Month: June 2016

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Discount Brokerage Weekly Roundup – June 24, 2016

Despite what the pundits and talking heads are passionately and energetically discussing on business news networks the world over, global markets are not in turmoil. While the calculus of a market repricing may seem messy (and it sometimes is), the reality is that markets are doing what they do best: putting a present day price on a picture of the future. In many ways, the outcome of the ‘unpredictable’ is somewhat predictable: buyers and sellers have different opinions on what something should be worth and volatility ensues until these two groups come to some consensus. For DIY investors and clients of discount brokerages, events like the Brexit also lead to some likely (if not predictable) scenarios when a trading system or two just can’t withstand the rush of orders.

In this week’s roundup, we take a look at the immediate aftermath of the Brexit vote on two Canadian discount brokerages and the lessons DIY investors can learn from them. On the topic of ‘what happens next’ we preview the deals and promotions landscape heading into July to see which offers may be going on a permanent vacation. From there we’ll take a look at the chatter on Twitter and from the investor forums to see what investors had to say during this very volatile week.

Vote of Confidence

A convenient way of contextualizing the Brexit referendum reaction is by understanding that markets act as a great big voting machine on what the world of tomorrow should be worth today.

What is clear in the aftermath of the Brexit vote was that investors had priced in one view of the world heading into the vote and, upon confirmation, they had to reprice the future to accept a new version of events.

For online brokerages, the ensuing volatility is great for bottom line. With all of the uncertainty, investors of all activity levels either foolishly or fearlessly venture into the price melee to bargain hunt or to unload risky assets. Either way, a commission is generated and the brokerage gets paid. That is, of course, if the order is executed.

Despite the “uncertainty” of what’s going to happen next in the markets, there are a few “certainties” about how DIY investors can navigate big market dislocations such as the Brexit.

First, there’s usually a huge spike in volumes and trading activity as speculators scramble to adjust positions and react to opportunities. DIY investors should be prepared for just about anything, including having to wait to access markets or market quotes when platforms go offline or to have an alternate means of executing an order (i.e. know your discount brokerage’s phone number) to either get into or out of a trade. While it is not a guarantee, the trading desks of larger firms have more resources during times of increased trading activity to handle orders over the phone.

Interestingly, even though these kinds of high volatility events can occur with some warning, many online brokerages continue to suffer slowdowns or outages because of the trading volume. Not getting client orders to market or enabling clients to be able to trade is a costly misstep so the more a brokerage is equipped to handle these heavy order day scenarios, the more likely a DIY investor can participate.

For example, the morning after the Brexit vote, clients from several Canadian online brokerages including Virtual Brokers and TD Direct Investing, suffered slowdowns and interruptions to online trading.

A good question to ask is which brokerage can withstand these kinds of spikes and a good place to look is online and whether there are complaints about outages or not.

One online brokerage that has been somewhat more vocal about the kinds of capacity their platform can handle has been Interactive Brokers. Earlier this year on a quarterly conference call, founder and CEO Thomas Peterffy, referenced ability of Interactive Brokers to handle trading volume surges and earlier today, an article from Marketwatch highlighted just how prepared Interactive Brokers’ systems were in the case of an unexpected Brexit outcome.

Source: Twitter
Source: Twitter

Another point to keep in mind is simply that as a DIY investor, there is a significant risk to the technology infrastructure supporting trading networks. There are so many complex moving parts involved in online trading that expecting a trade to execute or expecting to have access to markets is not the same thing as a guarantee of availability, something that many brokerages place in the fine print on a discount brokerage account agreement. When or if technology fails, discount brokerages appear to be off the hook (although clients will try to hold them accountable).

So, for DIY investors and active traders volatile markets are a double-edged sword:  To really be able to capitalize on volatility, individual investors, especially active traders, need too wade into markets when they’re dislocated. On the other hand, it is at those time that reliability of access, availability of shares to short, execution times or the resiliency of a network become real risks to consider.

Unfortunately, none of those risks make it into the marketing or advertising pitches put forward when brokerages want users to open an account. Taking a cue from the Brexit itself, the lesson for traders or aspiring traders is simple: wanting (or needing) to get out is very different than the mechanics of doing so.

On Point

In last week’s roundup we highlighted a comment from an investor forum discussion in which clients of RBC could use their reward point program (RBC Rewards) to pay for commissions on a trade at RBC Direct Investing. This past week, CIBC Investor’s Edge crossed our radar as they posted a message to website visitors that CIBC’s reward points (Aventura or Gold Bonus) can also be used towards funding an Investor’s Edge account.

According to the details, points holders can redeem a minimum of 12,000 points for $100 which is similar to the RBC Direct Investing point redemption minimum.

In addition to CIBC Investor’s Edge and RBC Direct Investing, National Bank Direct Brokerage also lets clients who have certain MasterCards redeem points at the rate of $100 for 11,000 points. The eligible accounts at NBDB are RRSPs or TFSAs.

