Schwab vs Interactive Brokers: both charge $0, and the crossover is 200 shares

Published rates side by side. Schwab is free on equities and IBKR Pro charges half a cent a share, which sounds decisive until you work out what each one does with your order and what it charges to lend you money.

Last verified 20 August 2026 · how we check

Both firms publish their numbers, which makes this comparison unusually settleable. Read from each firm’s own pricing page on 20 August 2026:

Two of the four columns say zero. If commission were the question, the comparison would be over, and that is why it isn’t the question.

What the zero costs at each firm

IBKR states in its routing disclosure that IBKR-LITE orders “are generally routed to select over-the-counter market-makers”, whose agreements “provide Interactive Brokers payment for order flow”, and that a potential effect is

reduced price improvement on executions received by IBKR-LITE clients

IBKR Pro instead routes through SmartRouting, which the same document says scans competing market centres and retains control of the order rather than handing it to another broker. We set the arithmetic out in Interactive Brokers pricing.

Schwab’s zero-commission equity trading sits in the same industry structure. The general mechanism is described in how brokers make money: free execution is paid for somewhere, and usually in the fill.

Where the crossover actually is

IBKR Pro Fixed charges half a cent a share with a $1 minimum, so the per-share cost falls until the minimum stops binding:

• 50 shares cost $1.00, which is two cents a share
• 100 shares cost $1.00, a full cent a share
• 200 shares cost exactly $1.00, and from here on it is a flat half a cent
• 2,000 shares cost $10.00, still half a cent a share

Against a broker charging zero, the question is therefore not “which is cheaper” but whether better routing returns more than half a cent a share. Above 200 shares that comparison does not change with order size, because both sides scale per share.

Below 200 shares the minimum makes Pro relatively expensive, and the case for it weakens fast.

The number that usually decides it

Margin. IBKR advertises borrowing from 4.13%. Schwab publishes a tiered schedule that starts materially higher for retail balances. Anyone carrying a margin balance will pay more in interest over a year than in commission over a decade, and this line is where the two firms genuinely differ rather than converge.

If you never borrow, ignore it. If you do, price it first and treat commission as a rounding error.

What each is actually built for

Schwab is a full-service US broker: branches, phone support, banking, advice, and a platform stack that includes thinkorswim. The $25 broker-assisted charge is the price of a service the other firm does not really offer.

Interactive Brokers is an execution business with global market access, and its complexity is the point rather than a flaw. The account structure, the tiered schedules and the routing choice all assume a user who wants to make those choices.

What we checked, and what we didn’t

All figures come from the two firms’ own published pricing pages and IBKR’s form 3074, read on 20 August 2026. The per-share arithmetic is ours, computed from those rates.

We have not opened accounts, compared fills, measured price improvement, or tested support at either firm. Schwab’s margin schedule is tiered by balance and we have not reproduced it here; check the tier that matches your own balance rather than the headline.

Sources

• Charles Schwab — pricing
• Interactive Brokers — commissions
• Interactive Brokers — Order Routing and Payment for Order Flow Disclosure, form 3074