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Thadeus Geodfrey is an experienced and celebrated writer and self-taught trader specialising in cryptocurrencies and forex. Market analysis, identifying fraudulent brokers, and security are his cup of tea. At BrokerRaters Thadeus develops educational materials and user-guides, offer market insights, ensures our content conforms to the best standards. Join Thadeus to succeed in your trading endeavours.
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In recent years, options trading has been growing in popularity in Canada and beyond. In fact, its global volume hit the $10 billion mark in 2022. We see you wondering, ”How can I get a piece of this growing cake?”
Your first step is to pick the best options trading platform Canada. But this homework can be time-consuming and stressful, considering the hungry horde of online scammers and unscrupulous providers.
That’s where we step in. Our team of experienced researchers sliced through the shiny promises on the internet to bring you the top-in-class options trading platforms in the country. We researched over 600 criteria points across crucial factors, including security, fees, customer care, and assets.
List of the Best Options Trading Platforms
- Interactive Brokers – Overall Best Options Trading Platform in Canada
- AvaTrade – Best Options Trading Platform for Canadian Newbies
- Saxo – Best Options Trading Platform for Professional Investors
In This Guide
Canadian Options Trading Platforms: Comparison Table
Our experts understand that a provider can be the genesis of your success or failure. The best platform for options trading Canada meets your financial goals, trading prowess, and other crucial factors. But in a world where everything screams “pick me,” how did we choose the above providers?
We tested most, if not all, options trading platforms in Canada for several months. We then analysed the top 3 that won the tight race. This work gave us the overall best provider and pinpointed the strengths and weaknesses of each platform.
We strive to remain reliable and trustworthy in all our reviews. So, we scoured reputable platforms where real customers left their reviews, such as Trustpilot, App Store, and Google’s Play Store.
Here’s a brief overview of our research:
| Best Options Trading Platform Canada | License & Regulations | Support Service | Software | Payment Method | Demo Account |
|---|---|---|---|---|---|
| Interactive Brokers | IIROC, FCA, SEC, FINRA, ASIC | 24/5 | Trader Workstation (TWS), IBKR Mobile | Bank transfer, Credit/debit cards, Wire transfer | Yes |
| AvaTrade | CIRO, CBI, FMA, FCA, FSCA, CySEC, PFSA, ASIC, FSC, FSA | 24/5 | AvaOptions, AvaTradeGo, WebTrader, MT4, MT5, Automated trading, Mac Trading | Credit/debit cards, Neteller, Skrill, Wire transfer, PerfectMoney | Yes |
| Saxo | CIRO, FCA, ASIC, FSA, MAS, CBI, SFC | 24/5 | SaxoTraderGo, SaxoTraderPRO, SaxoInvestor | Bank transfer, Credit/debit cards, PayPal | Yes |
Platforms Short Overview
Expensive platforms with limited opportunities can quickly dampen your enthusiasm for options trading. Therefore, your homework should include researching a broker’s fees and assets before choosing one.
We assure you our chosen platforms have considerate and clear pricing structures. See for yourself:
Fees
| Best Options Trading Platform Canada | Minimum Deposit Requirement | Commission/Spreads | Deposits/ Withdrawals | Inactivity Fee |
|---|---|---|---|---|
| Interactive Brokers | $0 | From $0.65 per contract | Free | None |
| AvaTrade | $100 | From 0.6 pips | Free | $50 after every three months of inactivity |
| Saxo | $0 | From 0.03% | Free | None |
Assets
| Best Options Trading Platform Canada | Stocks | Forex | Crypto | Commodities | Indices | ETFs | Options |
|---|---|---|---|---|---|---|---|
| IBKR | Yes | Yes | Yes | Yes | Yes | Yes | Yes |
| AvaTrade | Yes | Yes | Yes | Yes | Yes | Yes | Yes |
| Saxo | Yes | Yes | Yes | Yes | Yes | Yes | Yes |
Our Expert Opinion about Options Trading Platforms in CA
Let’s journey through our best options trading platforms Canada. We assure you all our recommended brokers have valid licenses from industry-recognized regulatory authorities. Furthermore, they’ve earned a name in the industry, having served Canadian traders for years without major issues.
