Month: July 2014

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Scotia iTrade Launches Loyalty Pricing Program

Here’s a question few people get asked in their day: what would it take to join a club that let’s DIY investors pay $9.99 in commission per trade? Well, if that ‘club’ is online broker Scotia iTrade, the answer is $50,000. At first blush the number may seem steep, however because of how that $50,000 threshold gets calculated, Scotia iTrade’s new loyalty pricing program has actually made qualifying for discounted trading slightly easier.

Getting Creative with Pricing

Without question, 2014 has been the year of falling commission prices. Many of Canada’s largest online brokerages, especially the bank-owned brokerages, have cut their standard equity trading commission prices from just under $30 to under $10.

Scotia iTrade, also a bank-owned brokerage, has opted to take a slightly different path. Instead of lowering their standard commission prices (currently $24.99 per trade) for all of their clients they have lowered commission pricing for certain segments. Earlier this year iTrade lowered the online trading commissions for active traders (defined as those who place at least 150 trades per quarter), to as low as $4.99 per trade.

With their newest plan, called the “loyalty pricing” program, Scotia iTrade is now offering up $9.99 per trade commissions. While they already have that commission as part of their existing pricing structure, they have changed the threshold of qualification for $9.99 commission pricing from $50,000 in assets with Scotia iTrade to $50,000 of accounts or products with Scotiabank and/or Scotia iTrade.

 

How loyalty pricing fits into Scotia iTrade commissions

The Details on Scotia iTrade’s Loyalty Pricing

So, how exactly does Scotia iTrade define ‘loyalty pricing’? According to their website Scotia iTrade clients are eligible for the $9.99 commission as soon as the total balance across eligible Scotiabank (and/or Scotia iTrade) accounts/products reaches $50,000.

The list of eligible accounts is significant and includes:

  • Mortgages
  • Lines of Credit
  • Credit Cards (Visa / American Express)
  • Chequing and Savings Accounts
  • Personal Loans
  • Investment Accounts (TFSA, RRSP, Non-Registered Accounts)
  • GICs
  • Mutual Funds
  • Non-Corporate Business Accounts

Another requirement to qualify for the loyalty pricing commission price is registration for paperless documentation. Scotia iTrade also has a requirement for mobile and iPad app users to log onto Scotia Online each quarter in order to confirm eligibility.

What Loyalty Pricing Means for DIY Investors

Having improved access to better commission rates is always a good thing for self-directed investors. The model picked by Scotia iTrade and Scotiabank means that the “convenience” factor of managing one’s personal finances with a bank-owned brokerage just got a lot more valuable.

Not only does doing everything in one place save time and reduce complexity (often big sticking points with investors juggling multiple accounts) but there is now actually financial incentive for doing so. Also, there is no “minimum number of trades” required to get the preferred pricing but rather just a maintenance or growth of business with Scotiabank.

If there is a downside for investors, it is that those who are looking to get started with investing may not meet the threshold for low pricing or, for whatever reason, may not be able to maintain it at which point they would be subject to standard commission fees.

Banking on Loyalty

The loyalty pricing strategy is not necessarily unique to Scotia iTrade. CIBC Investor’s Edge, for example, has had it in place for a number of years. While the commission-pricing given to CIBC Investor’s Edge clients via the loyalty pricing program is lower ($6.95 per trade vs $9.99 per trade) there are some offsetting factors, such as the higher dollar threshold ($100,000 vs $50,000) to qualify.

With the CIBC program the threshold for best pricing ($6.95 per trade) is set at $100,000 per household whereas with Scotia iTrade the third best commission discount is available (the $9.99 per trade) for $50,000 per client.

Building a Moat

Competing on price and being able to stand out from their competitors have been challenges for the Canadian bank-owned brokerages. Strategically, however, loyalty pricing is the kind of program that bank-owned brokerages can offer far more effectively than their independent brokerage counterparts can.

Whether the online brokerage side of the business helps grow banking or banking helps grow online brokerage, one side of the company can help the other. Thanks to the banking-side relationship, major bank-owned brokerages are able to provide a broader package of services and bundle them into an offer that independents are hard pressed to compete against.

For independent brokerages, the temptation to move into banking services is already apparent in the US. As US online brokerage E*trade has shown, however, wading too far into traditional banking can go horribly wrong if done at the expense of prudence and so winning market share without taking undue risk will be a challenge.

The Bottom Line

The move by Scotia iTrade to introduce loyalty pricing directly pits big-bank convenience against independent brokerage pricing. While $9.99 per trade isn’t necessarily the best price per trade, it is far better than the standard commission price that Scotia iTrade currently charges. Ironically, because of the options to qualify for the discount loyalty pricing, those not already with Scotiabank or Scotia iTrade will be starting to think about the benefits of being disloyal to their current provider.

