Ally Invest Review: The Best Online Broker For Active Traders

ally invest reviewWhen it comes to investing your money, you have a lot of options. Back when I first started to invest, discount brokers were just coming onto the scene. But the term “discount” was overrated. The fees to trade stock were still around $25 per share. But thanks to technology and competition, investing has become affordable for the average investor. One such example of this is with Ally Invest.

In this Ally Invest review, you will learn what makes Ally Invest great. You will also find out if this broker makes sense for you. And if so, how to get started investing with Ally Invest.

By the end of this post you will see why Ally Invest should be on your shortlist of online brokers.

Ally Invest Review Summary
  • Ease of Use
  • Account Fees
  • Account Types
  • Features
  • Customer Service

Summary

If you are an active investor, you can't go wrong with Ally Invest. They offer very competitive commissions on trades and offer a boatload of tools to help you make smart decisions when it comes to investing. If you are more of a buy-and-hold type of investor, there are better options out there for you - both in terms of lower costs and more investment vehicles to choose from. Overall though, Ally Invest is a solid online broker.

5

My Detailed Ally Invest Review

Ally Invest Background & History

Here is a short video that sums up what Ally Invest is all about in case you don’t have the time to read through this entire post.

Ally Invest came on the scene in 2016 when Ally Bank bought TradeKing and changed its name to Ally Invest.

TradeKing has been one of the top names in the online broker world since it was founded in 2005 as an alternative to the other online brokers.

At the time, many other brokers were, and still are, charging more for trades than Ally Invest. Today, Ally Invest sets itself apart from other brokers. They put the customer first and provide a lot of free tools and services that other brokers don’t.

Along the way to what it is now, here are some important moments in the history of this online broker:

  • In 2012, TradeKing merged with Zecco to expand on the products it offered.
  • In 2015 TradeKing bought MB Trading. This buy helped TradeKing to improve its trading platform for investors. It also allowed TradeKing to offer futures trading to investors.
  • In April of 2016, Ally Bank bought TradeKing. Since I use and love Ally Bank, I am not surprised at how they have made the online broker even better.

Ally Invest Features

On to the features that makes Ally Invest a great choice for investors. I’ll highlight these in bullet points and then go into more detail further down below.

  • $4.95 online trades for stocks priced $2 and more. This includes market and limit orders. Note that is fee isn’t a flat fee. I’ll talk about this more below.
  • Over 12,000 mutual funds are available to be traded on their platform. This is in line with many of the large online brokers.
  • Guarantee your trade. Ally Invest actually guarantees that your order will is filled at the National Best Bid of Offer. You don’t have to worry about paying too much! And you won’t get this guarantee with any other online broker either.
  • Streaming quotes are free for investors. Once you make your first trade, you can call Ally Invest to activate the free streaming quotes feature in your account. Again, many other brokers require you to trade a minimum amount of times before you get access to free streaming quotes. But not Ally Invest. They offer it right out of the gate.
  • Tons of investment options for investors. Choose from stocks, exchange traded funds, bonds, mutual funds, futures and options. You can invest in non-retirement, retirement and educational accounts as well. (Be sure to track any management fees you pay by using this free service.)
  • Forex trading for people interested in trading currency. What’s cool about this is that they give you a $50,000 mock forex account to learn how forex trading works before you ever trade. This is important if you have never traded forex before. You can read about my experience with forex trading here.

Ally Invest Benefits

Ally Invest has positioned itself well in the online broker market. It is a place that active traders should consider when looking into investing their money.

Here are the features of Ally Invest that I like most.

Zero account opening fee. There is no minimum to open an account with Ally Invest. This is a great feature for investors who don’t have the money needed to invest with a firm like Vanguard.

With Ally Invest, you can buy a couple shares of stock and take your time adding to your position.

Zero maintenance fees. Unlike other brokers, you aren’t getting hit with annual maintenance fees if your account balance doesn’t meet a certain dollar amount. Nor are there any fees from inactivity either.

Lower trade commissions for active traders. While the $4.95 trade commission is standard, if you are an active trader and place 30 or more trades in a quarter you can reduce your fee to $3.95 per trade. And if you trade more often, I am sure you could get an even better deal.

Amazing customer service. You can email, call or chat if you have any questions. TradeKing has won awards for its great customer service over the years and I am sure Ally Invest will continue in this great tradition. This just shows you they follow their mission to put the customer first.

In fact, they have a goal for email response time. During business hours, they will respond in 2 hours for emails. For emails received over the weekend, they will respond in 24 hours. This is great to know. I hate emailing and wondering when the company will ever get back to me.

Lots of education: Ally Invest has free classes and seminars to learn more about investing. They also have a forum where you can talk and discuss things with other investors that are part of Ally Invest.

Trading platform: Ally Invest’s trading platform offers real time streaming quotes. Super fast trade executions and a customizable dashboard are also standard. It is also browser based, so you can access it anywhere you have an internet connection.

The trading platform even works on your mobile device through Ally Invest’s mobile app.

What I love about it though is the customizable dashboard. I hate when I cannot make changes. There are certain things I want to see and I want to get rid of the rest of “the noise”. Ally Invest lets me do this.

Tax analysis: Taxes stink. But Ally Invest makes things a breeze. And you can even learn something. This is because Ally Invest uses Maxit Tax Manager. This free service gives you analysis and easy to understand tax reporting in real time. It even suggests trades for you to place that will help you to reduce your tax liability.

