Interactive Brokers vs Freedom24: A Comprehensive Comparison for UK Investors

Interactive Brokers and Freedom24 are two popular online brokers. Each has its strengths and weaknesses. Are you considering these brokers but uncertain which one is best for you?

Interactive brokers vs. freedom24

Dive into our detailed comparison of Interactive Brokers and Freedom24, where we unravel the specifics on fees, account types, markets, and more, equipping you with everything you need to make a well-informed decision.

Interactive Brokers vs Freedom24: How Do They Work?

How Does Interactive Brokers Work?

Interactive Brokers is a broker founded in 1978 by Thomas Peterffy. It quickly established itself as one of the main brokers in the trading world. The history of Interactive Broker is closely linked to its founder, a Hungarian immigrant who revolutionised electronic trading. He introduced automated and high-speed trading.

Thanks to its advanced trading platform, Interactive Brokers provides access to various financial instruments. It caters to both professional traders and individual investors. It is known for its low costs, sophisticated tools, and user-friendly interface.

How Does Freedom24 Work?

Freedom24 is a trading platform owned by Freedom Finance, founded in 2008 under the vision of Timur Turlov. He wanted to democratise access to global financial markets.

Starting modestly, Freedom24 has grown into a reputable platform offering various financial instruments. It prioritises a simplified trading experience while facilitating direct access to major global exchanges.

Interactive Brokers vs Freedom24: Main Features

 Interactive BrokersFreedom24
🏆 RegulationFCACySEC (not FCA licensed)
🔒 Guarantee FundUp to £85,000 (FSCS)Not under the protection of FSCS
💼 Account TypesCash account, Reg T account, Portfolio margin accountRetail account, Savings D-account, White label account
💰 Minimum Deposit£0£0
💻 PlatformsTrader WorkstationProprietary platform
📈 Products– Stocks
– ETFs
– Mutual Funds
– Bonds
– Options
– Futures
– Currency Pairs
– CFD
– Stocks
– ETFs
– Options
💲 Fees and commissions for stocks$0.005 per share for US stocks (minimum $1 per order)
€0,02 per share + €2 per order

 More informationInteractive Brokers review Freedom24 review

Regulation and Fund Protection

Before opening a trading account, make sure to choose a safe broker that guarantees the security of your funds. Here are some key points regarding the Interactive Brokers and Freedom24 regulations.

Regulation and Reliability of Interactive Brokers

Interactive Brokers is a reliable broker known for its financial strength. Being a broker based in the United States, it is subject to the strict regulation of the SEC and the CFTC. It also adheres to many local regulatory bodies to ensure optimal investor protection.

interactive brokers

As Interactive Brokers is FCA licensed and under the FSCS protection, British users are covered up to £85,000 in the unlikely event of bankruptcy.

Regulation and Reliability of Freedom24

Freedom24 is a notable player in the trading market. This platform managed by Freedom Finance is not registered in the UK — it is only registered with the CySEC, which regulates European brokers; however, due to Brexit this may not apply to UK residents anymore.

Despite this, Freedom24 complies with international standards to ensure the security of client funds. It uses segregated bank accounts, separating the company’s funds from those of the clients. However, as explained above, this may be risky for UK citizens as Freedom24 is not licensed by the FCA.

Interactive Brokers vs Freedom24: Available Investment Products for UK

If Freedom24 emphasizes access to IPOs, Interactive Brokers offers a much wider range of products. This table shows the available financial instruments at each of the two brokers.

Interactive BrokersFreedom24
– 73 Stock Markets– 35,000 Stocks
– Over 13,000 ETFs– Over 3100 ETFs
– Over 21,000 Mutual Funds– Over 500 Futures Contracts
– Over 26,000 Corporate Bonds– Over 800,000 Options
– 32 Options Markets
– 33 Futures Markets
– 115 Currency Pairs
– Over 70 CFD Indices
– Over 7000 CFD Stocks
– Over 300 CFD ETFs
– Over 50 CFD Metals

Comparison of Available Stock Markets on Interactive Brokers and Freedom24

Both Interactive Brokers and Freedom24 offer access to global stock markets. However, they differ in their scope and specialisation.

On the one hand, Interactive Brokers allows access to more than 135 markets in 33 countries. It allows you to trade securities on stock exchanges in Asia, Europe, North America, and other regions.

On the other hand, Freedom24 also offers international reach. However, Freedom24 mainly focuses on European and American markets.

So if you are a trader looking for maximum coverage, you would be better off opening an account with Interactive Brokers. On the other hand, if you want to focus on Western markets, Freedom24 remains competitive.

Costs and Fees: Interactive Brokers vs Freedom24

The comparison table above shows that the cost structures cater to different trader profiles. The fees depend on the volume of transactions, the frequency of trades and the specific services you seek.

However, from a general point of view, Interactive Brokers is known for its competitive fees. Yet, if you do not trade regularly, the Smart in EUR plan from Freedom24 could be more advantageous.

However, the comparison becomes more complex if you are an active trader. The decreasing commissions of Interactive Brokers would be advantageous if you reach high volumes. On the other hand, the Super in EUR Plan from Freedom24 could benefit you if you trade on high volumes and your strategy is profitable enough to cover the monthly fee of €200.

