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Questrade vs. Virtual Brokers 2021: Which Should You Pick?

Last updated May 7, 2021

Picking the best trading platform in Canada for you isn’t always a clear choice. Each platform offers unique qualities that set it apart from the rest.

Questrade is one of the most well-known trading platforms in Canada. Virtual Brokers has also been making a splash in recent years.

Which one is better for you? I’ve done the research and taken a close look at both of these discount brokers for this head-to-head comparison.

This Questrade vs. Virtual Brokers comparison article will discuss and compare the features, benefits, and fees for both discount brokers to help you make a better decision regarding which firm will work better to help you achieve your investing goals.

Questrade vs. Virtual Brokers 2021– A Quick Overview of the Discount Brokers

This section of my Questrade vs. Virtual Brokers comparison post will give you a quick overview of both Canadian discount brokers.

About Questrade

Questrade is a self-directed trading platform that lets you create your own portfolio at a lower cost than traditional financial institutions. It boasts over $25 billion in Assets Under Management (AUM).

Thanks to its bare-bones trading fee structure, Questrade has earned the reputation for being the fastest growing online brokerage firm in Canada, with more than 200,000 new accounts opened yearly.

Established in 1999, Questrade is a discount broker that has been around for a while. It is known mainly for its online trading platforms that enable Canadians to buy and sell ETFs, stocks, and other securities to build their own portfolios. The platform has won an award for being one of Canada’s “Best Managed Companies” for nine years.

Pros

  • Allows you to buy ETFs for free
  • Requires only $1,000 to begin investing
  • Offers a very affordable fee structure for trading stocks, options, and more
  • Provides investors with comprehensive research tools powered by Morningstar

Cons

  • ECN and FX fees may apply to certain trades
  • Does not boast the best customer service

About Virtual Brokers

Virtual Brokers logo

Virtual Brokers is among the newer discount brokerage firms established in Canada. Launched in 2009, Virtual Brokers is a division of CI Investment Services Inc., which is a subsidiary of CI Financial Corp.

CI Financial Corp. is a leading global asset manager based in Canada. It has total assets of $231.8 billion as of January 31, 2021, making it one of Canada’s largest financial firms.

The discount brokerage is also a member of the Canadian Investor Protection Fund (CIPF) and Lloyd’s of London, which offers $1 million and $11 million in additional protection for customers’ accounts, respectively. Virtual Brokers offers several free and premium trading platforms and boasts a responsive customer support team.

Pros

  • Has free ETF purchases
  • Provides competitive trading fees
  • Offers free mutual fund trading
  • Gives you access to excellent research tools

Cons

  • Charges $15 per quarter for U.S. dollar accounts
  • Is costlier than its peers for advanced traders

Questrade vs. Virtual Brokers – Investing Accounts Available

Questrade and Virtual Brokers allow their clients to open several types of accounts with their platforms based on their clients’ needs and investment objectives.

Accounts Offered by Questrade

  • Tax-Free Savings Account (TFSA)
  • Retirement Savings Plan (RRSP)
  • Margin Account
  • Registered Education Savings Plan (RESP)
  • Spousal RRSP
  • Locked-In Retirement Account
  • Locked-In RRSP
  • Registered Retirement Income Fund (RRIF)
  • Family RESP
  • Business Account
  • Cash Account

Accounts Offered by Virtual Brokers

  • Registered Education Savings Plan (RESP)
  • Locked-In Retirement Account (LIRA)
  • Life Income Fund (LIF)
  • Tax-Free Savings Account (TFSA)
  • Registered Retirement Income Fund (RRIF)
  • Retirement Savings Plan (RRSP)
  • Non-registered Equity account
  • Non-registered Margin account
  • Non-registered Options account
  • Non-registered Short options account

Both online brokerage firms offer their clients numerous account types that they can open using each broker. You can use the different account types to cater to various short- and long-term trading and financial goals.

Questrade and Virtual Brokers offer the most popular registered accounts that Canadian investors are using, along with a few lesser-known account types. Both discount brokers are on the same level in terms of the account types they offer.

Questrade vs. Virtual Brokers – Research Tools

This section of my Questrade vs. Virtual Brokers comparison will discuss the research tools available with both discount brokers and the experience they offer for investors.

Research Tools Offered by Questrade

Questrade offers you three different research tools that you can use based on the information you seek to make investment decisions:

  • Questrade Market Intelligence
  • Questrade Intraday Trader
  • Questrade IPO Centre

Market Intelligence is Questrade’s fundamental market research tool. It is powered by Morningstar, effectively making the third party its primary research partner.

