Interactive Brokers: The Right Platform for Day Traders

The road to financial freedom is paved with hard work, discipline and the ability to pick out the right tools for your investment strategy. Some people out there might be satisfied with toiling in an office job with a reasonable salary and a 401K to do their retirement savings for them. Some others might even like to dabble with investing in stocks or mutual funds on the side. Even more people might get hooked by the excitement of day trading. Those people will need a platform like Interactive Brokers.

This platform was built for active and professional traders, not for newbies with no money. The market is incredibly complicated, so beginning traders need a simpler introduction to the world of investing. For more advanced traders, you need a more complex interface for their strategies. That is where I can really work for active traders. The execution of trades is quick and easy. The customer service is geared towards professionals with real knowledge and understanding of the markets.

Novice traders need more time and seasoning before really jumping into a platform like this. A day trading education site with the classes, instructors and community to take a novice and bring them along to a higher level is great way to get started as a trader. But it also helps to work with a less complicated platform at first. Being overwhelmed with advanced charts, complicated technical indicators and a constant stream of information can be too much for newbies.

Another hurdle for newbie traders is the relatively high minimum account balance of $10,000. Early on, day traders can be extremely under-capitalized, which leaves them vulnerable to trading very low volumes of shares. That hinders the ability to make a real profit on trades. Even big winners that produce over 50% profit can not mean a lot in real dollars because of the size of the trade. So Interactive Brokers self selects by keeping their capital requirements pretty high.

IB offers margin accounts, which is great for active traders, but, again, the key is that you need to have the requisite experience to be able to handle trading on credit. Take your time to learn how to day trade before you end up working with a broker that is too advanced for you. Interactive Brokers can be a bad place for traders in over their heads.

Trader WorkStation is the platform that IB offers to its users. The complexity of the Java-based software is impressive, because of its advanced charting capabilities. You can also access streaming financial news to help make sense of the markets on a day to day basis. The trade execution is pretty solid across most asset classes, but it is not top of the heap in any of them. Traders with a particular affinity for stocks or futures might be better of with more niche brokers, but there is no better place for traders with the desire to trade across all markets.

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