The good news for points holders at CIBC Investor’s Edge, however, is that the commission rates are lower than at other bank-owned brokerages so one way or another the points can help clients go further for less.

Chopping Block

After the kind of shocking headlines from European markets, there might be more than few investors who are ready to ‘call it a summer’. For those that want to stick around and participate in the action (or even those in the ‘wait and see’ camp, there’s more volatility to be had in the discount brokerage deals space. Currently there are five offers that are set to expire at the end of June. While brokerages may change their minds and extend some or all of the deals, at this point it appears that July should turn into an interesting month.

On the chopping block are the following offers:

  1. National Bank Direct Brokerage’s commission-free Canadian ETF offer
  2. Desjardins Online Brokerage $500 commission credit offer
  3. Scotia iTrade’s refer-a-friend offer
  4. BMO InvestorLine’s refer-a-friend offer
  5. Virtual Broker’s Apple gift card contest offer

Even though there is likely to be a few of these that will be renewed, it will be interesting to see what unfolds in the next week and what other promotions these brokerages might come up with to replace the outgoing offers. Stay tuned.

Event Horizon

As Summer Solstice passes it’s time for new beginnings, and it’s an interesting week ahead for discount brokerage-sponsored investor education events. Here are some upcoming sessions that may be of interest to options enthusiasts and those interested in risk management.

June 28

Scotia iTRADE – Options Trading Mistakes to Avoid with Montreal Exchange

June 29

NBDB – Stop Orders: A Winning Solution Worth Knowing

Discount Brokerage Tweets of the Week

The big news in this weeks tweets is definitely what happened the day after the Brexit vote. Mentioned this week were Questrade (with some big news), Scotia iTRADE, TD Direct Investing and Virtual Brokers.

From the Forums

Short Interest

In what is sure to be an evolving story, investor forum users shared the news that Questrade is looking for a few good shares, that is, if users are willing to lend them out. One of the more creative and interesting maneuvers from Questrade appears to involve letting individuals who own securities lend them out to those looking to short the security. It’s actually quite brilliant since those doing the lending have the ability to earn revenue from the fees paid by those who borrow the shares.  This post from reddit has a great primer on the new feature as well as lots of perspectives for those considering the new program. Well played Questrade, well played.

Pointers on a Gambit

A perennial favourite, Norbert’s Gambit, surfaced yet again and may be something savvy traders look to take advantage of with the recent currency shift. In this post from reddit’s Personal Finance Canada section, performing a gambit at RBC Direct Investing was explained along with some handy resources.

Into the Close

What a note to close the week out on. The Brexit basically took over the headlines and outshone a massive IPO performance by Twilio and the Democrats staging a sit-in. Of course, the biggest exit, arguably, is still to come this weekend with the season finale of Game of Thrones. Just because summer is now here, doesn’t mean that winter isn’t going to show up in full force. Not sure what’s scarier heading into next week but either way, have a great weekend and happy hunting next week!

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Discount Brokerage Weekly Roundup – June 17, 2016

If there’s one thing markets are fueled by, it’s hype. Heading into this weekend, there’s plenty of hype to go around, from the upcoming Brexit vote, to the NBA finals game 7 or even the epic battle to be fought in game of thrones, all of these are building expectations and anticipation. For their part, some brokerages are astutely watching what DIY investors may be excited by and hoping, in some small way, to build excitement and shape expectations with some clever marketing.

In this week’s roundup we take a look at another promotion to surface from a Canadian discount brokerage – a sign that summer is not a period where brokerages are slowing down. Next we take a look at the latest online broker to embrace bringing a roboadvisor into their service offering. From there we look at interesting chatter we came across on various social media channels and close out with a few educational events upcoming and forum comments from the week.

Time Margins On

Summer is almost officially here and although this would be a time when a lot of DIY investors might be stepping back, another discount broker deal has surfaced, this time from National Bank Direct Brokerage.

The latest offer from NBDB appears to be well timed for those interested in trading the incoming volatility of a Brexit vote, a US presidential election and possible interest rate hike by the US as it is an offer that combines discounted margin borrowing rates as well as a lowered commission fee – both for a limited time (of course).

Specifically, National Bank Direct Brokerage is offering new and existing clients a discount of 0.75% on their typical margin lending rates. For new margin account clients, they’re also fixing the commission rates at $6.95 – the commission rate normally available to active traders – for the duration of the promotion. The promo itself runs from the beginning of June until the end of August.

Source: Screenshot from NBDB website

For those fortunate enough to time things just right, National Bank Direct Brokerage is also offering commission-free ETF trading on Canadian ETFs until June 30th so there is a window in which it could be possible to benefit from both promotions (although that is a very short window).