Market Intelligence lets you gain information through analyses on stocks, ETFs, and mutual fund products available through the platform. It also offers quick and accurate stock information and in-depth market analysis to help you make more well-informed investing decisions.

As for Intraday Trader, it is a research tool designed for active traders who need access to more technical information regarding securities. It lets you monitor your target markets and even set up chart patterns that visualize data, enabling you to analyze it based on your preferences.

The tool also allows you to set up a target trade. When the target trade is triggered, Intraday Trader will send you notifications containing charts and a description of what happened.

For its part, investing in Initial Public Offerings (IPOs) and new issues on stock markets is an exciting aspect of becoming a trader. The IPO Centre offers detailed information about the latest and upcoming IPOs and in-depth analyses to help you find new and excellent opportunities.

Research Tools Offered by Virtual Brokers

Virtual Brokers is not a discount firm to disregard when it comes to the research tools it offers. Whether you are a casual trader, day trader, or an institutional investor, the online brokerage offers a wide range of practical research tools that you can capitalize on to make better investing decisions.

Virtual Brokers Research Centre provides you with a list of extensive research tools that include:

  • Technical Analysis
  • Market Watch
  • Bond Research Centre
  • Preferred Share Analysis
  • Warranty Analysis
  • Financial Planning Tools
  • Convertible Debenture Analysis
  • Screeners and Alerts
  • ETF/EFN Research Centre
  • Equity Research Centre
  • Mutual Fund Research Centre

These research tools allow you to get at least basic information regarding all these securities. However, the research section could use some work in terms of its layout and the amount of data it offers. The stock, ETF, and mutual fund screeners available through the platform are also fairly basic, relying on basic screeners from Morningstar.

Its Advanced Portfolio Planner/Comparison feature is also a helpful resource that uses research provided by Morningstar to give you various planning and portfolio tracking features.

Questrade vs. Virtual Brokers – Customer Service

The massive influx of new investors makes it increasingly crucial for trading platforms to boast more robust customer service and ensure a good user experience. This section of my Questrade vs. Virtual Brokers comparison will discuss the customer service experience with both discount brokers.

Questrade Customer Service

Questrade has a good reputation for maintaining an excellent customer service experience for its users. My experience with Questrade has always been top-notch over the years.

Its customer representatives know what they are talking about and are very courteous. They expertly guide you through your problems well. You can reach them through online chat, email, and phone. So, it is no surprise that Questrade won the 2019 DALBAR Seal for Service Excellence.

However, I would like to point out that Questrade’s customer service has been getting a lot of negative feedback in recent months. It is likely due to an overwhelming number of new customers joining the platform and not enough customer service agents to cater to them. My experience tells me that the discount broker will scale and adapt to the issue.

Virtual Brokers Customer Service

Virtual Brokers’ website has been applauded for the intuitive layout that makes it easier for you to navigate to where you need. The platform also offers access to a customer support team that you can reach through phone, email, and live chat on its website.

Unfortunately, customer service for Virtual Brokers has been a consistent pain point for its users. Virtual Brokers is easy to navigate if you understand what you are looking at, but there is not much you can do with a trading platform as a newcomer without adequate customer support.

There are several Reddit discussions regarding Virtual Brokers’ customer service and other flaws that are delayed by—no surprise there—incompetent customer service.

At a time when customer service is becoming increasingly crucial, Virtual Brokers is at a significant disadvantage. While Questrade has recently had its fair share of troubles with customer service, it has a reputation for resolving customer problems without too many delays.

Questrade is the clear winner in terms of customer service.

Questrade vs. Virtual Brokers – What Do They Cost?

Many people prefer to work with independent discount brokers over traditional financial institutions because these platforms offer a lower-cost solution for their investing journeys. Questrade and Virtual Brokers are just some examples. However, you can expect different expenses while using each platform.

Questrade Fees

Questrade is known for its bare-bones fee structure, and that is another significant reason it is my top pick for the best discount broker in Canada. It does not charge any account maintenance fees and minimums. However, Questrade does charge an inactivity fee of $24.95 per quarter.

Fortunately, you can easily waive the inactivity fee if you have $5,000 invested through the broker or make at least one trade quarterly. Purchasing an ETF through the platform is an ideal way to waive the inactivity fee because the online broker does not charge commissions for ETF purchases.

There is also a foreign exchange fee for converting your Canadian dollars into whichever currency necessary to facilitate foreign stock trading.

