Is Ally Invest free?

Ally Invest is in fact a zero-commission broker when it comes to buying and selling US stocks. Zero commission is especially useful if you trade relatively low volumes, like buying stocks for less than $500 per trade, because you won't be hit with any minimum fees the broker might charge.

We should note that the payment-for-order-flow model, which is used by some zero-commission brokers to generate income (rather than relying on commissions), could potentially create a conflict of interest between you and your broker. This could result in trade execution (like routing your orders to specific market makers) that might be unfavorable for you under certain market conditions, especially when using market orders (as opposed to limit orders, which seem to be less affected).

Keep in mind that at some brokers, you could incur non-trading charges like withdrawal or inactivity fees. If you want to trade options, bonds or futures, then a transaction fee may also apply. Also, if you trade on margin, the margin rate charged by brokers can differ wildly. In the next chapter, we'll find out what these charges are at Ally Invest and how they compare with fees charged by its closest competitors.

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Ally Invest fees
Overview of Ally Invest fees and charges

It's safe to say that Ally Invest's fees are low in general. They either don't charge a brokerage fee for things that other brokers do, or they only charge a small amount.

Here's a high-level overview of Ally Invest's fees

Ally Invest Fees snapshot
Assets Fee level Fee terms
US stock fee Low Free stock and ETF trading for stocks priced above $2, otherwise $4.95 per trade + $0.1 per stock
EURUSD fee - Not available
US mutual fund fees Low $9.95 per trade
Inactivity fee Low No inactivity fee

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Ally Invest fees
Ally Invest fees explained

Online brokerages in general charge much lower brokerage fees than traditional brokerages do - this is largely because online brokerages' businesses can be much better scaled: from a purely technical standpoint, it doesn't make that much of a difference for them if they have 100 or 5,000 clients.

This is not to say, however, that they don't charge any fees at all. They make money by charging you various rates for various actions or events. Usually you need to keep an eye on the following three types of fees:

  • Trading fees - these are brokerage fees that you pay when you actually carry out a trade, like buying an Apple share or an ETF. What you pay is either a commission, a spread or a financing rate. Some brokers apply all of these.
    • A commission is either fixed or based on the traded volume.
    • A spread is the difference between the buy price and the sell price.
    • A financing rate or overnight rate is charged when you hold your leveraged positions for more than one day.
  • Non-trading fees. These are usually related to some operations you carry out in your account, such as depositing money, withdrawing money, or not trading for an extended period.

We compare Ally Invest fees with its closest competitors, Merrill Edge and Fidelity.

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Ally Invest fees
Ally Invest trading fees

Ally Invest's trading fees are low, which makes it suitable for you even if you trade often (i.e. several times a week).

Let's break down trading fees according to the different asset classes available at Ally Invest.

Trading fees

Ally Invest's trading fees are low.

Stock fees and ETF fees

Ally Invest has low stock trading fees.

Stock fees of a $2,000 trade
Ally Invest Merrill Edge Fidelity
US stock $0.0 $0.0 $0.0
UK stock - - $11.7
German stock - - $22.8

Fund fees

Ally Invest fund fees are low.

Fees of a $2,000 fund purchase
Ally Invest Merrill Edge Fidelity
Mutual fund $10.0 $20.0 $37.5
EU mutual fund - - -

Bond fees

Ally Invest has low bond fees.

Fees of a $10,000 bond trade
Ally Invest Merrill Edge Fidelity
US Treasury bond $10.0 $0.0 $0.0
EU government bond - - -

Options fees

Ally Invest's options fees are low.

Options fees for 10 contracts
Ally Invest Merrill Edge Fidelity
US stock options $5.0 $6.5 $6.5
US stock index options $5.0 $6.5 $6.5
UK stock index options - - -
German stock index options - - -

Margin rates

Ally Invest margin rates are high.

Ally Invest margin rates
Ally Invest Merrill Edge Fidelity
USD margin rate 7.8% 8.6% 8.3%
EUR margin rate - - -

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Ally Invest fees
Ally Invest non-trading fees

When it comes to non-trading fees, Ally Invest is a rather cheap broker.

Non-trading fees include various brokerage fees and charges at Ally Invest that are not related to buying or selling assets. This can be a withdrawal fee, deposit fee, inactivity fee or account fee.

A high-level overview of how Ally Invest stacks up in terms of non-trading fees
Ally Invest Merrill Edge Fidelity
Withdrawal fee $0 $0 $0
Deposit fee $0 $0 $0
Inactivity fee No No No
Account fee No No No

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Ally Invest fees
Ally Invest deposit fee

Usually, brokers don't charge anything for deposits, and Ally Invest is no different.

Ally Invest deposit methods
Ally Invest Merrill Edge Fidelity
Bank transfer Yes Yes Yes
Credit/debit card No No No
Electronic wallets No No Yes
Deposit fee $0 $0 $0

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Ally Invest fees
Ally Invest withdrawal fee

Ally Invest generally doesn't charge a withdrawal fee.

Ally Invest withdrawal fees and options compared
Ally Invest Merrill Edge Fidelity
Bank transfer Yes Yes Yes
Credit/debit card No No No
Electronic wallets No No Yes
Withdrawal fee for bank transfer $0 $0 $0

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Ally Invest fees
Ally Invest inactivity fee

Ally Invest does not apply an inactivity fee, which is great because your account won't be charged even if you do not trade for an extended period (like several months or years).

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Author of this article

Gergely Korpos

Author of this article

Gergely is the co-founder and CPO of Brokerchooser. His aim is to make personal investing crystal clear for everybody. Gergely has 10 years of experience in the financial markets. He concluded thousands of trades as a commodity trader and equity portfolio manager.

Gergely Korpos

Co-founder, CPO

Gergely is the co-founder and CPO of Brokerchooser. His aim is to make personal investing crystal clear for everybody. Gergely has 10 years of experience in the financial markets. He concluded thousands of trades as a commodity trader and equity portfolio manager.

Everything you find on BrokerChooser is based on reliable data and unbiased information. We combine our 10+ years finance experience with readers feedback. Read more about our methodology

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