One thing to keep in mind, however, is that opening a new account will take some time and a printer and rely on Canada Post (who may or may not be going on strike July 2). According to the NBDB website the turnaround time for opening a new account with NBDB can take up to 72 business hours (which is 9 business days @ 8 hours/day) once documents are received (by mail).

With this latest offer from National Bank Direct Brokerage, it is encouraging to see the competitive element return to the deals/promotions section. The post RSP season appeared to gear down substantially however activity appears to have picked up again getting closer to the summer. In addition, it is also interesting to see that brokerages appear to be getting more creative with the kinds of offers they’re putting forward.

In the case of National Bank Direct Brokerage, it looks like the promotional offers are about lowering costs, even if it is for just a limited amount of time, rather than offering up commission-free trading or cash back.  It will be interesting to see if other bank-owned brokerages start to follow suit and also what the independent brokerages start to do in response. Either way, it’s a great start to the summer for DIY investors looking for a break on an online trading account.

E*Trade goes Robo

Earlier this month, there was news that another US online brokerage is hopping on the robo-investor train. E*Trade Financial has followed Charles Schwab’s lead by rolling out their own robo-investor product.

While it is not a unique approach, E*Trade is branding their ‘adaptive’ offering as a robo-investor with a ‘human’ approach. What this means is that, in addition to the reliance on index ETFs, there will also be an option for a portfolio built to include actively managed (read pricier) mutual funds.

In Canada, robo-advisors such as BMO’s SmartFolio and Questrade’s Portfolio IQ have a “hybrid” approach that blends passive and active approaches to wealth management. It’s for that reason that even though there is the label of ‘robo’ attached to them, there is still a lot of ‘human’ influence to how and where investments are managed.

With the latest move by E*Trade, there is yet another signal confirming the trend in online brokerages hoping to capture and participate in the new ‘fintech’ era that is taking hold. It likely won’t be too long before we see the non-bank owned brokerages and bank-owned Canadian online brokerages alike start to offer these services (whether organically, in partnership with or by acquisition) in the not too distant future.

Around Social Media

In our regular sweep of social media channels, there were a couple of interesting pieces of news that crossed our radar this week.

BMO InvestorLine (according to Twitter)

First, according to this tweet, it looks like BMO InvestorLine is getting a new national director – Rosemary Torelli. Interestingly, that wasn’t the only BMO InvestorLine senior executive appearing on social media, as President of BMO InvestorLine, Julie Baker-Merz appeared in this clip on innovation in financial technology. Timing wise, the appearance seems to line up with yet another BMO InvestorLine panel sent to gather feedback about the online discount brokerage’s services.

Vault Cracker at National Bank Direct Brokerage

As a follow up to tweet from this past May, National Bank Direct Brokerage announced the winner of their ‘crack the vault’ contest. The lucky winner of $5,000, Semyon Levin, was announced on NBDB’s LinkedIn page.

 

Discount Brokerage Tweets of the Week

Maybe the nicer weather brought out the best in some as (most) tweets were a bit more congenial. Mentioned this week were CIBC Investor's Edge, Interactive Brokers, Questrade, Scotia iTRADE and TD Direct Investing.

Event Horizon

Summer’s almost here, and it’s a glorious week ahead for discount brokerage-sponsored investor education events. Here are some upcoming sessions that may be of interest to both options, and technical analysis enthusiasts. Margin accounts and short selling round out this week’s selection.

June 21

Scotia iTRADE – Index Iron Condors: A Friend When There is No Trend with Pro Market Advisors

June 22

NBDB – Take Advantage of Margin Accounts – [Fr]

From the Forums

Banking on Change

In this post from reddit’s Personal Finance Canada subreddit, one user feels the sting of fees from investing through their bank. Find out what the reddit community had to say about ways in which to lower investing related costs.

To the Point

Rewards points are a great little perk for buying everyday items. What those points are worth, however, is always a bit of a guessing game. In this post from RedFlagDeals.com’s investing thread, one user kindly shares something of interest to RBC Direct Investing users about the value of points to pay for a trade commission.

Into the Close

That’s a wrap for another week. Hope everyone has a great Father’s Day filled with many corny dad jokes. Of course there’s also lots of excitement for basketball fans and an epic battle on Game of Thrones between two guys who would probably not have a great Father’s Day (if they do that kind of thing in the seven kingdoms). In the meantime, here’s a great dunk to kick off the weekend.

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Discount Brokerage Weekly Roundup – June 10, 2016

In an era of robots and algos, and in a business that stresses keeping things unemotional, there are often times for every trader when emotions and humanity creep back into the picture. This was one of those weeks.

From the news of Muhammad Ali’s passing last week to the outpouring of beautiful tributes that came in through the week and the final service today, this week many of his fans, myself included, found it hard to not reflect on the life of such an incredible athlete and humanitarian. Between the heavy sighs, however, was the reminder that markets and money never sleep. And for many traders, the future is always where the focus lies and the next few weeks will be filled with many challenging events to navigate around.