 

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Discount Brokerage Weekly Roundup – July 25, 2014

As we cruise into the end of July, every trader’s favourite season is drawing to a close. No, it’s not summer but rather earnings season. Depending on which side of an analyst’s estimate a company falls, the news may be great or simply a great disappointment. Regardless, the lesson the market forces everyone to learn over and over again is to keep your expectations realistic.

In this week’s roundup, we look at some of the interesting expectations that Canada’s online brokerages have created and are fanning the flames on. In particular, we take a brief look at 2 fierce competitors and their latest features to be released after which we quickly scan through this month’s expiring deals and round out with an #FTF (From the Forums).

Looking for a Hot Date?

Desjardins Online Brokerage’s new investor education calendar may have several to offer. After receiving a significant makeover, the investor education calendar from Desjardins Online Brokerage launched and is poised to create a bit of a stir across the online brokerage industry. Specifically, with the recent commission price drops across the industry seeming to cool-off, online brokerages will be looking to other components of their business to highlight or improve in a bid to differentiate themselves from one another.

For those discount brokerages that are heavily invested in providing education to online investors (such as National Bank Direct Brokerage, Scotia iTrade and TD Direct Investing) the news probably signals time for some ‘fresher’ thinking when it comes to user experience and investor education.

Read more about the new features of the Desjardins Online Brokerage education calendar here.

It’s All About the Benjamins

National Bank Direct Brokerage has officially joined the ranks of online brokerages that offer US dollar registered accounts. As you can see from a screenshot of their site below, the announcement marks the formal roll out of this account option for RRSP, RESP, TFSA as well as several other popular registered account types.

The ability to have USD registered accounts is a sought after feature with many investors that trade/invest in many US listed securities and who want to avoid some of the steep currency conversion fees imposed by brokerages.

As was reported in February, National Bank Direct Brokerage has been rolling out this feature in phases and with feature how hitting the front of their website, it won’t be long before we start to see more about it and perhaps a response from those brokerages who still don’t offer this account type to investors.

Should They Stay or Should They Go?

With the end of the month just around the corner, there are usually some deals or promotions timed to expire. The two that are currently set to go at the end of this month are the 50/50 offer from BMO InvestorLine and the iPad Mini offer from Questrade. Of the two, the iPad Mini offer has expired once before only to be resurrected. We’ll see which (if either) get a time extension but for the moment both of these deals are scheduled to be in their final days.

From the Forums

This past week across the investor forums saw the usual interesting assortment of questions regarding DIY investing. On the menu for this roundup, we look at where to park cash in a trading account, how Virtual Brokers clients

Cash is king, but where does his highness hangout when not being put to work?

In this post from RedFlagDeals, an investor is looking to squeeze some extra juice out of some cash sitting in their trading account. The community chimes in with some interesting suggestions to try and get that cash to work.

The pricing plan is right

In another thread from RedFlagDeals, the cost of buying and selling ETFs at Virtual Brokers got put under the microscope. Because of their different pricing plans, clients can pick which commission charge works best for a particular trade. Find out what strategies folks ended up suggesting when trading ETFs by clicking the link above.

Lather, rinse, repeat

The ever popular Gambit trade between dual listed stocks was the topic of this post on the Canadian Money Forum. Specifically, a user shared with the community their experience of a bit of sticker shock when trying to do a Gambit in a non-registered account with TD Waterhouse (TD Direct Investing). Fortunately the other forum members chimed in with some helpful tips on how to get it done right.

That does it for this week’s roundup. With the US and Canadian markets (and even Facebook) hitting new highs again, it seems there might be cause to celebrate going into the weekend. Strangely, it seems like Mr. Market and traders don’t exactly know what to expect from one another – kind of like the high five moment gone awry.

 

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Looking for a Hot Date? Desjardins Online Brokerage’s Education Calendar Gets a Makeover

In a landscape littered with commission price drops, lowering price can only go so far in winning the attention and loyalty of potential and existing DIY investor clients. So, what is the secret ingredient Canadian online brokerages need in order to win the attention of self-directed investors? It’s no secret actually – build something really helpful.

With the update of their investor education calendar, Desjardins Online Brokerage has taken a bold move in committing to user experience for accessing education events. Their competitors, most notably those with significant investor education offerings such as National Bank Direct Brokerage, Scotia iTrade and TD Direct Investing, will most certainly be less enthusiastic about the new calendar roll out however for self-directed investors, the change is a signal of something significant across the industry.

Think Outside the Box

Of course, there are those that would ask (and rightfully so) what’s so exciting about a calendar? Well, coming from a site that continues to compile investor education events from Canada’s online brokerages, there’s actually several very interesting things the new calendar signals.

First, with pricing becoming less of a distinguishing feature between providers, there is likely going to be more of an effort required by Canada’s online brokerages to stand out.

