Discover the Online Stock Broker with an Award-Winning History [Ally Invest Review]

 

There are many options for putting your money in the market and growing your investment. If you’re looking for a way to invest your hard-earned cash, consider going with an online platform such as Ally Invest.

Ally Invest stands out from other major online brokers because it offers both self-directed and cash-enhanced managed accounts with low minimum balances. It also offers low-cost stock trading ($4.95). It’s a great option for active traders and offers forex and options trading.

This Ally Invest review will go over everything you need to know about the discount broker.  But, if you’re already sold, click here to try Ally Invest.

Is Ally Invest Safe?

Keep in mind that no company is completely safe. The Great Recession showed that even large companies such as Lehman Brothers and AIG can fail. With that said, Ally Invest is a good option for investors because of low trading costs and different ways to invest.

Since Ally Invest is a broker, it is regulated and monitored by the Securities and Exchange Commission (SEC). The SEC ensures that all firms that offer publicly traded securities follow the rules and laws designed to protect investors and maintain a fair and orderly market.

Ally Invest is also a member of the Securities Investor Protection Corporation (SPIC), which offers protection in case the company fails. It covers claims up to $500,000, not including forex trading. This does not protect you against investment risk, just from Ally itself going out of business and running away with your money.

Is Ally Invest Legit?

While Ally Invest is a relative newcomer to the scene, it has established itself as one of the 10 largest discount brokers in the country. It serves 250,000 customers for a total of $4.7 billion in assets.

The company acquired TradeKing in 2016 and rebranded as Ally Invest, combining the best parts of both companies. Ally Bank, the sister company to Ally Invest, is one of the leading online banks.

Is Ally Invest Good?

If you’re looking for a discount broker to open a retirement or trading account, Ally Invest is a good option. The low pricing structure at $4.95 per trade makes it one of the lowest on the market. It also offers a low mutual fund transaction fee at $9.95 per purchase.

Ally also offers the option to do self-directed investing or go with a cash-enhanced managed portfolio. The user-friendly web-based platform and app allow you to access your account and trade from anywhere.

Is Ally Invest Good for Beginners?

With no minimum balance required to open an account or hidden fees, Ally Invest is a good option to get you started. It offers one of the industry’s lowest trading fees at $4.95, which drops to $3.95 for volume and traders or with a large portfolio balance.

It offers a wide variety of investment products and in-depth research and market analysis tools. One of the best parts about Ally is their commitment to helping you navigate the platform. The customer service line offers access to brokers to answer your investment questions.

Get started with Ally Invest here.

How to Use Ally Invest

If you are ready to get started with Ally Invest, you will need to open a brokerage account. You can either go the self-directed route or a cash-enhanced managed account. If you go with a self-directed account, Ally Invest offers a full range of products to meet your needs.

How to Fund Ally Invest Account

Opening and funding your Ally Invest account is simple. If you want to open a self-directed account, you will need to go to the Self-Directed Trading page and fill out an application by clicking on the “Start Trading” button.

You can select how to fund the account as you fill out the application. There is no minimum deposit required to open an account except for self-directed brokerage margin accounts, which have a $2,000 minimum. You will receive an email once your application is approved.

To open a cash-enhanced managed portfolio account, go to the Managed Portfolios page and click the “Create Your Plan” button. You will be walked through several prompts to help you get a personalized portfolio plan, open an account, and choose your funding option.

There is a $100 minimum to open a cash-enhanced managed portfolio account. Once your application is approved, you will receive an email.

There are four options for funding your account: through an ACH transfer from your bank through a wire transfer, by transferring the funds from another broker or via check.

Learn more about Ally Invest here

How to Make Money with Ally Invest

When you invest in the stock market, there is no guarantee that your investment will go up. Building a diversified portfolio of stocks and bonds can help you manage your risk.

Ally Invest offers a comprehensive suite of tools to help you research potential investments. This includes streaming charts, watch lists, research and market data, probability calculator, profit/loss graphs, and so on.

RelatedThe Best Passive Income Ideas That Actually Work

Ally Bank Investments

Ally gives you a variety of investment options from stocks and Exchange-Traded Funds (ETFs) to options and bonds. It helps you keep costs low while building a diversified, self-directed portfolio that reflects your risk tolerance.

Ally Invest Mutual Funds

Ally Invest offers more than 12,000 mutual funds, some of which may charge a fee. Expect to pay $9.95 per trade to buy and sell no-load mutual funds. They are an easy way to diversify your investment portfolio.

Ally Invest Options Trading

Ally offers low-cost pricing for investors looking to trade options contracts. These are $4.95 + $0.65 per contract with no account minimums. If you qualify for Ally’s select pricing tier, costs go down to $3.95 + $0.50 per contract.

Ally Invest Bonds

Bonds are a good way to diversify a portfolio since they are a loan to a corporation or a government. The fee for buying and selling bonds is $1 with a $10 minimum. U.S. Treasuries are exempt from the fee.

Start investing with Ally Invest here.

Ally Invest Cash-Enhanced Managed Portfolios


Many people don’t have the time or skills necessary to manage their own investment portfolio. It takes time and research to pick the right stocks for their unique situation and keep their portfolio balanced.

The alternative seems to be paying high fees to an account manager and giving up control of your investments. Another assumption is that there are high minimum investment requirements to get started.

