Ally Invest is the investment and trading division of Ally Financial.
With an Ally Invest account, you can make self-directed trades on a self-service trading platform. You can also have your money automatically invested with a managed portfolio.
If you’re wondering whether or not Ally Invest has what it takes to meet your financial needs, you’ve come to the right place.
This post is going to provide a full review of the services available with an Ally Invest account. I’ll also cover the fees that they charge, the pros and cons of being a customer, and more.
What is Ally Invest?
Ally Invest is the company’s latest foray into the world of online investment services.
Ally Invest Securities, LLC — more commonly known as Ally Invest — was launched in 2016 following Ally’s acquisition of TradeKing. At the time, Ally Invest launched a new site and mobile app — both of which have been growing rapidly since their release.
It took Ally about one year to fully integrate and rebrand TradeKing into its Ally Bank platform. Now, let’s take a deeper dive into Ally Invest and see what’s under the hood.
Ally Invest Features
Ally Invest customers can trade stocks, ETFs, bonds, options, mutual funds, and securities for no-to-low fees.
There are three primary account options: Self-Directed Trading, Managed Portfolios, and Forex Trading.
Ally Invest’s Self-Directed Trading account allows you to make commission-free trades on stocks, options, mutual funds, ETFs, and securities. There’s no minimum balance required to open an account, and you can withdraw your funds at any time.
Ally Invest lets you access a full range of stocks, along with commission-free trading on U.S. listed companies. With commission-free trades, you don’t have to pay anything to buy and sell securities. As such, you’ll have more money to invest in the stock market. Additionally, Ally also provides comprehensive research and market analysis tools, making it easy to analyze and research stocks.
That said, a disclaimer: Never put more money in the stock market than you can afford to lose. While you can definitely make money with wise investments, things can go the opposite direction.
Ally Invest is SIPC insured, meaning you could be eligible for reimbursement in the event Ally ever went out of business. However, that insurance doesn’t protect you against fluctuations in market value.
Ally also offers commission-free trading for exchange-traded funds (ETFs), from companies like Vanguard. This is a great way to invest in a variety of companies at once in a way that is diverse and cost-effective. There are all kinds of ETFs, including those that focus on market indexes, those that focus on industry sectors, and those that focus on bonds and commodities, among other things.
In addition to ETFs, Ally Invest offers thousands of mutual funds to explore. Like ETFs, mutual funds are a collection of securities. However, mutual funds are actively managed by finance professionals and, as such, typically cost more than ETFs.
If you’re looking for secure investments through fixed-income securities, Ally has you covered, too. The online financial institution offers a variety of securities — including agency, treasuries, corporate, and CDs among others.
Fixed-income securities help balance your portfolio and provide stability to offset market volatility.
Options enable owners to buy and sell assets at a set price — or strike price — for a period of time. Ally provides $0 commissions for options plus a 50¢ contract fee. There is no account minimum requirement to leverage Ally Invest’s options.
Retirement Plans (IRA and Roth IRA)
Some of the additional features of a Self-Directed Trading account:
- 24/7 access to your funds online, from your mobile phone or tablet
- The ability to trade thousands of stocks and to lead ETFs without paying commissions
- Commission-free options trades, with contracts costing $0.50 (for comparison, Ally’s competitors, such as Schwab and Fidelity, charge $0.65 for options contracts)
- Next-level trading experience on Ally’s HTML 5-powered platform, which lets you easily manage your accounts and make trades from any device
- Margin accounts for more advanced traders
- Advanced trading tools—including streaming charts, watchlists, and options chains—that could be useful for savvy self-traders
Ally Invest’s Managed Portfolio
Ally Invest’s Managed Portfolio is the company’s equivalent of a robo-advisor account. As such, you’ll get automated rebalancing when needed. Ally’s financial strategists research and select the funds your money goes into.
A unique feature of Ally’s Managed Portfolio is that 30% of your funds will always be allocated in cash. This cash portion will earn around the same APR as it otherwise would in Ally’s high-yield savings account (HYSA), which is more than 15x the national average.
However, you won’t be able to withdraw this cash portion of your Managed Portfolio like you would from an HYSA.
The minimum opening balance for a Managed Portfolio account is only $100—which is substantially less than what I have seen in other platforms. For example, Schwab requires $5,000 to use its robo-advising service, while Wealthfront requires $500.