This calendar is yet another example of benefits to investors that competition amongst brokerages brings. User experience and the ‘look and feel’ of an online brokerage on the front end are going to matter more.

Another important angle to this calendar launch is that it signals a significant commitment to investor education.

Desjardins Online Brokerage currently runs in the order of 350 events per year. TD Direct Investing, by comparison, runs closer to 3000 per year. While the ‘number’ of events may not be the most telling indicator, it does communicate the scale at which investor education has to be provided and resourced. For Desjardins Online Brokerage, however, they’re continuing to bet big on education, as seen with their partnerships with Stockscores, DayTrader Canada and a potentially wider set of education partners.

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Discount Brokerage Weekly Roundup – July 18, 2014

With the World Cup now officially over many folks can get back to their regular routines. Of course for many traders, staring at a screen all day only to have nothing happen is a regular routine. Don’t be fooled by the calm, as things can (and usually do) change quite quickly. Soccer or no, for Canada’s discount brokerages, the game is still ‘afoot’ and this past week they showed that they’re still out to try and win the attention of DIY investors.

In this week’s roundup we look at some important news from Canadian securities regulators, a pair of deals launched from two online brokerages and showcase some interesting perspectives from the Canadian investor forums.

Making a Statement

A sound financial system is built on trust and transparency. For retail investors, the importance of being able to know what they’re buying and what they’re paying for are crucial to maintaining confidence in the capital marketplace. This past week, a series of important new rules about how fees are disclosed to investors take effect. Check out this article from the Getting Smarter About Money blog that provides a great explanation of the latest and upcoming changes.

Looking Out for Investors

In another regulatory-themed post, (this one from the BCSC site InvestRight) is an important reminder that getting approached or contacted about “investment opportunities” isn’t always above board. This post highlights a number of companies and/or individuals that have raised red flags with regulators. Several of Canada’s major securities regulators regularly publish alerts and provide guidance on how to handle individuals/entities that may approach you for an investment in ‘the next big thing’.

Sunny with a Chance of a Deal

While most people are out enjoying the summer sun, a pair of Canadian online brokerages are attempting to make it rain.

Putting Rates on Ice

On the heels of their recently successful iPad mini campaign, National Bank Direct Brokerage has followed up with a margin account promotion (Canadian margin account specifically). The deal offers a discount on the margin borrowing rate for 3 months of 1%. Check out our online brokerage deals and promotions section for more information.

Save the Date

When it comes to offering deals and promotions, Questrade is certainly one of the most active. With so many deals on the go, it’s interesting to see things continue to get a bit more creative than the ‘cash back’ or the latest iPad mini. This past week we spotted a new offer from Questrade that offers clients one-commission-free-trade per month for up to two years. For many reasons this was an interesting deal, most notably because it competes with several other existing offers. Given the uniqueness of this offer, we put together a detailed look at Questrade’s latest deal here.

From the Forums

Clearing the Bench

Asking one of Canada’s busiest forum of deal hunters which online brokerage they use is a great way to create a bit of a scrum. In fine fashion this post on Red Flag Deals did just that and, in tacky click bait form, what happened next probably wouldn’t surprise you.

Leaving the Group

Savvy investors know that controlling costs can be as important as generating returns. In this post on Reddit, Investor’s Group got put in the cross-hairs of one investor who was rethinking the value of the fees they pay.

A Marginal Trade

The mechanics of trading and order settlement are things that most investors (especially beginners) overlook. An important consequence of that settlement process is when you need to have funds in your account and when (or if) any margin might be used to cover the payment for an order. This article from an investor on Red Flag Deals’ personal finance forum is a good example of why knowing what’s moving where and when is important to know.

That wraps up this edition of the roundup. Have a great weekend and plenty of fun trying to stay cool.

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Deal Review: Questrade’s Commission-Free-Trade-per-Month Offer

The latest offer put forth from Questrade is a sign that Canadian discount brokerages are gearing up to compete even more creatively for new clients. In this post we take a detailed look at Questrade’s commission-free-trade-per-month offer to see what consumers are being offered and what potential strategies might be at play from Questrade’s end.

What is the offer?

Questrade is offering new or existing clients one commission-free trade per month for either 12 or 24 months or for as many months as a client makes consecutive deposits of $1,000 or more (up to a maximum of 24 months). This deal is currently running until August 30, 2014.

Cost and ConditionsQuestrade Commission Free Trade per Month Deal

There are 3 ways to qualify for this deal:

  1. Deposit $20,000
  2. Deposit $12,000
  3. Deposit at least $1,000/month for consecutive months

The offer is open to new and existing clients of Questrade however existing clients cannot use an existing Questrade account to fund a new account to qualify for the promotion.

Individuals can only use the commission-free trade for the month it is assigned to and there are no roll-overs or carry forwards. If a commission credit is not used in the month it is assigned to, clients forfeit that credit for that month. In other words, it is a ‘use-it-or-lose-it’ offer type.

