimal preliminary deposit: $0 for retail shoppers and $10,000 for brokers. 

Minimal commerce: Minimal commerce quantities at Interactive rely upon the kind of asset concerned. Retail foreign exchange merchants can commerce in customary a number of 100,000 base forex models and mini a number of 10,000 base forex models.

Regulators: As a U.S.-based firm, Interactive Brokers has oversight from the Commodities Futures Buying and selling Fee (CFTC) and is a member of the New York Inventory Alternate and the Nationwide Futures Affiliation (NFA) with NFA ID: 0258600. 

The worldwide dealer additionally maintains memberships on most main world inventory and commodities exchanges. Due to its worldwide presence, with illustration in 150 markets in 33 international locations, Interactive has oversight from most main world regulators, together with the U.Okay. Monetary Conduct Authority (FCA) beneath Reference Quantity 208159.  

Lively dealer or VIP low cost: Sure

Professionals:

• No minimal deposit for retail merchants
• Direct entry to Interbank market quotes for foreign exchange trades
• Entry to a variety of market analysis choices
• Digital Communications Community (ECN)-like market entry construction
• Can commerce over 100 forex pairs utilizing FXTrader
• Foreign exchange dealing spreads as tight as 1/10 of a pip
• Built-in multi-asset TWS buying and selling platform for spot currencies, futures, choices, inventory and stuck revenue
• Appropriate for superior merchants

Cons:

• Not geared toward inexperienced persons 
• No help for widespread third-party buying and selling platforms like MT4 and MT5
• Costs retail merchants who qualify for detrimental stability safety an extra financing unfold of 1% for CFD positions held in a single day

FOREX.com’s dealing spreads range based mostly on prevailing market circumstances. These embrace volatility and obtainable liquidity amongst different elements. On the dealer’s web site, “typical” spreads signify the median unfold seen over the remark interval, whereas the said “as little as” unfold represents the minimal dealing unfold quoted over the last full calendar month. These numbers are adjusted each first buying and selling day of the calendar month. The spreads famous under signify spreads outlined on the FOREX.com web site. 

Interactive Brokers Charges and Commissions

Interactive Brokers presents a few of the lowest charges, commissions and margin charges within the enterprise. Additionally, in the event you’re an energetic dealer, you may get vital quantity reductions based mostly in your exercise degree. 

Due to Interactive’s mixed citation streams from 17 of the world’s largest overseas alternate sellers, dealing spreads may be as little as a fraction of a pip. As a result of it gives this clear pricing construction and as a substitute of marking up quotes and charging no fee, a fee is charged by Interactive based mostly on the mixed Month-to-month Commerce Worth of Spot Foreign money trades. 

You possibly can take a look at Interactive’s 4-tier fee schedule at this hyperlink, which exhibits that the upper your combination month-to-month commerce worth is, the decrease the commissions you pay might be. For instance, Tier I begins at a month-to-month whole commerce worth of lower than or equal to $1 billion and entails a charge of 0.20 foundation factors with a $2.00 minimal cost per order. Tier 4 for these with over $5 billion in whole month-to-month commerce worth entails paying a fee of simply 0.08 foundation factors and a minimal cost of $1.00 per order.

On the draw back, IBKR does cost retail buyers who qualify for detrimental stability safety an extra 1% financing unfold for any CFD positions held in a single day.

The pattern dealing spreads famous under come from the IBKR reside citation display screen that seems within the dealer’s proprietary FXTrader platform. 

FOREX.com’s analysis and academic choices come freed from cost and provide you with entry to coaching and the most recent market information and analysis. Discovered on the highest of the FOREX.com web site’s House web page, the Information and Evaluation drop-down menu gives a wide range of helpful gadgets that assist you to get educated about foreign currency trading and maintain abreast of happenings that have an effect on the foreign exchange market. It consists of the next options: 

• Foreign currency trading information and financial analysis, together with present market information and financial information releases
• Market evaluation that features an financial calendar, pivot factors, commerce concepts and market insights 
• Webinars that embrace main financial releases and yearly market outlooks  
• Buying and selling programs for newbie, intermediate and superior foreign exchange merchants
• Buying and selling themes together with danger administration and elementary evaluation

Interactive Brokers Analysis Choices

Interactive Brokers gives merchants with entry to a variety of premium market analysis and information suppliers both freed from cost or for a subscription charge. Analysis companies are additionally obtainable to demo account holders with out extra funding or approval.

You possibly can click on right here to take a look at the complete listing of analysis companies supplied by Interactive. Ensure to click on on every tab in the event you want to view the related obtainable choices beneath it.  A abstract of every analysis tab seems under. 

• Free companies: IBKRQuant Weblog, IB Market Alerts, IB Dealer Perception, Coin Metrics Reference Charges, Redsky Markets, Quantum Analysis, Looking for Alpha, Smarter Analyst, StreetInsider, Merely Wall St., TalkMarkets Information, The Tie, TipRanks Market Information, Altavista Analysis, Alexandria Know-how, Capitalise.ai, Channelchek, Edison Analysis, Econoday, ETFguide, Estimize Knowledge Pack, McAlinden Analysis Merchandise, Ned Davis Analysis, Refinitiv, Seasonax, Social Market Analytics, TFI Securities, Inventory Merchants Day by day, Toggle AI, Zacks,  Astris Company Analysis, 24/7 Wall St. and Accesswire. Many analysis websites, together with Benzinga, provide free trials of their paid analysis companies via Interactive. 
• Bundled Analysis: In the event you’re keen to pay for analysis, you’ll be able to entry bundles resembling Dow Jones, Briefing.com, The Fly, Buying and selling Central and MT Newswires in a wide range of combos for various costs. 
• Analysis and Information: Underneath Interactive’s Analysis tab, you’ll discover numerous portals that provide analysis and information companies obtainable both freed from cost or for a subscription value. 
• Market Occasions: You possibly can entry companies resembling Econoday, Refinitiv and Wall St. Horizon to remain knowledgeable about main market-moving occasions. 
• Various Knowledge: Interactive enables you to entry different information suppliers like Estimize and Alexandria Analysis. 
• Third-Occasion Instruments: In the event you plan on doing algorithmic buying and selling or want a elementary valuation platform, you’ll be able to entry instruments like QuantConnect or Stockcalc for a free trial. 

Each FOREX.com and Interactive Brokers are well-regulated and respected on-line brokers that function high buying and selling companions to their focused clientele. Relying on whether or not you propose on buying and selling foreign exchange roughly completely or if you wish to commerce different asset sorts worldwide, the selection between Interactive Brokers and FOREX.com can simply be made.

FOREX.com makes a whole lot of sense for foreign exchange merchants, particularly in the event that they’re already acquainted with and wish to use the NinjaTrader platform or the ever-popular MetaQuotes platforms (MT4 and MT5) that help simple algorithmic buying and selling and technique backtesting.  

Additionally, much less skilled foreign exchange merchants can entry respectable instructional supplies geared particularly in the direction of the foreign exchange market at FOREX.com, whereas the tutorial assets at Interactive Brokers are likely to cater to extra skilled merchants and canopy a wide range of completely different monetary markets. 

Alternatively, in the event you’re a complicated dealer who needs to function globally and handle different property moreover currencies, resembling shares, bonds and different varieties of funding property, you’d most likely be higher off buying and selling via Interactive Brokers, since FOREX.com offers completely with foreign exchange and CFDs. 

Often Requested Questions