Tag: HSBC InvestDirect

HSBC InvestDirect

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Discount Brokerage Weekly Roundup – December 22, 2017

For last minute shoppers, this is it – the mad sprint to the finish line ahead of Christmas next week. Interestingly enough, procrastinating gift-givers weren’t the only ones getting things done this week, as Canadian online brokerages were also busy making news and releasing features heading into the final few days of 2017.

In this holiday edition of the weekly roundup, we look at the latest published Canadian discount brokerage rankings and highlight one online brokerage that has had an eventful 2017 on the rankings podium. From there, we report on a new feature released this week at a non-bank-owned brokerage and report on an interesting promotional offer that crossed our radar from one of Canada’s largest online brokerages. Also worth having a glance at are the DIY investor tweets this week as multiple platform outages and customer service wait times highlight the downside of DIY investing. Finally, we’ll wrap up with a pair of interesting DIY investor forum posts.

Qtrade Investor continues a winning 2017

Qtrade Investor continues to shine in 2017, notching another win in the circuit of Canadian discount brokerage rankings. This past week, Qtrade Investor came out on top of the Surviscor online brokerage ratings and continued what has been a very positive year for recognition and awards in the Canadian online brokerage space..

This past summer, for example, Qtrade Investor won the title of best overall brokerage in Moneysense magazine’s online brokerage review (which were also based on Surviscor’s analysis). And, in September, Qtrade placed a close second place in the J.D. Power Investor Satisfaction Study, just behind Desjardins Online Brokerage, whose parent Desjardins Group also owns Qtrade Investor. While the latest edition of the Globe and Mail online brokerage rankings are still forthcoming, there’s a good chance that Qtrade Investor will continue its strong showing there as well. In 2016, Qtrade Investor also took top honours in that ranking, demonstrating a broad positive performance across several different rankings.

In terms of the latest Surviscor rankings, Qtrade Investor managed to outperform 12 other Canadian discount brokerages across over a number of different criteria including categories related to site functionality, features, pricing and user experience over all.

For Qtrade Investor, notching a score of 90% on the Surviscor rankings put it well out in front of the field.  For the remaining firms in the top 5, however, the race was much tighter. Questrade, which came in second overall, scored 79% while BMO InvestorLine and Scotia iTRADE tied for third place at 77%. RBC Direct Investing, which scored 72%, rounded out the top five. At the bottom of this year’s list was HSBC InvestDirect, which scored 55%.

Another interesting observation was that the big bank-owned online brokerages were relatively close in scoring to one another. The top bank-owned online brokerages in this survey (BMO InvestorLine and Scotia iTRADE) scored 77% while TD Direct Investing, which placed 6th, did so with a score of 70%.  The only outlier for the big Canadian bank-owned online brokerages was CIBC Investor’s Edge, which placed 11th at 59%.

While the percentage differences may seem small, in a hyper competitive and rapidly evolving landscape, every advantage matters. This past year the Canadian online brokerage space underwent some important changes that will make 2018 and beyond a challenge for all providers to maneuver around.

For example, HSBC InvestDirect dropped their commission prices on North American equity trades down to the lowest standard rate of any of the big bank-owned online brokerages ($6.88). Also, just last week, it was announced that Qtrade Investor and Credential Direct would be merging as part of the major merger deal taking place in the Canadian credit union space.

For Canadian DIY investors looking for an online investing account, the awards received by Qtrade Investor offer a compelling set of reasons to consider this discount brokerage. Nonetheless, the data from the latest Surviscor rankings also show that the difference between most of the firms in the top 5 is relatively small. As a result, DIY investors can afford to be picky with an online brokerage or find an online brokerage with whom banking/lending convenience is the deciding factor. Either way, it will be interesting to watch what innovation or new development “online brokerages” would tackle next.

Credit Max from Virtual Brokers

Although the end of 2017 is just around the corner, Virtual Brokers knows that the race between online brokerages is not slowing down any time soon. This past week, they quietly rolled out a new feature called ‘Credit Max’ which enables clients to link their TFSA to their margin account to provide additional buying power when trading.

Similar to Questrade’s “Margin Power”, this new feature by Virtual Brokers is geared towards somewhat active and sophisticated traders who want the benefits of dynamically managing TFSA accounts as well as a margin account.

With VB’s new offer, all of the same risk factors regarding margin trading and leverage still apply. Perhaps the important additional consideration that programs like this require investors to think about, is the fact that the TFSA regulations around contributions and withdrawals also still apply. So, if a position or trade doesn’t work out and assets from a TFSA are needed to cover a losing trade, the additional tracking of one’s TFSA is another layer of complexity to sort through.

That said, it will be interesting to see if this feature spreads to other online brokerages. Already, there are some interesting TFSA-focused features being deployed. The TFSA contribution tracker at Qtrade Investor (also Wealthsimple has a TFSA contribution tracking feature) suggests TFSA may start to grab more of the spotlight at Canadian online brokerages more than either the margin trading or RSP accounts have typically enjoyed.

Deals Updates

This past week an important deal from one of Canada’s largest online brokerages crossed our radar. TD Direct Investing is now offering up a competitive cash-back bonus in hopes of attracting new assets through the ‘RSP season’.

While the threshold to qualify for this promotion is much lower by historical standards (at $10,000) and lower by comparison to deals/promos offered by other bank-owned online brokerages, this deal does come with an interesting twist. In order to qualify for the cash-back bonus, at least five commission-generating trades need to be placed within the first 90 days of the account being opened and funded. What that means is that individuals have to spend close to $50 to see the benefit of the cash-back award.

Although this is not the first discount brokerage deal to have a trading activity threshold requirement, it is interesting to see an offer like this hit the market at this time and from the largest online brokerage in Canada. Ideally, DIY investors would not have to execute trades to qualify for a cash back bonus, however this deal will likely be more enticing to slightly more active investors, which is exactly one of the prized demographics TD Direct Investing are hoping to land as new clients.

As always, the lesson for DIY investors is to read the fine print before committing. Click here to view our latest discount brokerage deals section and to review the offer in more detail.

Discount Brokerage Tweets of the Week

It was a tough week for DIY investors faced with platform outages, and probably an even tough one for the social media teams helping to triage. Mentioned by Canadian DIY investors were BMO InvestorLine, Credential Direct, CIBC Investor’s Edge, Questrade, RBC Direct Investing, Scotia iTRADE, and TD Direct Investing.

From the Forums

Banking on a Brokerage

The convenience and security of a big-bank owned online brokerage are appealing to many DIY investors. In this post, from RedFlagDeals.com’s investing thread, polls ask community users for their thoughts on the best bank-owned Canadian online brokerage.

Building Wealth

When it comes to learning about building and managing wealth, asking all kinds of questions is a great way to help get insight on sometimes difficult/thorny concepts. In this post from reddit’s Personal Finance Canada thread, one user shares questions about passive investing strategies that many DIY investors typically want to know about. Worth a read for anyone getting started to invest on their own.

Into the Close

Merry Christmas and Happy Holidays. Remember that stock markets are closed Monday (25th) and Tuesday (26th), but crypto markets are very much open. The weekly-roundup will return in the New Year with more exciting coverage of the Canadian online brokerage space. See you in the future!

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Discount Brokerage Deals and Promotions – December 2017

*Update: Dec. 21* If there’s one thing that we love to share heading into the end of the year, it’s holiday cheer. And, heading into the end of 2017 there’s lots to be cheerful for if you’re a DIY investor looking to open an online trading account at one of Canada’s discount brokerages.

Discount Brokerage Deals Quick Nav

  1. Cash Back/Free Trade/Product Offer Promotions
  2. Referral Promotions
  3. Transfer Fee Promotions
  4. Contests & Other Offers
  5. Digital Advice + Roboadvisor Promotions (new!)

As the end of the calendar year (which is important for TFSA’s) and the RRSP contribution deadline (in March) tick closer, Canadian discount brokerages are gearing up for another busy season of DIY investors shopping around for the best deal on an online trading account.

Another reason online brokerages are looking to attract DIY investors is the meteoric rise in Bitcoin and and all things cryptocurrency as well as the interest in stocks/companies poised to benefit from legalization of recreational marijuana in Canada and beyond. Even though stock markets are at all-time highs, it seems that general investor sentiment is positive overall which in turn, attracts investors off the sidelines and into the online brokerage space.

So, fundamentally, it seems that now would be an opportune time for Canadian online brokerages to ramp up their incentive offers to win over DIY investors on the fence about choosing an online brokerage.

With that in mind, we’ll be keeping an eye out for offers that come to market between now and the end of 2018 and, as always, if you spot something that might be of value to other DIY investors, please place it in the comments below.

Expired Offers

There were no offers that expired heading into December.

Extended Offers

There were no offers that were extended heading into December.

New Offers

*Update: Dec. 21: Just in time for the holiday shopping season (and RSP season), TD Direct Investing has launched a very competitive cash-back offer through to the beginning of March 2018. This tiered offer starts at qualifying deposits (or asset transfers from another online brokerage) of $10,000 ($100 cash back) and goes to deposits of $500,000 or more ($1,000 cash back). See table below for more information.*

*Update: Dec. 9: Better late than never for the latest deal to cross our radar. HSBC InvestDirect is offering a trade commission rebate offer for up to 30 trades. This promotion follows their recent commission-price cut which we reported in October. For those interested in HSBC InvestDirect, the deadline for eligibility for this offer is December 15th 2017. See table below for more information.*

Virtual Brokers added a new promotion for discounted commission pricing. For a limited time, eligible individuals are able to receive up to 15 trades per month at $4.99 per trade for up to two months. The minimum deposit to be eligible for this offer is $5,000 and the offer is set to expire in March 2018.

Discount Brokerage Deals

  1. Cash Back/Free Trade/Product Offer Promotions
  2. Referral Promotions
  3. Transfer Fee Promotions
  4. Contests & Other Offers
  5. Digital Advice + Roboadvisor Promotions (new!)