In this week’s roundup we take a look at a milestone in the history of one online brokerage and what they’re giving away to celebrate. Next we take a look at the little changes that one brokerage is making that DIY investors may be interested in keeping a handle on. From there we highlight some upcoming investor education events and round out with a review of the latest chatter on Twitter and across the forums.

CIBC Investor’s Edge Celebrates 25 years

There have never been more choices for Canadian DIY investors looking to trade ETFs commission free than there are right now. Along with Questrade, Virtual Brokers, Qtrade Investor, Scotia iTRADE and National Bank Direct Brokerage, another online brokerage, CIBC Investor’s Edge, has joined the commission-free ETF roster – albeit for a limited time.

To mark their 25th anniversary, CIBC Investor’s Edge is offering clients commission-free ETF trading on nearly 2000 ETFs for 25 trading days. This promotion runs between June 8th and July 13th.The list of eligible ETFs is here and includes many of the most popular Canadian and US ETFs.

In addition to the promotional offer, the CIBC Investor’s Edge website also has a fun little timeline of the 25 years that explains some of the major milestones for Investor’s Edge over that time.

source: screenshot from CIBC Investor’s Edge website

Despite all the fanfare, however, even celebratory balloons can have strings attached and this offer is no different. Here are some important notes from the terms and conditions.

First ETFs must be held at least one day to be eligible for commission free status. Second, other charges that could apply to trading an ETF, such as an ECN fee would apply to trading these ETFs. Third, the value of the trade needs to exceed $100 in the currency of the trade. Finally, commission-free ETF trades don’t count as qualifying trades for the active trader program.

For swing traders and those looking for an opportune time to rebalance, the commission-free ETF offer is a compelling one, even if the window to take advantage of it is quite small.

With a significant vote on the fate of Britain in the European Union coming up, rate decisions from the Fed chair and a looming US election, analysts are forecasting more volatility on the horizon, so the timing of this promotion may be considered opportune by some (either to get in commission-free or get out commission-free).

It’s somewhat hard to believe that 25 years has gone by as quickly as it has, and to have witnessed first-hand the impact of the dramatic shift in technology that’s occurred over that time. As Canadian online brokerages contemplate what the next 25 years might look like, there’s a good chance that there will a much greater shift in technology and a very different landscape of players and opportunities.

Better Terms

Sometimes there’s big changes that make the news and sometimes it’s the little things that catch our attention. For those brave (and prudent) enough to venture into the Virtual Brokers terms and conditions page recently, they may also have noted some changes to just how long that document isn’t.

Recently, it appears that Virtual Brokers has streamlined their terms and conditions page by taking the terms and conditions for individual promotions and placing them into the promotions pages.

While it may not seem like that big of a deal, for new or existing clients looking to see what their client agreement looks like with a brokerage, it’s nice not to have to wade through lots of irrelevant information to stay up to date. Now that said, there’s also information that still exists that is not quite current such as the information on transfer fee promos that expired at the end of March (and it’s now mid-June).

Another change to the fine print has seen the expiration date of their commission-free trading offer go from non-existent when it first rolled out to May 31st to now December 31st.

The promotion is three months of commission-free trading (and three months of no platform fees) on their commission-free trading account. In a nutshell, it’s three months of free trading for a deposit of $5,000. Like most other offers, however, there are also strings attached to this one so be sure to read (and take a copy of) the terms and conditions before signing on.

Of course, these fine print changes are something that many brokerages reserve the right to change at any time. There are a few upcoming changes to fees from online brokerages that are noteworthy including fee changes at Scotia iTRADE (set to take effect June 15) and BMO InvestorLine (set to take effect July 1st)

Discount Brokerage Tweets of the Week

Nicer weather outside may not quite have translated into nicer comments for Canadian discount brokerages on Twitter. Mentioned this week were Questrade, Scotia iTRADE and TD Direct Investing (and strangely Snoop Dogg).

Event Horizon

The days keep getting longer, and it’s an exciting week ahead for discount brokerage-sponsored investor education events. Here are some upcoming sessions that may be of interest to technical analysis enthusiasts, and those interested in ETFs in this week’s selection.

June 14

Scotia iTRADE – Active Investing Using ETFs with Horizons ETFs

NBDB – Introduction to Technical Analysis – Oscillators -[Fr]

 

From the Forums

Limited Timing

The recently announced commission-free ETF offer from CIBC Investor’s Edge seems to have one downside – time. In this post from reddit’s Personal Finance Canada section in the recent promotion was discussed by a few folks with some interesting thoughts on how to best approach the new offer.

