Saturday, September 25, 2010

Virtual Brokers Review: Million Dollar Journey

Virtual Brokers Review: Million Dollar Journey

Posted: 13 Sep 2010 04:30 AM PDT
As part of my philosophy of keeping costs low, I’m a big believer in keeping trading commissions as low as possible.  This is the reason for opening trading accounts with the lowest cost brokerages in Canada – Questrade and Interactive Brokers.  These online stock brokers manage to can keep costs low as they operate in a virtual environment with very little brick and mortar overhead to worry about.
While surfing Canadian Money Forum the other day, I came across a thread mentioning Virtual Brokers (VB), the newest online stock brokerage in Canada.  As I usually keep up with what’s available in the market, the new(ish) company piqued my interest.  I was especially curious to see if they were competitive with other low cost stock brokers.  From first impressions, it seems that this broker is geared towards traders.  More details below:

Types of Accounts

Most Canadian online stock brokers offer all the standard accounts (except Interactive Brokers). While Virtual Brokers offers the standard, they also provide some extras.  They offer:  non-registered, TFSA, RRSP (and USD RRSP) along with an RESP.

Trading Platform(s):

It appears that they offer multiple trading platforms, from the free web based version to the more advanced trading software.  The platforms include:
  • Meridian (free) – their web based platform that is reported to be user friendly with direct to market access.
  • AxisPro (free) – This is the same advanced trading platform that Scotia iTrade uses and is quite popular with traders.
  • Iress and Belzberg – This platform is for qualified traders only, I can only assume that they are for high net worth clients.

Trading Commissions

I found their website to be a little confusing, but from what I understand, traders have a choice as to which commission structure they want.  The two choices are:
  1. $6.49 per trade + ECN fee or
  2. $0.01/share (min $5/ticket) + ECN fee
The ECN fee is $0.04/share/trade if the trade removes liquidity (eg. market order) and can add up quickly.  For option traders,  add approximately $1.25 to the regular commission.  Providing that $6.49/trade is for unlimited shares, this makes Virtual Brokers to be very competitive providing that the trade manages to avoid the ECN fee.  I believe that other brokers that have the $9.99 trades for unlimited shares already include ECN fees (eg. iTrade, TD Waterhouse, RBC, BMO).
For small volume traders (<500 shares per trade), then $5 per ticket + ECN puts it in the same range as Questrade in terms of cost.

Other Fees

The “other fees” usually makes or breaks the broker.  In this case, the low trading fees come at a cost.  That is, real time quotes are not included in the account without paying a monthly fee which is similar to Interactive Brokers.
VB organizes their quotes into 3 packages which cost from $15/mo to $99/mo.  Traders who can get by on level 1 quotes would survive with $15/mo which works out to be $180/yr.  However, I didn’t read anywhere that a data package is ‘required’.  So if you’re dead set on using Virtual Brokers, then you may be able to use their low cost platforms, but get your quotes from another brokerage account.  One problem with this strategy however is for those looking to use the AxisPro trading platform which would be a drag without streaming quotes.
Here are some of the account administration fees:
  • RRSP/TFSA: Free
  • US RRSP: $50 /yr
  • RESP: $25 /yr
  • EFT: Free


As I don’t have an account with Virtual Brokers, I can’t really comment on their platform, but I can compare their prices with other brokers.  At first glance, it seems as though VB’s fees are very competitive for what they offer and is in direct competition with Questrade for the lowest cost RRSP/TFSA brokerage in Canada.
While VB looks tempting, their biggest downside is that they charge for real time quotes which adds up to at least $180 per year while most other brokerages have free quotes.  I don’t think I’ll be switching my RRSP or TFSA from Questrade just yet.
What are your thoughts on this brokerage?
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Normal is Broke

Living With A Chain

How to Get a Job when No One is Hiring

When the jobs are hidden

To get a job, you have to find the openings that no one's advertising, and really impress your potential employer.

By Jia Lynn Yang, writer-reporter

NEW YORK (Fortune) -- David Perry, a longtime headhunter, says you're wasting your time if you're looking for job postings online. And he should know: he's often the guy on the other side helping companies lure new talent. Perry, who's based in Ottawa, says that in the last 22 years he has accomplished 996 searches totaling $172 million in salary. And the bottom line in today's economy, he says, is you have to tap the "hidden job market."

Perry's also the co-author of "Guerrilla Marketing for Job Hunters" and he recently spoke with Fortune.

What's the "hidden job market"?

When companies say, 'We have a hiring freeze,' that doesn't mean they're not hiring. It just means they're not adding headcount. Every year there's 20-25% turn over. So in a 1,000-person company, 200 or 250 people are going to turn over, either through attrition, or someone moves. Those companies are still hiring but they don't want to tell you.

So how do you find these jobs?

What you have to do in a recession is map your skills to employers to where you know they have a problem you can solve. My advice to job hunters is pick 10 to 20 companies, no more, and pick companies you're interested in, and that you think you can add value to. That requires researching companies, and so that list may take you two weeks. If you're trying to crack the hidden job market and you know the job position you want reports to vice president, find that vice president on LinkedIn and look at his profile to see who else he's connected to and go ask them, 'What's this guy like to work for?' Do the research before you even pick up the phone.

How can you get someone's attention?

We can go into billboards, sandwiches - that stuff only works once. It's only for one person who figures it out once, once in a city. If you're looking for fun stuff, we have this thing called the coffee cup caper, 30% of the time it will result in an interview. You send an employer a coffee cup with a little $5 swipe card with a little note that says, I'd like to get together and talk with you over coffee. I'll be calling soon. And you send it by U.S. post two day delivery, and that gets registered. So when they've signed for it, you wait about 20 minutes and then you call them. And then you go, Hi, I know you just got my package.' You're proving you're imaginative and creative.

What something people should avoid during a job interview?

This drives me insane: I've seen people mentally deciding in the interview whether they want the job. That's the last place to decide. You go into an interview, and you sell like your life depends on it. You've got to get the job first. I've seen it thousands of times. There's this point in the interview, where people go 'Hmm, do I really want this? You can see their body change. The employer picks it up and it's gone. If the employer is telling you, 'I love you,' and you're not saying 'I love you too,' it's over with.

How about following up afterwards?

If you really like the opportunity, don't go home and write thank you very much. Go back and write a letter that says, upon further reflection of what we were talking about, here's what I bring to the table, here's how I see myself fitting into the organization, including a 30-60-90 day plan.

How can someone attract a recruiter's attention?

You have to go to ZoomInfo and LinkedIn and create a profile. All corporate recruiters and probably 20% of the headhunters in America have ZoomInfo accounts. When we start a search, companies aren't going to advertise. The headhunter goes to ZoomInfo, types in requirements that we need, like skillset, degree, city, functional title, and up will come anywhere from a hundred to several thousand people who fit that criteria. Then we go to LinkedIn and run the same search. If you're in ZoomInfo with a picture, we're going to call you first. Just reverse engineer what recruiters are doing so you get found.

How can you really impress a potential employer?

It hasn't worked in years just to bring in your resume, except only in the most junior positions. I concentrate on directors to CEOs, and the last interview for us regardless is always a Power Point presentation of what you've learned, pain points, and how you intend to fix that. Everyone talks about being a great leader and great communicator, so prove it. Don't go into an interview and treat it like it's just another business meeting. Your career is your biggest asset now - because it's certainly not your house. To top of page


August 2008 Dave Ramsey on Barack Obama

This was aired in August 2008. So was Dave right???