Cash Back/Free Trade/Product Offer 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 with HSBC InvestDirect and you may be eligible to receive up to 30 North American equity trades commission-free. See terms and conditions for full details. n/a 30 commission-free North American equity trades 60 days (commissions will be reimbursed after 90 days). HSBC InvestDirect Fall Offer December 15, 2017
Open and fund a new account (TFSA, Margin or RRSP) with at least $1,000 and you may be eligible to receive $88 in commission credits (up to 17 commission-free trades). Use promo code SPARX88 when signing up. Be sure to read terms and conditions carefully. $1,000 $88 commission credit 60 days Access this offer by clicking here: $88 commission-credit offer . For full terms and conditions, 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, 2017
Open and fund a new account with Virtual Brokers with at least $5,000 and you may be eligible to receive up to two months of trading at $4.99 per trade (maximum of 15 trades per month). Use promo code 499COM2017 when signing up to qualify. See terms and conditions for full details. $5,000 Up to 2 months of trading at $4.99 per trade (max 15 trades per month) Commissions will be reimbursed after June 30, 2018. For more details, click here March 31, 2018
Open and fund a qualifying account with TD Direct Investing with at least A) $10,000; B) $50,000; C) $100,000; D) $250,000 or E) $500,000+ and place at least 5 commissionable trades within 90 days of account opening and you may be eligible to receive either A) $100; B) $200; C) $300; D) $500 or E) $1,000 in cash back. Be sure to read full terms and conditions for eligibility for this offer. A) $10,000 B) $50,000 C) $100,000 D) $250,000 E) $500,000+ A) $100 B) $200 C) $300 D) $500 E) $1,000 Cash award will be paid to the client before the last day of the month following the conclusion of the qualification period (90 days). #RetireReady Promotion March 1, 2018
Disnat Desjardins Online Brokerage is offering new clients 1% of assets transferred into the new account in the form of commission credits (to a maximum value of $1,000). Minimum qualifying deposit is $10,000. To qualify, individuals will have to call 1-866-873-7103 and mention promo code DisnatTransfer or email: [email protected]. See details link for more info. $10,000 1% of assets transferred in the form of commission-credits (max credits: $1,000) 6 months Disnat 1% Commission Credit Promo January 31, 2018
Transfer at least A) $25,000; B) $50,000; or C) $100,000 into a new or existing RRSP, spousal RRSP or TFSA at CIBC Investor’s Edge before March 1, 2018 and you may be eligible for a cash back offer of A) $100; B) $200 or C) $400. Be sure to read terms and conditions for full details. A) $25,000 B) $50,000 C) $100,000 A) $100 B) $200 C) $400 Cash back will be deposited the week of May 4, 2018 (for transfers received by Dec. 31, 2017) or July 3, 2018 (for transfers received after Dec. 31, 2017). CIBC Investor’s Edge Cash Back Promo March 1, 2018
Scotia iTrade Open and fund a new account with Scotia iTRADE with at least A) $25,000; B) $50,000; C) $100,000; D) $250,000; E) $500,000 or F) $1M+ and you may be eligible to receive a pre-paid Visa gift card worth A) $50; B) $100, C) $200; D) $300; E) $600 or F) $1200. Use code VISA18 when signing up. Be sure to read terms and conditions for full details. A) $25,000 B) $50,000 C) $100,000 D) $250,000 E) $500,000 F) $1M+ A) $50 B) $100 C) $200 D) $300 E) $600 F) $1200 pre-paid card should arrive by July 31st 2018 Scotia iTRADE offer March 1, 2018
BMO InvestorLine Open a new qualifying account with BMO InvestorLine or fund a qualifying existing account, with at least A) $50,000; B) $100,000 or C) $250,000+ in net new assets and you may be eligible to receive up to A) $50; B) $100 or C) $300 cash back. In addition, eligible individuals can receive an extra $50 as part of the refer a friend program. Use promo code SPARXCASH when signing up for the cash back offer. Be sure to read the terms and conditions for more details on the offer. A) $50,000 B) $100,000 C) $250,000+ A) $50 B) $100 C) $300 Cash back will be deposited the week of Aug. 13, 2018. Fall cash back offer Phase 2 January 1, 2018

Expired Offers
Last Updated: Dec. 21, 2017 15:00 PT

Referral 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
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 June 30, 2018

Expired Offers
Last Updated: Dec. 1, 2017 13:50 PT

Transfer Fee 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 $20,000 or more to a National Bank Direct Brokerage account and they will pay up to $135 plus taxes in transfer fees $135 $20,000 Transfer Fee Rebate 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
Transfer $25,000 or more to Qtrade Investor from another brokerage and Qtrade Investor may cover up to $150 in transfer fees. See terms and conditions for more details. $150 $25,000 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 Transfer Fee promo tbd
Transfer $25,0000 or more to Scotia iTRADE and they cover up to $150 in transfer fees. $150 $25,000 Transfer Fee promo March 1, 2018
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
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 DisnatTransfer. See details link for more info. $150 $50,000 Disnat 1% Commission Credit Promo January 31, 2018
BMO InvestorLine Open a new qualifying account with BMO InvestorLine or fund a qualifying existing account, by transferring in at least $200,000+ in net new assets and you may be eligible to have transfer fees covered up to $200. Use promo code SPARXCASH when signing up to also be eligible for cash back offer. Be sure to read the terms and conditions for more details on the offer. $200 $200,000 Fall cash back offer Phase 2 January 1, 2018

Expired Offers
Last Updated: Dec. 1, 2017 13:50 PT

Other Promotions

Company Brief Description Minimum Deposit Amount Required Details Link Deadline
Disnat Desjardins Online Brokerage, in conjunction with MoneyTalks, is offering 3 months of the “Inside Edge” investor information service to Desjardins Online Brokerage clients. Use promo code DESJ2016 during checkout to qualify. Be sure to read full terms and conditions for more information. n/a MoneyTalks Inside Edge Discount none
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

Expired Offers
Last Updated: Dec. 1, 2017 13:50 PT

Digital Advice + Roboadvisor Promotions

Robo-advisor / Digital advisor Offer Type Offer Description Min. Deposit Reward / Promotion Promo Code Expiry Date Link
Discounted Management Open and fund a new Questrade Portfolio IQ account with a deposit of at least $1,000 and the first month of management will be free. For more information on Portfolio IQ, click the product link. $1000 1st month no management fees KDKFNBBC None Questrade Portfolio IQ Promo Offer
Discounted Management Open a new account with BMO SmartFolio and receive one year of management of up to $15,000 free. See offer terms and conditions for more details. $5,000 1 year no management fees STSF January 2, 2018 SmartFolio New Account Promotion
Cash Back – Referral BMO SmartFolio clients will receive $50 cash back for every friend or family member who opens and funds a new SmartFolio account. Friends and family referred to SmartFolio will receive $50 cash back for opening and funding an account, plus automatic enrollment into SmartFolio’s mass offer in market at the time. See offer terms and conditions for more details. $5,000 $50 cash back (referrer) $50 cash back (referee) Unique link generated from SmartFolio required. None SmartFolio Website
Transfer Fee Coverage Transfer at least $25,000 into Virtual Wealth when opening a new account and you may be eligible to have up to $150 in transfer fees covered by Virtual Wealth. $25,000 up to $150 in transfer fees covered None None Contact customer service directly for more information.
Last Updated: Dec. 1, 2017 13:50 PT
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Discount Brokerage Weekly Roundup – November 3, 2017

…Aaand we’re back. Now that November is here, it’s not only fireplaces and furnaces that are heating up, but also the action at Canadian discount brokerages. Specifically, the promotional activity is starting to ramp up and it looks like the gloves may be coming off to end 2017.

In this edition of the weekly roundup, we take a look at the latest deals and promos to go live from Canadian online brokerages and one of the biggest trends we’ve spotted that might make life pretty interesting for DIY investors and other online brokerages alike. From there we take a look at an interesting series about to launch from SparxTrading.com in the next few weeks and follow up with a very unique interview we found of the CEO of one of Canada’s independent online brokerage’s. As always, we’ll take a look at what DIY investors were chatting about on Twitter and in the DIY investor forums.

New Month, New Deals

While we probably won’t see another Black Friday or Cyber Monday style promotion for online trading accounts, the reality is that as RRSP season gets closer, we expect to see more incentive offers come to market, especially from online brokerages that typically sit on the sidelines for most of the year.

Fortunately, by the first Friday in November, there are already two new discount brokerage deals to kick off the month.

First out of the gate was BMO InvestorLine, who launched a new cash back promotion to replace their previous promotion that expired at the end of October.

This new offer has three different cash back levels based on the amount deposited. Cash back amounts range from $50 to $300 depending on the amount deposited. Interestingly, the minimum deposit to qualify for the current BMO InvestorLine cash back promotion is $50,000, which is typically lower than the $100,000 qualifying deposit level from past promotions.

Also noteworthy is that the cash back amounts can be combined with the referral bonus offer ($50 cash). So, new clients can receive a cash back promotion plus the amount from the referral bonus.

Another cash back offer to hit the market this week was from CIBC Investor’s Edge. This is another tiered offer with cash back amounts ranging from $100 (for deposits of $25,000 to $49,999) to $400 (for transfers of $100,000 or more). There is an important detail to this offer which is that accounts eligible for this promo are RRSP or TFSA accounts.

Currently, BMO InvestorLine and CIBC Investor’s Edge are the only major online brokerages offering a standalone cash back offer. All the other cash back offers have to be accessed through the referral offers, and even then, only three online brokerages (BMO InvestorLine, Questrade and Scotia iTRADE) have these cash back referral programs in place.

The bigger trend, it appears, is for Canadian online brokerages to be encouraging switching from competitor firms.

Almost all of Canada’s online brokerages have switching fee coverage offers. BMO InvestorLine offers the most coverage ($200) for transfer fees, however the deposit amount required for that transfer coverage is $200,000. By comparison, RBC Direct Investing and HSBC InvestDirect require at least $15,000 to cover transfer fees.

Interestingly, Desjardins Online Brokerage’s current promotion is geared towards attracting DIY investors from other online brokerages. Their 1% commission-credit campaign was recently updated with and extended deadline (through to January 31st) and has also revised the promotion code with a greater emphasis on the transfer aspect of the promotion. Similarly, the latest promotion from CIBC Investor’s Edge also appears to put greater emphasis on transferring an existing account from another institution.

For DIY investors, this kind of promotion is a signal that discount brokerages are becoming more assertive in pushing for assets, especially those from other brokerages. It should, in theory, push other online brokerages to step up their efforts to a) retain clients but also b) onboard new clients. As a result, we expect November will have additional new offers come online, and all DIY investors will want to keep an ear to the ground for what Canadian brokerages are offering.

Year in Review

It’s hard to believe the year is almost over but with just 7 more weeks until Christmas, the lights, decorations and holiday tunes will be hard to miss.

To get into the giving spirt, exclusively for readers of SparxTrading.com, we’ve got a special present of our own lined up: a collection of reviews and perspectives provided by Canadian online brokerages on the year that was.

While there might still be a few more surprises coming before the year is out, it will nonetheless be a great opportunity to hear what Canada’s online brokerages have to say about their milestones for the year as well as what DIY investors can expect in 2018. Stay tuned as these will start rolling out in the next two weeks!

