Choosing the right brokerage platform is crucial for any investor, but it’s especially important for options traders. Options involve more complexity than stock purchases and require a platform that caters to your specific trading style and experience level. This article explores nine of the best options trading platforms in Canada, highlighting their features, fees, and suitability for different investor types.
Factors to Consider When Choosing a Platform
Before diving into specific platforms, let’s explore some key factors to consider when making your choice:
- Commissions & Fees: Options trading typically incurs fees per contract, along with potential charges for exercise fees, exchange fees, and data subscriptions. Active traders who execute frequent trades should prioritize platforms with competitive fee structures.
- Options-Specific Tools and Resources: Platforms catering to options traders often provide tools like option chains, strategy builders, and volatility analysis. Educational resources like articles, webinars, and videos can also be valuable, especially for beginners.
- Supported Options Strategies: Different platforms allow varying levels of options strategies. Some may restrict beginners to basic calls and puts, while others cater to advanced strategies like spreads and naked puts. Ensure the platform supports your preferred strategies.
- Educational Content: Options trading requires a strong understanding of the market and option mechanics. Platforms offering comprehensive educational resources can significantly benefit new options traders.
Top Options Trading Platforms in Canada
1. Questrade
Ranking: Best options trading platform for beginners and experienced traders in Canada Promotion: Get a $50 trade credit
Questrade is a popular choice for options traders in Canada, offering various account types to suit different experience levels. Beginners can utilize the user-friendly web platform, while advanced traders can leverage Questrade Edge for complex strategies.
Commission fees for options trades start at $9.95 per trade, plus $1 per contract. Active traders can qualify for volume discounts. Questrade also charges a monthly fee for advanced live-streaming market data, with partial or full rebates depending on your trading activity.
Advantages:
- Multiple account types for beginners and experienced traders
- Competitive commission structure with volume discounts
- Advanced platform (Questrade Edge) for complex strategies
Disadvantages:
- Monthly fee for advanced market data (partially rebated)
2. Qtrade Direct Investing
Ranking: Best options brokerage platform for customer support Promotion: Up to $150 cashback bonus when you join
Owned by Aviso Wealth, Qtrade Direct Investing offers a user-friendly platform for options trading alongside other investment products. Investors can trade through the website or mobile app (Android and iOS). Qtrade provides a 30-day trial account for users to explore the platform before committing.
The base fee for options trades is $8.75, plus a $1.25 fee per contract. Active traders can qualify for a discounted rate. Qtrade charges an inactivity fee of $25 per quarter, which can be waived under certain conditions.
Advantages:
- User-friendly platform with a mobile app
- 30-day trial account available
- Competitive commission structure with active trader discounts
- Excellent customer support
Disadvantages:
- An inactivity fee applies unless conditions are met
3. TD Direct Investing
Ranking: Best big-bank options broker
TD Direct Investing, a subsidiary of TD Bank, is a solid option for those seeking a familiar platform from a major financial institution. It offers a variety of investment products, including options, and caters to investors with varying experience levels through three platforms: WebBroker, the TD app, and the Advanced Dashboard.
The standard commission fee for options is $9.99, plus $1.25 per contract. Active traders can qualify for a lower rate. Real-time streaming market data comes with varying fees depending on your trading activity and data package selection. TD Direct Investing charges an inactivity fee of $25 per quarter if your account balance falls below a certain threshold.
Advantages:
- Familiar platform for TD Bank customers
- Multiple platforms to suit different experience levels
- Competitive commission structure with active trader discounts
Disadvantages:
- An inactivity fee applies if the balance falls below a threshold
- Real-time market data incurs additional fees
4. Interactive Brokers Canada (Continued)
Ranking: Best options trading platform for advanced traders
Commission fees for options trades on US and Canadian markets vary based on volume. While generally lower than some competitors, especially for active traders, there are minimum fees per order and additional regulatory and exchange fees to consider. Advanced market data packages also incur extra costs.
Advantages:
- Extensive suite of advanced options trading tools
- Competitive commission structure for high-volume traders
- Multiple platform options, including the powerful Trader Workstation
Disadvantages:
- Not beginner-friendly; a complex platform for new options traders
- Minimum fees per order and additional exchange/regulatory fees
5. Wealthsimple Trade
Ranking: Best options trading platform for beginners in Canada Promotion: Get a $25 bonus when you deposit $150 or more within the first 30 days
Wealthsimple Trade is a great choice for beginners venturing into options trading. It boasts a user-friendly mobile app for commission-free stock and ETF trading, with low fees for options contracts on popular US-listed stocks.
Currently, Wealthsimple Trade only allows basic long call and long put options strategies on a limited selection of contracts. Option contract fees are $2 per contract for users with balances under $100,000 and $0.75 per contract for those exceeding that amount. There are no options for spread strategies or options on dual-listed securities or indices.
Advantages:
- User-friendly mobile app for easy options trading
- Commission-free stock and ETF trading
- Low fees for basic options contracts on popular US stocks
Disadvantages:
- Limited to basic options strategies and specific contracts
- No options for spread strategies or certain securities
6. National Bank Direct Brokerage
Ranking: Cheapest bank-owned options trading platform
Owned by the National Bank of Canada, National Bank Direct Brokerage offers some of the most competitive fees for options trading in Canada. Their platform provides various tools like Trading Central, Market-Q, Options Play, and Decision-Plus, alongside research reports and alerts.
The standard commission for options trades is $0, plus $1.25 per contract, with a minimum fee of $6.25 per transaction. National Bank Direct Brokerage charges an inactivity fee of $100 per year if your asset balance falls below a certain threshold by year-end.
Advantages:
- Low commission fees for options trading
- User-friendly platform with various trading tools
- Competitive options compared to other bank-owned platforms
Disadvantages:
- An inactivity fee applies if the balance falls below a threshold by year-end
7. CIBC Investor’s Edge
Another bank-owned platform, CIBC Investor’s Edge, offers a user-friendly interface for options trading at a lower cost compared to its competitor, TD Direct Investing. Investors can access screening tools, research reports, and advanced charting functionalities.
The commission fee for options is $6.95, plus $1.25 per contract. Active traders can qualify for a discounted rate. CIBC Investor’s Edge charges an inactivity fee of $100 per year if your account balance falls below a certain threshold.
Advantages:
- Lower standard commission fees compared to some bank-owned platforms
- User-friendly platform with research and charting tools
- Active trader discounts are available
Disadvantages:
- An inactivity fee applies if the balance falls below a threshold
- Limited functionalities compared to platforms for advanced traders
8. RBC Direct Investing
Ranking: Excellent for intermediate options traders and investors
RBC Direct Investing is a well-regarded platform for options trading in Canada, particularly suitable for intermediate investors. It offers a variety of investment products, including options, and provides access through a mobile app and desktop interface.
Investors receive free level 1 and level 2 quotes, research reports, and access to Trading Central technical analysis tools. RBC Direct Investing offers a demo account for practicing options trading without risking real capital.
Supported options strategies on RBC Direct Investing are limited to call and put options, along with covered calls and naked puts. However, spread strategies are not allowed. The platform’s commission fees can be high, with regular fees at $9.95 per trade plus $1.25 per contract, and a discounted rate for active traders. They also charge an inactivity fee per quarter.
Advantages:
- User-friendly platform with mobile app access
- Free level 1 & 2 quotes, research reports, and technical analysis tools
- A demo account is available for practicing options trading
Disadvantages:
- Limited to basic and intermediate options strategies
- Relatively high commission fees, especially for non-active traders
- An inactivity fee applies per quarter