Who are the Discount Brokerage Rankings For?
The intention behind the rankings is to provide those new to investing and/or “mainstream” investors with a way of learning about what Canadian discount brokerages offer. In addition to trading stocks, these rankings take into consideration products that many mainstream investors access, such as exchange traded funds (ETFs), mutual funds and fixed income products like bonds and GICs. Historically, these rankings have not really been geared towards “hyperactive” traders and as such issues like margin requirements/rates, execution speeds and volume trading discounts are not considered.
Canadian Discount Brokerages Covered
Most Canadian discount brokerages are covered by The Globe and Mail review and ranking, however there is a notable exception– Interactive Brokers. Part of the criteria for inclusion in the rankings is the requirement that the discount brokerage offer registered accounts (RRSPs, RESPs and TFSAs), which Interactive Brokers does not. While Carrick has acknowledged that there is usually interest on the part of his audience on Interactive Brokers, they simple don’t fit the profile of discount brokerages that investors would typically turn to for “mainstream” investor needs. Similarly, the lack of RESPs at Disnat Direct is why they are not in the ranking but Disnat Classic is. Other Canadian discount brokerages not covered by the ranking include Jitneytrade and Laurentian Bank Discount Brokerage because of their focus on active traders and too small of a client base respectively.
In part two of this series, we will go through what the rankings actually measure, tips on how to use rankings as well as some of the interesting findings we noted in looking across the last 11 rankings.