Questrade CEO Provides Perspective on Investing

Every so often an interesting nugget crosses our radar. Although we didn’t report this last week, we came across an interesting interview by blogger Jessica Moorhouse with CEO and founder of Questrade Edward Kholodenko.

Now, for any veteran investor in the markets and especially anyone doing investing in early stage companies or mining/exploration stocks, one of the key indicators to use in deciding whether to invest in a company is to look at the management and leadership. In the case of choosing an online brokerage, it is a challenge to get a very candid view of the leadership to understand what their vision is of the brand and what direction they are taking the firm in, so this video interview helps to shed some light on Questrade’s story through that of its founder.

Within Canada, Questrade is unique in that sense because they are still an independent brokerage and because their CEO isn’t camera shy. In this almost 30-minute interview, there’s a lot of ground that gets covered – including the story behind how Questrade got started. More interesting, however, is the entrepreneurial approach that Kholodenko has taken in founding Questrade, a theme that seems to have characterized its growth path since its launch. From the time that Questrade launched as a discount brokerage in Canada, they have since broadened their reach into ETFs, market making and managed wealth services, including the robo-advisor space.

Perhaps as a result of constantly evolving their technology offering in the financial services space, Questrade was recently invited to participate on a team to improve delivery of financial services technology in Ontario.

Of course, technology companies are not without growing pains. At discount brokerages in Canada, big and small, technology hiccups occur – and Questrade has had their fair share over the years. Any scan of the discount brokerage tweets of the week show that momentary interruptions in service, especially during market hours, get the attention of active (and typically vocal) investors. Nevertheless, the challenge to evolve and innovate is always there, so this interview offers a unique window into this online brokerage and especially the perspective of its CEO on DIY investing, robo-advisors and more.

Discount Brokerage Tweets of the Week

There were glitches galore across the board this past week. Find out what DIY investors were chatting about. Mentioned this week were Questrade, RBC Direct Investing, Scotia iTRADE, TD Direct Investing, and Virtual Brokers.

From the Forums

Friends & Family Feud

Referral programs at DIY brokerages are interesting approaches to acquire new clients. While there are a handful of programs in Canada, one of the most popular is Questrade’s. In this (very long) post from reddit’s personal finance Canada thread, one user provides a very interesting window into their experience with the referral program and all important “fine print” that is so important to read through.

DIY vs Robo

With investors now becoming more familiar with robo-advisors as a choice in the wealth management mix, there’s a natural question as to whether or not DIY investing is better or worse than robo-advisors. In this post from reddit’s personal finance Canada forum, it was interesting to read responses comparing the Canadian Couch Potato vs Wealthsimple.

Into the Close

That’s a wrap on another week. Daylight savings ends this weekend so there’s at least one more hour before market open on Monday. With lots of sports on the docket for the weekend, there’s certainly an extra hour to enjoy it all. Of course, now that winter has started to show up (amirite Vancouver?) in some places, the warm glow of a computer screen or LED TV is pretty tempting. Have a great weekend!

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Discount Brokerage Weekly Roundup – October 20, 2017

So, the weekly roundup is back online. Unfortunate circumstances caused us to have to pause the roundup, but like any good trader, we’ve dusted ourselves off and are back in the saddle. And, now that we’re here, it’s time to catch up on quite a lot big news that’s happened in just a few short weeks.

In this edition of the we take a look at one bank-owned brokerage that has recently dropped their standard commission rates to a new low, potentially setting the stage for yet another wave of commission price drops. From there we’ll highlight some new features launched by several Canadian brokerages in a lightning roundup. Also, to get caught up on the conversations by DIY investors on Twitter we’ll be publishing the discount brokerage tweets of the week for the weeks the roundup has been on pause.

HSBC InvestDirect Drops Trading Commission Prices

If there was any doubt about a price war among Canadian discount brokerages, that doubt was all but erased earlier this month as HSBC InvestDirect dropped their standard commission pricing from $9.88 down to $6.88 just two years after lowering them from $28.88. The days of the standard commission rates at $9.95/$9.99 are numbered.

With this latest round of pricing cuts, HSBC InvestDirect has now become the lowest cost Canadian bank-owned online brokerage for both standard commissions and, as of November 6th, also for active traders. Active trader pricing is slated to drop to $4.88 per trade for individuals who execute 150 or more trades per quarter.

This latest move by HSBC InvestDirect displaces CIBC Investor’s Edge as the lowest cost bank-owned online brokerage (CIBC Investor’s Edge charges $6.95 per trade) and will soon displace Scotia iTRADE’s active trader pricing ($4.99).

The range for standard commission prices for standard equity trades at Canadian bank-owned brokerages now stands between $6.88 (HSBC InvestDirect) and $24.99+ (Scotia iTRADE), an almost 4-fold difference; even the difference between $6.88 and the current industry standard of about $10 appears to be substantial.

Perhaps the most surprising (or potentially unsurprising) outcome of this price drop is the lack of chatter online about this move.

HSBC InvestDirect is typically not as active with respect to marketing or advertising relative to other Canadian online brokerages. That, however, may soon change as their new pricing structure can garner instant attention and relevance for price-sensitive DIY investors.

Bank-owned brokerages outside of the big 5, such as National Bank Direct Brokerage with their commission-free ETF program and now HSBC InvestDirect are aggressively looking at winning marketshare through discounted pricing.

As word of this pricing drop will inevitably start to spread, and if HSBC InvestDirect should deploy an advertising campaign to let people know this is their new pricing structure, it’s safe to say that at least one of the larger players is going to have to respond in kind by lowering their rates – if not to match the $6.88 benchmark then to definitely go further. And, unlike National Bank Direct Brokerage’s focus on ETFs and relative concentration in Quebec, HSBC InvestDirect has a very strong presence in Western Canada, particularly BC, which could push directly against Qtrade Investor and Credential Direct – and of course TD Direct Investing – for marketshare.

One of the biggest challenges to HSBC InvestDirect, however, will be competing on a digital basis with other Canadian online brokerages.

From website user experience, content development/strategy, investor education, platform offerings, trading experience – in particular on mobile, there remain multiple areas in which other Canadian online brokerages have been investing in significantly over the past few years. As these feature sets come to be viewed as “standard” offerings, the value of lower-priced trading commissions will be offset by how convenient and stable the trading and account management experience is.

In the interim, it will be very interesting to watch what other bank-owned brokerages do in order to respond. Perhaps the easiest and most likely option for most online brokerages is to turn to a very compelling incentive offer (aka promotions). Whatever the case, DIY investors in Canada are bound to benefit which is great news.

New Feature Lightning Round

Disnat Classic Launches Streaming Quotes

Clients of Disnat Classic (a product of Desjardins Online Brokerage) which typically are considered to be the ‘investor’ rather than ‘trader’, now have access to a feature that can help monitor key investments in real time.

The Disnat Classic platform now enables up to 10 securities to be tracked in real-time with streaming quotes. For those who execute fewer than 10 trades per month (note the commission cost at Disnat Classic is $9.95 per trade) the data cost for TSX-only quotes is $30/month while those wanting TSX-V real-time quotes as well will be paying $55/month.

From a cost/benefit perspective the data cost for the number of symbols to monitor is quite high relative to other platform and data options available to DIY investors. Typically, browser based watchlists can track between 20 to 50 or more symbols in real-time so it is important to consider the need for real-time monitoring on a platform traditionally targeted towards less active investors.

That said, it is an interesting signal that enhancements to the platform experience for ‘investors’ are now available to edge them, albeit modestly, towards to the functionality used by traders.

Qtrade Investor Speeds Up Account Opening

Remarkably, in an industry (online trading) that relies on technology to the extent that it does and brands itself as technologically forward-thinking, the onboarding process at many online brokerages is still significantly dependent on manual, physical steps – all of which result in the process of opening an online brokerage account taking time measured in minutes and in some cases, days.

Some brokerages still require having to print out, sign and mail documents; others require visiting a branch in person while others now enable sign ups to take place entirely online.

It is against this backdrop that Qtrade Investor’s recent launch of online applications stands out as an important development for Canadian online brokerages.

The process to open an online brokerage account via the web at Qtrade Investor is advertised to take 10 minutes – which is significantly faster than at most other online brokerages and definitely quicker than what it would take to go the print/send method.

We haven’t yet done a full walk through of the sign-up process so real-world results may vary. And, as seasoned DIY investors know, opening an account is just the first step in being able to get up and running; accounts also need to be approved and funded – both of which can add time to the setup process.

That said, the key takeaway for DIY investors is that Qtrade Investor is working harder to make getting started with online trading simpler and significantly faster – something younger investors will no doubt demand from any online brokerage. The advertised account opening time is more in line with a robo-advisor than a traditional online broker, again, likely a factor that considers the younger investor’s notion of what’s acceptable in terms of ‘waiting period’.

Stay tuned for more details on this feature as it is poised to be an important feature if it can live up to the benchmark claim of being able to open an online trading account online in about 10 minutes.

Discount Brokerage Tweets of the Week

There’s quite the backlog of Twitter comments from Canadian DIY investors. Good thing the internet never forgets. Here’s a rundown of what was said over the past four weeks:

Week ending September 29th 2017

Week ending October 6th 2017

Week ending October 13th 2017

Week ending October 20th 2017

Into the Close

That’s a wrap on this week’s roundup. We’ve got some very interesting content coming over the next several weeks so continue to tune into SparxTrading or follow us on Twitter for updates on what’s coming around the corner.

To the loyal readers who have been waiting for the roundup’s return – we thank you for your patience and are looking forward to returning to our regularly scheduled program of keeping you up to date on the latest and most interesting developments in the Canadian online brokerage space.

Have a wonderful weekend!

 

 

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Discount Brokerage Weekly Roundup – July 21, 2017

If there’s a lesson emerging from the scandal in the US or from Game of Thrones, it’s that details matter. At least in the case of the US, the details are emerging and in the process, the spin doctors are working overtime to shape the conversation. While this may seem like a leap for the online trading world, in reality, the lesson for DIY investors when considering online brokerages is to try and see past the spin and to focus on the details.

Fortunately, this edition of the roundup is chock-full of details as we take a deep dive into the latest rating of Canadian discount brokerages to be published. From there we provide an update on the latest insight piece on one Canadian online brokerage’s venture into sustainable investing. Wrapping up this week will be a collection of the many interesting (and sometimes colourful) DIY investor conversations that took place on Twitter.

A Q’rious result: Non-bank-owned Canadian online brokerages earn top marks in MoneySense’s latest rankings

For many DIY investors and those looking for a quick answer to the question: “who is the best online brokerage in Canada?” the answer appears to have evolved over the years. The shift appears to evolved from finding a singular ‘best’ online brokerage, to providing a category-based approach to report on discount brokerages who are the best at particular features.

