For the second year running, Qtrade has won the top honours in The Globe & Mail ranking of Canadian discount brokers. Fourteen brokers (Questrade and TradeFreedom are new entrants in this year’s survey) were ranked on seven criteria ranging from Fees and Commissions (the lower the better) to Security. The other spots in the top five were taken by E*Trade, TD Waterhouse, BMO InvestorLine and Credential Direct.
I wouldn’t read too much into the rankings as selecting the best broker depends on your individual needs. Even fees and commissions, a seemingly objective criterion, depends on individual circumstances. If you sell and buy significant amount of U.S. equities, the ability to wash trades may trump lower commissions, which would rule out E*Trade and Questrade, the brokers with the highest ranking in the fees and commissions category. I would also discount rankings in subjective categories such as customer satisfaction because the numbers were obtained from replies to questions in an online survey. For example, I have some experience with customer service at Questrade, TD Waterhouse and RBC Direct and I would definitely not rank them in that order.
Do you have an account with Qtrade? I’d love to hear your opinion in the comments.
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17 responses so far ↓
1 simms // Oct 8, 2007 at 10:37 pm
Interesting how Interactive Brokers is not in that article..
2 FourPillars // Oct 8, 2007 at 10:43 pm
I was a bit concerned that some of the brokers don’t have a security guarantee - although I’ve read that some of the ‘guarantees’ aren’t really that solid (ie they will argue that your computer didn’t have proper security etc).
Mike
3 Sam Luu // Oct 8, 2007 at 11:30 pm
How come it’s so difficult to find US exchange spreads. Most of the wanted ETFs, includings the ones suggested on this site are bought of US exchanges.
A 1% exchange spread for a 100K porfolio is huge especially over time over multiple investments. Isn’t it better to stick with CND ETFs even with the slightly higher MER?
4 MillionDollarJourney // Oct 9, 2007 at 7:36 am
I’m also interested in hearing people’s experience with QTrade. I’ve read that Qtrade also provides wash trades.
5 Canadian Capitalist // Oct 9, 2007 at 8:21 am
simms: I’m guessing that only brokers that offer RRSP accounts are included in the survey.
Sam: Most banks charge a 1% spread either way. You’ll have to decide if the initial 1% exchange fee is worth the benefits. In my opinion it is. VEA’s MER is 0.15%, XIN’s is 0.50%. Without any growth, you can make the MER within 3 years. Similarly, VTI is 0.07% and XSP is 0.24% and you get one-stop exposure to all US equities with VTI.
6 FourPillars // Oct 9, 2007 at 8:37 am
Sam - you should check out the discount brokerage comparison at Million $ Journey. He includes conversion rate as well.
http://www.milliondollarjourney.com/review-canadian-discount-brokerages.htm
Obviously there is no guarantee that everything is up to date but you can use it to narrow down your search and then verify the key points yourself.
Mike
7 MillionDollarJourney // Oct 9, 2007 at 9:10 am
Thanks for the plug FP.
8 alvanson // Oct 9, 2007 at 9:45 am
I’m a Qtrade customer (non-registered account only, however). When you open an account with Qtrade, they open both a CAD and a USD cash account and allow you to make trades out of/in to either one. There is no conversion fee except for the initial transfer between CAD and USD cash (and the one back if you decide to transfer funds out of your USD cash account).
As for customer service, Qtrade is one of the rare companies that will answer their 800 number with a live person after the second ring. As well, they are quick to respond to emails sent through their online form (and will even call you back if you leave a phone number). Every dealing I have had with Qtrade has been quite smooth.
9 Novice // Oct 9, 2007 at 12:53 pm
Hi, I’m a 32 year old guy just getting into finding out more about stock trading. I’ve had an RRSP for many years, and recently sold our loft and bought a house, and would like to purchase stocks with some of the left-over funds but am a bit confused about how to get started (from a practical point of view, I am reading all about ratios, etc). CC I realize you’re probably not interested in posting something on this topic, but I’ m hoping one of your readers can give me some pointers - who to use, why, etc. I have questions on how to read fees - ie https://www.qtrade.ca/investor/en/aboutus/services/fees.j
sp#fees - it seems there’s a lot of hidden little fees that can really eat into a small investment fund (leaving money aside for an emergency fund and new home expenditures, I’ll have about $5,000 I can invest). I’m thinking that an index fund is the best way to go, but don’t know how to get started. I’d also like a little bit (say $1,000) to just buy stocks in companies I admire, outside the fund. I’m hoping there’s a reader out there who won’t mind taking a few minutes to help me out - and I bet i’m not the only one reading this great blog by the way CC who sometimes feels out of their depth but keeps reading anyway.
10 Canadian Capitalist // Oct 9, 2007 at 1:35 pm
Novice: Before you do anything, I’d suggest doing some reading. The books on investing in the Recommended Reading page will give you a good grounding to get started. I have a sample portfolio built using TD e-Series index mutual funds that you may want to check out. The bonus with e-Series funds is that apart from the built-in MERs (fees), there are no other fees.
For $1,000, you might want to consider a DRIPs and SPPs offered by blue-chip Canadian companies. Canadian Money Saver magazine usually has a section devoted to DRIPs. Good luck!
11 Phil S // Oct 9, 2007 at 3:57 pm
In a complete twist of irony based upon what the main subject of today’s comments are - my banker just called me up today to chit chat about stuff. I have a personal banker at BMO who I guess is assigned to take care of my accounts. Anyways, she asked whether I would be interested in having a chat with their investment advisor or their financial planner(for free).
After thinking about this subject for a bit, it seems like a bit of bitter irony that maybe a decade ago, when I could have definitely used that service, it wasn’t available to me - especially for “free”. But now that my net worth is getting up there and they assign to me all of this personalized service, I don’t feel as though I really need it anymore. Still, I appreciate all of the effort that BMO is putting forth, but I’m at the point now where I no longer need it - it’s like the old adage, where the big banks only want to loan money to people who don’t need it.
12 Sam Luu // Oct 9, 2007 at 11:05 pm
CC: Thanks for the input. I’m still trying to gauge how much of my investment should be in Canadian securities/ETFs. Since I plan to retire here, I’m thinking I want between 10%-15% in Canadian securities/ETFs.
As for currency risk, is there more risk in the international ETFs? I assume they are all denominated into USD to trade on the AMEX, that’s risk #1. Second is that we have to convert to USD at the current rate, that’s risk #2.
Bottomline though, I guess you need to have your money internationally to get somee growth, but you need to accept the currency risk?
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17 Jamie // Jul 16, 2008 at 6:18 am
I have used Qtrade, E*Northern, Questrade, TD Waterhouse & E*trade Canada. Qtrade is by far my favourite with TD Waterhouse coming in second. With Qtrade I’ve come across no problems with any of my trades (no news is good news!) And when I call to tender a takeover offer or if I have a question, a real ‘Canadian’ person answers quickly after 2 rings!! That’s #1 for me too…
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