Ally Invest Review 2024: Pros, Cons and How It Compares
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Our Take
4.2
The bottom line:
Pros & Cons
Pros
Commission-free stock, options and ETF trades.
No account minimum.
Integration with Ally Bank, with easy transfers to high-yield savings account.
Low options contract fee.
Cons
No fractional shares.
Limited third-party research providers.
Basic trading platform.
Compare to Similar Brokers
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Fees $0 per online equity trade | Fees $0.005 per share; as low as $0.0005 with volume discounts | Fees $0 |
Account minimum $0 | Account minimum $0 | Account minimum $0 |
Promotion None no promotion available at this time | Promotion Exclusive! U.S. residents who open a new IBKR Pro account will receive a 0.25% rate reduction on margin loans. Terms apply. | Promotion Earn up to $10,000 when you transfer your investment portfolio to Public. |
Learn more on Charles Schwab's website | Learn more on Interactive Brokers' website | Learn more on Public's website |
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Full Review
In this review of Ally Invest
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. Ally also offers thousands of funds with expense ratios under 0.50%.
Advanced features: Ally offers 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. Those savings accounts do offer buckets to help you organize your finances.
Where Ally Invest falls short
Limited educational support: If you want to learn more about investing, other brokers offer better educational resources.
Not for advanced traders: If you're looking for expert analysis, advanced charting and tools, crypto, futures or forex, you won't find them at Ally.
Alternatives to consider:
For better educational resources: Fidelity
For better investment selection: Interactive Brokers
What type of investor should choose Ally Invest?
Beginners: Ally gives you everything you need and nothing that you don't. If having too many options feels stressful, Ally's pared down experience may be better than a full-tilt brokerage with all the bells and whistles.
Options traders: Options traders will have access to competitive pricing and surprisingly advanced tools through Ally.
What the Nerds think 🤓
'It took me a minute to figure out how to place the trade and there weren’t built in educational steps to figure out what stocks or funds I should buy. A few things, like the order types, had built in explanations. You also have to search for a company by its symbol — you can’t search by its name. I do like that Ally allows you to sign in with a passcode so you don’t have to enter your password every time."
Ally Invest at a glance
Account minimum | $0 |
Stock trading costs | $0 (on eligible U.S. securities) |
Options trades | $0.50 per contract |
Account fees (annual, transfer, closing, inactivity) | Annual fee: $0 Inactivity fee: $0 $50 ACAT transfer out (partial and full): $50 |
Interest rate on uninvested cash | 0%, but high-yield rate with Ally savings account. |
Number of no-transaction-fee mutual funds | Over 5,400 |
Tradable securities | Stocks, mutual funds, ETFs, options, bonds |
Trading platform | Two: Web and mobile app |
Mobile app | Available for iOS and Android |
Research and data | Two: Morningstar and TipRanks |
Customer support options (includes how easy it is to find key details on the website) | Call, chat and email Monday to Friday, 7:00 a.m. to 10:00 p.m. Eastern, Saturday, 8:00 a.m. to 8:00 p.m. Eastern. |
How to sign up for an Ally Invest account
Ally says you can sign up for an account in 5 minutes or less — but it took us a little longer than that. To open an account with Ally you'll need your Social Security or tax identification number and a U.S. residential street address. You'll also need to decide if you want to open a standard brokerage account or an IRA.
What to know about Ally Invest's fees
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.
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. There are a few instances in which you might pay a fee on a transaction using Ally. For stocks and ETFs priced under $2, Ally charges a $4.95 base commission plus $0.01 per share.
In addition to not charging a base commission for options trades, Ally Invest's per-contract fee comes in lower than some other brokers at $0.50 per contract. Ally also offers over-the-counter trading.
As for fees, 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.
Ally Invest's trading platforms and apps
Ally Invest’s browser-based platform is basic but effective. It 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.
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.
Ally scores well for its extended trading hours, which run from 8:00 a.m. to 5:00 p.m. Eastern.
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.
How we nerd out testing trading platforms
Our reviewers — who are writers and editors on NerdWallet’s content team — test every online broker platform in our analysis hands-on. That way, we can report on every aspect of the user experience, from funding a new account to placing trades.
We score each broker against criteria that factor in the capabilities offered and the actual user experience of trading with those capabilities. This includes how easy it was to sign up for and fund a new account. Note that a broker may score very highly for the platforms it offers but low for the experience of actually using that platform. Our analysis scores these criteria separately and weighs them evenly when factored into the broker’s overall score. As a result, a broker can offer an advanced trading platform. Still, if it is clunky to use or the process of opening an account is unnecessarily arduous, their score will reflect that.
Ally Invest's investment selection
Ally Invest offers stocks, ETFs, options, bonds and nearly 5,500 no-transaction-fee mutual funds.
Ally has a solid selection of bond products, including corporate, municipal, agency, Treasurys and bond ETFs.
Though there is a strong selection of tradable securities on offer, two fairly common securities are missing from that list: futures and cryptocurrency. And unlike some competitors, Ally doesn't offer access to IPOs. Expert traders can still enjoy advanced trading in options and penny stocks, but for futures, crypto and fractional shares, they’ll have to turn elsewhere.
Other key Ally Invest features
Research and data
Ally only offers access to two third-party research providers: Morningstar 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. Ally Invest has also introduced a new ETF screener that makes it easier for users to find an ETF that meets their investing goals.
Customer support
Ally Invest has good customer support via call, chat and email Monday through Friday, 7:00 a.m. to 10:00 p.m. Eastern and Saturdays 8:00 a.m. to 8:00 p.m. Eastern. Some brokers offer support 24/7, but having Saturday hours is a close second. And as a bonus, the customer support phone number is immediately visible within the app.
IRA account
Ally offers traditional, Roth and rollover IRAs. Some other brokers offer more types of IRAs, like SEP and SIMPLE IRAs.
$0
per trade (on eligible US securities)
$0
None
no promotion available at this time
Banking buckets
Not only does Ally offer a high-yield savings account, but it also offers buckets to help you organize your cash. These buckets make it easy to separate your emergency fund from your vacation fund.
Good to know about Ally Invest
Execution quality
Ally does accept payment for order flow (PFOF). Regulators have proposed potential reforms around PFOF; it involves market-making firms paying brokers to route customer orders through them. Although its effects are negligible for most investors, it's possible PFOF brokers could execute orders slightly slower or at slightly worse prices than non-PFOF brokers.
Ally says its execution quality is approximately 92%, which is on the lower end of brokers that we review.
The average execution quality of all brokers we review was 96.95% as of Oct. 16, 2024. That means 96.95% of orders sold for at a price that was at or better than the National Best Bid and Offer. Executing at or above the NBBO means you may receive a price improvement or a better share price than you were originally quoted.
Low interest rate on uninvested cash
While you won't earn interest by leaving cash in your Ally brokerage account, it's pretty easy to move money into and out of Ally's higher-yield savings accounts.
Is Ally Invest safe?
All investing comes with the risk of loss, but Ally is covered by insurance and is registered with all the appropriate governing bodies.
Is an investment at Ally FDIC insured?
Ally has FDIC insurance to protect cash deposits in checking and savings accounts for up to $250,000. Ally is also covered by SIPC insurance, which protects brokerage accounts up to $500,000. SIPC insurance doesn't apply to investment losses or price fluctuations. Ally is also regulated by the Securities and Exchange Commission to ensure compliance with securities regulations, and by FINRA, which regulates broker-dealers.
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.