Such is the case in the latest MoneySense ratings of Canadian online brokerages, which were published this past week. Based on data supplied by financial services research firm Surviscor, the latest online brokerage rankings suggest that when it comes to the “best overall” experience for online investing, non-bank-owned online brokerages are edging out their larger and better financed competitors.

Starting first with the ‘winners’ (beware the spoiler alerts). BC-based Qtrade Investor earned the top pick as best overall brokerage followed by Questrade which earned the runner up title of ‘honourable mention’.

In the bank-owned brokerage category, BMO InvestorLine and Scotia iTRADE tied for top pick with no runner up (or ‘honourable mention’) reported.

For followers of the MoneySense online brokerage rankings, there is an air of familiarity about the winners this year compared to 2016. Both Scotia iTRADE and BMO InvestorLine were rated as the best and ‘runner up’ bank-owned brokerage, while Qtrade Investor and Questrade took first and second place in the non-bank-owned online brokerage category respectively. So, as far as the top contenders are concerned, things look largely the same as they did last year. A few notable changes, however have shown up in the 2017 analysis.

This year, for example, the category of “user experience” was used instead of “ease of use”; “best for ETFs” was also introduced given the popularity of ETF trading choices now available and the popularity of these instruments with DIY investors and finally, the category of “best overall” replaced the category of “top independent brokerage.”

 

2017 2016
Category Top Pick Runner Up Top Pick Runner Up
Getting Started Questrade TD Direct Investing BMO InvestorLine Virtual Brokers
User Experience Questrade Qtrade Investor Scotia iTRADE Questrade
Fees & Commissions CIBC Investor’s Edge

Questrade

 Qtrade Investor

Virtual Brokers

 Questrade Qtrade Investor
Customer Service Qtrade Investor Desjardins Online Brokerage Qtrade Investor Scotia iTRADE
Reporting & Record Keeping BMO InvestorLine Qtrade Investor Scotia iTRADE BMO InvestorLine
Market Data TD Direct Investing Qtrade Investor TD Direct Investing Credential Direct
Best for ETFs Questrade

Virtual Brokers

 National Bank Direct Brokerage n/a n/a
Best Overall Qtrade Investor Questrade Qtrade Investor (best independent) Questrade (honourable mention independent)
Best bank-owned brokerage BMO InvestorLine
Scotia iTRADE		 Scotia iTRADE BMO InvestorLine

 

A quick scan of the results between last year and this year will show some new faces in certain categories, but by and large, this year’s MoneySense online brokerage rankings show a high degree of similarity to 2016. Nonetheless, as we’ve mentioned time and again on SparxTrading.com, when it comes to evaluating the online brokerage rankings, it is important to look at the details and critically evaluate the findings to ensure a more thorough understanding of what’s behind a rating or ranking.

Diving into Details

Perhaps one of the most immediate observations is that there are some brokerages that make multiple appearances across different categories. Specifically, although 9 different brokerages were mentioned in at least one category this year, either Qtrade Investor or Questrade were first or second a combined 9 times out of 17 possible mentions.  And, while that does make sense given the overall rankings of both of these online brokerages, when compared to the profile of results from 2016, it is notable that for the bank-owned online brokerages, Scotia iTRADE is far less visible in the top or runner up spots in 2017 than in 2016, despite landing a tie with BMO InvestorLine for top bank-owned online brokerage.

Ratings of Canadian discount brokerages according to MoneySense online brokerage rankings, 2017
Source: MoneySense online brokerage rankings, 2017

A closer look at the 2017 results reveals that of the top two bank-owned online brokerages, only BMO InvestorLine managed to achieve the best in the category of reporting and record keeping while Scotia iTRADE did not make a top pick or runner up in any of the categories mentioned. Curiously, despite TD Direct Investing placing in top spot for ‘market data’ and runner up for ‘getting started,’ it did not make the cut for best bank-owned brokerage or even ‘honourable mention’ according to the results.

Shut out from winner or runner up circles from this year’s rankings were Credential Direct, HSBC InvestDirect, Laurentian Bank Discount Brokerage and RBC Direct Investing. Also overlooked again this year was Interactive Brokers Canada, which was excluded from consideration and almost certainly would be a challenger in the fees & commissions, getting started, and market data categories.

One of the most crowded categories, curiously, was the commissions and fees spot.

Fee-ling crowded

Top pick for fees this year was a tie between CIBC Investor’s Edge as well as Questrade, while honourable mention (another tie) went to Qtrade Investor and Virtual Brokers. Given that commission pricing changes at CIBC Investor’s Edge appears not to have dramatically changed since we first reported the drop 2014, it was strange to see Investor’s Edge disappear from the 2016 ratings (while it did appear in 2015) but reappear in 2017. Likewise, commission pricing at Virtual Brokers has been restructured so that there is now standard commission structure pricing of 9.99 per trade, but Credential Direct (with standard commission pricing of $8.88), which was cited alongside CIBC Investor’s Edge as low cost by MoneySense in 2015, seems like it would have made the cut.

The takeaway: commission pricing is low at many Canadian online brokerages and one of the important factors to consider is whether there are any ECN fees or not. While the MoneySense ratings do not disclose a full methodology of how fees and commissions are calculated, the big picture shows that DIY investors who want to buy based on commission pricing do have a number of choices for good value.

Of course, the commissions and fees category is not without some controversy in this year’s ratings. A concern that we noted with the standard commission reporting, however, is that Scotia iTRADE’s “basic online equity” commission pricing is listed as $9.95, a condition which is true only if clients have more than $50,000 in assets at Scotiabank entities.

If having at least $50,000 in assets is the qualifying definition for standard commission pricing at Scotia iTRADE, then HSBC InvestDirect should have their rate posted as $8.88 rather than $9.95. Conversely, if having the minimum deposit to open an account is considered the threshold for ‘standard pricing’ – which we would argue should be the case – then Scotia iTRADE’s standard commission pricing would be at least $24.99 per trade – almost 4x that of CIBC Investor’s Edge and easily double the $9.95 at most of Scotia iTRADE’s bank-owned brokerage peers.

Again, without methodology detailing how these were calculated, the inclusion of Scotia iTRADE as a top pick with standard commission pricing so far above its peer group and no top pick or ‘honourable mention’ in any of the categories makes it a strange result. Unlike 2016, where Scotia iTRADE does appear in 3 categories as either top pick or ‘honourable mention’, this year’s inclusion in the winner’s circle at the bank-owned brokerage level seems less obvious as to why that would be the case.

To be fair, we’re not trying to penalize Scotia iTRADE. In fact, we noted that there were some notable discrepancies from Scotia iTRADE’s details (at the time of publication) that would be of value for potential clients to take note of and which could shift the scoring in Scotia iTRADE’s favour. Specifically, Scotia iTRADE is better at customer service availability and investor education support than the MoneySense comparisons would imply.

For example, the customer service hours which on the table on MoneySense are listed as Monday to Friday, 8:30am to 5:00pm (no timezone specified) whereas according to the Scotia iTRADE website contact section, the hours are listed for client support are Monday to Friday, 8:00am to 9:00pm ET and Saturday from 8:00am to 6:00pm ET. Offering service on a Saturday is something that stands out for Scotia iTRADE so, though the MoneySense category does list hours which might correspond to new account openings, it doesn’t necessarily reflect the experience that existing clients could expect to receive nor does the category clarify the meaning of “telephone services.”

Another point of concern appears under the ‘buyer beware’ category in the MoneySense breakdown where it states Scotia iTRADE has “weak educational material.” The characterization as “weak” seems highly subjective and inconsistent with the fact that Scotia iTRADE has not only had a long-standing focus on investor education but even on the relatively recent redesign of their website, they committed to having education as one of the four main menu choices. Further, Scotia iTRADE also has learning modules on basic topics related to trading and platform orientation, and more importantly, they have an extensive calendar of educational events (such as webinars) that are presented frequently and regularly throughout the year. For a claim of ‘weak’ educational material to be applied to Scotia iTRADE to be substantiated, even on a relative basis, it would mean that the vast majority of Canadian online brokerages ought to be called out for the same ‘buyer beware’ drawback and even more so for not having these webinar/seminar supports in place.

Wait a minute, Mr. Postman

Another interesting aspect of the rankings and ratings is the customer service response times on email across the Canadian online brokerage industry.

Surviscor regularly monitors the email response times for Canadian discount brokerages and has reported this data as part of its Service Level Assessment (formerly the Customer Email Responsiveness program) scoring. Included in MoneySense’s online brokerage rankings this year was a particular focus on email performance, and in particular, how poor the industry (with a few exceptions) is doing when it comes to responding to requests via email.

The range reported from this year’s analysis was substantial. Qtrade Investor was the quickest to respond with an average of just under 2 hours while Laurentian Bank Discount Brokerage came in at 113 hours.

Canadian discount brokerage email response times
Source: MoneySense online brokerage ratings, 2017

Given the staggeringly high variation, it would have been nice to have the standard deviation and number of emails sent to each firm reported. Averages, in and of themselves, are of limited value when trying to figure out “what’s normal” or representative of a service experience. Another unknown which would add more context would be knowing how many emails were sent (was it 3 or 30?), when they were sent (Friday nights, weekends or during market hours)? and what qualifies as a response (did the question get answered or was the note simply acknowledged as received?).

Another interesting observation was that the figures reported for Desjardins Online Brokerage’s response time in the dynamic chart supplied show it at 9 hours, which is the same for RBC Direct Investing. That is relevant because Desjardins Online Brokerage managed to score as a ‘honourable mention’ for that score while RBC Direct Investing did not. It is likely the case that the reported chart is rounding numbers (since Qtrade Investor was reported in the text to have an average under 2 hours but is reported in the chart as 2 hours) but this clarification is one that becomes important, since rounding to the nearest hour is a significant amount of time in an online world.

For the Ratings

For many DIY investors, including readers of MoneySense magazine, navigating the maze of Canadian online brokerages is both time consuming and complicated. Ratings such as the latest online brokerage comparison provide a handy way to understand the strengths and limitations of particular Canadian online brokerages.

While the latest ratings don’t necessarily “rank” numerically where particular online brokerages stand,  the MoneySense online brokerage nonetheless showcase a ‘top pick’ and an ‘honourable mention’. So, those DIY investors looking for a recommendation can find a brokerage worthy of consideration. In fact, a particularly nice feature for this year is the comparison tool which enables side by side comparisons of online brokerages.