While we have done the heavier lifting, remember these are general suggestions. Do your own research to find what best fits your trading and financial needs. Furthermore, check the official websites for any updates regarding fees, assets, and other elements.
1. Interactive Brokers – Overall Best Options Trading Platform in Canada
Interactive Brokers emerged as the overall winner in our diligent treasure hunt. Our experts found it to be the cheapest options trading platform in Canada. But make no mistake–it’s a powerhouse of innovative features and benefits even at lower prices.
Interactive Brokers focuses on putting more money into your account instead of leaking it away. In fact, their low-cost pricing structure is the first outstanding element that stole our heart. And those heartbroken by hidden charges will find a haven on this platform, as it offers a transparent pricing structure.
The commissions on US-listed stocks and ETFs begin as low as $0. Do you desire to trade on margins without facing huge borrowing costs? The margin rates on the IBKR platform can nose-dive up to 49% lower than the market average. And if you prefer to hold cash, enjoy up to $4.83% interest rates on available cash.
The broker is a gateway to 150+ global markets spanning 200+ countries. Thus, you can expand your trading boundaries beyond options on a single platform. Other assets we found on the platform include stocks, bonds, currencies, and futures.
Interactive also provides a cutting-edge platform and tools that live up to its name. The broker tailored its IBKR mobile, web, and desktop platforms to suit beginners, intermediate, and seasoned traders. Our rigorous tests also found it to have an arsenal of real-time trade confirmations, advanced portfolio management, margin specifics, and transaction cost evaluation.
You’ll love how the platform helps you unleash your specific trading strategy. Our research unearthed 90+ order types on this platform, from basic limit orders to advanced algorithmic trading. You can also immerse yourself in its 200+ research and news resources to sharpen your trades.
The platform didn’t leave security to chance. It’s authorized by top-tier regulatory bodies like CIRO to operate in Canada and beyond. And the broker’s $15.2 billion equity capital plus $10.9 billion in excess regulatory capital further cements its trustworthiness. Other layers of trust include the broker’s conservative balance sheet and automated risk controls.
Interactive Brokers
✔$0 minimum deposit requirement
✔No account inactivity fees
Pros & Cons
Fees
Trading Assets
Pros
- 200+ in-depth research resources
- Advanced trading tools
- Robust capital position and security
- Earn interest on idle funds
- Competitive margin rates
- Low commissions
Cons
- Steep learning curve for newbies
- $10 inactivity fee for pro accounts
After conducting thorough research and extensive assesments, we can confidently categorize Interactive Brokers as one of the most affordable service providers out here. As we’ve already mentioned, this company has no minimum deposit requirement. Plus, it allows traders to fund their accounts with payment methods like ACH and wire transfer at no additional cost. We also highly recommend IBKR because, unlike other brokers, it doesn’t require traders to pay inactivity fees for dormant accounts.
Here’s an overview of the Interactive Brokers fees and charges our team unearthed during our evaluation and exploration:
| Type | Fee |
|---|---|
| Account opening and maintenance | $0 |
| Deposit | $0 |
| Withdrawal | Yes |
| Inactivity | $0 |
| Overnight charges | Yes |
| Currency conversion | 0,5% |
2. AvaTrade – Best Options Trading Platform for Canadian Newbies
AvaTrade carried the trophy for being a beginner-friendly platform. In fact, it gives you a dedicated AvaOptions platform so you can focus on options trading without all the fluffs. The resources also come packed with rich educational resources plus robust trading tools.
With AvaOption’s user-friendly interface, you can structure option trade without hassles. Remember to peek into past market behaviour through the interactive historical chart. Also, look into the possible outcomes using this platform’s Confidence Level feature plus Profit/Loss Chart.
The platform understands that newbies need to prioritise risk management. We recommend bar charts that reveal net exposure by currency pair. You can also use portfolio risk summaries to inform and accelerate your decisions.
The self-paced learning resources can turn any novice into a pro within a few months. While its free option education is tailored for beginners, intermediate and seasoned traders also use it. The platform also has a demo account for practising your newly acquired knowledge.
