This week’s discount brokerage roundup finds us crossing into the home stretch of 2013. Now that December is finally here things will almost certainly begin to gear down on the discount brokerage front until 2014. Even so, this past week had a number of stories from various discount brokers including a new fee & commission schedule taking effect at a major discount brokerage, an order type being removed from another brokerage, several discount brokerage-related events that popped up on the radar and finally a couple of interesting stories from the forums for good measure.
Speaking of measure, it being the beginning of the month, trading metrics from Interactive Brokers for November were released earlier in the week. Trading activity (as measured by daily average revenue trades (DARTs)) showed an increase of 16% year over year however it was about flat compared to October. A very interesting figure was the growth of customer margin loan balances which was $12.6 billion at the end of November compared to $9.6 billion from the year before. While the figures show quite a dramatic change from last year, on a month over month basis, activity and growth appear to be steady.
Mind the Fees
BMO InvestorLine’s updated commission fee schedule took effect December 1st, with mostly nominal increases to their AccountLink service fees making up the bulk of the changes. For more information on the new fee schedule, check it out here. Incidentally, there will also be another fee change coming in May of 2014 (details of which can be downloaded here).
Scotia iTrade announced to clients that they are no longer accepting stop market orders on Canadian stocks. As part of the Investment Industry Regulatory Organization of Canada (IIROC) review on ensuring investors receive the best available pricing at the time of order execution, stop market orders were put under the microscope to determine whether or not they were beneficial or harmful to investors.
Ultimately, IIROC strongly recommended that discount brokerages ensure their clients use stop limit orders (i.e. that clients should be entering in limit prices) rather than stop market orders. For the full report (13-0191) outlining IIROC’s position on stop market orders, click here.
An Eventful Week
The SparxTrading Investor Education Calendar for December is full of interesting seminars/webinars from Canada’s discount brokerages. This past week two discount brokerages who don’t normally hold many seminars, Credential Direct and CIBC Investor’s Edge, held seminars on researching for investing ideas using Recognia’s Value Analyzer tool and Morningstar Research Tools respectively.
Two brokerages geared towards active and professional traders, JitneyTrade and Interactive Brokers, were among the sponsors of the Canadian Annual Derivatives Conference (organized by the Montreal Exchange) in Mont Tremblant this past week. Although it was geared towards investment industry professionals, there were several interesting discussion topics which will undoubtedly also impact retail investors.
From the Forums
TFSA/RRSP room after an options trade loss
This past week, two forum discussions were definitely worthy of sharing.
The first was a thread from the Canadian Money Forum on taking a loss on an options trade and how (or if) it impacts the contribution room.
Unpublished commission rate deals
Regular SparxTrading.com readers know that the discount brokerage deals section covers most of the deals offered by Canadian discount brokerages. Occasionally though, there are offers extended by discount brokerages to clients as an incentive to do more business with them (e.g. transfer a mortgage or loan over as well as open an investment account). This is known as ‘relationship’ pricing and while not every brokerage offers it, it certainly doesn’t hurt to ask. The following thread covers one forum user’s experience with trying to get a better commission rate with BMO InvestorLine.
That’s a wrap for this week, have a great weekend and happy shopping (only 19 days left until Christmas!)!