All that said, as has been stated many times on SparxTrading, it is important for readers and users of discount brokerage rankings to have clarity on what the categories being used mean as well as how they’re measured. The MoneySense online brokerage ratings rely heavily on data sourced from Surviscor’s analysis and as such, it might be useful to point readers to the methodology sections on the Service Level Assessment (which explains some of how the email testing is done) and also on the assessment for categories like user experience or commissions and fees.

In sum, Canadian online brokerage account shopping can be as simple or complicated as DIY investors want it to be. To help make the task of figuring out what other rankings or ratings are saying (such as the MoneySense brokerage rankings or those from the Globe and Mail), we’ve added all the ratings received by a Canadian online brokerage onto the profiles of each individual brokerage (accessible in each online brokerage’s profile page).  The best news for DIY investors coming out of these rankings, however, is that competition amongst brokerages is pushing at least a handful of them to put forth their best effort into winning new clients and keeping existing clients satisfied.

Socially responsible investing in the spotlight at Scotia iTRADE

For many investors, there is a growing trend towards thinking carefully about the impact and nature of where profits come from. Socially responsible investing is definitely gaining in popularity with investors and even this past week, there were headlines that major robo-advisors in the US were moving into this space by adding the SRI into their portfolio offerings.

For DIY investors in Canada, however, there’s at least one online brokerage who’s taken the leap to provide a tool to research and analyze companies according to their environmental, social and governance (ESG) components. Earlier this year, Scotia iTRADE became the first Canadian online brokerage to launch this ESG tool for their clients.

This past week, we profiled this tool in detail and provided a highlight of some of the issues that DIY investors might want to consider when using this tool, as well as whether this tool – itself a measure of controversy, might in fact also be a source of controversy in the Canadian online brokerage landscape.

The ESG screener and associated reports enable DIY investors to investigate the ESG rating of hundreds of companies listed on the TSX in order to learn more about whether those companies fit within the investor’s goals of socially responsible investment decisions.

Of course, while socially responsible investing is an idea that many can get on board with, in reality the definition of what this means and how it works exactly are important to know.

In the world of DIY investing, in particular in Canada, there has been a discussion as to the nature and types of tools that order execution only brokerages can provide. Separately, events in the US with respect to fiduciary duties of money managers and advisors have also helped to colour the debate on social responsible investing – namely that it introduces a bias that may be at odds with the duty or objective to maximize the monetary benefit to the investor.

Click to read the full story in the blog here.

Discount Brokerage Tweets of the Week

This week it looks like outages and advertising were the topics of choice for DIY investors on Twitter. Mentioned this week were Questrade, RBC Direct Investing, Scotia iTRADE, TD Direct Investing and Virtual Brokers.

Into the Close

That’s a wrap on another week. Now that the weekend is here, hopefully there’s some sunshine to enjoy. Of course, for GoT enthusiasts, there’s plenty of winter to look forward to on Sunday and lots of watercooler talk on Monday. For a more real-life GoT experience, however, be sure to tune into CNN as the intensity level of the drama that is US politics ratchets up. On that note, now that ‘Spicey’ has left the building, here is a fun collection of memes commemorating the departure.


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Discount Brokerage Weekly Roundup – July 7, 2017

Oh boy, where to even begin? With the warm weather upon us it seems like real estate sales in Toronto are melting like ice cream left in the sun for too long, and the world’s attention is turned squarely on the meetings between world leaders for the G20. Of course, there are so many headlines that it’s easy to miss some of the stories that aren’t being generated 140 characters at a time. Paying attention to the slow and steady stories can be quite revealing, however, especially when it comes to Canada’s discount brokerages.

In this ‘trend’ filled episode of the weekly roundup, we kick things off with a look at the latest website update being telegraphed by a bank-owned online brokerage and what might be coming down the wire for the second half of the year. From there, we take a very interesting look at some possible macro factors swirling around the online brokerage industry in Canada that could substantially reshape and redraw an already dynamic landscape. Fortunately, we wind up the roundup on a familiar note with tweets from DIY investors and the latest chatter from the investor forums.

CIBC Investor’s Edge telegraphs an upgrade

Summer is a great time to do renovations and upgrades, and not just around the house. This past week, CIBC Investor’s Edge posted a notice on their website indicating that some updates and upgrades are in the works for their website front end.

screenshot of CIBC Investor’s Edge

But it wasn’t just the announcement that caught our attention, it was also a survey that popped up while on the homepage. Specifically, an online survey that sought out feedback from CIBC Investor’s Edge clients on certain features and functionality related to their online experience as well as the overall satisfaction with certain components of the CIBC Investor’s Edge offering.

If some of this sounds familiar, it is because in April, another online brokerage, Credential Direct, also posted a user survey to help provide guidance on functionality prior to launching their new website. Unlike the survey in April, which was focused on how individuals would locate certain information on a new website, the survey by CIBC Investor’s Edge seemed to looking for satisfaction with experience and taking a top down approach to establishing where improvements might be required.

In the first half of 2017, in fact, that there appears to be renewed interest and resource being devoted to improving the online user experience, especially at the bank-owned brokerages. Several website launches, staffing up in digital content and experience and a general shift towards releasing features to market more quickly all signal that Canada’s discount brokerages are gaining ground and learning from the ‘fintech’ model that is gaining a foothold in the wealth management space.

That said, it also points to the likelihood that changes are going to be more frequent and prevalent. For the last half of 2017, there are strong odds that we’ll see some very big announcements from certain discount brokerages on new website roll-outs of their own.

In the meantime, we’re excited to see what CIBC Investor’s Edge unveils and the accompanying response from DIY investors and clients on the new website format.

Beware of active lifestyles

Unlike some of the more obvious changes and developments in the Canadian discount brokerage space, there appears to be a handful of ‘macro’ trends that might steer the news and behaviour in the near future.

What does that elusive opener refer to exactly?

Over the past few months, the regulatory landscape around the Canadian online brokerages appears to be shifting. There are two forces at play from different government entities that could drastically reshape how DIY investors access online brokerages’ services and, perhaps, severely constrain the DIY investor space as a whole.

On the one hand, there is the issue raised by IIROC on the nature of what Canadian online brokerages (as order execution only entities) can provide in terms of tools or features that cater to investors. Specifically at issue, is what constitutes a recommendation and how much autonomy an individual investor may have in deciding what is or isn’t appropriate for their own investing objectives. While this is an important point, part of it has been covered in a previous roundup which serves as a prelude to this second, and perhaps more disruptive issue.

For the last few weeks, the story of the Canada Revenue Agency’s purported ‘crackdown’ on TFSA windfalls has been gathering media attention and investor ire.

Although this is not the first time that the CRA auditing TFSA account compliance/performance has made news, what is making the news is the rather large sum of $75 million that has been flagged for collection, an indication that efforts to regulate TFSAs has escalated. Before proceeding, there is an important caveat to state, and that is that the CRA ensuring that individuals don’t abuse the tax system is ultimately a net benefit for everyone. That said, the TFSA is a very interesting (and recent) vehicle for wealth building and it is that wealth building that finds itself at odds with a tax system (and it’s rules) for investors that was developed well before the democratization of information on and about securities (such as stocks).

And, while there are lots of very interesting angles to the evolving TFSA crackdown story, at the heart of the issue for DIY investors and for financial advisors, wealth managers and ultimately for online brokerages is what exactly constitutes ‘trading’ versus ‘investing’.

Without delving too far into the past, the CRA has published guidance on the subject of what may or may not constitute a trader but for many DIY investors and the industries that service them, the definition has been far too open ended. From an armchair analyst’s point of view, the issue appears to be ensuring that capital gains should get treated differently than business income, so separating what counts as either is crucial to administering the tax-preferred treatment that capital gains get.

To do so, the CRA has set out a multi-part test when evaluating what does or does not constitute business income or capital gains. That said, it is worth stating that according to the CRA’s documentation, business income is classified as anything derived from an “adventure or concern in the nature of trade.”

While, from the CRA’s perspective, this approach might afford the flexibility to evaluate cases on the merits of particular facts, the counterpoint is that is has created tremendous uncertainty. And, if there’s one thing that efficient markets disdain, it’s uncertainty.

As a result of the somewhat vague test of what could or could not constitute an “adventure or concern in the nature of trade” situations like the following can arise.

The popular DIY tax software Turbo Tax, published an article entitled “How to calculate capital gains when day trading in Canada” which spoke to interpreting how to log investment transactions in TFSAs as follows:

“TFSAs are purchased with after-tax dollars, without any taxation upon withdrawal. There are no restrictions on taxpayers using day-trading techniques for investments, and profits realized can be declared and taxed as capital gains.”

Clearly, if individuals are DIY investors, there’s a reasonably good chance they may also want to use software that helps to take a DIY approach to taxes. In fact, there are examples of some Canadian online brokerages who’ve offered incentives such as discounts on this software as a sign up bonus, so there’s a good chance resourceful individuals might turn to such a document to help figure out how to populate their tax returns.

In this case the language used in the article might lead some people to believe that they can use ‘day-trading’ in the same way as a capital gain. A reading of the CRA guidance, however, seems to contravene that statement. For example, with regards to short selling which the CRA guide explicitly states:

“The gain or loss on the “short sale” of shares is considered to be on income account.”

Clearly, anyone with a margin account who decides to short a stock needs to consider treating such a transaction differently for tax purposes than does anyone going long on an investment – but good luck to DIY investors trying to stumble across this information easily.

As a counterpoint to the information provided by Turbo Tax, recent articles, such as the one in the Financial Post by noteworthy taxation expert Jamie Golombeck state:

“Under the tax rules, if a TFSA carries on a business then it must pay income tax on its business income.”

Considering the points above, one very interesting angle is the moving target on what constitutes an active investor, specifically because this impacts how Canadian online brokerages communicate to DIY investors considering opening an online investing (or trading) account – including a TFSA.

The table below shows that an “active” investor is being communicated differently depending on the discount brokerage. For the CRA, and in the case cited in the Golombeck article above, it may not be interpreted the same way by everyone and that is highly problematic.

Trading level 30 trades per quarter 150 trades per quarter
Bank-owned online brokerages with offers or incentives at these levels NBDB, RBC Direct Investing, BMO InvestorLine; Disnat Direct, HSBC InvestDirect Advance RBC Direct Investing, TD Direct Investing, Scotia iTRADE, BMO InvestorLine
*some firms may appear twice as they have offers in each tier.

Add to this, the fact that there are also incentives that are being offered to individuals (such as discounted commissions or waived platform fees) depending on the number of trades executed. The range is quite extraordinary, going from 30 trades per quarter to as high as 150 or more per quarter.

