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moneysense.ca, 4/11/09
2009 Globe and Mail Discount Broker Rankings
For the fourth year running, Qtrade finished first in the Globe and Mail’s ranking of online discount brokers. Credential Direct, BMO InvestorLine, Scotia iTrade and RBC Direct Investing round out the top five. TD Waterhouse missed a spot in the top five in a photo finish.
I’ve held accounts at TD Waterhouse, RBC Direct Investing, Scotia iTrade and Questrade and would rank them in that order. I wouldn’t read too much into a broker’s rank and would instead pick one that offers the features I’m looking for (or at least a nice fat bonus).
Some interesting tidbits from the Globe and Mail column:
- Qtrade is now offering US dollar RRSP accounts. Either Qtrade has been keeping it quiet or I missed any media coverage on this.
- Discount brokers are doing roaring business. Rob Carrick, who assembled the rankings, notes that account openings, excluding TFSAs are up in the range of 19 to 26 percent.
- Scotia Direct is going to be merged with Scotia iTrade (formerly E*Trade Canada), which is not surprising because CIBC and Scotia are still in the bottom of the heap among discount brokers.
- RBC Direct is the only broker offering lower-fee mutual funds. It is outrageous that discount brokers keep collecting trailers fees, which are supposed to compensate financial advice.
moneysense.ca, 4/11/09
I would include TD e-Series Funds offered by TD Waterhouse Discount Brokerage in the “lower-fee mutual funds” category too.
Interesting that TD missed out on one of the top spots. Hopefully they’ll lower their fees in an attempt to get back into the top 5 next year
[...] link: 2009 Globe and Mail Discount Broker Rankings | Canadian Capitalist Tags: bmo, direct, finished-first, fourth, globe, investor, qtrade, the-fourth, [...]
@Gabe: Fair enough. But it would be nice if TD also offer MER breaks on its money market fund like RBC does. Also to be fair, discount brokers might not be the only ones at fault here. Mutual fund companies are also loathe to cut trailer fees for DIY investors. Just look at what happened to Questrade and Sprott funds.
I asked qtrade about their USD RRSP accounts and they said…
“We will have our US currency RSP accounts available in the near future. It will be posted on our website when they are available to be opened. At that time, you will be required to complete a new account application form to open that account.
You will be able to place US trades in the RSP account without having to convert funds between CAD/USD.
To deposit funds to the USD RSP account you will have to either buy USD within your Qtrade account, or mail a USD cheque/draft to deposit to the USD account.”
@DG: Thanks for checking that out. I was curious why their website made no mention of USD accounts either. Your comment makes it clear why — they are going to offer it soon…
I think in fact Scotia is Merging all of it’s client base. TradeFreedom (remember them?) clients got an email 2 weeks ago that TF was being merged into iTrade.
Off topic note:
I was sick of having two logins to remember for my Qtrade TFSA\RRSP. I talked to them and by simply sending an email request they consolidated both my RRSP and TFSA into a single login. Now I just select which account I want from a drop down once logged in
End off topic note.
I have an account with TD Waterhouse. The only comparison I can make is with my old Ameritrade account that TD took over and converted to TD a few years back. I loved my Ameritrade account. I could do all kinds of things I cannot do with TD – use trailing stop losses (with no cancellation dates), see exactly how each position and portfolio was performing with numerical and percentage ratings, etc. If TD is one of the best, that is a sad comment on the state of discount brokers in Canada.
Why isn’t interactive brokers in the mix? Is it because they don’t offer registered accounts?
Speaking of that, does anyone know if interactive brokers ever intends to offer registered accounts?
@Jon: Good point. The number of discount brokers in the Globe rankings is down to 12 in the past year. The one that disappeared: TradeFreedom, which as you note got merged with iTrade. Looks like the same fate awaits Scotia Direct.
@Jack: I agree with you regarding Ameritrade (I too used to have an account) — they were $9.99 trades when nobody else was and a really good platform.
@Lance: That’s exactly why. IB does not offer registered accounts, which is why it is not included in these rankings.
Very interesting that you would put RBC ahead of questrade. My approach is that I invest to make money. Any fees I pay goes against my primary goal. Questrade so far provides lowest fees, so I’m sticking with that. I’ll admit the rest of the interfaces leave MUCH to be desired (why the hell to do I have to go to a separate site with a separate login to look at the financial history details), but I put up with it. You make a good point though, ultimately it’s what you’re looking for, if you’re contributing small amounts at a time, mutual funds with no purchase fees are the ticket for example. I find RBC’s $29 to purchase stock (for non-high net worth individuals) too excessive.
