Virtual Brokers Review: Low Fee Trading for Canadian DIY Investors

One of the biggest draws to DIY investing is the ability to save on fees. Costs such as account administration fees, MERs, and trading fees can take a serious bite out of your investment returns over the long run. The easiest way to invest on your own while reducing your investment costs is with an online discount brokerage. In this Virtual Brokers review, I’ll show you how you can save, and let you know why they’re one of our top-rated online brokers here at MapleMoney. Ready? Let’s dive in!

What Is Virtual Brokers?

Virtual Brokers is a division of CI Investment Services, which offers a range of brokerage and trading services to hedge funds, portfolio managers, and institutional investors. Virtual Brokers was launched in 2009 and is well-known for its low fees, which appeal to investors of all experience levels. In fact, their mission statement is to “provide outstanding trade execution services, whether you are a new investor, experienced trader, or fund manager…”

Virtual Broker Account Types

The Virtual Brokers’ product offering is broad enough to satisfy the vast majority of Canadian self-directed investors. Below is a list of the types of accounts you can hold with Virtual Brokers. With the exception of the RESP, which costs $25/year, there is no charge to open and maintain a Virtual Brokers account:

• Non-Registered trading account for cash, margin, and options trading
• Tax-Free Savings Account (TFSA)
• Registered Retirement Savings Plan (RRSP)
• Spousal RRSP
• Locked-In RRSP (LIRA)
• Registered Retirement Income Fund (RRIF)
• Life Income Fund (LIF)
• Registered Education Savings Plan (RESP)

Virtual Brokers Fees

Virtual Brokers has among the lowest fees amongst Canadian brokerages, in direct competition with names like Questrade and Wealthsimple Trade. They don’t charge trading fees for ETF purchases, and equities can be traded for as low as $.01/share, with a maximum fee of $7.99. This is lower than most, if not all, of the Big Bank brokerages. Mutual fund trades are free, and there are no annual account administration fees. Here’s a breakdown of Virtual Broker (VB) fees:

Virtual Brokers Commission Structure:

• Buy ETF: FREE
• Sell ETF: As low as $.01/share, min. $1.99/trade, max $7.99/trade
• Buy/Sell Equities: As low as $.01/share, min. $1.99/trade, max $7.99/trade
• Options: Buy or Sell, $7.99/Trade + $1.25/contract
• Buy/Sell Mutual Funds: FREE
• Exchange-Traded Debentures: $24.99 + “$1 per each $1,000 par value” per side.

Virtual Brokers Active Trader Rates:

The following rates are available to active traders who have placed over 150 trades during the previous quarter:

• Buy/Sell Equities: $3.99/trade (flat fee)
• Options: $3.99 + $1.25/contract

Virtual Brokers Broker Assisted Rates:

If you place trades with the assistance of a VB broker, the fees will be as follows:

• Buy/Sell Equities: $50 per trade + 3% of principal value to a maximum of $0.03 per share.
• Options: $50 per trade + $2 per contract
• Exchange-Traded Debentures: 1.5% of principal value.

Virtual Brokers Administrative Fees

Aside from trading fees, you should be aware of how much you’re paying just to maintain an account with a discount brokerage. With Virtual Brokers, this is of less concern because many of their administrative fees are waived. I’ve included a list of the most common prices below. For a complete list, check out the Virtual Brokers Administrative Fee Structure:

• No annual fee for the following account types: RRSP, Spousal RRSP, LIRA, RIF, LIF, TFSA

• RESP: $25/year

• Account Transfer-In: FREE

• Account deposits (via bill payment or wire transfer): FREE

• EFT Withdrawal: FREE

• Wire Transfer Withdrawal (domestic, CAD/USD): $50

• Wire Transfer Withdrawal (International, USD): $100

• Partial Transfer-Out: $50/account

• Full Transfer-Out: $150/account

Virtual Brokers Trading Platform

Customers have a few different options when it comes to which Virtual Brokers trading platform to use. For standard trading, there are desktop and mobile trading platforms available to use, free of charge. Active or sophisticated traders can pay $250USD/month for PowerTrader Pro. Let’s take a closer look at what each platform has to offer.

Dashboard

Virtual Brokers Dashboard offers a standard desktop trading experience that’s suitable for most investors. It provides access to several views and functions on the same page so that you can trade quickly. You can buy and sell stocks, options, mutual funds, fixed-income securities, GICs, and more.

Virtual Brokers Mobile App

The VB Mobile App is available for download for iOS and Android devices. It’s perfect for investors who prefer to trade on the go. In addition to placing trades, you can check out your account balances, transaction history and transfer funds to and from your account with the mobile app.

PowerTrader Pro

Active traders who want to unlock the power of advanced market research and trading tools can register for PowerTrader Pro. According to Virtual Brokers, this highly customizable platform was once only available to institutional investors. Users have access to things like in-depth charting, hotkeys, and advanced options trading tools.

At $250USD/month, PowerTrader Pro is very expensive, so you need to make sure it’s worth the cost before signing up. To help you decide, you can request a free trial by emailing Virtual Brokers at [email protected] and providing your name, email address, and phone number.

RealTick EMS

For $400USD, RealTick EMS gives active traders access to real-time analytics and advanced tools for managing global equity, futures, and options markets.

ITS TraderLite

If you need a trading platform that gives you access to all Canadian marketplaces, ITS TraderLite can help. It’s a fully customizable trading platform with access to US market data and US order entries. The price is $580USD.

Virtual Brokers Pros and Cons

For active traders and fee-conscious investors alike, there’s a lot to like about Virtual Brokers. Here’s a complete list of pros and cons.

Pros

• No fee ETFs
• Competitive equity trading fees
• No annual account fees (except RESP)
• Access to advanced trading platforms
• No fee mutual fund trades

Cons

• $25 yearly RESP account fee
• Advanced research tools are pricey
• Lacklustre mobile app

Virtual Brokers vs. Questrade

You may be wondering how Virtual Brokers stacks up against the competition. Here at MapleMoney, our top-rated discount brokerage is Questrade, for their combination of low fees, solid desktop and mobile trading platforms, and excellent customer support.

We consider Virtual Brokers to be a solid runner-up. The pricing is very similar to Questrade (free ETFs, no annual account fees). Virtual Brokers gets the nod over Questrade for active traders due to the wealth of market research tools and advanced trading platforms.

However, the average investor will appreciate Questrade’s standard trading platform, superior mobile app, and supportive customer service.

Final Thoughts on Virtual Brokers

There are several top discount brokerages for the Canadian retail investor to choose from, and Virtual Brokers ranks near the top of the list. If you’re an active trader, I would give them a serious look, while investors of all experience levels will appreciate their low fees. Also, if you hold an existing trading account with a Canadian bank brokerage, I strongly recommend comparing their pricing with Virtual Brokers and Questrade. You’ll be surprised at how much money you can save.