Globe and Mail 2012 Canadian Discount Brokerage Rankings Review

Handle with Care

When reading these kinds of rankings, it is important to know what the strengths and limitations are, especially if/when using these rankings as part of a decision to consider one discount brokerage over another.

The Globe and Mail ranking has been taking place annually for 14 years and is done “from the point of view of mainstream investors”.  Because the “mainstream” contains a mixture of different needs and preferences, it is important to understand what your individual needs are to see which category or categories reflect your particular situation.

For most shoppers, price matters but perceived value matters more.  Is research important to you? Are you willing to pay more for your trading to get easier transaction experiences or more reliable trade execution? Do see yourself as an active or passive investor? Do you know how much money you should invest? Asking questions such as these is important because the more time you spend getting clear on what you need before you go hunting, the easier it will be to find the right fit.

Rankings such as these can certainly cut down on some of the research time. It was a nice touch that the rankings in all categories were reported rather than an aggregate score (and that you could download a spreadsheet of them!) because sorting who fits you best is simpler.  You may choose to put a different emphasis on trading or tools than the way the original survey weighted it.  To that end, we’ve created a sortable version of the results table below that lets you sort who ranks highest in the category that matters most to you.

There are also a couple of interesting videos (featuring Rob Carrick) as part of additional content  on the 2012 discount brokerage rankings: the top brokers for retired investors and the top brokers for young investors. Both are short clips but provide some useful advice on which brokerages to consider for each group and why.

Conclusion

On a final note, even though Rob Carrick is one of the most informed sources on the Canadian discount brokerage market, and the ranking is structured around a knowledgeable consumer’s point of view, the comments around the experience with each company reflect those of the author.  A sound strategy to follow is one that Rob Carrick himself suggests in his article “Three smart ways to find an online broker” which is to “cross-reference your findings with the many online resources available.”

Finding reliable and impartial sources, such as some of those listed within Rob Carrick’s article, is important for self-directed investors because when you have over a dozen discount brokerages trying to get and keep your business, there is no shortage of opinions on who or what makes a company the best Canadian discount brokerage.

Table 1: Globe and Mail Canadian Discount Brokerage Rankings 2012

Overall Rank	Broker	Costs (out of 25)	Account Info (out of 25)	Trading (out of 20)	Tools (out of 20)	Innovation (out of 10)	Total (out of 100)
1	Virtual Brokers	24	14	18	12.5	10	78.5
2	Qtrade Investor	15	22	18	15	8	78
3	BMO InvestorLine	10	19	15.5	16	7	67.5
4	Scotia iTrade	14.5	14	13	17	7.5	66
5	RBC Direct Investing	12.5	19	9.5	18	5.5	64.5
6	TD Waterhouse	11	10	14	20	6	61
7	Credential Direct	12	19	9	14	4	58
8	Questrade	15	8	14	11	8	56
9	Disnat (Classic)	11	17	7.5	14	4	53.5
10	CIBC Investor’s Edge	14	9	11	12	5	51
11	National Bank Direct Brokerage	10	14	10	14	2	50
12	HSBC InvestDirect	14	15	10.5	9	2	50.5

(source: Rob Carrick. (November 20, 2012). A new winner: The Globe’s 14th Annual Online Brokers Survey. Globe and Mail (accessed online here)