What’s more, there are four different portfolio types you can choose from depending on your investment strategy.
Ally Invest Portfolio Types:
- Income – Ally’s Income portfolio is generally conservative with how and where it invests your money. The main goal of this portfolio is to maximize dividend yields while also protecting your investments from large market shifts.
- Core – Ally’s Core portfolio is diversified across U.S.-based stocks, international assets, and fixed-income investments. You’ll be able to select how aggressive you want your investments to be based on your risk preference.
- Tax Optimized – Ally’s Tax Optimized portfolio seeks to minimize the tax liability of your investments. It might be ideal for those who are investing their taxable income.
- Socially Responsible – Ally’s Socially Responsible portfolio only contains funds and companies that Ally has determined to be ethical. For example, Ally will strive to match your investments with companies that are known for practicing sustainable and environmentally friendly practices.
Ally Forex Trading
Advanced traders can use Ally’s Forex Trading Platform. This account is registered and handled separately from the previously mentioned Self-Trading and Managed Portfolio accounts.
With an Ally Forex Trading account, you’ll be able to trade over 50 currencies pairs in real-time. One cool feature is that you can open a practice account to test your skills without having any real skin in the game.
Unfortunately, if you find out you’re a wunderkind, you won’t get to keep your gains.
Ally Invest Pricing
Ally Invest is one of the lowest-fee brokerage firms on the market today. There are no fees to conduct most trades and no advisory fees on either the Self-Directed and Managed Portfolio accounts. But companies have to make money somehow.
Breakdown of the fees that Ally charges:
- Options trades are free, but contracts cost $0.50
- Trading no-load mutual funds cost $9.95 each
- Low-priced stocks (i.e., stocks under $2 per share) cost $4.95 to trade, plus $0.01 per share
- Bonds trades cost $1
It takes just a few minutes to open up an Ally Invest account. Keep in mind that you’ll actually be opening an Ally Invest Securities brokerage account, which is separate from an Ally Bank account.
If you don’t have an existing Ally Bank account, you’ll have to enter some additional personal information.
If you’re already an Ally Bank customer, you’ll be prompted to log in to your account. Ally can then automatically pull your personal information to expedite the application process.
Next, you’ll have to select the account type you want and enter your additional personal details such as your name, address, and Social Security number. You’ll then be able to link an external bank account (if you don’t bank with Ally, you’ll need to do this).
When the dust settles, you should have your account approved within just a few minutes. It’s that easy!
Like all major financial institutions, Ally takes security very seriously.
Here are just a few of the security features that Ally uses to protect its customers.
- 2-Step Authentication helps prevent unauthorized access to customer accounts.
- Ally’s Online and Mobile Banking Guarantee ensures that you won’t be held liable for any unauthorized transactions that occur on your mobile device or online account. Just be sure to report the fraudulent activity within 60 days.
- Free Webroot Antivirus and Anti-Malware Software are available to all customers on up to three devices.
Ally Invest offers 24/7 phone support to customers at the following number: 1-855-880-2559.
You can also submit support issues via email to [email protected] or communicate through online chat (when logged into your account).
Pros and Cons of Ally Invest
- Reliable Trading Platform: Ally has a browser-based trading platform with a customizable dashboard and access to a full suite of brokerage tools for efficient researching and trading. Some of the tools that Ally offers include a pricing calculator and a strategy scanner.
- Robust Mobile App: Ally is known for offering a high-quality mobile app called Ally Mobile, which is available for both Android and iPhone. The app enables you to buy and sell stocks on the go while accessing quotes, charts, and stock updates.
- Low Fees: Ally Invest is a discount stock broker. Their services are typically less expensive than you will find at leading competitors. In addition to offering commission-free trading, no annual maintenance fees, and low-cost trades, Ally won’t require you to make a minimum investment when opening an account, and you can choose between self-directed and managed funds.
- Customer Support: Subpar customer support should be a dealbreaker when working with a broker. For example, suppose you want to make a trade but you can’t log in and access your information. It’s vital to have customer support on standby to help out. Ally offers access to live customer support via phone, live chat, and email, enabling you to contact a live agent for guidance and troubleshooting.
