Interactive Brokers Canada Review

As an individual who has been investing for over five years, I am constantly looking for the best options when it comes to investment platforms.

Over the years, the number of options has grown substantially, and long gone are the days when the only choices were to invest through trading platforms of the big six banks.

This increase in competition has driven commissions down but has also made the process of selecting a platform more difficult.

Currently, I am using the Interactive Brokers Canada platform. I believe that their combination of low fees, great research tools, and choice of products gives me the most flexibility in terms of reaching my investing goals.

Fees and Pricing

While originally catering towards high-frequency traders, Interactive Brokers has shifted its strategy to accommodate the needs of retail investors as well.

As this pricing model shows, commissions on trading can reach as low as 35 cents a trade.

This is one of the lowest amongst Canadian brokerage platforms.

The ability to trade both U.S. and Canadian-based securities for equally low fees is unmatched in Canada.

For example, Wealthsimple Trade offers commission-free trading for Canadian stocks but charges a 1.5% currency conversion fee for purchasing U.S. stocks.

Accessing U.S. markets is extremely important for me as it is for many other traders.

In this regard, Interactive Brokers is simply one of the best choices.

Pros

Low commissions on trading, particularly for high-frequency traders as well as those with high account balances.

Lots of options when it comes to the type of investment products (stocks, options, bonds, warrants, futures, forex, etc.)

Accounts can hold most major currencies, allowing for access and exposure to different markets around the world.

Cons

The trading platform is less user-friendly than the competition.

It may take some time for new users to adjust and understand all the features.

With both fixed and tiered trading options that include multiple pricing structures, understanding the fees you are charged on trades may be confusing at first.

Interactive Brokers Platform Features

In my experience, Interactive Brokers is a versatile platform that has dozens of features to meet the needs of a wide range of investors.

Whether for first-time investors or seasoned veterans, I found that Interactive Brokers was a great platform to use.

Here are some of the top features that I felt make Interactive Brokers stand out in a crowded market.

Account Types

One of the biggest upsides to Interactive Brokers is the ability to open a wide range of account types.

While some platforms are limited to only one or two types, Interactive Brokers boasts a diverse range of options, including Tax-Free Savings Account (TSFA), Registered Retirement Savings Plan (RRSP), Spousal RRSP, Margin, and various Trust accounts.

When I started trading, I only used TFSA and RRSP as these were the only two available on other platforms.

Moving over to Interactive Brokers has opened up more choices for me, and keeping these options open will allow me to change my investing strategy as necessary.

While beginner investors may not need such a wide range of options, it is always beneficial to have them available should you need to access them.

Tradeable Securities

Another advantage Interactive Brokers holds over its competition is the ability to trade an extensive variety of securities.

For most traders, the most important feature would be access to U.S. and Canadian markets.

The ability to trade stocks on the major exchanges in these two countries is standard and available on just about every platform in Canada.

Where Interactive Brokers sets itself apart is its ability to gain exposure to international markets.

From Europe to Asia, Interactive Brokers gives users the ability to buy, sell, and hold stocks, ETFs, warrants, and options from companies around the world.

Other notable securities that can be traded include precious metals like gold as well as fixed-income products.

This range of tradeable securities means that those with lower risk tolerances that do not wish to invest in the stock market still have other options within the Interactive Broker platform.

User Experience

One of the most common complaints about Interactive Brokers is the user experience.

Generally, new users may find the platform overly complicated.

Packed full of features, navigating through either the web or mobile application requires time and patience.

There are so many options to sort through, and understanding what each one does can require a great deal of effort.

In the end, the learning curve is well worth it, as the features are all great tools to help investors gain more information and make more informed choices regarding their investment decisions.

Setting up accounts is another area where Interactive Brokers lags behind their competition.

While users can get set up on other platforms with just a few simple clicks, Interactive Brokers generally requires more steps than other platforms.

Initial verification of identity can take a while, and there are many posts online claiming that a commissioner of oaths or guarantor was necessary in order to verify and sign off on your ID.

While this problem did not happen to me, it is something to keep in mind for those who are eager to start trading in order to avoid any unexpected roadblocks

Research Tools / Data Streams

The platform had a decent number of research tools at the disposal of users.

Several tools can be used to scan charts and perform technical analysis.

The platform also has partnerships with major research firms like Morningstar that provide users with stock related news and information.

I found this feature great for conducting research and gaining a better understanding of the companies I was interested in investing in.

For a monthly subscription fee, users can gain access to a variety of market data tools.

Prices for subscriptions to real-time streaming market data vary, and users can pick and choose which markets they would like to receive data for.

These subscription fees can be waived once a certain amount of commission is paid each month.