Every beginner desires a clear path to victory. AvaOptions is where you can choose from 13 top options strategies. For example, you can go with Straddles and add a few more tactics like Spreads and Strangles as you advance. The platform’s menu ensures you focus more on executing trades and less on navigating clutters and noise.
Running low on capital but desire to trade options? AvaTrade’s competitive pricing will make your dream come true. You can also view streaming prices for 40+ currency pairs from your screen. We loved how it allowed us to set entry and closing limits with just a few clicks. These features help steer from trade risks and make profits.
Usher in AvaTrafeGo to grab the hottest opportunities in the market, execute a trade, and manage your portfolio on the go. It has all the crucial features found on the desktop version, such as live pricing, real-time streaming trades, and option strategies.
AvaTrade
✔Regulated by FCA
✔The platform supports algorithmic trading
Pros & Cons
Fees
Trading Assets
Pros
- Beginners-friendly interface
- Free demos and educational resources
- Real-time price streaming
- Multi-platform access
- Comprehensive risk management tools
Cons
- High inactivity fees
- Limited asset variety
Our experts investigated the AvaTrade broker’s fees and charges. We first noticed that the platform has a modest minimum deposit requirement of $100. What’s more, its users pay no additional costs while depositing funds or cashing out. That makes AvaTrade an ideal broker for both cost-conscious and newbie traders who want to test their waters with small capital before going all in.
That said, AvaTrade requires dormant account holders to pay $50 after every 3 consecutive months of inactivity. Moreover, if you let your account remain inactive for over successive months of inactivity, the broker will charge you a $100 administration fee. Not to forget, AvaTrade requires traders who hold positions overnight to cover a premium.
Here’s a breakdown of the fees you should expect to encounter while trading with this service provider:
| Fees and Charges | Amount |
|---|---|
| Spreads | From 0.9 pips |
| Administration fee | $100 |
| Inactivity fee | $50 |
| Overnight premium | Yes |
3. Saxo – Best Options Trading Platform for Professional Investors
Saxo is a great companion for advanced options traders in Canada. Our experts okay it as a platform where robust tools meet diverse asset classes and complex strategies.
As a Canadian options trading professional, you desire a platform that will boost your portfolio optimisation and hedge against risks. We found that the broker is a doorway to 20 global exchanges. In addition to options, you can diversify your game into stocks, indices, futures, interest rates, and other assets.
Saxo also provides top-notch tools for your advanced moves. Option Chain helped us dig up real-time information, speed up decisions, and trade directly. Strategy Builder is your tool for crafting flexible multi-legged orders. Want to execute quickly on market shifts? Roll Option won’t fail you when extending your strategy.
The platform didn’t fail us in risk management. It integrated risk data and metrics like vega, theta, and delta at each step. Stay on top of potential market moves and tweak your strategy accordingly.
As a professional, the last thing you want is to waste time dealing with hidden fees. Saxo provides a transparent fee structure so you can plan your finances and move like a pro. With options transaction charges starting from as low as $0.75, you can focus more on profits while keeping expenses in check.
The platform cares for your security and safety, going by its valid licenses from reputable authorities like ASIC and CIRO. And since option selling is a highly risky venture, the default settings only allow option buying. But the story doesn’t end there–you can be a seller, too, if your account hits $5,000+ and acknowledges the underlying risks. Thus, professional traders can enjoy wider flexibility and control.
Saxo also has a proven track record of reliability. Let the numbers speak: It has 1.2+ million clients and handles 260,000+ transactions daily. Thus, we are confident that this platform can’t disappear into thin air or crumble under the weight of large trades.
Pros & Cons
Pros
- Access to 20+ global markets
- Powerful options trading tools
- Competitive pricing
- Trusted platform with a rich history of transactions
- Diverse asset classes
- Integrated risk data
Cons
- High minimum deposit requirement to sell options
- Newbies-unfriendly due to stringent requirements
Options Trading in Canada
Options trading in Canada is legal but heavily regulated. CIRO (formerly IIROC) and CSA are two major regulatory bodies that govern this and other investment markets. A broker operating in Canada must adhere to these authorities’ practices, such as KYC (Know Your Client) and watertight security measures.