- Robo-Advisor: Robo-advisors have become a popular tool among investors over the last few years. Ally offers a robo advisory service called a Cash-Enhanced Managed Portfolio. This service will build a risk profile based on your unique financial situation and goals and automatically invest funds on your behalf. In other words, you can invest without having to worry about managing day-to-day transactions. This service also offers automatic rebalancing to keep your account up to date.
- No Branches: One of the biggest downsides to working with Ally Invest is there are no brick-and-mortar branch locations. This makes many investors uncomfortable — especially those who are used to having a personal relationship with a banker. But this isn’t all bad news. The tradeoff is Ally doesn’t have to invest in as much real estate or overhead because of this, which enables them to offer some of the most competitive brokerage rates that you’ll find on the market. It could easily be argued that physical branch locations are overrated and that it’s better to work with a lean bank — especially one that offers a range of customer support options.
- Limited Features: Ally Invest is a great resource for beginner to advanced investors. However, at a certain point, Ally Invest is unable to match competitors like Schwab, Fidelity, and Vanguard. The platform lacks the tools and user experience that you will find on these professional-grade platforms. That said, Ally still offers a great user experience and is a great option for most investors.
Frequently Asked Questions
Still, have questions about Ally Invest? Let’s review some of the most common questions that you might be wondering about.
Is Ally Invest Good for Beginners?
Yes, Ally Invest is a good trading platform for beginners to use. The main reason is that there are no minimum account balance requirements in many cases, and there are very low minimum balance requirements in some.
Ally Invest also charges very low fees, which means more money for you to invest in your portfolio.
Does Ally Offer a Cash Bonus?
Ally Invest does offer a cash bonus, which varies depending on how much money you put into your account when signing up. This can range from a minimum cash bonus of $50 up to a maximum of $3,500.
Is Ally Invest Legit?
Yes. Ally Invest is legit. It’s backed by Ally Financial, which is ranked as the 19th largest bank in the U.S. with over 8,000 employees.
How do I Buy Stock with Ally?
You can easily buy stock with Ally with a Self-Directed trading account. Simply sign up for an account, link your bank account, deposit funds (or transfer funds if you already have an Ally Bank account), and you’ll be ready to purchase stocks in no time.
Is Ally Good for Day Trading?
Yes. Ally Invest is a solid day-trading platform because most trades are commission-free. Account-holders will also have access to some helpful trading and research tools.
How does Ally Invest Compare to Fidelity?
Ally Invest offers lower fees than Fidelity — especially for mutual funds. The company also offers comparable customer service with around-the-clock support.
Fidelity offers a few advantages, such as a nationwide network of branch locations. The company also offers a more advanced trading platform with educational tools to guide investors through their decisions. Additionally, Fidelity has some advanced features that you can’t find with Ally Invest, such as a real-time alert service that works in conjunction with Apple Watch.
Add it all up, and if you’re looking for a low-cost platform, you can’t go wrong with Ally Invest. However, Fidelity is one of the most comprehensive investing providers on the market and beats Ally in several areas. Familiarize yourself with both platforms before you make a decision.
How do you open an Ally Invest account?
You can apply online for an Ally Invest Self-Directed Trading or Managed Portfolio. Simply enter your personal information and follow the prompts, and you’ll be up and running with minimal hassle.
Does Ally Invest Charge Rollover Fees?
Ally Invest does not charge any fees for IRA rollovers.
To do a rollover with Ally Invest for an IRA, open a new account online and select Rollover IRA or Rollover Roth IRA. Then contact your provider and request a transfer through a direct or indirect rollover. The funds will take about two weeks to transfer, according to the company.
Alternatives to Ally Invest
When it comes to online-only investment institutions, some similar alternatives to Ally Invest include:
Larger firms that offer similar services, as well as offer physical branch locations include:
Is Ally Invest Right for Me?
Ally Invest is a solid low-cost online investment platform. If you’re already an Ally Bank customer and looking to get your feet wet in the investment world, it almost seems like a no-brainer to test the waters with Ally Invest.
Ally Invest also is ideal for frequent traders due to a large amount of commission-free trades available. And if you’re looking to park your funds with a robo advisor, the Managed Portfolio might be a good option.
I hope this post has helped you learn whether or not Ally Invest is right for your unique financial needs. Thanks for reading, and best of luck on your investment journey!