Another important detail to keep in mind is that trading commissions will be charged at the time of a trade and then rebated back to the client within the first week of the month following the month in which the trade was placed.

What is the Value of the Offer?

The value of a standard commission at Questrade can range from $4.95 to $9.95 (excluding ECN or market fees) and the maximum value of a trade commission set forth in the deal’s terms and conditions is $9.95 per trade.

Since what clients get is a discount on a trade (as opposed to cash up front for example), one important assumption is that a client would, in fact, place at least one trade per month for consecutive months.

Let’s consider the available scenarios attached to this offer to see what clients receive for making a deposit:

Scenario 1: Deposit $20,000

Under this scenario an individual has to commit $20,000 of capital into their trading account. By doing so, they receive 24 commission trades (one free trade per month for two years). Hence, the value of the offer is capped at 24*$9.95 = $238.80 which represents 1.19% of the deposited amount over two years.

Scenario 2: Deposit $12,000

With this scenario an individual deposits $12,000 and receives 12 commission-free trades at the rate of one per month. The value of this option is 12*$9.95 = $119.40 which represents 1.00% of the deposit amount over one year.

Scenario 3: Deposit $1,000 a month consecutively

The last option available for this offer is for a client to receive one commission free trade per month for each month that a deposit of $1,000 or more is made. The value of this option is also about 1% over the possible time frame allowed with this option (which is 24 months). Importantly, if a client fails to make a deposit of at least $1,000 for consecutive months they no longer become eligible for any further commission-free trades as a part of this offer.

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Discount Brokerage Weekly Roundup – July 11, 2014

The word heading into the end of this week: Drama. This weekend it seems no matter where you look there is some source of incredible drama. An Argentinian team playing for the World Cup final in Brazil, LeBron ‘going home’ to Cleveland and rumours of Eva Mendes having Ryan Gossling’s baby – wait what?

Not to be outdone by rivalry, homecomings, and bundles of joy, Canadian discount brokerages had their fair share of news making to do. In this week’s roundup we take a look at a major commission price announcement that takes one online broker out of the shadows and back into the spotlight. Next we highlight the competition between brokerages as July deals and promotions start to show up in droves. We then take a quick look at the next trillion-dollar idea brokerages are trying to position themselves for. Of course no roundup would be complete without a healthy dose of investor commentary from the investor forums.

Don’t H8 The Player

Although they’ve been out of the spotlight for quite some time, Credential Direct stepped up their game by announcing a major commission drop and pricing structure overhaul.

Gone are the convoluted pricing tiers and the separation between ‘active’ and ‘non-active’ traders. In their place: one price, $8.88, is now applicable to all online equity trades. While it is a significant internal shift, the pricing move also is bound to generate quite a bit of buzz with other Canadian brokerages who have recently lowered their trading fees to $9.95/$9.99. Read more in a special feature post on the new Credential Direct offer here.

Save the Dates

There’s something about calendars that have got two Canadian online brokerages inspired.

In the first instance, Questrade has just rolled out a very unique set of offers in a bid to win new clients/assets. As part of their latest promotion (among several already ongoing ones), Questrade is offering new clients the option of receiving a free trade a month for 12 (for deposits of at least $12,000) or 24 months (for deposits of $20,000 or more).

The next calendar inspired promotion is from RBC Direct Investing as part of a lead up to its 25th anniversary. Specifically RBC Direct Investing is holding a weekly giveaway of $1,000 for 12 weeks (between July 24th and October 9th) for individuals that are a part of its “community”. Existing members of the RBC Direct Investing community are automatically registered. To become a member of the community one has to either be an RBC Direct Investing client or be an RBC Royal Bank Online Banking client and have a practice account. For more information including contest terms and conditions, click here.

Paying it Forward

While many people get excited about the prospect of new bundles of joy, the conversation about the other end of the circle of life is understandably less enthusiastic – unless you happen to be a financial adviser. The notion of inheritance and passing along wealth to subsequent generations has got lots of financial institutions trying to position themselves for nearly a trillion dollar’s worth of wealth to be passed on. This past week, BMO InvestorLine released the results of a study it had commissioned on inheritance and what that might mean for individuals and their investment decisions.

From the Forums

 Symbolic Gestures

Ticker symbols can seem like a language unto themselves. Part of the process of learning to invest on one’s own means having to get comfortable with learning the different ways in which ticker symbols get entered and the different exchanges that exist to look for stocks to trade. In this post from RedFlagDeals’ investing thread, one user shares their confusion with making sense of the symbols and the markets that they refer to.

More Potato Skin in the Game

In this interesting post from the Reddit Personal Finance Canada thread, a community member shares their journey of getting a Couch Potato inspired ETF portfolio set up within their RBC Direct Investing account. The other members chimed in to provide some great tips on the finer points of building a low maintenance portfolio.

