Ally Invest offers low prices with a robust platform, but it falls short on mutual funds, and ETFs.

Launched in 2005, Ally Invest has since become widely known for offering some of the lowest prices among online stock brokers. Few consumers outside of the stock trading world really know about the firm, though. Ally Invest doesn’t invest in major television ad spots or marketing campaigns like Scottrade or E*Trade do, but that doesn’t mean it’s not a good option.

Ally Invest stocks trade at a flat fee of $4.95 — the lowest in the industry. There is a $0 minimum deposit to join. Options trade at $4.95 + $0.65/contract, and mutual fund fees are capped at $9.95. These prices are very low compared to many of the other big brands in the online brokerage industry. (See chart below for price comparison.)

 Ally InvestOptionshouseTD AmeritradeScottradeE*TradeMerrill Edge
Stock Fee$4.95$4.95$9.99$7.00$9.99$6.95
Options Fee$4.95 + $0.65$4.95 + $0.50$9.99 + $0.75$7.00 + $0.70$9.99 + $0.75$6.95 + $0.75
Mutual Fund Fee$9.95$20.00$49.99$49.95$19.99$19.95
Broker Assisted$20.00$25.00$44.99$32.00$25.00$29.95
Min. Deposit$0$0$0$2,500$500$0

Among the biggest online stock trading companies, Ally Invest’s stock and options prices are really only comparable to OptionsHouse. But when you consider mutual funds and broker-assisted fees, Ally Invest is simply the cheapest broker out there. Coupled with stellar customer service, a user-friendly platform and trading tools, as well as a rather impressive library of investor research, it’s understandable why Ally Invest really stands out within the industry.

So what’s the catch? Read the fine print: Ally Invest will charge you an annual fee of $50 if you do not have account minimums of at least $2,500 and no commission-charged trades have been made within 12 months. This means that if you have less than $2,500 in your account, you must make at least one trade per year or be charged the fee. Fortunately, this is a term that’s relatively easy for most investors to meet.

The Specs

Costs & FeesStock Trades: $4.95
Options: $4.95 + $0.65 contract
Mutual Fund Trades: $9.95
Broker Assisted Trades: $20.00
Account Fee: $0
Inactivity Fee: $50 (conditional)
Minimum Account balance: $0
Misc. Fees$1.00 Bond Trade Fee
$24.95 Treasury Trade Fee
$0.00 CD Trade Fee
$0.00 IVR Trade Fee
$0.00 IRA Annual Fee
$50.00 IRA Closure Fee
$20.00 Forced Margin Sellout Fee
$30.00 Returned ACH Fee
$30.00 Returned Wire Fee
$200.00 Stock Certificate Processing Fee
$200.00 Stock Certificate Delivery Fee
$2.50 Paper Statement Fee
$1.00 Paper Confirmation Fee
$30.00 Domestic Wire Fee
$50.00 International Wire Fee
Minimum Deposit$0
Account TypesFull-service brokerage (stocks, bonds, CDs, 401K, other fixed income assets)
Commission-free ETFs
7,589 Mutual Funds (Load); 4,516 (No-Load); 0 (NTF)
Options
Futures
Forex
No Fee IRAs
Best ForBeginner investors and advanced investors
Mutual Funds
Price-conscious traders
Data Analysis
Not ForInactive traders
Commission-free ETFs
Margins7.75% Under $24,999.99
7.75% $25,000.00 to 49,999.99
6.75% $50,000.00 to $99,999.99
5.50% $100,000.00 to $249,999.99
4.50% $250,000.00 to $499,999.99
4.00% $500,000.00 to $999,999.99
4.00% Above $1,000,000.00
ServicesPhone, email, live chat
PlatformAlly Invest LIVE
Windows
Web platform (for both Windows and Mac users)
Mobile (Android & iOS)
Standout FeaturesAuto Investing
28 Charting & Drawing Tools
Ladder Trading
Option Chains - Streaming Real-time
Stock Alerts Delivery – Email, Sound, Text
Streaming Time & Sales
Watchlists - Streaming Real-time Quotes
AwardsBest in Class "Commissions and Fees" – 2016 – StockBrokers.com
4 stars for 10 years running: 2007-2016 - Barron's

The Claim

Ally Invest offers the lowest prices in the online brokerage industry among the big brands, including Scottrade, Merrill Edge, and TD Ameritrade. Along with low fees, it offers competitive extras, like a user-friendly trading platform and robust education and analysis tools.

Is it True?

