Ally Invest Review 2023: Pros, Cons and How It Compares
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Our Take
4.9
The bottom line:
Pros & Cons
Pros
Commission-free trades on eligible U.S. stocks, options and ETFs.
No account minimum.
Strong web-based platform.
Cons
No fractional shares.
Limited third-party research providers.
Compare to Similar Brokers
NerdWallet rating 5.0 /5 | NerdWallet rating 5.0 /5 | NerdWallet rating 5.0 /5 | NerdWallet rating 5.0 /5 |
Fees $0 per trade for online U.S. stocks and ETFs | Fees $0.005 per share; as low as $0.0005 with volume discounts | Fees $0 per trade | Fees $0 per trade |
Account minimum $0 | Account minimum $0 | Account minimum $0 | Account minimum $0 |
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Full Review
Where Ally Invest shines
Costs: Ally Invest appeals to both the beginning investor and the experienced stock trader with $0 trading costs on eligible U.S. securities, no account minimum and low-cost options trading. In February 2023, Ally Invest eliminated its $9.95 fee for mutual fund trades as a part of its strategy to remove barriers and eliminate fees for customers. Around 17,000 of Ally's mutual funds can now be purchased transaction free.
Advanced features: Ally doesn’t merely compete with the major online brokers on costs: It also offers bells and whistles like forex trading, an automated portfolio management option and a suite of free tools for technical investors.
Cash management: Uninvested cash in an Ally Invest brokerage account earns no interest, but Ally invest offers instant money movement between Ally savings and brokerage accounts, letting investors take advantage of interest rates several times higher than the typical default sweep interest rates of most brokerages. This does, however, require opening an Ally savings account separately.
Where Ally Invest falls short
No branches: If you'd like the ability to schedule an in-person meeting, you'll have to look elsewhere.
Ally Invest is best for:
Active traders.
Beginner investors.
Options traders.
Forex traders.
Ally Invest at a glance
Account minimum | $0 |
Stock trading costs | $0 (on eligible U.S. securities) |
Options trades | No base commission; $0.50 per contract |
Account fees (annual, transfer, closing, inactivity) | No inactivity or annual fees; $50 full/partial outgoing transfer fee |
Number of no-transaction-fee mutual funds | About 17,000 funds |
Tradable securities |
|
Trading platform | Browser-based platform with free screening tools, customizable charting, research and real-time data. |
Mobile app | Access to holdings, trading, order status, research, an ETF screener, watchlist, transfers and activity. |
Research and data | Research from Morningstar, CFRA and TipRanks. |
Customer support options (includes how easy it is to find key details on the website) | 24/7 by phone, email and chat. |
More details about Ally Invest's ratings
Account minimum: 5 out of 5 stars
Like many online brokerages these days, Ally Invest has no account minimum, which is a great perk for someone who doesn’t have much to invest in the beginning. Some brokerages have account minimums between a few hundred and a few thousand dollars.
Stock trading costs: 5 out of 5 stars
Ally Invest has commission-free trades for eligible U.S. stocks, options and exchange-traded funds. This is typical of brokers these days — charging a commission for stock and ETF trades is relatively rare.
Options trades: 5 out of 5 stars
In addition to not charging a base commission for options trades, Ally Invest's per-contract fee comes in lower than many other brokers at $0.50 per contract.
Account fees: 3 out of 5 stars
Ally Invest charges $50 for a full or partial transfer of your securities out of your account (called an ACAT transfer). Often brokers charge a reduced fee for a partial transfer, but in general, $50 isn’t as high as some other brokerages.
Number of no-transaction-fee mutual funds: 5 out of 5 stars
Ally Invest now offers about 17,000 no-transaction-fee mutual funds to choose from.
Tradable securities: 4.5 out of 5 stars
Though there is a strong selection of tradable securities on offer, two fairly common securities are missing from that list: futures and cryptocurrency. Expert traders can still enjoy advanced trading in options, forex and penny stocks, but for futures, they’ll have to turn elsewhere, such as TradeStation or Interactive Brokers. And for investors wanting to get started with small amounts (or dollar-cost average into investing), Robinhood, Schwab and Fidelity all offer fractional shares.
Trading platform: 4.5 out of 5 stars
Ally Invest’s browser-based platform offers quick trading capabilities, real-time streaming quotes and data, a customizable dashboard, and access to all of the broker's tools. Customers who frequently trade from various computers — home and work, for example — will appreciate this web-based platform, which doesn’t require any downloads. Ally also allows its customers to trade via mobile devices with Ally Mobile or Ally Forex, the brokerage's app dedicated to forex trading.
Mobile app: 4 out of 5 stars
Ally Invest’s mobile app is a part of the larger Ally Bank app, and lets users access holdings, the trading platform, research, screeners, a stocks watchlist and more.
Research and data: 2 out of 5 stars
Ally only offers access to three third-party research providers: Morningstar, CFRA and TipRanks. However, it does offer a suite of investing tools that exceed expectations for a deep-discount broker. Its options trading tools are particularly strong and include an options pricing calculator to compare current bid/ask prices to forecast theoretical values, as well as a strategy builder that identifies and executes option strategies based on criteria you choose. (Just getting into options trading? Here's our guide.) Ally Invest has also introduced a new ETF screener that makes it easier for users to find an ETF that meets their investing goals.
Other free tools include a profit-and-loss calculator, a probability calculator (that uses implied volatility to determine your likelihood of hitting your targets) and the Maxit Tax Manager, which identifies tax implications of trading decisions (e.g., short- and long-term gains and losses or wash sales) and generates on-demand 1099 forms.
Customer support options: 4.5 out of 5 stars
Ally Invest has strong customer support, offering access 24/7 via phone, email and chat.
Is Ally Invest right for you?
Ally Invest has competitive pricing, helpful trading tools and an easy-to-use trading platform. With no account minimum it's easy for beginners to get started, while active investors will appreciate Ally's commission-free trades on eligible U.S. securities and low options contract fee. Advanced investors looking to trade futures or cryptocurrency, however, may find a better home at another broker.
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We collect data directly from providers through detailed questionnaires, and conduct first-hand testing and observation through provider demonstrations. The questionnaire answers, combined with demonstrations, interviews of personnel at the providers and our specialists’ hands-on research, fuel our proprietary assessment process that scores each provider’s performance across more than 20 factors. The final output produces star ratings from poor (one star) to excellent (five stars).
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Disclosure: The author held no positions in the aforementioned securities at the original time of publication.