That brings us to the end of the roundup. Regardless of what or who you’re cheering for this weekend, there will most certainly be lots to chat about around the water cooler next week. Have a fantastic weekend!

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Is Eight Enough? Credential Direct Drops Commission Pricing

The price war between Canadian online brokerages just got a little hotter as Credential Direct announced a major shift in its pricing structure and a substantial commission price drop.

Effective July 9th the standard commission per online equity trade at Credential Direct is $8.88. That is a significant drop from their previous standard commission price of $19 per trade and also a reduction in price from their previous ‘best price’ of $9.95. To boot, it is also strategically positions Credential Direct as a lower cost alternative to many of the $9.95 standard commission offers that are currently in play across the online brokerage space.

Drop it Like it’s Hot

The new pricing structure offered by Credential Direct is almost a complete overhaul from its predecessor.

First, the distinction between “active trader” and “standard user” has been removed. That means that all clients, regardless of trading activity level, are offered the best possible price on an online equity trade commission and online options trade.

Another major change is that all online equity trades are $8.88 regardless of the price of the stock/ETF being traded. This is especially welcome news for those who like to dabble in low dollar value shares, ‘penny stocks’ or junior companies where the size of the orders can be quite high. Under the previous commission schedule, non-active users could pay up to $250 per trade depending on the size of the order and the price of the stock.

In many ways, the new pricing plan was the result of a major shift at the beginning of the year from many of Canada’s large bank-owned brokerages. What is particularly interesting, however, is that Credential Direct didn’t just match the offers – they actually bid underneath them.

How Fortun-8

Another interesting touch was the choice to use all 8’s in the pricing. The use of then numbers seems like a clever way to add some cultural appeal to the many East Asian investors that see the number as a sign of good fortune. Given the significant footprint Credential Direct has in British Columbia the new pricing may indeed prove to be self-fulfilling.

Of course other institutions, that focus heavily on connecting with East Asian or Chinese clientele, such as HSBC InvestDirect, have incorporated the number 8 into their pricing schedules for similar reasons (and another example of a ‘fortunate’ coincidence: TD Direct Investing’s Investor Centre address in Downtown Vancouver is 888 Dunsmuir St).

The Tradeoff

While the lowering of the commission price is likely welcome news for many who actively trade, there is a tradeoff that the new pricing structure imposes: administrative fees.

Specifically, for clients who have less than $15,000 in combined assets with Credential Direct, they may be subject to a $25 per quarter administrative fee. Historically Credential Direct did not charge administrative/activity fees but it looks like they’re banking on lower commission pricing offering more competitive value. Other fees are also increasing – especially for telephone assisted trades and some administrative services. These other fees are scheduled to take effect in October of 2014.

Like a couple of other online brokerages, however, Credential Direct does offer clients who fall under the $15,000 balance threshold a couple of ways to be exempt from the administrative fee.

For those with less than $15,000 in combined assets, the first way to be exempt from the administrative fee is to make at least two commission generating trades per quarter. According to this scheme the annual cost of placing two trades per quarter at the new commission price would be $71.04 (which is cheaper than paying the $100 per year for passively holding).

The second way for clients with sub-$15,000 accounts to avoid the administrative fee is to register for a pre-authorized contribution plan of at least $100 per month. What is great about pre-authorized contribution plans is that they create a structured and scheduled way to put some money aside, so having this option is a plus for those just starting out with DIY investing.

New clients (defined as clients that have accounts that are under 6 months old) will also be exempt from the administrative charge.

The Bottom Line

For most online investors, getting a break on commission pricing is welcome news. Other brokerages – such as the bank-owned brokerages as well as (and especially) the independent brokerages have fewer reasons to smile.

The drastic overhaul of Credential Direct’s pricing model is going to make it much easier for investors to understand the commission pricing (and to afford it) – something that the marketplace is clearly communicating to the Canadian online brokerage community.

Credential Direct has been extra bold by challenging the $9.95 standard price floor established by the bank-owned brokerages earlier this year. Whether or not fortune favours their boldness remains to be seen but at the very least they’ve got some lucky numbers to help their chances.

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Discount Brokerage Weekly Roundup – July 4, 2014

This past week has been filled with many reasons to look skyward. Canada Day, Independence Day, and new all-time highs on major market indices. Add to the mix that it is the beginning of a new month and that we’ve passed the halfway mark on 2014 and there are even more reasons to smile.

For Canadian discount brokerages, the new month typically brings a bit of a change to the promotions and deals, and this month is no different. We’ll take a look at these in this week’s roundup in addition to looking at trading figures and trends from a  major US online brokerage and some interesting conversations between investors in the online investing forums related to the trending markets.

