IMPACT app review: Choose from 13 socially responsible investing categories

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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


Investment Types


Stocks, ETFs, cryptocurrencies, and mutual funds


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


Investment Types


Stocks, ETFs, cryptocurrencies, and mutual funds

Pros

  • No minimums; commission-free stocks and ETFs
  • Fractional share investing available
  • Investors can choose from among 13 different ESG categories when analyzing their portfolios
  • IMPACT allows you to swap certain assets for others that are more in-line with your values
Cons

  • All mutual funds aren’t commission-free
  • No automated investing (however, this is available through Interactive Advisors)

Overall rating

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 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 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. 



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