Ally Invest Review – Trade for Only $4.95!

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Ally Invest  (formerly known as TradeKing) is a good low-cost discount broker that has been in business over a decade. This Ally Invest review will help you determine if they’re worth looking at to manage your investments. There are many things to consider when you invest in the stock market – especially when it comes to the fees you pay.

If price is high on your list Ally Invest, is worth a serious consideration. This Ally Invest review will go below the surface of the low-cost to see what they have to offer you as an investor. I dealt with Ally Invest extensively during my days in the online brokerage industry and was always impressed with their service as well as their platform.

If you’ve not heard of Ally Invest, they have risen in popularity after their acquisition of Zecco in 2012 that brought on a fuller range of investment offerings. Ally Invest is also widely known as having the cheapest commission schedule in the industry at a flat $4.95 per stock trade and $.65 per option contract – both of which are very tough to beat. With that all out of the way let’s get on with the review of Ally Invest.

How Ally Invest Is Different

Ally Invest has been in business for a little over ten years and during that time they’ve managed to make a good name for themselves. Of course, Ally Invest has some things you’d find at any other brokerage though following are some of their unique traits:

  • Ally Invest has killer pricing. At a flat $4.95 per trade and an additional $.65 per option contract they are the market leader in price. Again, this makes them the cheapest brokerage in the space, along with Motif Investing. If you trade more than 30 times per quarter, or have a balance over $100,000, that rate goes to $3.95 per trade and $.50 per option trade.
  • Ally Invest offers forex trading. This feature is available as a result of their merger with Zecco. A number of brokerages offer forex, though certainly not all. There is no commission associated with forex trading at Ally Invest as they’re compensated on the bid/ask spread. If you want to get your feet wet with forex trading, TradeKing offers a free $50,000 virtual forex trading account to get you started.
  • Ally Invest Advisors Program. This is a new feature Ally Invest launched in late 2014 as a way to better help individuals manage their investing needs. The program essentially acts as a robo-advisor that uses portfolios modeled by Ibottson (which is a subsidiary of Morningstar) consisting of low-cost index funds. You can open a TradeKing Advisors account for as little as $500, and this service is free of fees in its first year! This makes Ally Invest able to offer a wider range of investment options, including those who want a managed account.
  • Like Motif Investing, Ally Invest is active on their site with both social media and various forums. I love to see this as it provides a way to get real time support when you need it.
  • Ally Invest offers more than 12,000 mutual funds. If you like to invest in mutual funds, you’ll notice that this puts Ally Invest in the highest tier of what brokerages offer. As a result, you shouldn’t have much of an issue locating the mutual funds you like at TradeKing.

What’s Needed To Open An Ally Invest Account?

This is likely my favorite feature of Ally Invest. TradeKing does not have a minimum account opening balance requirement. Few brokerages offer that, which is a shame in my opinion. If you want to start investing with $1,000 or less, this makes Ally Invest a brokerage you’d want to look at right away.

Fees I’m no fan of investment fees as they eat away at your portfolio. Ally Invest does not have any hidden fees, though they do have an inactivity fee. At first glance, I don’t like it but you need to dig a little deeper to see if it would impact you. If not, you can ignore it as you’ll never be charged the fee. Ally Invest’s inactivity fee is $50 per calendar year if your combined account values are under $2,500 and/or you don’t have a commissionable stock trade in the past 12 months. However, if you meet one of those qualifications it’s not something that applies to you and have nothing to worry about.

Investment Options I would rate the investment options available at Ally Invest as relatively competitive, especially as you compare them against other lower cost brokerages. Ally Invest offers the following investment options beyond the standard stocks, EFTs/mutual funds and options:

  • Forex trading
  • Bonds
  • AutoTrade – which is a feature that allows you to automate trading based on the recommendation of specified investment newsletters

What helps Ally Invest stand out from the pack is the introduction of the Advisors program. This allows Ally Invest to be more than just a low-cost brokerage but a firm that can manage accounts for you. Add that to an intuitive platform and a healthy self-directed offering, and it  puts TradeKing on the higher end for investment offerings.

Ally Invest Review – My Take

I think for many, Ally Invest, is a great brokerage to consider. The pricing at TradeKing is difficult to beat and they have a growing offering of investment options. Ally Invest is also consistently recognized as having the best customer service available among online brokers which, having worked in the industry myself, is saying a lot. I know the inactivity fee can be hard to swallow.

However, if you wouldn’t be impacted by it then it is of no concern as you would not be charged it. If it were something you’d be hit by then I might look elsewhere, but if not don’t let it hold you back from considering them. If you are considering opening an account with Ally Invest, make sure to be on the look out for a promotion.

Their best current promotion allows for $1,000 in free commissions when you deposit $5,000. In order to qualify, make sure to deposit funds within the first 30 days of account opening and use the promo code “FREE1000.”

You can also potentially qualify for up to $150 in transfer fees to be reimbursed in addition to the free commissions. If you’re going to bring them your business, it makes sense to earn a little something back for it. 🙂

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