Interactive Brokers

§02Who uses Interactive Brokers

Retail tracks. IBKR Lite — US only, $0 commission (PFOF). IBKR Pro — Global, SmartRouting (no PFOF), tiered commissions, Full Trader Workstation. Detail in §03.

Institutional — the segment your counterparty belongs to

• Registered Investment Advisors (RIAs) — turnkey custody, advisor portal, flexible billing, no platform / software / reporting fees, no minimums.
• Family Offices — multi-entity, multi-currency consolidation.
• Hedge Funds — execution + prime-brokerage-style services + Hedge Fund Capital Introduction Program.
• Hedge Fund Allocators — for funds-of-funds.
• Money Managers / Proprietary Trading Groups — sub-advisor / multi-strat structures.
• Introducing Brokers (IBs) — small broker-dealers using IBKR as the clearing firm.
• Fund Administrators · Compliance Officers · SIMPLE IRA admins — operational accounts.

For a fund manager teaching private investments, the relevant account is usually:

• RIA account (if registered with SEC / state) — custodies client public-market assets, runs model portfolios, bills clients directly through IBKR.
• Non-Professional Advisor account — exempt advisors with ≤15 clients (US rule).
• Money Manager account — if structured as a sub-advisor.

§03Commercial structure

IBKR Lite vs Pro — January 2026 retail-facing pricing

Advisor / institutional pricing

• "No ticket charges, no custodial fees, no minimums, no technology / software / platform / reporting fees" — the headline RIA pitch.
• Commissions on the same Pro tiered / fixed schedule; advisor passes through or absorbs.
• Flexible client billing: flat fees, percent of AUM, percent of P&L, blended — IBKR handles the calculation and debit.

The line that resonates with fund managers: the platform doesn't tax you for being on it; you pay execution costs only.

§04The "protocol" — IBKR's platform surface

Key talking point. When someone says "I'll build on IBKR," they could mean (a) custody only, (b) custody + TWS API for automation, (c) custody + white-branded Client Portal for a turnkey advisor experience, or (d) custody + FIX for institutional flow. These are very different builds.

§05Private investments — read carefully

So how do fund managers teaching private investments use IBKR?

Common pattern: a three-tier sleeve architecture with reporting consolidated on top.

• Public-markets sleeve at IBKR. Client's "liquid" portion — ETFs, bonds, options overlays, cash management — custodied with IBKR under the RIA account.
• Private-investments sleeve at an alt custodian or direct SPV. Educated and sold separately. Reported back via PortfolioAnalyst data import for a consolidated view.
• Education product. IBKR is the practice ground. White-branded Client Portal + paper trading account let the fund manager show clients how public-market mechanics work, while the private-investment thesis is taught alongside.

§06Robo advisors — what to know

The counterparty flagged this as important. Three things to have at fingertips.

a · Interactive Advisors — IBKR's own robo

• Subsidiary of IBKR. URL: interactiveadvisors.com.
• ~60 portfolios. $100 minimum on many.
• 0.10% – 0.75% AUM management fee. Zero trading commissions at the robo layer.
• Tax-loss harvesting standard.
• Themed portfolios (social justice, responsible management, ESG) + ability to follow portfolio managers — a hybrid robo / "social trading" angle that is uncommon.
• Won US News "Best Robo Advisor" 2024 & 2025, Forbes "Best Robo for Hands-on Investors" (Aug 2025), Investopedia awards.
• Upgrade path — client can promote a robo account to a full IBKR self-directed account without moving custody.

b · White-label robo landscape — the industry trend the counterparty is reacting to

Why this matters: the trend is "every advisor will need a digital onboarding + automated rebalancing layer." Three ways to get one:

• Build on IBKR + TWS API directly — cheapest, most engineering.
• IBKR White Branding on top of Client Portal — turnkey, lower control.
• Pick a white-label robo (TradingFront et al.) that itself custodies at IBKR or similar.

c · Robo + private investments — the live question

Most established robos are public-markets only. The frontier is "alts-aware" digital advice — iCapital, CAIS, Yieldstreet, Moonfare have built advisor platforms specifically for accredited / qualified-purchaser private deal flow. None of those custody at IBKR. The counterparty's "IBKR + teach private investments" idea likely needs a companion alt-custody story.

§07For the meeting

Risks · sharp edges to surface gently

• IBKR Lite uses PFOF; IBKR Pro doesn't. If the counterparty is sensitive to execution-quality stories with clients, push them to Pro.
• The TWS API requires Pro + funded account + specific 2FA methods (IB Key, Handy Key, SMS, DSC+). Older 2FA methods (Bingo Card, etc.) won't work.
• IBKR's UI is famously dense. For client education, the simpler IBKR GlobalTrader or Client Portal is what to demo — not full TWS.
• Customer support is reputedly thin compared to Schwab / Fidelity. Important for an advisor practice.
• Iceland-specific: IBKR operates in EU via Interactive Brokers Ireland Limited and Interactive Brokers Central Europe. Icelandic-resident clients typically open under IBIE. Worth checking jurisdictional fit if the counterparty is Iceland-based.

Questions to ask

• "Are you planning to custody all assets at IBKR, or use IBKR for the liquid sleeve only?"
• "When you say private investments — LP interests, private credit, real estate, or alt-strategy public funds (BDCs, interval funds, etc.)? The custodial implications are very different."
• "Is the robo concern about competing with robos, integrating one into your practice, or replacing parts of the advisor workflow?"
• "What's your regulatory wrapper — registered RIA, exempt non-professional advisor, sub-advisor under someone else's RIA?"
• "Do you need white branding, or are you comfortable having clients see IBKR's brand?"