Recently I noted in a post that I opened up a new Interactive Brokers account in order to trade options more economically. Here in Canada, we have always lagged our US cousins when it comes to competitive pricing. The volume simply isn’t there for most financial products to be competitive. As a result, we end up paying higher fees for most products and services.
Interactive Brokers (IB) has been on my radar for a while, but when I looked at it years ago, they did not offer tax sheltered accounts such as RRSP and TFSA. That has now changed, as IB offers both types of accounts. However, the minimum amount necessary for opening an account is still the same — a slightly steep US$10,000. If you do not have $10K lying around, but have the funds in other accounts at other brokers, you can transfer them in when opening an account — this is exactly what I did.
Based on some requests from readers, here is the process to open an IB account in Canada while moving funds from another broker (I show how to move from Questrade here, but other brokers will have the same steps).
Note: this process detailed here involves fund transfer from same account types – from a RRSP account at Questrade to RRSP account at IB. If the account types do not match, you may run into problems.
Without futher ado, here are the steps…
Step 1: Sign up to open a account with IB. This is a straightforward process where you can choose a username and password and verify your email address.
Step 2: Now, to complete the application process, you need to fund the account. Go to the ‘Funding’ tab and click ‘Position Transfers’.
Step 3: Select Transfer Method ‘ATON – Canadian Asset Transfer’.
Select Partial or full transfer (I chose Partial as I didn’t want to move all my funds from Questrade).
Select your broker from the Source list.
Step 4: Enter your Questrade (or your own broker’s) account number. Note that you also fill out a couple of other questions whether you hold margin or short position in that account.
Note: It is important to enter your account number accurately. In case of Questrade, the account number is usually 10-digits, but for most intents and purposes, they only display 8 digits as an identifier in the reports. You can go to Questrade’s eStatements or Account Management section and get the full 10-digit account number. If you only use the 8-digit number, your transfer will fail.
Step 5: Now enter the amount to transfer by clicking the Add button and selecting the cash amount. You can also transfer positions in-kind. Note that the amount necessary needs to be atleast US$10,000 — that’s approx $13,200 in Canadian dollars these days based on exchange rate.
That’s about it. Now you sit back and let the transfer take place.
Note that some brokers charge fees to transfer funds out. In case of Questrade, the charge is $25. Unfortunately there is no way around this fee and IB does not cover the charges.
Hope that provides a decent update on how to move funds from your broker to IB Canada. If you have trouble, you can always call IB’s customer service or chat online with their agents who can sort your problems out.