Of course the other issue with being an ‘active’ investor is the time spent researching and following markets, as well as the level of knowledge of the markets. Both of these components are used in the test to establish whether an individual is considered to be generating business income or is eligible for the capital gains exemption. To do due diligence, however, does require time and effort – even in passive portfolios, to rebalance, read and generally know what you’re buying into.

Finally there’s the pricing for data feeds for active trading platforms. For business (such as sole-proprietor) investing/trading accounts, the data feed costs are significantly higher than for individual accounts, which means that the true cost to active investors who may not want run afoul of the CRA criteria is actually quite high. That’s bad news for the online brokerage industry who would now have to communicate the value proposition of being an active trader, doing so outside of the TFSA (potentially) and incurring huge data and platform fees.

Interestingly these two issues, that of the suite of services offered by order execution only (OEO) firms and what the CRA appears to be doing with TFSAs might actually intersect.

The fact of the matter is there is insufficient clarity on several fronts: what determines ‘trader’ or ‘investor’, the degree to which an individual who opens an account with an online brokerage firm can or cannot decide for themselves as to the level of ‘appropriateness’ of executing a particular transaction and the implication for them doing so in a TFSA.

In fact, it seems like there is a slight misalignment between the list of criteria put forward by the CRA in terms of “knowledge of securities” and the KYC rules put forward by securities regulators that would enable an individual investor to perform transactions in TFSA. On the one hand, individuals may be taxed for knowing too much about securities but on the other hand they may not be able to access tools from their online brokerages because they might not know enough.

In this case, it begs the question, does something need to change about the way TFSA accounts can be used by online brokerages? According to the Golombeck article cited above, the CRA’s position appears to be that TFSA’s are not that special.

That said how do the CRA’s tests for being considered a trader (for tax purposes) mesh with securities regulations that require online brokerages to determine, at some level, the degree to which an individual would be knowledgeable enough about securities to open an account and appreciate the extent of risk associated with online investing?

There’s certain to be much more debate on these issues ahead as the CRA had opened the can of worms of counting ‘wins’ in DIY investor TFSAs as business income but not necessarily equally considered losses obtained through the same set of activities as ‘business losses’ (if they have, it’s not been as widely reported).

Similarly, reconciling tax requirements with securities legislation is sure to come up especially if it can potentially hurt DIY investors in their journey to save for retirement. This very tangled set of issues will be fascinating to watch unfold, and as usual for DIY investors, the playbook seems to suggest: be ready to change.

Discount Brokerage Tweets of the Week

A somewhat quiet week by Twitter standards. Mentioned this week were CIBC Investor’s Edge, Interactive Brokers, Questrade, Scotia iTRADE and TD Direct Investing.

Into the Close

So much for keeping it short. Well, on the topic of shorts (not the trade but summer attire) have a great weekend and hopefully enjoy some of that summer weather while it’s still here!

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Discount Brokerage Weekly Roundup – June 2, 2017

There seems to be no way around it, what happens on social media has now become ‘the news’ cycle the world over. Curiously, the news cycle this week focused on deciphering covfefe as well as the art of the deal – or rather the art of pulling out of the deal. For Canada’s discount brokerages, there may (or may not) be covfefe to worry about, but fortunately there are lots of deals, which is something all DIY investors can look forward to.

As an homage to keeping people guessing and to deals, this week’s roundup is full of teasers as well as great info on the latest deals and promotions to kick off the new month. Keep reading to find out about an exclusive preview of a soon-to-be released promotional offer, as well as additional features and an exclusive promotion that’s close to launch. Speaking of launch, after the deals roundup we rocket through some minor (but soon to be major) developments over the past week in the Canadian online brokerage space. As always, we’ll take a look at the latest DIY investor chatter on Twitter and on the forums.

Spotlight on Deals

Despite Wonder Women tearing up the box office, some of the biggest blockbusters of this summer are still to come and a few of them will actually be in the online brokerage space. Although there might not be any talking robots, there are, ironically, robots making an appearance in the deals section – roboadvisors to be exact. Here are some ‘teasers’ of deals and promotions coming down the wire this month.

Rise of the Machines

Of several big announcements for this month’s deals & promotions section is the news that SparxTrading.com will be starting to cover the deals being offered by roboadvisors. Specifically, Canadian discount brokerages who’ve also deployed (or are affiliated through a parent with) a roboadvisor or ‘digital advice’ investment service.

The list at the time of publication includes four known entities: BMO SmartFolio, National Bank Direct Brokerage’s Investcube, Questrade Portfolio IQ, and VirtualWealth from Qtrade. Not too far on the horizon, however, is also a robo-advisor from Credential Direct and rumour has it another Canadian online brokerage is on the cusp of rolling out its own robo-advisor product. Interestingly, HSBC announced this week it too would be launching a robo-advisor however there are no details on whether this will be coming to Canada any time soon – more on that below.

Crazy 88’s

The second big announcement is the launch of a SparxTrading.com exclusive commission-rebate offer with one of Canada’s online brokerages. Full details of this promotion (including which brokerage it will be with) will be made available shortly. In the meantime, stay tuned to the SparxTrading Twitter feed and the deals & promotions section to find out when it goes live.

The Legend of Zero

A third interesting sneak peek announcement comes in the form of a promotion from Virtual Brokers, who recently held a webinar jointly sponsored by the Independent Investor Institute.

As part of signing up for that seminar, registrants were offered access to 3 months of commission-free trading for either Canadian or US ETFs (to a maximum of 20 trades) . The last time we saw a promotional offer that featured free ETF trading was from National Bank Direct Brokerage who subsequently went on to offer commission-free trading on all Canadian ETFs.

screenshot from promotional offer sent to webinar attendees

While the Virtual Brokers’ latest offer is not yet being advertised to the general public, it may likely be something opened up to the public in the near future. Regardless of how many people take advantage of the offer or the timeline for its release, it raises the question, is Virtual Brokers testing the water on commission-free ETF trading and could this be the next shoe to drop in the online brokerage commission price battle?

Walking the InvestorLine

Finally, as we mentioned in the most recent deals & promotions post, there are several promotions that are scheduled to end in June. The earliest is from BMO InvestorLine, which will see their cash back and free trade promotion expire on June 5th. Fortunately, there is already another offer ready to go to replace this promotion as of June 6th.

SparxTrading.com has an exclusive first look at BMO InvestorLine’s newest promotion which offers up to $1200 cash back for a deposit of at least $200,000 in net new assets. In addition to the cash back component, qualified applicants get a 60-day trial of the BMO InvestorLine 5 Star Program and its active trading platform, BMO MarketPro as well as a transfer fee rebate of up to $200 to cover switching fees from another brokerage. To boot, savvy individuals can also take advantage of the Refer-a-Friend offer to get an extra $50 stacked on top of the $1200 cash back.

According to the offer’s terms & conditions, the accounts that are eligible to take advantage of this promotion are cash or margin accounts (individual or joint), corporate, sole proprietorship, RRSP and spousal RRSP accounts. Importantly, TFSA accounts and clients with PRO accounts are excluded. This summer promotional offer expires on August 7th.

At this point, BMO InvestorLine is the only Canadian online brokerage offering up a cash back promotion of this magnitude (>$1,000) for deposits of this size (>$200K) for an online trading account. The only alternative to receive a cash back (currently) is through one of the referral cash back offers, the highest being from Questrade ($250 for deposits of $100,00+).

With asset gathering clearly being a primary goal of all the players in the online brokerage space, having incentives in place to compensate investors makes sense.

For the moment BMO InvestorLine remains unchallenged among their bank-owned peers and, to a large degree, by most of Canada’s other online brokerages with an offer for the $200K+ deposit range. It will be interesting to see if other offers start to show up at this higher “mass affluent” deposit tier or if BMO InvestorLine will be able to put this offer on autopilot for the better portion of the summer.

Autumn in New York

This month’s deals and promotions saw a slight uptick courtesy of a contest sponsored by Desjardins Online Brokerage for a trip to New York City in the fall (autumn in New York anyone?). No purchase is required for entry to the contest. To enter, users have to register for Desjardins Online Brokerage’s newsletter (D Bulletin) and/or alerts for webinars/seminars. Prize value (including the spending money) for this contest is $3,000. More details are available in the deals & promotions section here.

Interestingly, Desjardins’ choice to run a contest may be a response to their close rival, National Bank Direct Brokerage, who is running a contest in conjunction with Horizon’s ETFs and which focuses on a fantasy ETF portfolio.

Sidebar: for individuals interested in participating in a fantasy stock challenge related to cannabis and medical marijuana companies, the Canadian Securities Exchange in conjunction with Stockpools and the Lift Cannabis Expo, are running a competition from July through September. There are weekly cash prizes as well as a grand prize trip to Las Vegas.

Bottom Line

The good news for DIY investors is that there are still lots (24) advertised offers to choose from in June and if May has been any indicator online brokerages are getting more creative with their offers/incentives. We’ve also caught wind of at least two other offers that have been targeted to launch in June from a Canadian online brokerage, signaling more fireworks to come well before Canada Day. Don’t let the warmer weather fool you, it seems like Canadian discount brokerages will be working just as hard, not only to roll out new promotions during the typically quieter summer months, but also in preparation for the busy fall season.

*Disclosure: SparxTrading.com may receive compensation for individuals signing up for an online brokerage account with BMO InvestorLine or from Questrade’s refer-a-friend program mentioned above.

Lightning Roundup

Here’s a quick recap on what else was taking place this week around Canada’s discount brokerages.

Mobile on a rollout

The rollout of Questrade’s mobile app was made official earlier in the week. In last week’s roundup, we reported the soft launch of the app and positive early reviews. Now with another week under its belt, the reviews for the Android (4/5) and iOS (3.5/5) appear to have remained relatively positive.

Recognia expands to China

As posted on their social media accounts, Trading Central, parent of the of the popular stock analysis tool company, Recognia, announced they’ve opened up an office in Shanghai, China (officially as of March 20, 2017). The launch party will be on June 22. Recognia, based out of Ottawa, was acquired by Trading Central in 2014.

Digital bench press

It looks like the trend towards ‘going digital’ continues across the Canadian online brokerage space. In the past two weeks we’ve spotted Canadian discount brokerages CIBC Investor’s Edge, Credential Direct, Qtrade Financial and Scotia iTRADE seeking to build their bench in the digital, social and content arenas. Of course, they’re not the only ones.

In a recent interview with Investment Executive, the vice president and head of retail banking and wealth management for HSBC Canada Larry Tomei stated that HSBC Canada has been spending “a significant amount of money” on digital initiatives, including revamping HSBC InvestDirect.

