Invest in companies whose values align with yours.
IMPACT by Interactive Brokers; Rachel Mendelson/Insider
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Bottom line: The IMPACT app is best for existing Interactive Brokers investors who want to tailor their portfolios to companies that value environmental, social, and ethical causes. If you aren’t currently an Interactive Brokers client, you’ll need to set up an IBKR Lite account to use the app.
Overall rating
FeatureInsider rating (out of 5)Fees4.75Investment selection4.50Access4.20Ethics5.00Customer service5.00Overall score4.69
Is IMPACT by Interactive Brokers right for you?
IMPACT by Interactive Brokers is an investment app strictly designed for socially responsible investing, also known as Environmental, Social, and Corporate Governance (ESG) investing.
IMPACT gives you access to 13 different investing categories (including ethical and transparent business practices, racial and gender equality, and much more), and it even offers newcomers a simulated trading account that they can experiment with before opening a real trading account.
The IMPACT app is available on iOS and Android devices.
IMPACT vs. Betterment
IMPACT by Interactive Brokers
Betterment
Min. Investment
$0
Min. Investment
$0 or $100,000, depending on plan
Fees
0% stocks, ETFs, and mutual funds; 3% or $14.95/trade for other mutual funds (whichever is lower); 2%, $1, or 1% for carbon offsets; 12-18% cryptocurrencies
Fees
0.25% (0.40% for premium plan)
Investment choices
Stocks, ETFs, cryptocurrencies, and mutual funds
Investment choices
Stock ETFs and bond ETFs
IMPACTBetterment
IMPACT and Betterment both offer socially responsible investing options. IMPACT, however, is the better choice for ESG-focused, active traders since it offers more investing categories and features to choose from. Though Betterment offers ESG portfolios, it doesn’t focus solely on impact investing.
Although Interactive Brokers also gives clients access to automated investing through Interactive Advisors, Betterment bests IMPACT when it comes to hands-off investing. The robo-advisor handles the entire investment process for you, and it lets you choose from the following socially responsible portfolios: Climate Impact, Social Impact, and Broad Impact.
IMPACT vs. Ellevest
IMPACT by Interactive Brokers
Ellevest
Min. Investment
$0
Min. Investment
$0
Fees
0% stocks, ETFs, and mutual funds; 3% or $14.95/trade for other mutual funds (whichever is lower); 2%, $1, or 1% for carbon offsets; 12-18% cryptocurrencies
Fees
$5 or $9 per month; $54 or $97 annually
Investment choices
Stocks, ETFs, cryptocurrencies, and mutual funds
Investment choices
Stock ETFs and bond ETFs
IMPACTEllevest
IMPACT also outperforms Ellevest in the socially responsible investing space. The investment app lets you trade stocks, ETFs, crypto, mutual funds, and carbon offset projects. Ellevest only offers ETFs.
While you can use IMPACT to focus your portfolio on up to 13 different ESG categories, Ellevest’s Impact portfolio invests up to 53% of your funds in impact and socially responsible funds. It mainly targets companies that: (1) advance women leaders, (2) support loans for community development, and (3) prioritize sustainability and ethical practices.
Ways to invest with IMPACT by Interactive Brokers
You’ll have several options for investing with IMPACT. The investment app offers commission-free stocks and ETFs, and most of its mutual funds are also commission-free (although some cost 3% or $14.95 per trade). You’ll also be able to invest in cryptocurrencies through Paxos Trust Company, and you can add carbon offsets to your portfolio if you choose.
The platform offers a simulating trading account for those who just want to test out the account without taking on any real risk. Setting up an account with IMPACT automatically enrolls US residents in Interactive Brokers’ IBKR Lite account. This means that, in addition to IMPACT’s offerings, you can also take advantage of other investments Interactive Brokers offers outside of IMPACT.
Once you set up your account, you’ll gain access to 13 different ESG categories. You can then have IMPACT analyze your current portfolio’s holdings (according to the categories you selected) and produce an IMPACT score based off how well your portfolio aligns with those categories. It uses a grade range to evaluate how well your portfolio aligns with the values you’ve selected. Additionally, you can use the app to find other investments that you feel better align with your values.
You can also have the IMPACT app filter your portfolio or companies you’re interested in to exclude business practices you oppose (e.g., animal testing, political spending, high water use, hazardous waste, and more). Plus, if you don’t feel that certain stocks in your portfolio meet your values, you can simply swap that stock for another.
IMPACT by Interactive Brokers: Is it trustworthy?
Although IMPACT doesn’t have a Better Business Bureau profile at the moment, the bureau gives Interactive Brokers an A+ rating. The BBB’s ratings range from A+ to F and reflect its opinion of how well businesses interact with clients.
Its ratings also consider other factors such as type of business, time in business, customer complaint history, and licensing and government actions. In fact, in August 2020, Interactive Brokers got a $11.5 million fine from the SEC for failing to file suspicious activity reports for certain trades it executed.
The brokerage has closed 29 complaints in the last 12 months.
IMPACT by Interactive Brokers — Frequently asked questions (FAQ)
What is IMPACT by Interactive Brokers?
IMPACT is an Interactive Brokers-owned investment platform focusing specifically on environmental, social, and corporate governance (ESG) investing. It offers a space where you can invest in the companies that embody the values you believe in.
And when it comes to investment types, IMPACT gives you access to stocks, ETFs, mutual funds, and cryptocurrencies.
What are the benefits of Interactive Brokers?
Interactive Brokers offers a variety of investment products that cater to all types of investors. These include self-directed brokerage accounts, automated investing accounts, IRAs, margin accounts, crypto trading (available through Paxos), and much more.
However, it’s best to figure out what your investing preferences are before opening an account. This determines which accounts — and investment types — you’ll use when working toward your goals.
Is your money safe with Interactive Brokers?
Yes. Interactive Brokers offers Securities Investor Protection Corporation (SIPC) insurance for up to $500,000 (with a $250,000 cash sublimit) on all of its securities accounts.
Related terms
ESG investing: Investors use this approach to buy shares of companies that adhere to impactful environmental, social, and corporate governance standards and business practices. ETFs: These funds contain a diversified blend of stocks, bonds, and commodities. They’re generally less risky than stocks because they function as a basket of different investments, as opposed to just one security.Mutual funds: Just like with ETFs, mutual funds utilize multiple several investment types. However, they’re usually actively managed by professional money managers.Cryptocurrencies: Powered by blockchain technology, these digital assets allow for decentralized transactions between two parties. There are thousands of crypto assets available for exchange.