But it doesn’t stop there. With Ally Invest, you don’t have to wait for your 1099 in the mail. You don’t even have to send it to your accountant. You give your accountant access to your 1099 online and they can download it when they need it.

Charting and technical analysis: If you are an active trader, Ally Invest should be high on your list of brokers to consider.

This is because Ally Invest offers a suite of tools that exceed expectations for a discount broker. For example, they offer calculators for options traders to help assess the profit or loss potential of trades.

They offer an online trader network where you can get insights and ideas from other traders. It is like a private social media network for stock traders. Share trading notes, strategies and anything else your heart desires. It is a community built for you.

Ally Invest also offers reports from third party sources like Standard & Poor’s. And Ally Invest analyzes the reports for you! Traders can find useful information like price projections, chart pattern recognition, and more.

They even offer free educational material to help beginners just starting out trading. This helps to better understand how the market works. They even offer investing tips to increase success.

Downsides To Ally Invest

There are a few downsides to Ally Invest to list. Here they are in no particular order:

  • Zero No-Fee ETFs and Mutual Funds: Ally Invest currently does not offer any ETFs or mutual funds without any trading fees. This means that when you buy ETFs, you are going to pay the $4.95 trading fee. With no-load mutual funds you will be paying $9.95. Note that if you buy a load mutual fund, there is no trading fee from Ally Invest. Just the typical fee the mutual fund charges you.
  • Non-Uniform Trading Fees: While the $4.95 is a great price for trading, it is not a flat $4.95. If you are buying shares of stock that are under $2 per share, you pay an extra $0.01 per share. This isn’t a huge deal, but needs noting. The last thing you want is to be surprised if you are looking to place penny stock trades.

If Ally Invest sounds like it is the right fit for your investing needs, you can open up an account here.

Ally Invest Managed Portfolios

There is one other feature Ally Invest has recently rolled out that needs to discussing. In response to the popularity of robo-advisors like Betterment, Ally Invest entered into this market. Their goal is to improve upon what Betterment does by offering more for less.

With Ally Invest Managed Portfolios, you can start investing in a portfolio with as little as $2,500. Like Betterment, you will be invested in low-cost ETFs.

The portfolios Ally Invest Managed Portfolios are created using an average of 9 low cost ETF funds.

When it comes to fees, you pay 0.30% in management fees per year regardless of your balance.

Who Is Ally Invest Best For?

So who is Ally Invest a best fit for? If you are an active trader, then Ally Invest is a perfect match for you. You get many free tools and features that most other online brokers don’t provide or charge extra for. Plus, you get a competitive price for trading shares of stock and ETFs.

In the past, I might have recommended E*Trade to active investors, but they have dropped the ball and have been surpasses by the features that Ally Invest now offers.

I will admit though that E*Trade still wins when it comes to funny commercials.

Another option is Webull. Not only do they allow you to invest for free, but they have a huge library of investor education resources and monthly contests where you can win various prizes.

If you are looking to join the robo-advisor revolution, is Ally Invest Managed Portfolios the best choice for you? Not necessarily.

While they do compete with other robo-advisors in terms of fees and portfolio creation, the others in this space, namely Betterment and Wealthsimple offer many more features.

For example, both of these options offer tax loss harvesting which Ally Invest Managed Portfolios does not. By taking advantage of tax loss harvesting, you can boost your long term growth.

By clicking here, you can see how great of a benefit this is with Betterment.

At the end of the day, for an active trader, you simply cannot beat Ally Invest.

For investors looking for an automated solution, I would suggest you skip Ally Invest Managed Portfolios and look more at Betterment or Wealthsimple.

Final Thoughts

Ally Invest has taken what TradeKing built and continues to make it better. With all the features and excellent customer service, you would be more than happy with them as your broker.

But Ally Invest isn’t for every investor. Remember that your broker needs to fit your needs so that it can be a happy, long term relationship. For active traders, Ally Invest fits the bill perfectly.

For investors who don’t trade often and only in mutual funds, Charles Schwab would be a better fit.

Take the time now to pick the right broker for you and then start investing and growing your money and profit from it.

[Photo Credit: FirmBee]

6 thoughts on “Ally Invest Review: The Best Online Broker For Active Traders”

  1. Jean @ NearlyRetired

    Unfortunately my investments are in ETFs and mutual funds, so sounds like this isn’t the right brokerage for me at this time. But it’s good to be aware of them as an option if I start dealing with stocks directly.

  2. I like your reviews on various online brokers. I’m not sure if it’s because I have a bias since I’ve been with Fidelity the longest, but I really like their interface and tools that show you your balances. They recently revamped their site so you can also easily see how your investments are doing compared to their 52 week high/lows.

    Since I don’t trade frequently enough (usually once a month), I’m not that concerned with the actual fees associated with trades. Getting a clear view of my current investments is the most important feature to me. I have a Scottrade account too and it’s always hard for me to determine my cost basis, perhaps I just don’t know how to find this information. I would be interested in seeing how you think Fidelity stacks up against the others. Not many other bloggers seem to comment on Fidelity for some reason.

  3. TradeKing has been a great online broker. I have known some people who use their services and they are well satisfied with the results they’re getting.

  4. This is a great write up of TradeKings. I can’t say that I was overly familiar with them but definitely something to consider in the future. Up until now I have mainly used Vanguard since I buy a lot of passive index funds through them and most recently I bought 20 stocks through Motif Investing. There are pluses and minuses with both but I will definitely have to explore TradeKings some more. Thanks for sharing!!!

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