Posted on

Discount Brokerage Weekly Roundup – May 1, 2015

Getting to the top is one thing, but staying there is another. Heading into the weekend US stock markets, which were previously at new highs, faltered slightly. Elsewhere, hockey fans are watching the good, bad and ugly unfold on the road to the Stanley cup and for boxing fans, the long awaited fight between two of boxing’s biggest names will test whether one will go undefeated or just walk away incredibly wealthy. For Canadian discount brokerages, however, the fight will not be a short one and the competition not so willing to roll over just because summer is coming.

In this week’s roundup, we take a look at which online brokerages continue the slugfest for new clients with the latest discount brokerage deals and promotions. Next, we take a look at one brokerage that has enabled early birds to be able to trade the pre-market. Following that, we take a look at the Apple Watch and whether one online brokerage is really ahead of the curve or just at the party a bit too soon. Finally we cruise through the investor education events and take a look at some interesting DIY investor chatter from the investor forums.

New Deals

Stock markets weren’t the only places to have a pullback going into May. The volume of deals offered by discount brokerages has also dropped off.

At the start of this month, there are 16 deals or promotions being offered by 6 Canadian discount brokerages. Interestingly, 13 of those deals come from just three brokerages: BMO InvestorLine, Questrade and Scotia iTrade.

Compared to February when there were over 25 offers, there is a clear sense that that the ‘rush’ to have a promotion has subsided. That said, those brokerages mentioned above that are offering multiple, concurrent promotions are not likely to slow down their marketing efforts across the summer months. With the MoneySense/Surviscor discount brokerage rankings due out soon and the new TFSA contribution limits recently announced, there are still plenty of reasons for brokerages to be actively campaigning during the late spring/early summer.

Questrade has been the first out of the gate with regards to pushing a TFSA themed promotion however it is unlikely that they will be the only ones doing so for too long. Check out the discount brokerage deals & promotions section for the full details.

Premarket Trading at Questrade

This past week Questrade announced that they will be enabling clients to trade the pre-market sessions as early as 7:30am ET on select US exchanges. With many earnings announcements taking place both before and after the official market hours (9:30am – 4pm), getting into or out of positions at these extended hours can sometimes give traders a jump on the action.

That said, trading in extended market hours is incredibly risky.

The absence of many traders at those times means that pricing on securities is much more volatile and that bid/ask spreads are typically wider. Likely for that reason, Questrade has restricted the eligible order types to “limit orders” with at Good Till Extended Market (GTEM) duration.

Just remember that while the early bird may get the worm, it’s the second mouse that gets the cheese.

Watch and Wait

While CIBC was reported to be the first of the big Canadian banks to release an app for the Apple Watch, TD was able to go one step further and offer their clients the ability to monitor watchlists and get updates on their TD Direct Investing account balance levels. Unfortunately for Canadian DIY investors, that’s as far as functionality goes for now.

With the Apple Watch still on back order and with bugs still being discovered and worked out, it may not be of too much consequence to wait for the dust to settle before seeing the impact of the ultra-small screen on monitoring and managing trading on the go.

Screenshot of TD app for Apple Watch (source iTunes)

In the US, brokerages are still cautiously venturing forward with the Apple Watch technology. A recent piece from Forbes goes through what some of the interfaces look like at larger brokerages in the US such as Schwab and Fidelity. Early feedback seems to be neutral/unimpressed as functionality for trading seems to be tethered to the iPhone, begging the question “why have the watch?” Of course, as any Apple fanatic will testify, “why not” seems to be the more appropriate question.

Event Horizon

May 5

Scotia iTRADE – Playing Both Sides of the Market with Options Straddles and Strangles

TD Direct Investing – Do-It-Yourself Investing for Women

May 6

Desjardins Online Brokerage (Disnat) – How I Day and Swing Trade the Market

Scotia iTRADE – Avoiding Home Country Bias – Constructing Globally Diversified Portfolios With Smart Beta ETFs

TD Direct Investing – Introduction to Investing in Options

NBDB – Tools and Technical Analysis with Michel Carignan – [Fr]

From the Forums

Tax Break

Like that student who prays for a deadline extension around finals, it seems that many last minute tax return filers caught a break as tax filing deadlines were extended for a few more days. That said, this past week there were still comments across the investor forums for individuals expressing frustration at not having the proper documentation from their discount brokerage in a timely fashion.

Peace of Minds

The reality of an increasingly digital world is that convenience often comes at the expense of security. In this post from Red Flag Deals’ investing forum, security measures at different brokerages are put under the spotlight, with only one brokerage standing out as having a robust option in place.

That does it for this week’s roundup. It’s a full weekend for sports fans and a great weekend for the non-sports fans to let the TV do the babysitting. In either case, enjoy the May weather or the Mayweather. Here’s a fun look at the hype behind the great (and most expensive) battle between two boxing legends.