Published April 18, 2024
Fact Checked
Ashley Maready
Two of the best brokerages for active traders are Interactive Brokers and Charles Schwab. While Interactive Brokers is one of The Ascent's picks for day trading platforms, Charles Schwab also has advanced tools and capabilities that can make it a good fit for active investors and professional traders.
Let's look at a breakdown of Interactive Brokers vs. Charles Schwab, and see which brokerage could be the best choice for your investing style and financial goals.
Interactive Brokers vs. Charles Schwab: At a glance
| Offer |
|
|
|---|---|---|
| Rating |
Rating image, 4.5 out of 5 stars.
4.5/5
Our ratings are based on a 5 star scale.
5 stars equals Best.
4 stars equals Excellent.
3 stars equals Good.
2 stars equals Fair.
1 star equals Poor.
We want your money to work harder for you. Which is why our ratings are biased toward offers that deliver versatility while cutting out-of-pocket costs.
= Best
= Excellent
= Good
= Fair = Poor |
Rating image, 4.5 out of 5 stars.
4.5/5
Our ratings are based on a 5 star scale.
5 stars equals Best.
4 stars equals Excellent.
3 stars equals Good.
2 stars equals Fair.
1 star equals Poor.
We want your money to work harder for you. Which is why our ratings are biased toward offers that deliver versatility while cutting out-of-pocket costs.
= Best
= Excellent
= Good
= Fair = Poor |
| Commissions |
As low as $0 stock trades |
$0 stock, ETF, and Schwab Mutual Fund OneSource® trades |
| Account Minimum | $0 | $0 |
| Next Steps |
|
Interactive Brokers vs. Charles Schwab: Commissions & fees
Both Interactive Brokers and Charles Schwab offer low-cost trading, with commissions starting at $0. Both brokerages also offer extensive selections of no-transaction-fee ETFs. Some more complex investment products might have a higher commission or fee structure, or your fees could depend on the type of account you have.
For example, Interactive Brokers offers commission-free trades for U.S. exchange-listed stocks and ETFs, but only for its IBKR Lite accounts. If you use the higher tiers of IBKR Pro accounts, you will have to pay some commissions and fees based on the minimum (or maximum) amount per order, and your monthly trading volume.
Charles Schwab also offers $0 commissions for U.S.-listed stocks and ETFs, but charges per-contract fees for options and futures. While many Charles Schwab mutual funds are commission free (if purchased through Schwab Mutual Fund OneSource®), other mutual funds could charge up to $74.95 per purchase.
READ MORE: Best ETF Brokers
|
Interactive Brokers (IBKR Lite) |
Charles Schwab | |
|---|---|---|
| Stock & ETF commissions | $0 | $0 |
| Options commissions | $0.65 per contract | $0.65 per contract |
| Crypto commissions | Starting at 0.18% (for trade value at or below $100,000 per month) | N/A |
| Mutual fund commissions |
$0 for thousands of no transaction fee mutual funds. For others, lesser of 3% of trade value or $14.95 per transaction |
$0 for Schwab Mutual Fund OneSource® funds; up to $74.95 for others |
| Account transfer fee | No | $50 |
| Account maintenance fee | No | $0 |
Data source: Interactive Brokers and Charles Schwab.
Interactive Brokers vs. Charles Schwab: Investments available
Interactive Brokers and Charles Schwab offer a wide range of investments for sophisticated traders. Whether you want to buy individual stocks or ETFs, invest in bonds, options, futures, or currencies, both of these brokerages can give you the investment choices you want.
READ MORE: Best Day Trading Platforms
But if you want to invest in individual cryptocurrencies, Interactive Brokers is the better choice. Charles Schwab has a cryptocurrency-themed ETF, but it does not allow investments in individual cryptocurrencies.
| Interactive Brokers | Charles Schwab | |
|---|---|---|
| Stocks and ETFs | Yes | Yes |
| Fractional shares | Yes | Yes |
| Options | Yes | Yes |
| Mutual funds | Yes | Yes |
| CDs | Yes | Yes |
| Bonds | Yes | Yes |
| Futures | Yes | Yes |
| Crypto | Yes | No |
| Currencies | Yes | Yes |
Data source: Interactive Brokers and Charles Schwab.
Interactive Brokers vs. Charles Schwab: Account types available
Charles Schwab and Interactive Brokers offer a wide selection of account types, beyond just the typical taxable brokerage account. If you want to use these platforms to manage your IRA money, borrow on margin, or open other specialized types of investment accounts, both Interactive Brokers and Charles Schwab can accommodate you.
The main difference in account types between Interactive Brokers vs. Charles Schwab is that Schwab offers a few unique types of banking accounts and services that Interactive Brokers does not. Schwab can set you up with a checking account, a savings account, and even credit cards. If so inclined, you could do all of your everyday banking with Schwab.
However Interactive Brokers also has a distinctive hybrid account called the IB Universal Account that offers a high yield on cash and easy mobile check deposit. However, this account does not offer check writing or bill pay, so it doesn't pass muster as a "checking account."
Let's see which types of accounts are available with Interactive Brokers vs. Charles Schwab.
LEARN MORE: Best IRA Accounts
| Interactive Brokers | Charles Schwab | |
|---|---|---|
| Taxable brokerage | Yes | Yes |
| Joint tenant | Yes | Yes |
| Margin | Yes | Yes |
| Robo-advisor | Yes | Yes |
| Traditional IRA | Yes | Yes |
| Roth IRA | Yes | Yes |
| SEP IRA | Yes | Yes |
| Custodial (UGMA/UTMA) | Yes | Yes |
| Checking | No | Yes |
| Savings | Yes | Yes |
| Credit card | No | Yes |
Data source: Interactive Brokers and Charles Schwab.