Deposits and Withdrawals: Interactive Brokers vs Freedom24

Deposits and Withdrawals on Interactive Brokers

Previously, Interactive Brokers required a minimum deposit of $10,000 for any type of account. However, now it is possible to open an account with Interactive Brokers with a minimum deposit of $0.

As for withdrawals, you can directly withdraw your earnings by electronic transfer to your bank account. However, remember that you will be charged if you make more than one monthly withdrawal.

Deposits and Withdrawals on Freedom24

Freedom24 facilitates users’ deposit and withdrawal operations. You can make deposits by bank transfer or credit card. Additionally, there are other payment methods specific to certain regions. However, be aware that fees may be applied to card deposits.

Regarding withdrawals, the broker charges 7 per withdrawal, which is quite high compared to the competition. Processing times depend on the method used.

Platform and Demo Accounts of Interactive Brokers vs Freedom24

Platform and Demo Account Offered by Interactive Brokers

Interactive Brokers mainly offers its proprietary platform, the Trader Workstation (TWS) and the mobile version IBKR Mobile. It is an advanced interface that offers powerful analysis, research and portfolio management tools.

ibkr mobile

Interactive Brokers provides a demo account for beginners or those who wish to familiarise themselves with the platform. This account simulates the real-time trading environment. It allows you to test the features of TWS without risking real cash.

Platform and Demo Account Offered by Freedom24

Just like Interactive Brokers, Freedom24 offers its users a modern and intuitive trading platform. It meets the needs of both novice and experienced investors. In addition, the platform is accessible via a web interface or mobile. It offers advanced charts, analysis tools and fast order execution.

Freedom24 also offers a demo account for those who wish to learn to trade. This simulator account reproduces the real-time trading environment for safe learning.

Types of Accounts Interactive Brokers vs Freedom24

The two brokers, Interactive Brokers and Freedom24, offer various types of accounts to meet the specific needs of their clients.

Types of Accounts Available on Interactive Brokers:

  • Cash Account: This is a type of account where you can invest only the money you have deposited. No borrowing or leverage is allowed. You can open a cash account with a minimum deposit of $0.
  • Reg T Account: This account requires a minimum deposit of $2,000. You can use leverage and short-sell assets.
  • Portfolio Margin Account: This is an account for professional traders. The minimum deposit is $100,000.

Types of Accounts Available on Freedom24:

  • Retail account: for trading activities.
  • Savings D-account: for long-term savings – it offers interest on EUR and USD cash balances.
  • White label account: suitable for financial institutions.

Customer Service: Interactive Brokers vs Freedom24

Customer service is a crucial element for online brokers. Being one of the largest brokers in the world, Interactive Brokers offers almost non-stop support and a comprehensive knowledge base.

On the other hand, Freedom24, although smaller, strives to provide quality and responsive customer support to meet its users’ needs.

After evaluating user reviews, both brokers offer satisfactory assistance.

Training and Education: Interactive Broker vs Freedom24

To support traders, each broker offers free training and educational resources.

On the one hand, Interactive Brokers offers free courses and videos. It also organises live webinars on various trading topics.

On the other hand, Freedom24 offers articles, tutorials, and videos to help new traders. It also offers live sessions on certain trading strategies and market news.

Interactive Brokers vs Freedom24: Pros and cons

Pros and cons of Interactive Brokers

Pros Interactive BrokersCons Interactive Brokers
✅ Range of financial instruments
✅ Advanced platform
✅ Competitive rates
❌ Complex platform for beginners

Pros and cons of Freedom24

Pros Freedom24Cons Freedom24
✅ Modern and intuitive platform
✅ Multiple cost structures to choose from
✅ Responsive customer service
❌ High withdrawal fees
❌ Not regulated in the UK

Interactive Broker vs Freedom24: Summary

To conclude this review, Interactive Brokers remains a highly competitive giant in the trading world. It provides traders with a feature-rich platform, global coverage, and solid educational tools.

It is ideal for experienced traders looking for a diverse offer. Beginners may want to hone their skills by checking our trading guide and learning about technical analysis, or even check the best brokers for beginners.

On the other hand, Freedom24 has strengthened as an interesting option for those targeting European and American markets. It stands out for its user-friendly interface and responsive customer support, but keep in mind it is not regulated in the UK.

Considering these aspects, the choice between the two depends on your preferences, target markets, and the level of expertise you seek.

FAQs

What sets Interactive Brokers apart from Freedom24?

Interactive Brokers stands out for its extensive range of financial instruments and tools catering to professional traders and individual investors. It’s known for its low costs, sophisticated trading platform, and user-friendly interface.

Are there significant differences in fees between Interactive Brokers and Freedom24?

Yes, there are differences. Interactive Brokers is known for its low costs, making it appealing for cost-conscious traders. Freedom24 has varying fee structures depending on the chosen cost structure.

Can I access global markets with both Interactive Brokers and Freedom24?

Both platforms provide access to global markets. Interactive Brokers is known for its extensive access to various markets worldwide, while Freedom24 also allows traders to access major global exchanges while focusing on providing a simplified experience.

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