Consider that the minimum deposit to open with IB is 10k (and you have to maintain > 2k I think) and that you have to pay 10$ per month for data if you generate less than 30$ comish per month.
I realize they are cheaper, still that shouldn't be a problem as I pay hundreds of dollars a week in comm to my thief major bank online broker :S
TOS is more expensive... but i'm playing with small lots (<5 contracts) and small amount of funds, and i'm not active. plus, i'm still learning, and TOS tools are invaluable to me. Helps me understand things a lot more. i just wish I could hold canadian funds, and I wish they did equities on the tsx. I'm a little worried about the TD buyout... we'll see what impact that has on commissions, tools and equities. edit: I actually phoned in a "contingent order" once in TD Waterhouse for a vertical spread... it was a joke. I'm never doing that again. I'm so surprised we're so behind here in canada for options.
Well i'm not an etrade client but does someone knows what impact the BNS buyout had on it? That should give an indication. One thing is for certain, generally less competition is not in client's favor...
lol, aside from a stupid commercial? I'm not sure... AFAIK it didn't change, but I'm most probably wrong. I guess I'm worried that TD will take away tools for inactive and smaller accounts (like me). TD Waterhouse's commissions are atrocious. We have questrade which has cheap stock/options trades, but no one can handle spreads like the American brokers. Also, they have higher margin requirements. I like that TOS only needs you to cover the risk of the spread, whereas the other guys need an arbitrary $5,000 in the account, which blows goats.
I used to be an option broker for a large bank's discount broker and I can tell you that I didn't know half of what I know now (which is still not that much in my opinion). Even then though, there were no client calls that I considered challenging... I guess the level of service we get -that would be major crappy- is an indication of the average canadian investor's knowledge about options.
I totally agree with erol. I use TOS, and you can negotiate your commissions down if you do decent volume. Their order software supports 4 legged spreads with complete flexibility. You can do named (condors, butterflies, backspreads, etc. ) or you can do custom orders with a mix of expiry, strike and calls or puts. It's also very easy to use, and tells you exactly what will be done. Their analysis software is also superb. One advantage with TOS is that they don't charge for cancelled orders like IB and there are no charges for data so you won't be nickled and dimed to death. I appreciate the cancelled orders feature because I will often do an order for a spread and then slowly up the order until it fills. That way, I can get the best price available. With IB, this would result in one or two cancellation charges. I sincerely hope that TD leaves TOS alone and doesn't mess it up. If they introduce Canadian stocks into the mix and leave the rest alone, I would gladly bring my stocks in from my other (expensive) Canadian broker. I tried trading options with them, but I also found that they had to be educated about options at a fairly basic level. I found it a bit scary when I knew a lot more than my broker did about trading. With TOS, I'm sure that they get it completely!!