Deals Cooling Down

As we mentioned in last week’s roundup, there were a number of deals and promotions poised to expire at the end of June. Although it is still early in the new month, we have seen deal action pull back slightly.

There were 4 offers that officially expired at the end of June and so July started with 15 deals. Within the first week, however, a deal from Questrade and National Bank Direct Brokerage have ended bringing the total down to 13 offers. As a quick update, it looks like the popular iPad Mini promotion from National Bank Direct Brokerage has concluded earlier than originally scheduled due to high demand. Click the following link for more details on this month’s online brokerage deals and promotions.

Traders Taking a Breather

With the recent spate of low market volatility and gradually rising prices, for better or worse the “excitement” in the markets has been muted. In their latest trading figures, Interactive Brokers’ reported a 4% m/m dip in the number of DARTs (Daily Average Revenue Trades) but increases in the number of customer accounts (17% yr/yr and 1% m/m) to 262,000.

A quick look at the recent 6 month trends in DARTs and average commission revenue shows that while the market (Dow Jones Industrial Average) has been trending upwards, traders may be sitting back, riding the trend and monitoring positions and ultimately sending fewer orders into the market.

Interactive Brokers Trading Data 1st Half 2014
Interactive Brokers Trading Data 1st Half 2014

From The Forums

The Trend has some Friends

With markets that have been trending (mostly) upwards for a few years now, the index investors have been content to allocate accordingly and mostly enjoy the ride up. It stands to reason that ETFs and in particular those that track indices have become very popular with most investors.

Keeping with the ‘trending market’ theme, the following post from the Reddit Personal Finance Canada thread tracks an interesting story of a DIY investor wanting to use the popular TD e-series mutual funds as part of their strategy. Click here to read the particularly vocal response from the community.

Starting Out

A familiar question for beginner investors is how to get started in the markets. In this post, again from Reddit, a self-described investment ‘newbie’ shares their financial picture and ideas for how to get started. Again, the popularity of ETFs and index investing with the other investors show up in the responses. Click here to read more.

That does it for this week’s roundup. Have a great weekend and we hope to see stock charts and soccer goals continue to aim for the upper right.

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Discount Brokerage Deals & Promotions – July 2014

[Updated: July 18, 2014]

July is here and while sidewalks and barbeques might be sizzling, deals at Canada’s online brokerages at the outset of the month are quite a bit cooler. That said, if history is any predictor, we don’t expect that situation to persist for too long.

As was the case last month, the beginning of the month is off to a quiet start. The deals that are currently in play feature commission-free trading, cash back offers and iPad minis.

In a landscape where pricing has become so competitive, it is interesting to take note of which brokerages are more willing to ‘give’ in order to ‘get’. The mix involves both bank and credit union-owned brokerages as well as independent brokerages, however there are more of the former than the latter.

So, just who is in the deal pool this month? Thus far it is BMO InvestorLine, Desjardins Online Brokerage (Disnat), JitneyTrade, National Bank Direct Brokerage, Scotia iTrade and Questrade. Of this group, BMO InvestorLine, Questrade and Scotia iTrade have multiple offers.

For more details on all of the offers, check the comparison table below. As always, if there are any deals that we’ve missed, we’d love to hear about them & share them with other Canadian investors.

New Deals

[Update: July 18, 2014]

  • National Bank Direct Brokerage has launched a new Canadian margin account promotion that offers an introductory margin rate of 2% (prime rate – 1%).   This offer is open to new and existing clients (who don’t already have a Canadian margin account). This offer is scheduled to run until August 31st 2014, see table below for more details.
  • Questrade has introduced an innovative new offer – get one commission-free trade per month for either 12 (with a $12,000 deposit), 24 months (with a $24,000 deposit) or for as long as you make a deposit of at least $1,000 per month for consecutive months (for up to 24 months). This offer is open to new and existing clients however for existing clients, funds for the new account cannot come from another Questrade account. Also, each free trade must be used in the month it is assigned to otherwise the trade expires (no carry forward or rollovers). For more details see table below or click the following link for an analysis of Questrade’s latest deal.

There are no new deals as of July 1st however there were 2 deals announced mid-late June (both from Questrade) which extend past and/or expire within July. .

The first, set to expire in early July (July 3rd) is a commission-free trading offer (the Canada Day promotion). This offer is interesting because it allows clients to have 25 commission-free trades that don’t expire until the end of December 2014 (~6 months). Many commission-free trading offers are good for between 60 and 90 days.

A second promotion announced in late June by Questrade was the 3 months of unlimited trading offer for deposits of $50,000 or more. There are also unlimited trading offers for those with lower deposit amounts – see the table below for more details. Currently Questrade is the only brokerage running ‘unlimited trading’ offers.

Extended Deals

Scotia iTrade has extended two of the three deals that were set to expire at the end of June.