To Bank or Not to Bank

In this post from RedFlagDeals.com’s investing section, one user asks about the pros and cons of going with either a bank-owned brokerage or an independent brokerage.

Into the Close

Last week the world said goodbye to one of the greatest people of all time, Muhammad Ali. It was a particularly difficult loss for many, myself included, and today was his memorial service. One of the most touching eulogies delivered at the service was that from his long-time friend Billy Crystal. We end the roundup on this bittersweet note with a segment of that speech:

‘But didn’t he make all of our lives a little bit better than they were?

‘That my friends, is my history with a man, and I’ve labored to come up with a way to describe the legend.

‘He was a tremendous bolt of lightning, created by mother nature out of thin air, a fantastic combination of power and beauty.

‘We’ve seen still photographs of lightning bolts, at the moment of impact – ferocious in its strength, magnificent in its elegance.

‘And at the moment of impact, it lights up everything around it, so you can see everything clearly.

‘Muhammad Ali struck us in the middle of America’s darkest night, in the heart of its most threatening gathering storm.

‘His power toppled the mightiest of foes, and his intense light shined on America and we were able to see clearly injustice, inequality, poverty, pride, self-realization, courage, laughter, love, joy and religious freedom for all.

‘Ali forced us to take a look at ourselves. This brash young man who thrilled us, angered us, confused, and challenged us, ultimately became a silent messenger of peace who taught us that life is best when you build bridges between people, not walls.

‘My friends- only once in a thousand years or so do we get to hear a Mozart or see a Picasso or read a Shakespeare.

‘Ali was one of them, and yet at his heart, he was still a kid from Louisville who ran with the Gods and walked with the crippled and smiled at the foolishness of it all.

‘He is gone but he will never die. He was my big brother. Thank you.’

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Discount Brokerage Weekly Roundup – June 3, 2016

source: Giphy

In case you didn’t get the memo, it’s National Donut Day – oh and apparently there’s a bull market in commodities to mark the occasion. As we head into a new month, the headline of a ‘bull market’ in commodities is great news for Canadian traders, regardless of whether or not the rally sustains itself. For Canadian online brokerages, this could be the break they’ve been waiting for, so long as they’re able to get their story out over and above the Canadian real estate price craze that is dominating the news cycle.

In this week’s roundup, we take a look at the freshly baked offers from Canadian discount brokerages who are offering up deals to woo back DIY investors into the summer markets. Next, we take a look at one online brokerage who has grown its number of clients by over 250% since the great recession. From there we’ll take a look at the latest online brokerage related tweets and what DIY investors were talking about this week.

Sweet Deals are Made of These

With summer just around the corner, most people will be looking to take it easy. Not so at a few Canadian online brokerages drumming up interest with deals & promotions.

Heading into a new month the deals activity appears to have stabilized somewhat with promotions from Scotia iTRADE coming back online in May and a new deal from BMO InvestorLine launching at the beginning of the month to replace their outgoing spring promotion.

One of the interesting trends that seems to be picking up steam is the use of contests. Virtual Brokers was at it again with regards to running a contest, this time for their existing clients, offering up a contest entry for completing a feedback survey. The prizes: 3 draws for an Apple gift card (or a $500 deposit into their account).

As we had referenced last week, National Bank Direct Brokerage, RBC Direct Investing, Virtual Brokers and Scotia iTRADE all have contests going at the moment whereas the ‘cash back’ or ‘free trade’ offers continue to remain on hold.

For those looking for a deal or promotion from Questrade, the good news is that there are still affiliate-based offers to be had that provide cash back or free trades. Specifically, users can use this link for a $50 commission credit or check our deals section on referral offers for a cash back offering. (note: Sparx will receive an affiliate payment for either of these)

Now that the commodity markets (in Canada) seem to be signaling a bullish tone, it will be interesting to watch how or if discount brokerages will move quickly to capitalize on the attention.

Interactive Brokers Grinds Higher

In sports, whenever a team or an athlete goes on a winning streak people start paying attention. In the online brokerage world, however, things are a bit more, um, humble.

As we’ve highlighted in the past, the beginning of the month typically signals a point at which we can check in on the latest trading metrics at Interactive Brokers (since they are one of a few online brokerages in the US that actually report these figures).

For anyone keeping score, trading metrics for the month of May at Interactive Brokers were largely in line with activity in the year thus far: DARTs, client equity and credit balances were healthy. The only sign of an issue was with margin loan balances decreasing on both a month/month and year/year basis.

What was particularly fascinating in looking through these figures is the growth streak that Interactive Brokers has been on.

For some context, each month when these stats are published, there seems to be one number that keeps on growing: the number of total accounts. “How long has this been going?” we wondered since it has been that way for as long as SparxTrading.com has been around and then some. So we checked.