Yes. When Ally Invest started in 2005, it set out to offer super-cheap prices, stellar customer service, and an online space for investors to discuss strategies and the stock market in general. With the rise of more players in the online brokerage space, Ally Invest was forced to maintain an edge, and so far it’s been able to pull it off. The company has remained the cheapest option while still providing a comparable platform and level of customer service to other, more expensive brokerages.

More than a decade later, it maintains the lowest price across the board among the largest players in the online brokerage industry. It has also managed to provide an impressively easy-to-use trading platform — Ally Invest LIVE, perfect for every level of investor — without raising prices. While it could do more in terms of investor education and research, it has consistently tried to keep up with competitors by adding to the educational libraries and maintaining ease of access to these from the platform. Scottrade and E*Trade, brokers that are slightly more expensive in terms of per-trade fee and minimum deposits, have a much better wealth of knowledge and investor education than some of the cheaper, discount brokers.

Ally Invest also requires no minimum deposit to start an account, unlike E*Trade ($500) or Scottrade ($2,500). As I have mentioned in previous reviews, however, it is important not to be swayed by the $0 minimum deposit feature alone. Investors are always going to have to deposit something to start trading, and you would probably want something in the neighborhood of $2,000 to start making any sort of substantial trades anyway. So while the $0 requirement looks good on the surface, it shouldn’t be the only attribute that moves you to join any broker with the same flashy offering.

It’s difficult to find many downsides with Ally Invest. There are some, but there are no major problems, and certainly nothing that would scare prospective customers away from joining. That said, here’s what I did find:

Another issue is Ally Invest’s slow and slightly annoying sign-up process. Forget about clicking around its website to check everything out before signing up. While other brokers allow you to click through their pages and even scan some of their investor education libraries for free, Ally Invest won’t let you access a thing until you enter in your personal information (including your Social Security number) and create an account. This multilayered process was a bit annoying, and unless users know all the details about what Ally Invest offers up front, this process could deter them and steer them toward other competitors that have an easier signup process, like OptionsHouse or TD Ameritrade.

The classic web platform is not as customizable as one might like, and there are other discount brokers out there that do have customizable features, like Scottrade, for example. The web platform will not allow users to toggle everything or create customizable charts and data streams that other platforms do allow through a web browser.

Nevertheless, Ally Invest launched its latest non-web-based platform, Ally Invest LIVE, in 2014, and it is everything any new or experienced investor would want. The dashboard is fully customizable and there are streaming quotes all over the place, making it perfect for investors to see an array of data and analysis all in one place. Users can click and drag windows wherever they want to view them within the dashboard, and bringing up every trading tool or resource is super easy — they are clearly labeled, in bold, and it is nowhere near as convoluted as some of the other broker platforms out there. In fact, if an investor is solely looking at price and platform ease-of-use to make a choice in online broker, Ally Invest could easily take the crown for the best discount online brokerage firm.

Ally Invest regularly updates Ally Invest LIVE, and its features are only getting better. It currently has 10 different drawing tools and over 80 technical indicators for investors to use while trading. Charts are smooth and easy to toggle, and there is now a deep analysis feature that allows users to compare theoretical market positions with actual, live positions. Again, it’s important to note that the desktop platform blows its web platform out of the water – and that is sort of bad news for Mac users. Ally Invest LIVE only runs on Windows-based platforms, so Mac users will have to use the web portal or, like with many Windows-only applications, run a Windows emulator or install Windows on their Mac computers (not difficult to come by, and Mac users have long understood this problem and the ways around it for years).

