Ally Invest Review – Is This Broker Worth it For Day Trading?

About Ally Invest

Ally Invest is a recent entrant into the on-line discount brokerage world. Ally Financial purchased TradeKing in 2016, and the broker was born. While it doesn’t offer a lot of advanced technology, Ally Invest does provide some good benefits for day traders and other high-volume accounts. Learn more in our Ally Invest review. 

Ally Invest Pricing

Commissions

Ally Invest charges $4.95 for stock and ETF trades, which similar to other discount brokers like ETRADE and TD Ameritrade. There is a $1 discount for active traders and large accounts. The minimums are thirty trades every three months or $100,000 in assets. The brokerage firm does not offer any ETF’s commission-free.

Options

Derivative contracts at Ally Invest are 65¢ each plus the base charge mentioned above. Active traders and large accounts receive a 15¢ discount. Assignments cost $4.95, while exercises are charged $9.95.

Forex

Ally Invest is one of the few online discount securities brokers to also offer currency trading. A separate account must be opened, a slight nuisance that TD Ameritrade customers don’t have to go through. Ally is compensated through bid-ask spreads, so it doesn’t charge commissions for fx trading. Its most recent spread on EUR/USD was 1.9, and GBP/JPY was at 4.4.

Account Requirements

There are no account fees at Ally Invest. Furthermore, an account can be opened with any deposit or no deposit at all. There are no trading minimums at Ally.

Software Fees

Ally Invest doesn’t have the best trading tools, as we shall see in this Ally Invest review, but the broker-dealer doesn’t charge anything for its software, either.

Trading Platforms

Ally Invest LIVE

Although orders can be submitted through simple web pages at Ally, most traders will probably want to use the broker’s browser-based trading system. Called Ally Invest LIVE, the program is free to use, which is a good thing, because it’s not a very robust platform.

LIVE is divided into tiles, which makes navigation pretty straightforward. Each tile has a specific theme, such as account balance, orders, funds transfer, or quotes. Within the quote tile, a drop-down menu allows for more possibilities, such as charting and option chains.

What I didn’t like about the platform’s option chains was the lack of strategies. Only calls and puts are available. Nevertheless, entering a derivative order was simple by clicking on a bid or ask price and then using the broker’s user-friendly ticket.

I found the trading ticket convenient and comprehensible. Clicking on ‘QuickTrade’ at the top of the platform or selecting ‘Trade’ on the quote tile produces the trade ticket on the right-hand side of the screen.

I enjoyed using LIVE’s charting program when going through the Ally Invest review, although it has somewhat of an elementary feel to it. Large red and green candlesticks show price history, which has a maximum of just five years. Five other chart styles are available. There are several drawing tools and roughly 90 technical indicators.  A chart can be detached and displayed full screen. Personally, I prefer TradingView charts.

It’s worth mentioning that while having very similar commissions to TradeStation, Ally’s software offerings are much weaker.

Forex Platform

A discrete platform is used to trade forex at Ally. It seems strange that Ally would offer a desktop platform for currencies but not one for securities. In any case, I thought the forex platform had many useful features. Dealing boxes make order entry quick and easy. Charting comes with several technical studies and drawing tools. Forex news is shown in a separate window, and a watchlist can be created.

Mobile Trading

The Ally Invest mobile app is the same platform that Ally Bank customers use. After logging in, any financial account can be selected. I felt the charting system on the investment side was underdeveloped. Mutual funds cannot be traded, either, and the platform does not offer any video news. On the positive side, there is a check deposit feature, and the app is easy to use.

Ally’s mobile platform pales in comparison to more sophisticated mobile platforms like TD Ameritrade‘s Thinkorswim mobile app.

Research Tools

Only minimal information is on the Ally website, and even less on the broker’s app. The website hosts short articles on a variety of investment topics, such as margin and order routing. There are a few educational videos. Stock reports are available free of charge from CFRA only. By contrast, Fidelity offers reports from no less than 13 analysts.

Customer Service

A customer service agent can be reached anytime of the day or night, including weekends. These hours are more generous than TradeStation and Robinhood, both of whom offer more limited hours. The Ally website also has an on-line chat feature, which is very useful.

On the flip side, Ally Invest doesn’t have any brick-and-mortar locations, which may be a slight inconvenience for some traders. There is an Ally Invest global phone number for customers who are temporarily outside the U.S. The brokerage house does not offer service in any foreign languages, something that Schwab and Firstrade do offer.

Executions and Routes

Ally Invest does not offer direct-routing for orders. The brokerage firm chooses where to send orders and is compensated for some of these decisions.

Shorting Stocks

Taking short positions on equities is permissible in a margin account at Ally Invest. For stocks above $5, the initial maintenance requirement is 50% of market value plus the proceeds from the sale.

Type of Trader Ally Invest Is Best For

Investors who execute trades with a large number of shares will benefit from Ally’s low commission schedule. Clients who are interested in portfolio management can use Ally’s robo-advisory service. Below are the pros and cons we found in the Ally Invest Review.

Pros…

• Ally’s commission schedule is lower than E*Trade, Fidelity, Schwab, and TD Ameritrade.
• A securities account can be linked to one of Ally’s competitive bank accounts.
• Ally’s transaction fee for mutual funds is only $9.95, and the broker does not charge a short-term redemption fee for any fund.
• Ally’s robo-advisory service requires just $2,500 and charges a low 0.35%.
• Because Ally works as an introducing broker to Wedbush Futures, traders who want to invest in commodities can do so.

…and Cons

• The lack of a desktop platform will be a deal breaker for many active traders.
• The broker’s website is underdeveloped and doesn’t have much material on it.
• Ally does not offer any no-load, no-transaction-fee mutual funds.

Judgment

Ally Invest provides budget trading with minimal technology. Traders who need robust software will have to go elsewhere.