What this all points to is that Canadian online brokerages (as well as their parent financial brands) have to make the transition into being adept technology companies as well as publishing companies while retaining their financial services roots. This recent spike in staffing up the digital benches suggests that some very interesting features and upgrades are just around the corner.

Discount Brokerage Tweets of the Week

While the environment was on the minds of many, it also managed to spill over into the online trading world too. Mentioned this week were CIBC Investor’s Edge, Questrade, Scotia iTRADE, TD Direct Investing and Virtual Brokers.

From the Forums

Exit Strategy

Looking before you leap is a sound strategy. In one DIY investor’s case, they wanted to know what the leap from Scotia iTRADE to Questrade might be like in this thread from reddit’s Personal Finance Canada section.

Time to split

While there are always two sides to a story, for one DIY investor, it seemed their online brokerage was having difficulties dealing with a share split. When asking aloud if other DIY investors on reddit encountered any customer service issues in this post, it was interesting to see how other investors weighed in and what they had to say about this online brokerage.

Into the Close

That’s a wrap on the week. What better note to end on than record market levels in the US, national donut day, and a weekend full of playoff hockey and basketball. Of course, watching the French government troll DJT also makes for a pretty fun spectator sport as well. Whatever you happen to watch this weekend (even if it’s cryptocurrency prices) have fun!

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Discount Brokerage Deals & Promotions – April 2017

*Updated April 14* Even though this is technically April Fool’s Day, the pullback in deals is no laughing matter. After a very busy March in which there were as many as 35 deals in play, April kicks off with a more modest 24 live deals. The bigger story, however, is recognizing that now might not be the best timing for brokerages to be on the sidelines.

Having compared online brokerage deals & promotions for several years now, there is clearly some seasonality at play. Last year, for example, the transition from March to April saw the deal count drop from 33 to 19.

Discount brokerage deals and promotions typically ramp up at the beginning of a new year and crest heading into the RRSP contribution deadline at the beginning of March, after which things slowly subside.

Coming into 2017, however, it was noteworthy that several online brokerages had launched their major promotional pushes just before the end of 2016, signaling a much fiercer competitive environment for attracting new clientele.

And, although the start of April begins with a major contraction in offers, it is also interesting to see that competitive forces are still at play in the early part of 2017.

While we can’t be certain of the timing of this change, National Bank Direct Brokerage quietly lowered their minimum transfer deposit requirement from $25,000 to $20,000 for individuals to receive a transfer fee credit. The majority of Canadian online brokerages have set the bar at $25,000 to qualify for the transfer fee credit to apply so this move from NBDB might be enough to tip a few competitors to do the same.

Another interesting development at the outset of a new month is absence of special offers listed on the Scotia iTRADE ‘special offers’ page.

Along with BMO InvestorLine, Scotia iTRADE has been a stalwart of the deals race, typically running promotions to attract new clients. Interestingly, the ‘refer-a-friend’ and the ‘Start Right’ offers appear to have been labeled as “programs” (in the Fees section) rather than being listed under the special offers section.  The same is true for their ‘buck-a-bond’ offer, which has been a fixture of previous special offer sections.

The restructuring of Scotia iTRADE’s deals could be a consequence of the new website organization but for DIY investors looking for an incentive, this change has made it less clear that there are offers available.

On the surface, it seems that running offers/promotions when DIY investors are in the market for opening an account makes sense. It’s why retailers concentrate their efforts around big shopping dates in the calendar year. Unlike retail, however, the reality is that DIY investors, especially those on the margins, might be driven more by the investment climate than by seasonal deadlines.

With our own internal data showing steady DIY investor interest, markets trading at all-time highs and economic forecasts flashing green, there’s a case to be made that there’s no better time for brokerages to be offering up more promotions rather than less. If investors are coming back to the markets, it will be interesting to see just how long brokerages are going to sit this opportunity out. Stay tuned.

Expired Deals

*Update: April 3 – BMO InvestorLine has retired their winter promotion and replaced it with a new offer (see below).*

There were 12 deals that expired at one point or another during March. Here’s a list of the deals that didn’t make it into April (as of April 1st):

  • CIBC Investor’s Edge – Cash back promotion
  • Credential Direct – Cash back promotion
  • HSBC InvestDirect – 50 commission-free equity trades
  • National Bank Direct Brokerage – Cash back promotion
  • Qtrade Investor – Cash back promotion
  • RBC Direct Investing – Pay with points promotion
  • Scotia iTRADE – Travel points promotion
  • Scotia iTRADE – Transfer fee promotion
  • Scotia iTRADE – Visa Gift Card promotion
  • TD Direct Investing – 200 commission-free trade promotion
  • Virtual Brokers – $10,000 commission rebate offer
  • Virtual Brokers – 5i Research Subscription Offer

Extended Deals

No deals that were set to expire at the end of March have been extended (as of time of publication).

New Deals

*Update: April 14 – Qtrade Investor is once again offering their transfer promotion which lowers the minimum deposit amount required to qualify for covering transfer fees from $25,000 to $10,000. This is the most competitive transfer fee offer currently available from a Canadian online brokerage. See table below for more details.*

*Update: April 3 – BMO InvestorLine has introduced a very competitive cash back or commission-free trade deal for DIY investors. For deposits of at least $100,000, eligible individuals can receive either $200 cash back or 20 commission-free trades; for deposits of at least $250,000, eligible individuals can receive either $1,000 cash back or 100 commission free trades. According to the terms and conditions for this deal, the eligible account types are cash or margin (individual or joint) accounts, corporate accounts, sole proprietorship accounts, RRSP and spousal RRSP accounts.*

No new deals or promotions to report (as of time of publication).

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 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, 2017
Open and fund a new registered account at Virtual Brokers with at least A) $5,000; B) $25,000; or C) $50,000+ in new assets and you may be eligible to receive A) $30; B) $50; C) $100 cash back. Use promo code RRSPCB2017 when signing up. Be sure to read terms and conditions for full details. A) $5,000 – $24,999 B) $25,000 – $49,999 C) $50,000+ A) $30 B) $50 C) $100 Cash back will be deposited just after October 31, 2017 RSP cash back bonus April 30, 2017
Open and fund a new account at Virtual Brokers with at least $5,000 and you may be eligible to receive 2 months of commission-free equity trading and a $250 USD/mo credit towards Edge Trader Pro for 2 months. Use promo code 2MFREE2017 at sign up to qualify. Be sure to read full terms and conditions for details. $5,000 2 months commission-free equity trading + $250 USD/mo platform fee rebate. 2 months 2 months free trading April 30, 2017
Disnat Desjardins Online Brokerage is offering new clients 1% of assets transferred into the new account in the form of commission credits (to a maximum value of $1,000). Minimum qualifying deposit is $10,000. To qualify, individuals will have to call 1-866-873-7103 and mention promo code DisnatFlex or email: [email protected]. See details link for more info. $10,000 1% of assets transferred in the form of commission-credits (max credits: $1,000) 6 months Disnat 1% Commission Credit Promo April 28, 2017
BMO InvestorLine Open a new qualifying account with BMO InvestorLine or fund a qualifying existing account, with at least A) $100,000 or B) $250,000+ in net new assets and you may be eligible to receive A) $200 cash back or 20 commission-free trades; B) $1,000 cash back or 100 commission-free trades. Use promo code CASH when signing up for cash back offer or TRADES to be eligible for commission-free equity trade offer. Be sure to read the terms and conditions for more details on the offer. A) $100,000 – $249,999 B) $249,999+ A) Cash back: $200 OR 20 commission-free trades B) Cash back: $1,000 OR 100 commission-free trades. Cash back will be deposited the week of January 8, 2018. Commission-free equity trades are eligible for use up to August 6, 2017. Cash back or Free trade offer June 5, 2017

Expired Offers
BMO InvestorLine Open a new qualifying account with BMO InvestorLine, and fund it with at least A) $100,000; B) $200,000 or C) $300,000+ in net new assets and you may be eligible to receive A) $200; B) $400 or C) $750 cash back. Use promo code PROMO750 when signing up to be eligible. Be sure to read the terms and conditions for more details on the offer. A) $100,000 – $199,999 B) $200,000 – $299,999 C) $300,000+ Cash back bonus A) $200 B) $400 C) $750 Cash back will be deposited the week of November 6, 2017. 2017 Winter Campaign *Expired* April 2, 2017 *Expired*
Last Updated: April 22, 2017 01:00 PT

Referral 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
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 June 30, 2017

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: April 1, 2017 14:30 PT

Transfer Fee 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 $20,000 or more to a National Bank Direct Brokerage account and they will pay up to $135 plus taxes in transfer fees $135 $20,000 Transfer Fee Rebate 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
Transfer $10,000 or more to Qtrade Investor from another brokerage and Qtrade Investor may cover up to $150 in transfer fees. See terms and conditions for more details. $150 $10,000 Transfer Fee Rebate May 11, 2017
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 Transfer Fee promo tbd
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
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 DisnatFlex. See details link for more info. $150 $50,000 Disnat 1% Commission Credit Promo April 28, 2017

Expired Offers
Last Updated: April 14, 2017 23:30 PT

Other 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
Disnat Desjardins Online Brokerage, in conjunction with MoneyTalks, is offering 3 months of the “Inside Edge” investor information service to Desjardins Online Brokerage clients. Use promo code DESJ2016 during checkout to qualify. Be sure to read full terms and conditions for more information. n/a MoneyTalks Inside Edge Discount none
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
Open a new account with Virtual Brokers with a deposit of at least $1,000 (for the Classic Commission Account) and you may be eligible to win a $250 gift card to the Apple store. Use promo code 250AGC2017 during sign up to be eligible. Residents of Quebec are not eligible for this contest. Be sure to read terms and conditions for full details. $1,000 (Classic Commission Account) $250 Apple Gift Card Draw April 30, 2017
Open a new account with Virtual Brokers with a deposit of at least $1,000 (for the Classic Commission Account) or $5,000 (for the Commission Free Trading Account) and you may be eligible to receive a one-year subscription to access 5i Research. Use promo code 5iVB2016 when signing up. Be sure to read terms and conditions for full details. $1,000 (Classic Commission Account); $5,000 (Commission Free Trading Account) 5i Research Offer March 31, 2017

Expired Offers
Last Updated: April 1, 2017 14:30 PT
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Discount Brokerage Weekly Roundup – March 31, 2017

Even though March is over, it still doesn’t quite feel like the madness is behind us yet. Nonetheless, housing prices (in Toronto) and stock markets are still buoyant, and are managing to keep up appearances. For investors & discount brokerages, it seems the old farmer adage stands: make hay while the sun shines.