The first, their Refer-a-Friend offer, has been extended out until October 31st. This deal had typically been extended at one month intervals so it is interesting to note that it is now be extended for the next 3 months.

Another deal extended by Scotia iTrade is their 100 commission-free trades offer (for deposits of $15,000 or more) which has been extended until August 31st.

Expired Deals

[Update: July 10, 2014]

  • Editor’s Note: A representative from BMO Investorline has contacted us directly to let us know that the terms for the Select1500 and Select700 offers are being updated and that this will only be offered to select existing clients.  As such we have removed this offer from the deals sections in which it appears.

[Update: July 4, 2014]

  • National Bank Direct Brokerage has officially ended their iPad Mini Offer on July 2nd (earlier than the original July 31st deadline) because the iPad Minis had all been given away

Deals that wound down going into July include:

  • Desjardins Online Brokerage’s Hat Trick Offer
  • Questrade Amazon Gift Card Offer
  • Scotia iTrade’s $500 Cash Back/500 free trade Offer
  • Virtual Brokers Free Trade Offer

Discount Brokerage Deals

Company Brief Description Minimum Deposit Amount Commission/Cash Offer Type Time Limit to Use Commission/Cash Offer Details Link Deadline
Jitney Trade A Sparx Trading exclusive offer! Use the promo code “Sparx Trading” when signing up for a new account with Jitney and receive access to their preferred pricing package and a massive 45% discount on the Real Tick trading platform. n/a Discounted Commission Rates none For more details click here none
BMO InvestorLine For individuals between 18 and 35 who open a new qualifying account with BMO Investorline, they may be eligible to receive 35 commission-free trades, an eBook on investing and potentially waived account minimum fees. Use promo code “New” when signing up. Be sure to read the terms and conditions for more details on the offer. n/a 35 commission-free trades 90 days Youth Promotion October 31, 2014
Open and fund a new Canadian margin account with National Bank Direct Brokerage and receive a promotional margin interest rate of 2% for 3 months. New clients are also eligible for 3 months of $6.95 commission pricing. Use promo code: MARGIN2014 when signing up. Be sure to read terms and conditions for full details n/a A) 2% margin rate (for Canadian margin account only) B) $6.95 commission rate (new clients only) A) 3 months B) 3 months NBDB Margin Account Promotion August 31, 2014
Open a new account (TFSA, Margin or RRSP) and receive $50 commission credit . Use promo code: kdkfnbbc $1,000 $50 commission credit none none none
Refer a friend to Questrade and when they open an account you receive $100 and they receive $50. To receive this deal you must be an existing client with an equity account and refer a person that does not reside with you and who has not previously opened a Questrade account. $1,000 $50 commission credit (friend) $100 commission credit (referrer bonus) 60 days Refer a friend none
Open a new account (TFSA, Margin or RRSP) by August 30 2014 A) $1000 or B) $10,000 to receive either A)10 commission-free trades or B)100 commission-free trades. The promo code 100LOWCOM14S must be used at time of account opening. There are many conditions attached to this offer so be sure to read the details link for more information. A)$1,000 B)$10,000 A)10 free trades B)100 free trades 60 days 100 commission-free trades August 30, 2014
Open a new account (TFSA, Margin or RRSP) by August 30 2014 with either a)$1000 per month, b)$12,000 or c)$24,000 and receive 1 commission free trade per month for A) every consecutive month a $1000 deposit is made [promo code: ONETRADEMTH1000]; B) 12 months [promo code: ONETRADEMTH12] or C) 24 months [promo code: ONETRADEMTH24]. A) $1,000 per month (24 month max) B) $12,000 C) $24,000 A) 1 commission free trade per month per $1,000 deposit B) One commission-free trade per month for 12 months (12 trades) C) One commission-free trade per month for 24 months (24 trades) 1 month (each commission-free trade is only valid for month assigned) One Free Trade per Month Offer August 30, 2014
Open a new TFSA, margin or registered account with Questrade and receive either A) 31 days B) 62 days or C) 90 days of unlimited commission-free stock & options trades. Use promo code FREETRADES14 when signing up. Be sure to read the terms and conditions for more information. A)$1,000 B)$25,000 C)$50,000 Unlimited commission-free trades during associated period. A) 31 days B) 62 days C) 90 days Questrade Unlimited Trade Promo August 31, 2014
Scotia iTrade If you refer a friend/family member who is not already a Scotia iTrade account holder to them, both you and your friend get a bonus of either cash or free trades. You have to use the referral form to pass along your info as well as your friend/family members’ contact info in order to qualify. There are lots of details/conditions to this deal so be sure to read the details link. A)$10,000 B)$50,000+ A) You(referrer): $50 or 10 free trades; Your “Friend”: $50 or 10 free trades (max total value:$99.90) B) You(referrer): $100 cash or 50 free trades; Your “Friend”: $100 cash or 50 free trades (max total value: $499.50) 60 days Refer A Friend to Scotia iTrade August 31, 2014
Scotia iTrade Open and fund a new Scotia iTRADE account with at least $15,000 before June 30, 2014 and the commissions associated with your first 100 trades placed within 60 days of the date the account is activated and funded are free. Also, the new FlightDesk platform is being offered for free for 60 days. Use promo code HUN-SP. See details link for further terms and conditions. $15,000 100 commission-free trades ($999 value @ $9.99 commission rate) 60 days Scotia iTrade 100 free trades + FlightDesk August 31, 2014
Open and fund a new account with National Bank Direct Brokerage by July 31st, 2014 and you could be eligible to receive an iPad mini. A commission generating trade must be placed within the ‘validation period’ in order to qualify. Use promo code IPADMINI14. Be sure to read full terms and conditions, especially around validation periods. $20,000 iPad Mini (value $319) iPad Mini to be sent after either Dec. 31/14 or Jan. 31/15 depending on eligibility. At least 1 commission generating trade must be placed to be eligible. iPad Mini Promotion *EXPIRED JULY 2, 2014* (original expiry July 31, 2014)
Open and fund a new account at Questrade with at least $25,000 and you may be eligible to receive 25 commission-free trades. Use promo code CANADADAY14 when signing up. Be sure to read the full terms and conditions for more information. $25,000 25 commission-free trades Dec. 31st, 2014 Canada Day Promo July 3, 2014
BMO InvestorLine Open a new qualifying account or fund an existing qualifying account by July 31, 2014 with at least $50,000 and BMO InvestorLine will provide a $50 cash back offer, 50 commission-free trades and a 1 year subscription to GlobeInvestor. Use promo code BONUS to qualify when signing up. Be sure to read full deal terms and conditions. $50,000 $50 cash back 50 commission-free trades ($497.50 value) 1 year subscription to Globe Investor (~$228 value) Cash Back: Payout after 6 months Commission-Credits: 50 days Spring “New Investors” 50 50 Promotion July 31, 2014
Disnat Disnat is offering new & existing clients $300 in commission credits which can be used for up to 6 months. To be eligible, new/existing clients need to deposit $50,000 into a Disnat account. You’ll have to call 1 800 268-8471 and mention promo code Disnat300. See details link for more info. $50,000 $300 commission credit 6 months Disnat $300 Commission Credit Promo August 29, 2014
BMO InvestorLine If you refer a new client to BMO InvestorLine and they open an account with a)$50,000 – $249,999 or b)$250,000+ the referrer and the referee will both receive cash. The new account must be opened with the referral code specific to the referrer. A) $50,000 – $249,000 B) $250,000+ A) You(referrer): $200; Your Friend(referee): $50 B) You(referrer): $300; Your Friend: $100 Payout occurs after 60 days (subject to conditions). Refer A Friend Terms & Conditions October 31, 2014
Open and fund a new qualifying account with at least $100,000 in net new assets and you may be eligible to receive either A) a new 16gb iPad Mini (wifi only) or B)$250 cash back. To be eligible for either, at least one commission generating trade must be placed. For the iPad Mini use promo code IPADMINIS14 or for the $250 cash back offer use promo code CASH250S14. Be sure to read full terms and conditions for eligibility and further details. $100,000 A) iPad Mini or B) $250 cash back A) iPad will be sent after 6 months B) Payout occurs after 60 days iPad Mini or Cash Back Promo July 30, 2014