Our Deep Dive

  • Costs and More: Ally Invest offers a flat $4.95 stock trade fee across the board. It also offers a $4.95 Options base fee + $0.65 contract. Mutual funds are $9.95 (OptionsHouse is $20.00; TD Ameritrade is $49.99) and broker-assisted trades are $20.00 (OptionsHouse is $25.00; TD Ameritrade is $44.99). There is no minimum deposit required to sign up, but Ally Invest will charge you a $50 fee for accounts under $2,500 and which have not made a trade within 12 months.
  • Learning Curve: Signing up and depositing money is a long process, but everything else is super user-friendly, especially its main platform, Ally Invest LIVE.
  • The Platforms: Users get access to Ally Invest LIVE. It’s fast, easy to use, and every level of investor will find it useful. It’s easy to learn for beginners and has nearly everything experienced investors would want. It is not as powerful as TD Ameritrade’s thinkorswim (users won’t find embedded CNBC, heatmapping tools, or mutual fund research reports), but if the company ever figures out how to add those, it will be a serious contender to thinkorswim, which is considered the best trading platform in the industry. The web platform leaves much to be desired, however, and Mac users will have to use this since Ally Invest LIVE only works on PC platforms. Nevertheless, there are Mac apps that can run Windows-based programs which could be a work-around if you are an Apple customer. The mobile app is available for both Android and iOS, but users will really want to do everything through Ally Invest LIVE, if possible.
  • Research: Ally Invest has one of the best research libraries available when compared to most of its competitors. It has a large archive of information and brings both visual slides and interactive media to the user experience. Here, users can analyze everything from earnings to transactions, study graphs, and get an overview of a wide variety of market data. Many other brokers simply give you a rundown of items with boring (albeit still useful) data.
  • Customer Service: Ally Invest does not have 24/7 customer service or hundreds of branches like Scottrade, E*Trade, or Fidelity, but it does offer customer service in every area you may need: phone, live chat, and email. In its early days, Ally Invest was known for stellar customer service (it even won awards for it shortly after its founding), but since the industry has evolved, customer service is about on par with the rest of the online brokers in the industry.
  • Ally Invest Advisors: In 2014, Ally Invest began to offer Ally Invest Advisors to customers for additional fees. This sidekick service to Ally Invest as a whole simply offers customers a professionally managed portfolio through a digital portal with the support of advisors hired by Ally Invest.

Cost Rundown

Ally Invest charges a flat rate of $4.95 per stock trade, $4.95 + 0.65 for Options, and $9.95 for Mutual Fund trades. Within the big brands it’s only true competitor — price-wise — is OptionsHouse, which charges $4.95 per stock trade, $4.95 + 0.50 for Options, and $20.00 for Mutual Fund trades – prices still slightly higher than Ally Invest.

OptionsHouse is great if you are an experienced investor and have an active interest in trading options. It was simply made for seasoned investors, by seasoned investors. The platform is just as powerful, but there’s a slight learning curve; OptionsHouse simply isn’t as user-friendly as Ally Invest.

Cheaper (or Free!) Alternatives

No major brand-name firm can beat Ally Invest on prices, although OptionsHouse comes close. As stated in the OptionsHouse review, cheaper alternatives would be Interactive Brokers, which doesn’t charge any fees, but instead takes a $0.005 of a stock’s trading fee per share. The online broker Just2Trade only charges a $2.50 flat fee per trade, but requires a $2,500 deposit to start trading. These two companies are relatively unknown, and nothing about them stacks up to any of the big online stock brokers in the industry.

The Competition

  • Scottrade: $7.00 flat free trade plan; $2,500 minimum deposit. Scottrade is one of the more expensive online brokers out there, but it offers cheaper trades without a tiered pricing system. It’s also one of the few online brokers with physical brick-and-mortar stores in nearly every state.
  • E*Trade: $9.99 flat free trade plan; $500 minimum deposit. E*Trade is largely recognized by its humorous television commercials, and while it is not the most affordable, it markets to a large audience and therefore maintains a valuable customer-oriented presence similar to Scottrade.
  • Optionshouse: $4.95 flat free trade plan; $0 minimum deposit. OptionsHouse is extremely affordable, offering stock trades at half the price of many of its competitors. It often tops the list of online stock broker reviews.
  • Merrill Edge: $6.95 flat free trade plan; $0 minimum deposit. Owned by Bank of America since 2010, Merrill Edge is affordable and would be beneficial for those who already have various BoA accounts.
  • TD Ameritrade: $9.99 flat free trade plan; $0 minimum deposit. This is double the price of Ally Invest or OptionsHouse. Customers turn to TD Ameritrade because it offers everything all of the major online stock broker brands provide plus all the things each one tends to be lacking on. This includes investor education, user-friendly platform for all platforms and devices, or 24/7 customer service. Where each major online stock broker lacks, TD Ameritrade seems to pick up the slack – and customers don’t seem to mind paying extra for that.

What Others Are Saying

  • In April 2016, Ally Financial announced the acquisition of TradeKing Group for $275 million. According to the TradeKing site, the interface will stay the same and “for the foreseeable future there’ll be no change in pricing for TradeKing clients, including Securities, Advisors, and Forex clients.”
  • In a December 2015 press release, Modest Money reported on the benefits of signing up with Ally Invest.
  • In July 2014, Information Week covered Ally Invest’s move into advisory services.

The Bottom Line

Ally Invest is the most affordable online stock broker among the big players in the industry. It provides users with a great all-around user experience, and if price and platform are the things that matter most to you, Ally Invest is going to be your best option.