As it turns out, as of the data available (going back to January 2008), Interactive Brokers has been growing the number of users for the past 100 (yep) consecutive months which explains how they’ve grown their user base 263% from 97.2 thousand clients to 352.6 thousand. That despite the great recession/housing crisis, the hubbub in Europe over sovereign debt and all other market pullbacks along the way.

Interactive Brokers Account Growth 2008 – Present

For some context, the number of brokerage accounts at E*trade in April 2016 was about 3.2M so Interactive Brokers is certainly a much smaller player in comparison to its peers in the US and also in Canada. That said, in January of 2014, E*trade had 3M brokerage accounts so the percentage growth in brokerage accounts since then (~7%)  has been relatively flat whereas at Interactive Brokers client base grew 45% over the same period.

While all streaks must eventually come to an end, this is one is an interesting signal that a) investors are continuing to turn to DIY platforms for investing/trading and that b) Interactive Brokers must be doing something right when it comes to catering to active traders – who, incidentally, are the most highly prized (and profitable) client segment of the market for online brokerages.

Naturally their competitors and clients would want to know what their ‘secret’ is however as CEO of Interactive Brokers revealed, the ‘secret’ is a relentless focus on technological dominance and lowering the cost of trading execution.

As part of a recent communique to clients and again on their Twitter feed, they highlighted new order types available to clients – an adaptive algorithmic market order.

While it is a mouthful to say, the clip shown below demonstrates just how far ahead of the other brokerage players (at least in Canada) Interactive Brokers is when it comes to trading experience. A “smart” market order that can adapt to market conditions to get a little better of a fill price is indicative of the technical savvy of Interactive Brokers and also a sign that human traders are increasingly turning to machines/algos to help compete against the robots they’re inevitably trading against (their Accumulate Distribute Algo is also very interesting for any trading geeks out there).

With that in mind, it will be interesting what technology the other Canadian online brokerages embrace to provide active trading clients with in order to compete against other traders. Even more interesting, however, will be what technology the brokerages will embrace to compete against the robo-advisors that are also chipping away at their market share.

Discount Brokerage Tweets of the Week

An interesting selection of queries, comments and some shade this week. Mentioned are Questrade, RBC Direct Investing, Scotia iTRADE, TD Direct Investing and Virtual Brokers.

From the Forums

Making a Move from Questrade

As many DIY investors will confess, keeping multiple trading accounts offers the best of all worlds for features but not so much for convenience. In this post from RedFlagDeals.com’s Investing forum, one user is looking to consolidate from Questrade to BMO InvestorLine and receives an interesting answer worth considering.

Going Steady

Going the couch potato route is a popular approach for many investors. How well it works, however, can also be influenced by the commissions paid for ETFs. In this post from reddit’s PersonalFinanceCanada section, one user asks for comments comparing TD’s popular E-Series with ETFs and how regular (large-ish) contributions might factor in.

Into the Close

It’s finally Friday. There’s definitely no shortage of ways to enjoy this weekend from inside or out. While there’s no telling what next week in the markets soon – an interest rate hike isn’t likely to be one. As for exactly when, for that we need psychics. Now if we could only ask this duo (see video) when that hike will hit or have them around during earnings season, that would be something!

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Discount Brokerage Deals & Promotions – June 1, 2016

Summer is close at hand and now that May is behind us, those who have sold in May and gone away might still find a reason to come back to the markets – at least that’s what some brokerages are banking on.

As we launch into a new month the discount brokerage deals and promotions landscape this year looks quite different than a year ago at this time.

For starters, one of the major sources of promotional offers for DIY investors, Questrade, is still in a holding pattern with no new noteworthy promotions being put forward. This is in stark contrast to last year where they were leading all brokerages with the most offers. For those still seeking a deal with Questrade, several are available, including (see below) links to affiliate plans and refer-a-friend bonuses.

In terms of the bank-owned brokerages, there were two interesting developments. First, BMO InvestorLine started the month with a new offer for the summer to replace their outgoing promotion that concluded at the end of May. Second, Scotia iTrade recently celebrated their 1-year anniversary of their downtown Toronto investor centre opening and marked it with incentives like free gelato and movie passes to meet with investment representatives.

There’s been a recent uptick in the number of contests being put forward by online brokerages so it will be interesting to monitor this approach to see if this will be a strategic way to drum up excitement for online brokerages during the summer months.

That said, there are a number of offers that are scheduled to expire during and at the end of June. Desjardins Online Brokerage’s commission credit offer, Virtual Brokers Apple gift card promotion, BMO InvestorLine’s refer-a-friend and National Bank Direct Brokerage’s commission-free Canadian ETF promotion are all on the chopping block this month so it will be interesting to see which discount brokerage promotion, if any, gets renewed.

If not, it will definitely be a much smaller field of brokerages and offers for DIY investors to choose from, at least until the fall season shows up when brokerages will be more interested in ramping up their promotional activities.