The Questrade interface is a bit clunky and the technical support is “luck of the draw”, but I’m still surprised they didn’t finish higher in the ranking, since they offer two things that most of the others don’t:
1. USD in RRSP accounts:
http://www.questrade.com/trading/registered_accounts_usd.aspx
2. Rebate mutual fee trailer fees:
http://www.questrade.com/trading/mutual_funds_maximizer.aspx
@Greg: I happen to get $9.99 trades at RBC but even if I didn’t, I’ll go with iTrade instead of Questrade. The reason is that I’ve been burned with Questrade and would like to avoid the hassles of dealing with their customer service. I’ve detailed my experiences with Questrade elsewhere — let’s just say that I’ll be happy to pay to avoid dealing with them
@Erick: I do agree that Questrade is very responsive to customer demands. Though I don’t want to open an account with them, I do wish them success. Big brokers typically react to competitors (however small) nipping at their heels. Without them, we’d still be paying $29 trades and chafing under a oligopoly.
[...] Canadian Capitalist discusses the Globe’s discount broker survey for 2009. [...]
Lots of people have said this, but I find it so unfortunate that Qtrade and Questrade have such similar names. Even in a short discussion like this, I get confused over which one is highly regarded (Qtrade) and which is often despised (Questrade). Maybe Qtrade should adopt the motto “We’re the Good Ones!”
[...] Canadian Capitalist writes about the 2009 Globe and Mail Discount Broker Rankings, which is interesting, given it doesn’t mention my brokers, but I haven’t had any [...]
I’m confused with USD RRSP thing.
if it’s not a wash-trade, that TD Waterhouse has been practicing for years, how did they manage to get around this law:
“All cash inside an RRSP must be in Canadian dollars.
@Igor: There is no law that says all cash inside an RRSP must be in Canadian dollars. It is just that the brokerages are unwilling to offer this as foreign currency transactions are a cash cow. Questrade is the only broker offering some sort of US dollar RRSP and looks like QTrade will also be doing so in the near future.
I see, then this post is somewhat wrong
http://www.investingintelligently.com/2007/11/07/ask-dave-us-dollar-investments-inside-your-rrsp/
@Igor: What do you think is wrong in that post? It does mention that not allowing USD RRSP is not a legal requirement — simply that brokers haven’t bothered to allow it.
My fault. I read it wrong. Missed “nothing” word
I do have question – My funds are mostly in US dollar and I was thinking opening account with US discount brokerage (Charles Schwab). I did a bit research and they do allow Canadian citizens who live in Canada to open an account. Their fees are good as well . It ranges from $7.97 – $12.95 .
I probably can’t buy Canadian stocks trade on TSX.
Any downside to opening this account as far as the legality and etc?
It is outrageous that RBC Direct Investing took away their Equity Research about two weeks ago!!!
[...] 2010 · No Comments QTrade (a reader shares his experience with the broker here), which consistently earns top honours in Globe and Mail’s annual discount broker rankings, is now offering US-dollar self-directed RRSP accounts. These accounts would allow investors [...]
Is there such a thing as a good brokerage firm in Canada?
http://www.elitetrader.com/vB/printthread.php?threadid=150077
I recently opened an account with Virtual Brokers [ http://www.virtualbrokers.com ]
When I tried to return my money back from virtual brokers to my own bank I have problem getting my money back. I filled the form on their website which state that within 2 days the money will be return via EFT – the secretary on the phone confirmed it will be done within 2 days. It was not. Later I talked to Peter Wong, one of their Trading Support people (at that time). I was verbally told the money will be in my account in 10 days. It was not. I contacted a manager BBS Securities Inc. [ Virtual Brokers is a branch of this company ], I was told he will look into this … now I’m in contact with investment industry regulatory organization of canada – 416-943-6910
Is anyone out there had similar problem with Virtual Brokers ? Have you got your money back? What did you do?
I suggest you use ACATS (Automated Customer Account Transfer Service). This can be initiated at your current broker and should be able to transfer all securities and cash from your Virtual Brokers account in a few days. If there is any problem, you can contact your current broker (the recipient of the transfer).
http://www.dtcc.com/products/cs/equities_clearance/acats.php
I’m not too crazy about RBC Direct Investing and I may be leaving them soon. Reasons:
1. They advertise the fact that they offer separate US and Cdn accounts within their registered accounts, however I cannot transfer cash back and forth between the two currencies. As a result I currently have a $5000 US debit in my LIRA that I cannot do anything about except sell the equity I bought.
2. I cannot open my messages which I hope includes answers to questions like the above.
3. Phone support is no help at all. I think their front line reps are mostly in Bangalore, judging the names which appear at the bottom of the transaction statements they send me.
4. Preferential treatment for six figure portfolio holders. My coworker can view spread screens which I could not get if I offered to pay extra for them.
5. Inconsistent trading fees. I’ve paid $9.95, $28.95 and $34.95 for buying or selling the same block of equities over and over.
6. Slow updating of positions online especially the cash balances. I don’t have a problem with how quickly they fill equity orders however especially when you order in blocks of 100. I’ve bought option positions at 3:59 EST before.
[...] Canadian Capitalist reports on the Globe and Mail top brokerage rankings. [...]