Transfer Fee Deals

Company Brief Description Maximum Transfer Fee Coverage Amount Minimum Deposit Amount for Transfer Fee Eligibility Details Link Deadline
Transfer $15,000 or more to RBC Direct Investing and they will pay up to $135 in transfer fees $135 $15,000 Transfer Fee Rebate Details none
Move your brokerage account to Questrade and they’ll cover the transfer-out fee up to $150. $150 $25,000 Transfer Fee Promo none
Transfer $25,000 or more to a National Bank Direct Brokerage account and they will pay up to $135 plus taxes in transfer fees $135 $25,000 Transfer Fee Rebate none
Qtrade Investor Qtrade Investor will reimburse your transfer fee up to $125 when transferring a balance of $25,000 or more. For reimbursement, please mail or fax a copy of your statement from the transferring institution that shows the transfer charge to Qtrade Investor at 604.484.2627 and indicate your Qtrade Investor account number. $125 $25,000 Transfer Fee Promo none
Disnat Disnat is offering up to $150 to cover the cost of transfer fees from another institution. To be eligible, new/existing clients need to deposit $50,000 into a Disnat account. You’ll have to call 1 800 268-8471 and mention promo code Disnat300. See details link for more info. $150 $50,000 Disnat $300 Commission Credit Promo August 29, 2014