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“On the surface ok but scratch service and VERY poor”

Written on: 25/05/2021

Wouldn't recommend any more
Been with them for over a decade, but wouldn't recommend them to anyone anymore. They were okay when I first joined, but over the years other brokers, particularly those in the US, have marched ahead by a long way.

Thankfully I don't have all my eggs in this basket and if it wasn't for my ISAs and SIPPs I would move everything elsewhere.

They are okay as long as your needs are very simple and you are not an active investor, but if you want to do anything like buy shares in a US company they are probably the worst UK broker around.

Amazingly, Interactive Investor takes TWO DAYS just to transfer dollars into pounds. This is something you can do instantly with any GOOD financial institution or any of dozens of online apps, but yet Interactive Investor will take your money, invest it for themselves on the money markets to earn themselves interest, and then give you it back two days later. I know this beggars belief and sounds like something from the 1980s, but it is true. Personally, I think this kind of thing should be illegal now, as it is absolutely inexcusable. This is something a mere mortal can do in two minutes online, so why it would take a professional financial institution TWO days is very questionable. I've asked why, but they refuse to tell you, and pretty much just say 'Because it does' (I am paraphrasing).

They are also a LOT more expensive than any other online brokers for buying shares from anywhere else in the world. You will be looking at fees of as much as £20, when Interactive Brokers, Tradestation, etc, would charge you less then $5 for the same transaction. That is over 500% more expensive.

And then there's the stop-losses. I can honestly say I have never seen a worse implementation of stop-losses on any system ever. It is as though whoever designed this system wasn't an investor.

With most brokers you just specify what you want the stop loss to be, and you can change it whenever you like. With Interactive Investor you have to actually place a trade order (e.g. sell Intel if price reaches £50). This trade order will only last a set amount of time (which I think it 60 days) so you have to remember to go in and place another order before that one runs or else you will no longer have a stop loss in place.

Any competent investor will tell you how important stop-losses are, but it seems Interactive Investor don't really care about them that much. There's absolutely no facility to have a trailing stop-loss (wow!) and if you do want to change the stop loss you have to (amazingly) go in and cancel the current stop loss trade order. Then wait until that trade order has happened, which you'd think would be instantaneous, but it isn't. I have had it where I've had to wait for hours for it to happen. I don't know whether that was a glitch or whether it was due to having to wait until the markets had re-opened, although why you'd need to wait until the markets were open who knows.

Then once you've managed to cancel that initial stop-loss order you need to place a new stop-loss order. Imagine having to do that for a few dozen stock holdings every two months. It takes MANY HOURS!!!

These are just a few of the issues. There are lots more such as the inability to buy/sell options (gosh you can do this with apps on your phone these days), and if you're expecting to do anything even slight 'advanced' such as bracket orders forget about it. Not a chance.

I think maybe the people who use Interactive Investor have very small, inactive portfolios, so some of these things won't be a problem (although a good stop loss habit is important for everyone). But for anyone who has a sizeable amount to invest, and wants a diversified portfolio, that is well organised with stop-losses and take-profit orders, and a truly first class service, Interactive Investor are definitely not your best bet.

Their customer service is okay, and they do have some pleasant staff, although it does often take several days to get a reply, and the replies are often very brief and require additional follow-up, which isn't ideal.

It seems that they grow through acquisition rather than through providing an excellent service, and they don't employ enough staff to best meet the needs of their clients (hence the long wait times), but alas, this is often the way these days.

My advice would be to checkout the other options.

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