Interactive Brokers Canada Lite vs Pro: Key Differences Explained

Introduction

Interactive Brokers LLC.

Interactive Brokers LLC is a financial services company founded in 1978 by Thomas Peterffy in New York.

The company’s current headquarters are in Greenwich, Connecticut, in the U.S.

Known for its competitively lower costs, low margin rates, advanced trading platform, and extensive selection of tradable securities, Interactive Brokers is one of the most popular trading platforms in North America.

In 2011 Interactive Brokers became the largest online broker in the United States as far as daily average revenue trades before being overtaken by Charles Schwab, which currently holds that title.

Interactive Brokers LLC also happens to be one of the largest mutual fund brokers in the United States.

The Company offers its clients access to 135 exchanges across 33 countries worldwide and access to one of the most extensive selections of tradable securities of any trading platform.

These include stocks, exchange-traded funds, fractional shares, forex, cryptocurrencies, mutual funds, options, futures contracts, and precious metals.

When you open an account with Interactive brokers, you are presented with the option of an IBKR lite account or an IBKR Pro account.

In today’s IBKR lite vs pro review, we will look at the features of the two accounts, after which the individual investor can ascertain which account will best suit their investment needs.

Disclaimer

The equity investments are subject to market risks and may not be suitable for all investors. If you have any doubts as to the merits of an investment, you should seek advice from an independent financial advisor. So please invest at your own risk.

 

 

The Differences

IBKR PRO

The IBKR Pro platform is the flagship online brokerage service from Interactive Brokers LLC and has been a popular product amongst active traders.

The IBKR Pro account doesn’t come with commission-free trades for U.S listed stocks and ETFs like the IBKR Lite account.

The IBKR pro account makes up for that with very low trading fees that are very attractive to many investors.

The IBKR pro account comes in two pricing options: Fixed and Tiered.

 

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Fixed Pricing

In the fixed pricing option, IBKR Pro clients pay between $0.005 to as low as $0.0005 per share, depending on the volume of trades they conduct.

This is due to a volume discount offered by Interactive brokers.

Some ETFs also come commission free.

When it comes to options contracts, IBKR Pro clients pay 15 to 65 cents per contract, depending on the commission structure they sign up for.

Tiered Pricing

In the Tiered pricing option, IBKR Pro clients pay between $0.0035 (for trades up to 300,000 a month) to as low as $0.0005 per share (for trades up to 100,000,000 a month).

Extra fees on these plans include exchange and regulatory fees.

Other Features

The IBKR Pro platform comes with a $ 10-a-month subscription cost.

IBKR pro clients have exclusive access to early pre-market trading sessions that start at 4.00 am.

Market data packages for IBKR pro clients are far more comprehensive than for IBKR lite clients, although this depends on the subscription.

Interactive brokers pro clients also get access to special desktop features that Lite customers do not, such as portfolio builder, rebalancing, and basket trader.

IBKR pro clients also get access to an FDC sweep program for cash that’s uninvested.

IBKR pro clients’ free cash balances also come with higher interest rates compared to lite customers, with a current difference of 1%.

The margin rate for IBKR pro clients is 3.83 % maximum for balances up to $100,000. .

IBKR LITE

In 2019, Interactive brokers launched the IBKR lite platform in a successful attempt at capturing more of the casual investor market.

The IBKR lite clients get commission-free trades for U.S listed ETFs and Stocks, unlike IBKR Pro clients.

This made the IBKR lite platform very popular with new investors interested in getting their feet wet in the trading world.

IBKR lite customers also have access to other investment asset classes such as mutual funds, futures, options, and fixed-income securities, but they pay fixed pricing on these trades much similar to IBKR pro clients.

IBKR Lite does not come with a monthly subscription fee.

IBKR lite customers only get access to the cheaper and much simpler market data packages.

IBKR lite is not available to institutional investors such as proprietary trading groups or hedge funds, but it is available to retail investors, including those trading on behalf of clients.

The interest paid on idle cash balances in IBKR lite is 0.5%

The margin rate for IBKR lite clients is 4.83 % maximum for balances up to $100,000.

 

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The Similarities

Both the IBKR Lite and Pro accounts have no minimum deposit required.

Both the IBKR Lite and Pro accounts get access to the Client portal trading platform.

The client portal tends to serve the needs of both pro and lite users as far as basic trading tools, but should they choose to have more tools, the Trader workstation comes into play.

Both the IBKR Lite and Pro accounts have access to the Trader workstation (IBKR’s advanced desktop application), which is considered by advanced traders as one of the best trading platforms available.

It comes with comprehensive trading tools such as watchlists, customizable dashboards, alerts, and real-time monitoring.

The platforms also offer other intuitive tools such as advanced charting, a volatility lab, a mutual find replicator, stock symbol performance monitoring, and heat maps for individual market sectors.

Both the IBKR Lite and Pro accounts also have access to the mobile app, which is an on-the-go version of their trading workstation.

Both the IBKR Lite and Pro offer access to fractional shares of stocks.

Both accounts offer access to cryptocurrency trading at very low fees (0.12 % – 0.18% of trade value)

Verdict

Although the platform is popular, they still have a lot of improvements they can work on, such as:

• Streamlining information on the fees and commissions structures for IBKR pro customers
• Fixing the confusion caused by its website’s dedication to institutional, broker proprietary trading accounts
• Streamlining the mobile app user interface to make it more appealing and engaging to their clients.

 

Learn more at InteractiveBrokers.ca

 

Conclusion

All in all, the IBKR platforms have been and for the foreseeable future will continue to be popular with active traders and with the recently introduced Lite version Casual traders too.