Ally Invest Review
Ease of Use
Ally Invest is a discount broker that features self-directed trading, robo-advising, and wealth management. This broker offers commission-free stock, options, and ETF trading with no account minimums. It also includes access to a variety of account types including individual, joint, custodial, trust, traditional IRA, Roth IRA, rollover IRA, and more. Learn everything you need to know about this discount broker by reading our complete Ally Invest review.
- No account fees
- Commission-free stocks and ETFs; low-cost per option trades
- Ability to do self-direct or robo-assisted portfolio management on the mobile app
- Focus on low-fee mutual funds and forex trading
- 24/7 phone support
- Registration promotions, including account transfer fee reimbursement and cash bonuses based on deposit total
- Integration with existing Ally Bank services – an all-in-one platform: investing plus banking
- No access to cryptocurrencies
- Trading platform lacks sophistication
- Annoyingly cumbersome registration process
Ally Invest is an award-winning discount broker with core offerings in self-directed trading, robo-advising, and wealth management. As a discount broker, Ally Invest offers commission-free stock, ETF, and options trading along with no account minimums. This is a solid investing service powered by a well-known financial services company with a long history.
Investors will find that Ally Invest operates a robust, fairly intuitive trading platform. More experienced investors can get access to a range of assets: bonds, mutual funds, low priced securities, and forex, among others. Additionally, you can access the Ally Invest platform via web or by mobile app: iOS or Android.
Read this Ally Invest review to learn more about this broker and its offerings.
About Ally Invest
Ally Invest is the investing service arm of Ally Financial (NYSE: ALLY). The parent company Ally Financial was founded in 1919, focusing on vehicle insurance. Today, the company operates as a digital financial services company with banking, loan, investing, and insurance services.
The parent company, Ally Financial, started Ally Invest in 2016 with the purchase of the online broker TradeKing. Ally Invest was built in part to integrate with Ally Bank customers, integrating digital bank savings and online investing, portfolio management, and retirement planning.
Ally Invest only serves the U.S. market. Securities products purchased through the Ally Invest platform are offered through Ally Invest Securities, LLC, which is a member of FINRA and SIPC. Forex purchases through the Ally Invest platform are offered through the forex subsidiary, Ally Invest Forex LLC.
Ally Invest Features
Ally Invest is a discount broker specializing in investment products and retirement planning services. The company offers web-based and mobile app-based trading platforms with low costs and access to plenty of securities. Before we get into the investing and retirement services, we’ll take a look at the registration process.
Unlike most discount brokers, registration is a little cumbersome. If you want to register with Ally Invest, you’ll first have to create an Ally brokerage account. This is an umbrella account for Ally’s banking, loans, and investing services. After this account is created, you can apply for an Ally Invest account. You’ll need to provide a social security number, U.S. street address, and phone number. After that, you will need to answer questions about your employment status, net worth, trading experience, and investment objectives.
Account approval took me about 12 hours, though it could take longer. After approval, you can fund your account. There are no account fees. Funding methods include wire transfer, check payment, brokerage transfer, or moving funds from an Ally Bank account. Account types include the following: individual, joint account, custodial, trust, traditional IRA, Roth IRA, rollover IRA, beneficiary Roth IRA, beneficiary IRA, and a Coverdell.
After you have an Ally Invest account, you can decide which investing approach to take. Ally Invest offers the following three approaches:
- Self-directed trading
- Robo-advisor portfolios
- Wealth management
Self-directed trading is where you get access to most of the discount broker services, such as commission-free trading. There is no minimum account balance and no account fees to get started. Here is what you can access when you do self-directed trading:
- Stocks (long and short)
- ETFs (leveraged, inverse, and long inverse)
- Fixed income
- Mutual funds
- Low-priced securities (including penny stocks)
- Securities income program
The Ally Invest trading platform is solid, and includes a robust set of research options and trading tools. Below are the key features of the platform:
- Order types: market, market on close, limit, stop, and stop-limit
- Platform tools: watchlists, order status, customizable charting, real-time data, basic portfolio analysis
- Platform research: stock screener, ETF screener, mutual funds screener, options screener, fixed income screener, basic market news
Mobile users can trade on the Ally Mobile app. Forex traders will need to download a separate mobile app, Ally Forex.
Ally Invest offers free automated investing through its robo-advisor offering. Robo-advising portfolios use computer algorithms to automatically structure and rebalance your investment portfolio. Portfolios are made up of low-cost ETFs with low costs, usually averaging around 0.15% assets under management.
