E*TRADE vs Interactive Brokers (2026) — Which Is Better?
Compare E*TRADE and Interactive Brokers — features, pricing, pros and cons.
Quick Verdict
Higher Rated
Interactive Brokers (4.6)
More Affordable
E*TRADE (Free)
E*TRADE
Morgan Stanley's online brokerage with Power E*TRADE for options trading, commission-free stocks, and comprehensive banking integration.
Interactive Brokers
Professional-grade brokerage with the lowest commissions, global market access, and powerful Trader Workstation platform.
Our Analysis
E*TRADE and Interactive Brokers target different trader profiles. E*TRADE, backed by Morgan Stanley, excels as a retail-friendly platform with Power E*TRADE's specialized options trading tools and integrated banking services. Interactive Brokers positions itself as the professional's choice, offering the industry's lowest commissions and access to 150+ markets across 33 countries. Both offer identical core features—AI analysis, backtesting, paper trading, and alerts—at no cost, but their platform philosophies diverge sharply.
The defining differentiator is market scope and cost structure. Interactive Brokers' commission advantage scales significantly for active traders executing high volumes, while its global market access eliminates broker limitations. E*TRADE prioritizes accessibility through Power E*TRADE's streamlined interface for options and Morgan Stanley's institutional research integration, plus volume discounts on options commissions—a tactical advantage for options-focused traders.
Choose E*TRADE if you're a domestic options trader or investor wanting straightforward setup with quality research tools. Select Interactive Brokers if you actively trade stocks or derivatives, require global exposure, trade multiple asset classes, or prioritize minimizing commissions. The 4.6/5 vs. 4.3/5 ratings reflect this positioning: Interactive Brokers ranks higher among power users, while E*TRADE succeeds with convenience-seeking retail investors.
Feature Comparison
| Feature | E*TRADE | Interactive Brokers |
|---|---|---|
| Rating | ★ 4.3 | ★ 4.6 |
| Starting Price | Free | Free |
| Free Tier | Yes | Yes |
| Markets | stocks, options, futures | ETFs, options, bonds, forex, crypto, spot currencies, forecast contracts, mutual funds, stocks, hedge funds, futures, US spot gold |
| AI Analysis | ✗ | ✗ |
| Backtesting | ✗ | ✗ |
| Paper Trading | ✓ | ✓ |
| Price Alerts | ✓ | ✓ |
| Mobile App | ✓ | ✓ |
| API Access | ✗ | ✓ |
| Social Features | ✗ | ✗ |
| Broker Integration | ✓ | ✓ |
| Custom Indicators | ✗ | ✓ |
| Automated Trading | ✗ | ✓ |
| Trade Journaling | ✗ | ✗ |
| Performance Analytics | ✓ | ✓ |
| Risk Management | ✓ | ✓ |
| News Feed | ✓ | ✓ |
| Education Content | ✓ | ✓ |
E*TRADE: Pros & Cons
Pros
- + Power E*TRADE is excellent for options trading
- + Morgan Stanley research integration
- + Volume discounts on options commissions
- + Strong mobile app experience
Cons
- - No cryptocurrency trading
- - Futures offerings are limited
- - Banking features less robust than Schwab
- - Platform can feel dated outside Power E*TRADE
Interactive Brokers: Pros & Cons
Pros
- + Lowest commissions in the industry for active traders
- + Access to 150+ markets in 33 countries
- + Excellent margin rates
- + Powerful API for automated trading
Cons
- - Trader Workstation has a steep learning curve
- - Platform can feel overwhelming for beginners
- - Customer support can be slow