Besides the account fees, here is a look at the trading fees you can expect to pay with Questrade:

  • Stocks: $.0.01 per share, with a minimum of $4.95 to a maximum of $9.95 per trade
  • ETFs: Free to buy, but you have to pay $0.01 per share per sale, costing a minimum of $4.95 to a maximum of $9.95 per trade
  • Options: $9.95 and $1 per contract
  • Mutual Funds: $9.95 per trade
  • Bonds: Free with at least $5,000 purchase
  • GICs: Free with a minimum of $5,000 purchase
  • International Equities: 1% of the trade value, with a minimum of $195.00 and applicable exchange or stamp fees, charged in the currency of the account in which the trade is placed
  • IPOs and New Issues: Free but requires a minimum $5,000 purchase
  • Product Precious Metals: US$19.95 per trade

Questrade offers very competitive pricing and beats out all its competition with its bare-bones fee structure. It also offers several discounts and promos that you can capitalize on.

New investors can sign up to the discount broker through this promo offer code of $50 in free trades to begin their journey as self-directed investors.

Virtual Brokers Fees

If you are planning to work with Virtual Brokers and its various platforms for self-directed investing, you should know that there are many expenses to contend with while using the discount broker.

Virtual Brokers has had variations with its fee structure over the years. For a long time since it launched, it offered its famous “Penny-a-Trade” fee structure that would let you make as many trades as you would like without paying more than a penny for each trade. This was too good to keep sustainable, however, and Virtual Brokers ended that offer early in 2016.

Opening an account with Virtual Brokers requires a minimum of $1,000 deposit. Active traders with over 150 trades per month or users with account balances over $5,000 can also get access to Virtual Brokers’ commission-free accounts.

Here is a look at the trading fees for various securities through Virtual Brokers:

  • Equities: $0.01 per share, $1.99 minimum, and $7.99 maximum per trade. Virtual Brokers charges a $3.99 flat fee for active traders.
  • Options: $7.99 per trade and $1.25 per contract. The broker charges $3.99 plus $1.25 per contract for active traders.
  • ETFs: Buy for free
  • Exchange-traded debentures: $24.99 plus $1 per $1,000 par value per side
  • Mutual funds: Free
  • Fixed-income securities: Free. Virtual Brokers only trades fixed income on an agency basis.

Besides the trading fees and commissions, Virtual Brokers charges fees for several of its different platforms available to traders for various investment goals. Here is what the platform rental fees look like:

  • Virtual Brokers Dashboard: Free
  • Virtual Brokers Mobile: Free
  • PowerTrader Pro: US$250 per month
  • RealTick: US$400 per month, plus a 20% platform handling fee markup
  • ITS Trader Lite: US$580 per month, plus a 20% platform handling fee markup

The prices for using these trading platforms are high. Unfortunately, the costs of using Virtual Brokers do not end there. You also have to pay fees for the different data feeds on these platforms separately.

For instance, Level 1 consolidated feeds for the TSX and TSXV cost $9.50. On the other hand, TSX and TSXV Levels 2 each cost $40.

Between Virtual Brokers and Questrade, Virtual Brokers offers a competitive structure for trading and commissions. However, all the additional charges of using various platforms and necessary data feeds with variable charges can make the cost of using Virtual Brokers too high.

Questrade vs. Virtual Brokers – The Verdict

After comparing all the features, benefits, and fees, it’s clear why I prefer Questrade over Virtual Brokers. Not only does Questrade offer a much lower solution; it also has better customer service and provides you with an overall better experience as a self-directed investor.

However, I will briefly discuss for whom both discount brokers would be ideal.

Use Questrade if:

  • You are an index investor interested in purchasing a lot of ETFs. It offers a wider number of ETFs that you can purchase for free.
  • You want to cut your costs for investing.
  • You do not need a lot of assistance in maintaining your portfolio.

You can check out my detailed Questrade review to learn more about the discount broker.

Use Virtual Brokers if:

  • You prefer trading mutual funds, although this is something I would not recommend.
  • You don’t mind paying higher fees.
  • You prefer using different specialized platforms.

You can check out my detailed Virtual Brokers review to learn more about the discount broker.

My Questrade vs. Virtual Brokers comparison clearly shows that Questrade is the winner in every respect for self-directed investors. It also offers a robo-advisor product that can help you invest in a professionally managed portfolio that aligns with your investment goals and risk tolerance.

Questrade vs. Virtual Brokers
Christopher Liew, CFA

Christopher Liew, CFA

Author Bio - Christopher Liew is a CFA Charterholder with 11 years of finance experience and the creator of Wealthawesome.com. Read about how he quit his 6-figure salary career to travel the world here.

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