Interactive Brokers vs. Charles Schwab: Mobile app and trading platforms
Interactive Brokers offers a wide range of trading platforms, including IBKR Mobile, IBKR Desktop, the IBKR Client Portal, and advanced tools like the IBKR Trader Workstation. Your choice of platform affects your choice of investment products and your access to features; Interactive Brokers recommends that beginning traders start out with the IBKR Global Trader platform, while more advanced traders should use the IBKR Trader Workstation.
Want to invest and manage your Interactive Brokers account on the go? Use the IBKR Mobile App. It's highly rated for iOS (4.5 stars on the App Store) and Android (4.7 stars on Google Play).
Charles Schwab also offers a few different types of trading solutions for active investors and professional traders. Schwab's trading experience is called Schwab Trading powered by Ameritrade™, and it offers a few different thinkorswim® trading platforms for different levels of traders and investors. Schwab recommends:
- thinkorswim web for less experienced traders, and
- thinkorswim desktop for more seasoned traders who want a more full-featured platform
Investors can also manage everyday investing and trades online at Schwab.com or via the Schwab mobile app. Schwab Mobile gets high ratings for iOS (4.8 stars on the App Store) but has a lot of bad reviews for Android (2.3 stars on Google Play). If you're an Android user and a bad mobile app is a dealbreaker for you, Schwab might not be the best brokerage for your needs.
Final take
Deciding between Interactive Brokers vs. Charles Schwab comes down to how you prefer to invest, what types of accounts you want to open with your brokerage, and how many bells and whistles you need to support your active investor trading style. If you want to buy cryptocurrencies, Interactive Brokers is a better choice than Schwab. If you want a brokerage that can also give you full-service banking, Schwab fits the bill better than Interactive Brokers.
Want to try the trading platform before you commit? Interactive Brokers offers a free trial. Schwab also offers a free 30-day Guest Pass where you can try its thinkorswim® trading platforms. Doing a free test run of a new trading platform is often the best way to see how its user experience fits your investing style -- and see how much you could save on fees compared to your current brokerage.
Alternatives to Consider
We recommend comparing brokerage options to ensure the account you're selecting is the best fit for you. To make your search easier, here's a short list of our best trading platforms of 2024.
| Account | Fees | Account Minimum | |
|---|---|---|---|
|
Featured Offer
Rating image, 4.5 out of 5 stars.
4.5/5
Our ratings are based on a 5 star scale.
5 stars equals Best.
4 stars equals Excellent.
3 stars equals Good.
2 stars equals Fair.
1 star equals Poor.
We want your money to work harder for you. Which is why our ratings are biased toward offers that deliver versatility while cutting out-of-pocket costs.
= Best
= Excellent
= Good
= Fair = Poor |
$0 for stocks, ETFs, and options; $5 monthly for Robinhood Gold | $0 | |
|
$0 for stocks, $0 for options contracts | $0 | |
Rating image, 5.0 out of 5 stars.
5.0/5
Our ratings are based on a 5 star scale.
5 stars equals Best.
4 stars equals Excellent.
3 stars equals Good.
2 stars equals Fair.
1 star equals Poor.
We want your money to work harder for you. Which is why our ratings are biased toward offers that deliver versatility while cutting out-of-pocket costs.
= Best
= Excellent
= Good
= Fair = Poor |
$0 commission for online U.S. stock and ETF trades; trade fractional shares for as little as $1 | $0 |
Our Brokerages Experts
Fact Checked
Ashley Maready
Ashley Maready is a former history museum professional who made the leap to digital content writing and editing in 2021. She has a BA in History and Philosophy from Hood College and an MA in Applied History from Shippensburg University. Ashley loves creating content for the public and learning new things so she can teach others, whether it's information about salt mining, canal mules, or personal finance.
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We're firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers. The Ascent, a Motley Fool service, does not cover all offers on the market. The Ascent has a dedicated team of editors and analysts focused on personal finance, and they follow the same set of publishing standards and editorial integrity while maintaining professional separation from the analysts and editors on other Motley Fool brands.
Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Charles Schwab is an advertising partner of The Ascent, a Motley Fool company. The Motley Fool has positions in and recommends Alphabet and Charles Schwab. The Motley Fool recommends Interactive Brokers Group and recommends the following options: short June 2024 $65 puts on Charles Schwab. The Motley Fool has a disclosure policy.
Fidelity disclosure
Fractional share quantities can be entered out to 3 decimal places (.001) as long as the value of the order is at least $1.00. Dollar-based trades can be entered out to 2 decimal places (e.g. $250.00)
Robinhood disclosure
All investments involve risk and loss of principal is possible.
Securities are offered through Robinhood Financial LLC, member FINRA/SIPC. Cryptocurrency services are offered through an account with Robinhood Crypto, LLC (NMLS ID 1702840). Robinhood Crypto is licensed to engage in virtual currency business activity by the New York State Department of Financial Services. Cryptocurrency held through Robinhood Crypto is not FDIC insured or SIPC protected. For more information see the Robinhood Crypto Risk Disclosure.
Trades of stocks, ETFs and options are commission-free at Robinhood Financial LLC. Other fees may apply. Please see Robinhood Financial’s Fee Schedule to learn more.
Fractional shares are illiquid outside of Robinhood and are not transferable. Not all securities available through Robinhood are eligible for fractional share orders. For a complete explanation of conditions, restrictions and limitations associated with fractional shares, see the Fractional Shares section of our Customer Agreement.
Robinhood Gold is an account offering premium services available for a $5 monthly fee. Not all investors will be eligible to trade on Margin. Margin investing involves the risk of greater investment losses. Additional interest charges may apply depending on the amount of margin used. Bigger Instant Deposits are only available if your Instant Deposits status is in good standing.