Expired Deals

The turnover in deals in May was not that substantial, with an offer from BMO InvestorLine and Virtual Brokers’ referral deal expiring. At the time of publication, it was not confirmed if Virtual Brokers would be extending the Cash Referral Program however we will post an update when we have one.

Extended Deals

No deals were officially extended at the time of publication.

New Deals

BMO InvestorLine was the only online brokerage to kick off the new month with a new offer. Specifically, BMO InvestorLine is offering investors cash back for opening and funding a new qualifying account. The cash back amounts range from $200 to $1,000 cash back depending on deposit sizes. In keeping with many of their previous promotions, the minimum deposit to qualify (for the entry level cash back amount) is $100,000. Interestingly, and unlike many other brokerages, BMO InvestorLine enables this cash back offer to be combined with their referral bonus ($50 for a minimum deposit of $50,000).

Discount Brokerage Deals

  1. Cash Back/Free Trade/Product Offer Promotions
  2. Referral Promotions
  3. Transfer Fee Promotions
  4. Contests & Other Offers

Cash Back/Free Trade/Product Offer Promotions

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
Transfer $25,000 or more from another brokerage and Credential Direct will cover up to $150 in transfer fees. Use promo code SWITCHME when signing up to qualify for the transfer promotion. $150 $25,000 Credential Direct Transfer Fee Rebate 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 at least $25,000 or more in new assets to TD Direct Investing when opening a new account and you may qualify to have transfer fees reimbursed up to $150. Be sure to contact TD Direct Investing for further details. $150 $25,000 Contact client service for more information (1-800-465-5463). none
Transfer $25,000 or more to Virtual Brokers and they may cover up to $150 in transfer fees. $150 $25,000 Apple gift card promo June 30, 2016
Transfer $25,000 or more into a CIBC Investor’s Edge account and they will reimburse up to $135 in brokerage transfer fees. Clients must call customer service to request rebate after transfer made. $135 $25,000 Confirmed with reps. Contact client service for more information (1-800-567-3343). 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
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 1-866-873-7103 and mention promo code Disnat500. See details link for more info. $150 $50,000 Disnat $500 Commission Credit Promo June 30, 2016

Expired Offers
Last Updated: June 1, 2016 16:50 PT

Referral Promotions

Company Brief Description Minimum Deposit Amount Required Details Link Deadline
Credential Direct has partnered with Trend Micro to offer 50% off Trend Micro Titanium Internet Security. Use code “TrendCF” at checkout. n/a Trend Micro Special Offer Code none
National Bank Direct Brokerage is sponsoring the latest edition of the Horizons ETFs Biggest Winner simulated trading competition. Top prize for the contest winner is $7,500 with a runner up prize of $2,500. There will also be weekly prizes of $500. Be sure to read terms and conditions for full details on timing and eligibility. n/a Horizons ETFs Biggest Winner 6 June 17, 2016
Scotia iTrade Scotia iTRADE is offering a no-purchase entry option to their Stock Shopping Spree contest. There is a limit of one (1) ballot per person using the no purchase required method. Top prize is $10,000 and there are 5 runner-up prizes of $1,000. Be sure to read full contest rules and regulations for eligibility. n/a No Purchase Entry Link . Click here for full contest rules. July 31, 2016
Disnat Desjardins Online Brokerage is offering $50 in commission credits for new Disnat Classic clients depositing at least $1,000. See terms and conditions for full details. $1,000 Broker@ge 18-30 Promotion none
Scotia iTrade Scotiabank StartRight customers can receive 10 commission-free trades when investing $1,000 or more in a new Scotia iTrade account. Trades are good for use for up to 1 year from the date the account is funded. Use promo code SRPE15 when applying (in English) or SRPF15 when applying in French. Be sure to read full terms and conditions for full details. $1,000 StartRight Free Trade offer none
Virtual Brokers is offering the chance for individuals who sign up for a new online trading account on the classic commission structure with a deposit of at least $1,000 to win an Apple $500 gift card. Be sure to read terms and conditions for more information. $1,000 Apple Gift Card Promotion June 30, 2016