Depending on the province, an options trader must be at least 18 or 19. The country prohibits minors from opening or operating a brokerage account independently. Furthermore, a platform may restrict you to basic options strategies until you demonstrate prowess in advanced trading.
CRA views profits from options trading as capital gains. Do you hold the options as investments? The authority will require a capital gains tax on 50% of your profits. But if the profit is a regular or business income, the profits are subject to a full tax rate.
What is Options Trading?
Options trading is a financial practice where you buy or sell options contracts. You get the right, but not the obligation, to trade an underlying asset at a strike price within an agreed period.
How to Choose the Best Options Trading Platform in Canada
Before choosing an options trading platform, ensure you’ve done your research well. Our experts suggest you evaluate multiple criteria across the following crucial considerations:
Trading Fees
Security
Markets and Products
User-ability
Customer Care
Educational & Research Resources
Check out a platform’s fee structure. Is it transparent and fair? Go beyond and research any complaint regarding hidden fees that shot up without notice.
What’s the status of the broker’s licensing and regulations? The last thing you want to deal with is a broker with invalid licenses or one whose regulatory authorities are untraceable or unknown in the industry.
A wide selection of options helps diversify your portfolio and hedge against risks. On the contrary, having fewer assets exposes you to sudden losses if the market shifts unexpectedly against your position.
Ensure the platform offers a hassle-free trading experience. Be sure it comes with preferred or popular trading platforms to help you meet your goals. Also, check if it has excellent analytical and charting tools.
If you experience an issue, a platform’s customer care resources should help you get up and running quickly. So, test a platform’s customer care channels and support agents to ensure you won’t be dealing with an irresponsive and unhelpful team.
Newbies will appreciate a platform generous with in-depth learning resources, including a demo account and market news. These resources also help intermediate and seasoned options traders tweak strategies and keep up with the latest tricks.
Risks to Trade Options for Canadian Traders
Let’s face it–notorious pitfalls will haunt you throughout your trading career at all levels. It’s easy to fall into them, especially if you’re a greenhorn in the industry. But with the right guide and strategies, you can evade them and make a kill at every turn. Here are some of the giants you should watch out for:
- Market risk
Options prices are often volatile. A sudden adverse change in market factors like interest rates can plummet your investment. That’s why you should befriend hedging and other risk management tactics.
- Time decay (Theta risk)
Your option may lose value as the expiration date approaches. If you’re a buyer and the asset doesn’t move quickly in the anticipated direction, you may face a huge loss.
- Emotional risk
Emotions may get in the way of strategic decisions. For example, you might exit a position because of fearing a loss, even if your initial analysis is robust. Other stubborn emotions include greed, impatience, and overconfidence.
Pros & Cons of Trading Options
Just like any business, options trading comes with benefits and drawbacks. Our experts identified the following pros and cons that traders encounter:
Pros:
- Potentially maximise profits through leverage
- Buying options is more affordable than buying the assets outright
- Options like buying puts can help limit potential losses with predefined risk
- Options can be great for hedging, speculation, and income generation
- Can profit from different market conditions, such as sideways, bullish, and bearish
- Selling options like covered calls may earn you premiums
Cons:
- Options trading is a complex venture that requires advanced strategies
- Time decay is a threat to options holders
- No ownership rights
- Low trading volume sparks low liquidity
- Leveraged strategies are risky
Explore our additional article for a deeper dive into Penny Stock Brokers & Apps.
Conclusion
It’s time to board the best trading vehicle to prosperity. But we remind you to shun any provider with a serious red flag. And while trading, stay alert and avoid risks along the way.
Excellent traders also set SMART options trading goals and stick with their solid strategies. Therefore, determine your time-bound profit targets, loss limits, and learning objectives.
Allocate your capital appropriately and incorporate a robust risk management plan. Also, befriend diversification. And here’s a rule of thumb: risk only 1-2% of your total capital per trade.
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