Ally Invest Cash-Enhanced Managed Portfolios breaks down the investment barrier for and offers a solution that costs much less than working with a traditional advisor. You don’t have to come up with tens of thousands of dollars to receive guidance with your account.

Many people appreciate the cash-enhanced managed portfolio option, which removes the need to actively monitor and trade investments. Perfect for those of us who are to busy to learn all the ins and outs of investing, and wouldn’t have time to monitor them anyways.

Your personalized portfolio is crafted based on information including your financial needs, risk tolerance, goals and investment horizons.

Ally takes these factors into consideration when building your portfolio recommendations. In addition, you can adjust your risk tolerance, if your financial situation changes.

With your input, Ally builds a cash-enhanced managed portfolio that allocates your investment across a variety of low-cost index funds. The company uses a “rigorous” evaluation process to identify favorable index funds, based on your unique risk tolerance and investment timeline. This portfolio also keeps 30% of your account in cash, earning 1.9%. This cash account is intended to balance risk. 

There is an annual advisory fee of zero percent, and there are no trade fees when securities are bought or sold on your behalf.

The average person may shy away from any managed investments because they assume that it will require them to make a sizable deposit. However, with Ally Invest Cash-Enhanced Managed Portfolios, the minimum investment is only $100.

The small deposit requirement makes this investment option available for people in a wide range of financial situations. You can add funds to your account at any time.

Sign up now for Ally Invest Cash-Enhanced Managed Portfolios.

Ally Invest Mutual Fund Fees

If you’re looking to add more diversity to your portfolio, consider researching mutual funds. Ally Invest lets you choose from more than 12,000 funds, some of which may charge a fee. There is a fee of $9.95 fee per trade to buy and sell no-load mutual funds.

Ally also offers 500 commission-free ETFs from WisdomTree, iShares, and more. The ETFs range from domestic, international and global equities to socially responsible investment options focusing on the environmental, social and governance sectors.

Ally Invest Trade Fees

TradeKing was well known for its low-cost stock trading. Ally has adopted similarly low pricing and offers stock trades for a flat fee of $4.95 plus $0.65 for every options contract.

Low trading fees are one of their selling points for active traders:

For those interested in trading penny stocks valued at less than $2, expect to pay an extra $0.01 per share. The low pricing puts Ally in direct competition with other discount brokerages, coming ahead of many of them.

To qualify for volume pricing, you will need to make 30 trades or more per quarter or have a balance of at least $100,000. The price goes down to $3.95 per trade plus $0.50 for options contracts, which is on the lower end compared to other online brokerages.

While there is no minimum account balance, you will need to purchase at least $100 worth of bonds, securities, etc. to open the account. There are no account or inactivity fees.

Other fees to keep in mind is a $50 full outgoing transfer fee and a fee when you close an IRA, which is also $50.

Ally Bank Fees and Pricing

Ally Invest’s sister company, Ally Bank, offers an added advantage with some of the highest interest rates on savings. It also offers great options for auto financing.

Banking services include interest-earning checking accounts, a no-fee savings account with competitive interest rates, money market accounts and high-yield certificates of deposit.

Since Ally is an online company, there are no local branches for the banking or investing arms. This is unlike other investment brokerages such as Fidelity or Charles Schwab, which have physical locations.

Ally Bank App

Since Ally Bank does not have physical locations, it has invested in its online and mobile platforms. The free app is available for both iOS and Android devices and offers many features you would expect to find–and some you may not.

Use the app to deposit checks, transfer money between your Ally accounts and other banks, pay bills, check balances, view statements and tax forms and find nearby ATMs. Ally has partnered with Zelle®, which makes it easy to pay almost anyone with a U.S. bank account.

In addition, the app gives you access to your investments on the Ally Invest platform. This is one advantage that Ally has over other brokerages since you can consolidate your bank and investment accounts, earn high-interest rates, and see everything in one place.

You can use the app to trade stocks and multi-leg options from the palm of your hand and used the advanced charting tools to analyze your investments. Monitor investments and view up-to-date market quotes, read current market news and check balances and transaction history.

The app features bank-level encryption technology and never stores personal information on your device. You can set up an added layer of security by using your fingerprint or a unique passcode to access your accounts.

The Bottom Line on Ally Invest

When it comes to discount brokerages, Ally Invest has many features that make it stand out from other options. It offers both self-directed investing options and cash-enhanced managed portfolios for those who prefer someone else to do the heavy lifting.

If you’re an active trader, you can’t do better than Ally’s trade fees, which go as low as $3.95. Ally has also gotten on board with other discount brokerages and now offers more than 500 commission-free ETFs.

Since Ally Invest is the sister company to Ally Bank, you can consolidate your accounts between the two while using the same online and mobile platform. Ally Bank offers some of the highest interest rates on online savings and checking accounts, which is a bonus.  Get started today with Ally Invest.

Ally Invest
About Philip Taylor, CPA

Philip Taylor, aka "PT", is a CPA, blogger, podcaster, husband, and father of three. PT is also the founder and CEO of the personal finance industry conference and trade show, FinCon.

He created Part-Time Money® back in 2007 to share his advice on money, hold himself accountable (while paying off over $75k in debt), and to meet others passionate about moving toward financial independence.

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