Expired Offers
Last Updated: June 1, 2016 16:50 PT

Transfer Fee Promotions

Company Brief Description Minimum Deposit Amount Commission/Cash Offer/Promotion 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 Jitneytrade and receive access to their preferred pricing package. n/a Discounted Commission Rates none For more details click here none
Open and fund a new account (TFSA, Margin or RRSP) with at least $1,000 and you may be eligible to receive 5 commission-free trades. Use promo code 5FREETRADES when signing up. Be sure to read terms and conditions carefully. $1,000 5 commission-free trades 60 days 5 commission-free trade offer December 31, 2016
Open and fund a new account at Virtual Brokers with at least $5,000 and you may be eligible to receive 3 months of commission-free equity trading and a $150 USD/mo credit towards Edge Trader Pro for 3 months. Use promo code sent at sign up to qualify. Be sure to read full terms and conditions for details. $5,000 3 months commission-free equity trading + $150 USD/mo platform fee rebate. 3 months 3 months free trading / Sign up form for promo code available here none
Scotia iTrade Open and fund a new account at Scotia iTrade with at least A) $25,000; B) $50,000; C) $100,000 D) $250,000 E) $500,000 or F) $1,000,000+ and you may be eligible to receive up to A) 75 commission-free trades and 5 contest ballots; B) 150 commission-free trades and 10 contest ballots; C) 200 commission-free trades and 25 contest ballots; D) 250 commission-free trades and 50 contest ballots; E) 250 commission-free trades and 100 contest ballots; or F) 250 commission-free trades and 200 contest ballots. Use promo code SP16FT when opening account to be eligible. Be sure to read terms and conditions for full details. A) $25,000 – $49,999 B) $50,000 – $99,999 C) $100,000 – $249,999 D) $250,000 – $499,999 E) $500,000 – $999,999 F) $1,000,000+ A) 75 commission-free trades + 5 contest ballots B) 150 commission-free trades + 10 ballots C) 200 commission-free trades + 25 ballots D) 250 commission-free trades + 50 ballots E) 250 commission-free trades + 100 ballots F) 250 commission-free trades + 200 ballots 90 days for free trades TSX Shopping Spree Contest . For full contest rules, click here July 31, 2016
Disnat Disnat is offering new & existing clients up to $500 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 1-866-873-7103 and mention promo code Disnat500. See details link for more info. $50,000 $500 commission credit 6 months Disnat $500 Commission Credit Promo August 30, 2016
BMO InvestorLine Open a new qualifying account with BMO InvestorLine, and fund it with at least A) $100,000 or B) $250,000 or C)$500,000 in net new assets and you may be eligible to receive A) $200 cash back, B)$500 cash back or C) $1,000 cash back. Use promo code Summer1000 when signing up to be eligible. Be sure to read the terms and conditions for more details on the offer. A) $100,000 – $249,999 B) $250,000 – $499,999 C) $500,000+ A) $200 cash back B) $500 cash back C) $1,000 cash back Cash back will be deposited the week of Mar. 6, 2017. Summer 2016 Promotion July 31, 2016

Expired Offers
Last Updated: July 8 14:45 PT

Other Promotions

Company Brief Description Minimum Deposit Amount Incentive Structure Time Limit to Use Commission/Cash Offer Deposit Details Link Deadline
Refer a friend to Questrade and when they open an account you receive $25 cash back and they receive either A) $25; B) $50; C) $75; D) $100; or E) $250 depending on the amount deposited amount. Enter code: 476104302388759 during account sign up to qualify. Be sure to read the terms and conditions for eligibility and additional bonus payment structure and minimum balance requirements. A) $1,000 – $9,999 B) $10,000 – $24,999 C) $25,000 – $49,999 D) $50,000 -$99,999 E) $100,000+ $25 cash back (for referrer per referral; $50 bonus cash back for every 3rd referral) For referred individuals: A) $25 cash back B) $50 cash back C) $75 cash back D) $100 cash back E) $250 cash back Cash deposited into Questrade billing account within 7 days after funding period ends (90 days) Refer a friend terms and conditions Code Number: 476104302388759 none
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 tbd
If you (an existing Virtual Brokers client) refer a friend or family member to open a new account with at least $5,000 you may be eligible to receive $25 cash per referral. For 3 or more referrals Virtual Brokers will add a $50 bonus. Referred individuals depositing either A) $5,000 – $50,000 or B) $50,000+ may be eligible to receive A) $25 or B) $50 cash back. Be sure to read the full terms and conditions carefully for full details. Be sure to read the terms and conditions to this offer carefully for full details. A) $5,000 – $50,000 B) $50,000+ Referrer: $25 per referral; $50 bonus for each 3 or more referrals. Referee: A) $25 B) $50 Cash to be deposited to VB account by August 15, 2016. Cash Referral Program May 31, 2016
BMO InvestorLine If you (an existing BMO InvestorLine client) refer a new client to BMO InvestorLine and they open an account with at least $50,000 the referrer and the referee may both be eligible to receive $50 cash. To qualify the referee must use the email of the referrer that is linked to their BMO InvestorLine account. See terms and conditions for full details. $50,000 You(referrer): $50; Your Friend(referee): $50 Payout occurs 45 days after minimum 90 day holding period(subject to conditions). BMO InvestorLine Refer-a-Friend October 31, 2016

Expired Offers
Open a new account (TFSA, Margin or RRSP) and receive $50 commission credit . Use promo code: kdkfnbbc $1,000 $50 commission credit 30 days none none
Last Updated: July 8, 2016 14:51PT