Below are the key points for the Ally Invest robo portfolios:
- $100 minimum to get started
- Four portfolio types: core, income, tax optimized, and socially responsible portfolio
- Interest earning on your cash account balance
Make sure to look at the fine print when you use the Ally Invest robo-advisor. Your account is required to hold a 30% cash buffer, which is interest-earning and no-fee. If you want a market-focused portfolio with a lower cash buffer, you’ll face a 0.30% assets under management annual advisory fee.
Ally Invest Wealth Management is built for investors who want personalized advice and a dedicated financial advisor. This includes the following services:
- Advisor-constructed and managed portfolio
- One-on-one financial support for a registered fiduciary
- Available to current Ally Bank or Ally Invest customers
Ally Invest Pricing
In this section, we’ll take a look at Ally Invest service minimums and pricing across three services: self-directed trading, robo-advising, and wealth management. Additional fees may apply beyond those listed, so make sure to check Ally Invest’s commissions and fees webpage.
Self-direct trading – Minimum: $0 unless trading forex, then $250
- Stocks and ETFs: $0
- Options trading: $0.50 per contract fee
- Mutual funds: $9.95 commission on no load mutual funds
- Low-priced securities: $4.95 base commission plus one cent per share per order
- Margin rates: based on margin balance, from 8.50% to as low as 4.00%
- Broker assisted trades: $20 per trade
- Bonds and treasuries: $1 per bond
- CDs: $24.95 per
Robo-advisor investing – Minimum: $100
- No advisory fees
- ETF management fees
- Account maintenance fee of 0.30% assets under management for low-cash percentage accounts
Wealth management investing – Minimum: $100,000
- Annual advisory fee from 0.75% to 0.85% based on assets under management
- Some standard fees waived
Some additional important fees include account transfer fees ($50), IRA transfer fees ($25), and IRA closing fees ($25).
Ally Invest Customer Service
Ally Invest goes further than many brokerages by offering 24/7 phone support. The company also maintains a fraud hotline for customers. Customer support can also be reached through in-platform chat functions, or by email or regular mail.
How Does Ally Invest Compare?
Ally Invest is a discount broker with different offerings, targeted at current Ally Bank customers. In order to give you an idea of where Ally Invest stands, I’ve compared it to Robinhood and Fidelity, below:
- Ally Invest vs. Robinhood – Robinhood is a true no-cost broker, offering better fees and margin rates than Ally Invest. Robinhood is focused on accessibility and ease-of-use at the expense of offering many different securities. Ally Invest costs more, but offers more investment options, a fully-featured trading platform, day trading, and wealth management services.
- Ally Invest vs. Fidelity – Fidelity is closer to a full-service broker, which out-competes Ally Invest on many measures: price, fees, order types, and trading platform features. Ally Invest has closed the gap in the past several years, offering better comparable margin rates and lower mutual funds fees and broker-assisted trading fees.
Who is Ally Invest Best For?
Ally Invest is a discount broker that will appeal to two types of investors: those who already bank with Ally and those who want low-cost access to a range of investing options. Some active traders, especially forex traders, may find Ally Invest a good fit.
If you are one of the over 6 million customers of Ally Bank, Ally Invest should be your first stop. Ally Invest services are integrated with your Ally Bank account, making for a one-stop dashboard for your financial planning.
FAQ: Ally Invest
What exactly is a robo-advisor?
A robo-advisor is a computer program that builds and manages your personalized investment portfolio automatically. Think of this as digital financial planning and management without a person.
How does margin trading work?
Margin trading is a risky trading practice where investors borrow money from the broker and then purchase securities. This loan is repaid with interest. Read more on Ally’s website here.
How does Ally Invest make money?
Ally Invest makes money through different fees, depending on the service type. Additionally, Ally Invest makes money in the following four ways: payment for order flow, interest on cash balances, price improvement, and securities lending.
Final Verdict: Ally Invest Review
Ally Invest offers a range of self-directed and managed investing options. The discount broker offerings make this a low-cost service with broad appeal, especially for current Ally Bank customers and some active traders.
Investors who need simplified offerings, like just robo-advising or no-fee stocks, should consider more specialized services. More advanced or experienced investors may prefer spending more upfront to get access to a more sophisticated trading platform. Investors who need more advanced trading tools and research will want to search elsewhere.