Interactive Brokers vs Fidelity: The Power Broker Showdown
Two of the most respected brokers in the industry, with very different approaches. IBKR wins on costs, Fidelity wins on service. Here's how to choose.
⚡ Quick Verdict
Best for: Active traders, margin users, global investors, cost-conscious investors with $100K+
Best for: Long-term investors, retirement accounts, those who value research and customer service
| Feature | IBKR Pro | Fidelity | Winner |
|---|---|---|---|
| Stock Commissions | $0 (Lite) / $0.005/share (Pro) | $0 | Tie |
| Options | $0.15-$0.65/contract | $0.65/contract | IBKR |
| Margin Rate | 5.83% (Pro) | 10.575% | IBKR |
| PFOF? | No (Pro) / Yes (Lite) | No | Tie |
| International Markets | 150+ markets, 33 countries | 25 countries | IBKR |
| Research | Good | Excellent (20+ sources) | Fidelity |
| Customer Service | Limited | 24/7, excellent | Fidelity |
| Platform Complexity | Steep learning curve | Beginner-friendly | Fidelity |
| Transfer Fee | $0 | $0 | Tie |
| Fractional Shares | Limited | 7,000+ stocks | Fidelity |
The Core Difference
This comparison comes down to one question: Are you optimizing for cost or experience?
Interactive Brokers is built for professionals and active traders who want the lowest possible costs and maximum flexibility. Their margin rates (5.83% vs 10.575%) alone can save thousands annually for margin users.
Fidelity is built for everyone else—investors who want excellent service, great research, and a platform that doesn't require a manual to understand. They sacrifice some cost efficiency for a dramatically better user experience.
Where IBKR Wins
Margin Rates: Not Even Close
IBKR's margin rates are almost half of Fidelity's. On a $100,000 margin balance:
- IBKR Pro: ~$5,830/year
- Fidelity: ~$10,575/year
- Savings: $4,745/year
For margin users, this is the whole ballgame. Fidelity's margin rates are simply not competitive.
Global Market Access
Want to buy stocks in Tokyo, Frankfurt, or Singapore? IBKR offers access to 150+ markets across 33 countries with competitive currency exchange rates. Fidelity offers international trading but with far fewer markets and less flexibility.
Options Pricing
High-volume options traders can pay as little as $0.15/contract at IBKR versus $0.65 at Fidelity. For someone trading 1,000 contracts/month, that's $500 in monthly savings.
Where Fidelity Wins
Customer Service
Fidelity's 24/7 phone support actually answers. Quickly. With knowledgeable reps. IBKR's customer service is... functional. If you've never had to navigate IBKR's ticket system, count yourself lucky.
Research Quality
Fidelity aggregates research from 20+ providers including Morningstar, Zacks, Argus, and their own analysts. Their stock screeners are genuinely useful. IBKR has research, but it's not as comprehensive or accessible.
Ease of Use
Fidelity's web and mobile apps are intuitive. IBKR's Trader Workstation (TWS) is powerful but intimidating—expect a weekend of learning before you're comfortable.
Fractional Shares
Fidelity offers fractional shares on 7,000+ stocks and ETFs. IBKR's fractional share support is more limited and the process is less streamlined.
The IBKR Lite vs Pro Question
IBKR offers two tiers:
- IBKR Lite: Commission-free stocks, uses PFOF, higher margin rates (6.83%)
- IBKR Pro: $0.005/share commissions, no PFOF, lowest margin rates (5.83%)
If you're choosing IBKR specifically for low costs and execution quality, go Pro. Lite defeats the purpose of using IBKR—you'd get similar execution at Fidelity with better service.
Who Should Choose IBKR?
- Active traders making frequent trades
- Margin users (the savings are substantial)
- International stock buyers
- Options traders with high volume
- Investors comfortable with complex platforms
- Those who prioritize cost over convenience
Who Should Choose Fidelity?
- Long-term buy-and-hold investors
- Retirement account holders
- Anyone who values customer service
- New investors who want guidance
- Research-driven investors
- Those who don't use margin
The Verdict
Both are excellent brokers—among the best in the industry. The choice is clear based on your profile:
Choose IBKR if: You're cost-conscious, use margin, trade actively, or need global market access. Be prepared for a learning curve.
Choose Fidelity if: You want excellent all-around service, great research, and a platform that just works. You're okay paying slightly more for a dramatically better experience.
Many sophisticated investors actually use both—Fidelity for retirement accounts and research, IBKR for margin trading and active positions.