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moneysense.ca, 16/07/06
Cashable GICs from Action Direct
Current issue:
I called Action Direct and asked if they offer any cashable GICs. They do and here is how to find them on their website: Click on the “GICs / Bonds” tab. In the Fixed Income Search box, click on GICs, select type “Annual” and maturity “1 yr” and click the “Find” button. The GICs that have cashable in their name can be cashed after one month.
The last time I checked, the search returned three cashable GICs: RBMC cashable at 3.8%, Royal Bank Cashable at 3.8% and BMO AAT 30D cashable at 3.95%. I hope Action Direct realizes their website sucks when customers have to call them to find basic information like this.
moneysense.ca, 16/07/06
I was wondering if this is really worth it over the Altamira cash performer? Assuming you had $10K – invested it for one year – the difference between the best cashable GIC and the Altamira fund is a whopping 20$.
Especially with RBC Action Direct – its so confusing, the $20 buys you seem peace of mind with the flexibility of Altamira..
Rob: The spread between the GIC and the Altamira fund is not very much. But, the GIC is guaranteed for one year and cashable after one month. If the Bank of Canada cuts interest rates (looks like the Bank is going to hold interest rates steady), the GICs will be preferable.
President’s Choice now has a 4% Savings Plus account (min $1k investment, cashable in 1 day). Why is it better to invest in GICs instead of this?
Wave: PC Account is great for a savings account (I made a post on their new account) but what do you do for the cash portion of your SDRSP? You have two options: either a cashable GIC or the Altamira savings account AIS100.
Maybe this is off topic but why do you even use Action Direct? To be blunt, it really sucks compared to the likes of TD Waterhouse, and the cost is comparable. No disrespect, but I’m wondering what is the motivation for using a sub-par service.
Mike: I have to agree with you that Action Direct sucks compared to TD Waterhouse (I just got a Waterhouse account as my Ameritrade account was converted). Also, TD Waterhouse offers their excellent eFunds. I am actually considering switching from Action Direct.
My Rationale for Action Direct is because I already deal with Royal Bank for my banking. It seems easier to have all your finances (investments, bank accounts) accessible through one -portal.
I’m guessing it may make money transfers between investment and regular accounts easier too.
A lot of this may be psychological – which is too bad, because Action Direct really does suck compared with the competitors.
Rob, indeed this is a good reason to want to use AD. I feel fortunate that I bank fully with TD and take advantage of TDW which is in house.
Rob: After reading your comment, I realised I did not answer Mike’s question at all. My rationale for the brokerage account with Action Direct is the same as you. We have all our accounts (checking, US Dollar checking, Line of Credit etc.) with Royal Bank and it was natural for me to open a brokerage account with them. Once the accounts were opened, sheer inertia keeps us there
I must admit AD has lagged behind BMO investorline and TDW for quite some time, but they have made considerable changes recently that makes the bottom line much more attractive for clients. They dropped commissions early this May, added an active trader pricing that is cheaper than TDW/BMO/McLeod (with the exception of eTrade I Think), introduced Level II quotes and real-time balances. Their research from the street is supposed to be vamped up also this fall.
One more thing in respect to the original thread: RY Cashables can be redeemed prior to the first 30 days (not locked in), the downside is that you must forfeit any interest accrued. BMO’s cashable is usually at a higher rate but locked in for the first 30, and last 15 days prior to maturity. For redemptions, RY allows you to do partials of $100 redemptions, while BMO has a minimum of $10k per redemption.
If I cash out a 30 day cashable with a 1 year term after 45 days, do I still get interest for the 45 days? Or is that forfeited.
Thanks.
where can I find a list of the companies offering 30 day Cashable GICS and their rates
Some that use RBC Direct, TD Waterhouse, Scotiabank and other ridiculous services which charge outrageous fees for so called “direct investing” may want to consider some discount companies like Questrade ($4.95 trades). For a “discount brokerage” I find the fees with RBC direct and TD Waterhouse absolutely insane.
Also, as soon as you open an account some discount brokerages, you are eligible to earn up to $50 in commission-free trades. In order to get this deal you can let me know if you like.
Please try our services we provide the best rates and focus on service.
regards