In this edition of the roundup, we look at the deals and promotions turnover set to take place across the board as we head into a new month. From there, we’ll review the latest security feature from a Canadian bank-owned discount brokerage that leverages voice biometrics. As always, we’ll look at what DIY investors had to say on Twitter and wrap up the week with a couple of interesting forum posts.

Marching Forward

After the madness of the RSP contribution season, a rally in the stock market, and rumblings of interest rate increases, it appears as if the landscape for online brokerages is due for a bit of a shakeup.

As we head into a new month, it is already clear that there will be a great deal of change on the deals & promotions front with at least six offers officially set to expire at midnight. Interestingly, deals from National Bank Direct Brokerage, CIBC Investor’s Edge and Scotia iTRADE were pulled from their websites in advance of the official calendar roll over.

The transition from March madness to April (sadness?) is not unusual. Last year, the shift from March to April saw the deal count fall 42% from 33 offers down to 19, with most of the offers disappearing from the cash back/free trade category. The deal count through March of this year reached close to 30 before pulling back slightly with the expiration of deals from Credential Direct, Qtrade Investor and HSBC InvestDirect.

One curious observation this year is that online brokerages have removed offers from their website in advance of the calendar roll over. Typically these deals last through the last day of the offer, even sticking around a few days after the deal has expired.

It’s not quite clear what this means for publication of new offers, however it seems that brokerages are being slightly more responsive than they have been previously. Also, it is curious to note that, at the time of publication, there were no longer any promotional offers or deals listed on the Scotia iTRADE special offers section. Scotia iTRADE has been staple of the deals race for a very long time, so it will be interesting to see if they populate their deals section again soon or if this is a signal of a change in strategy.

We will continue to monitor the deals & promotions section heading into April, especially since the landscape for DIY investors’ choice of promotions keeps shifting. With several ‘coming soon’ features announced by brokerages (including one described below) there may be a convenient promotion to accompany new feature releases.

List of some of the brokerages and deals expired as of March 31st:

  • Virtual Brokers’ $10,000 Commission Credit Offer
  • National Bank Direct Brokerage Cash Back Promotion
  • Scotia iTRADE Winter 2017 Commission Rebate Offer
  • CIBC Investor’s Edge Cash Back & Free Trade Offer
  • TD Direct Investing 200 Commission-free Trade Offer

New Voice of Security

Whether it’s Siri, Google or Alexa, there’s no question that voice recognition is playing a greater role in the day to day lives of consumers. Now, it appears, it will do the same for DIY investors.

Voice recognition technology has typically found its way into the financial services world as a means to replace users having to push numbers on a keypad to navigate, but now it is possible for this technology to verify the identity of who’s on the line.

An announcement posted on the CIBC Investor’s Edge website indicates that voice recognition biometrics will soon be integrated into the customer service experience at one of Canada’s bank-owned online discount brokerages. Instead of fumbling about with passwords, PINs or security verification questions, individuals who are in a hurry will simply be able to rely on a ‘voiceprint’ for security authentication.

Screenshot from CIBC Investor’s Edge Website

How much time can be saved using voice biometric login? Quite a bit, it seems. A recent study of voiceprint-based biometric authentication from Citibank’s Asian Pacific region found that the average time to validate a client’s identity dropped from 45 seconds to 15 seconds using this new technology. In a world where user experience online demands web pages load in fractions of a second, it’s easy to see why making the case to shave the telephone authentication experience down makes sense.

Another improvement to the telephone experience CIBC Investors Edge users will enjoy is being able to schedule a call back instead of waiting on hold.

Granted, it seems like a small improvement, but for impatient traders or investors who would rather listen to the market news instead of hold music (or hold commercials), the call back feature is a godsend and will make scenarios like the one mentioned above a thing of the past. Of course, while call backs are preferable, how long it takes for an agent to call back is another matter entirely.

The announcement page for this new feature also has compiled a useful list of questions, including what should happen if voice authentication does not work or does not allow a user in.

This latest feature announcement, while not revolutionary, is still evolutionary and helps to exemplify that the bigger bank-owned discount brokerages are not standing still when it comes to innovation. When it comes to deciding on how to improve consumer experience as an online brokerage, this one seems to be a good call.

Discount Brokerage Tweets of the Week

If there’s a rule to social media and discount brokerages, it’s that when things break, you’ll hear about it on Twitter. Mentioned this week were BMO InvestorLine, Disnat, Questrade, Scotia iTRADE, TD Direct Investing & Virtual Brokers.

From the Forums

Conversion Factor

DIY investors are always on the lookout for a good deal. In this post, from reddit’s Personal Finance Canada, one DIY investor looking for a better way to convert between USD & CAD found a good tip to consider at a popular online brokerage.

Qtrade vs Questrade

Without meaning to, the Q-named Canadian discount brokerages are often mistaken for one another. In this post, however, one user had narrowed the field down to choosing between Qtrade Investor and Questrade. More instructive, however, is the response on this channel that Questrade managed to provide.

Into the Close

That does it for another week in the markets. Assuming that nothing totally crazy happens on Twitter this weekend, enjoy April Fool’s Day, the start of spring training and celebrating the successful launch (and return) of the SpaceX rocket. For a head start on April Fool’s pranks, here’s a fun rundown of them.

 

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Discount Brokerage Weekly Roundup – March 17, 2017

March madness indeed. After ‘losing’ an hour to start the week, things were looking kind of looking up with Pi day, then there was the interest rate hike in the US, that whole ‘Ides of March’, the IPO of Canada Goose and finally St. Patrick’s Day on a quadruple witching day. Even though Canadian discount brokerages may be used to these ups and downs, the bigger picture appears to be how to stand out to investors with so much else going on.

In this week’s roundup we take a look at a couple of online brokerages attempting to grab the spotlight as best they can amidst a crazy news cycle. The first, a major platform upgrade, could be a signal of some changes to come at a brokerage that doesn’t often make the news. Next we look at what might be the ‘next big thing’ for socially responsible investors and a big differentiator at a bank-owned online brokerage. Also on the menu, we cut through the cat videos, Trump tweets and trolls to find what DIY investors were chirping about on Twitter and on the investing forums.

HSBC Launching New Platform

It’s almost cliché at this point but user experience is important for traders on the web today.

Over the past four years, there has been a concerted effort by most Canadian discount brokerages to improve ‘user experience’ for their existing and prospective clients. Earlier this year, Scotia iTRADE released a new front end website to improve navigation and usability. This past week, HSBC InvestDirect posted an update to their website indicating that a major facelift or upgrade to their online trading experience is on its way.

Screenshot from HSBC InvestDirect Website

Based on an early look at the new platform available on the InvestDirect website, the new trading platform features screenshots that highlight the cleaner look and feel to the landing page. A consolidated view of the holdings, positions and overall gains/losses makes up the dashboard.

Asset breakdowns are in line with other brokerage interfaces and contain clear(er) charts showcasing asset allocation, regions/sectors and performance to help track investments.

Under their ‘investor tools’ the layout includes essential trading information on a stock as well as essential functionality (such as the ability to trade, refresh for quotes, add stocks to a watchlist or setting an alert). The nice feature they have in their stock window is the ability to compare up to three stocks on a chart against one another. Even though it is clean and somewhat minimal in design, it appears to have some of the more popular features that most DIY investors would require.

In terms of screeners, HSBC InvestDirect provided a preview to their mutual fund, ETF and fixed income screeners. The filter parameters include a few standard values such as Risk, MER and Morningstar Ratings as well as the ability to run pre-defined search queries. With so many of these products on the market, a screener that has some advanced filters is a valuable tool.

Although this new platform is clearly catered towards the standard DIY investor (more likely the buy/hold or occasional investor/swing trader) it is nonetheless an important step forward for HSBC InvestDirect’s digital identity. Not only will the new platform enable them to better service their existing clients with an improved order entry, research and tracking experience, this newer interface might improve the perception of the HSBC InvestDirect brand.

For many years, discount brokerage rankings from Surviscor and Rob Carrick (Globe and Mail) for being out of touch with the needs/user experience of modern investors. For example, the last ranking from Rob Carrick referenced HSBC InvestDirect as “the broker that time forgot. Hasn’t done much to shake things up since the mid-2000’s…” while Surviscor assigned a grade of “C-“ to “transaction process” and a “D” to “website resources.”

Though the unveiling of a new trading platform won’t necessarily be revolutionary, the fact that it is evolutionary is a good sign for HSBC InvestDirect. And even though it’s hard to tell what else will be changing (if at all) and when, the best news for DIY investors is that they’re not standing still.

Scotia iTRADE goes for sustainability

Another interesting development this week was from Scotia iTRADE who became the first DIY investing brokerage to launch integrated tools to evaluate the ‘sustainability’ (measured across Environmental, Social and Governance – ESG – parameters) of publicly traded companies.  The tool itself is developed by a third-party, Sustainalytics, which has been involved in evaluating companies on ESG parameters for the past 25 years.

While there will be more to come in an upcoming post, at first blush this new feature looks like a significant directional move by Scotia iTRADE. At a time when marketing budgets across online brokerages are getting increasing scrutiny, the cost of professionally producing and launching a new product video is not insignificant, so the three part explainer videos hint at a major commitment from iTRADE to let investors know about this new feature.

Reading between the lines, the coordination of marketing efforts to do this means the ‘sustainable’ angle likely will form an important component to what will differentiate Scotia iTRADE from its peers, especially in the near term.

Interestingly, the spotlight on ethical and sustainable issues has never been more timely (and perhaps a tad ironic).

The Canadian financial services industry is still reeling from the blowback from the recent CBC news investigation that revealed (alleged) significant ethical violations from front-line staff. How the Canadian banks would fare on an ESG score sheet after this new revelation would be very important to track especially as more details emerge.

Discount Brokerage Tweets of the Week

Feature requests and customer service gripes made up the menu of tweets this week. Mentioned were CIBC Investor’ Edge, Credential Direct, Questrade, Scotia iTRADE, TD Direct Investing and Virtual Brokers.

 

From the Forums

Detail Disoriented

When it comes to investing and trading, everybody starts at the bottom of the mountain. Thankfully there are some good people along the way that can offer sober advice about the journey to becoming a confident DIY investor. In this post from reddit’s Personal Finance Canada thread, one new investor finds out that details matter and keeping them all straight is just the beginning of the juggling act of investing solo.

Certifiably Unhappy

Nothing like a nasty fee surprise to leave a bad impression of a service provider. For one DIY investor trying to deposit a share certificate with Scotia iTRADE, the sting of a deposit fee was enough to have them start to shop around. Read what others had to say about the share certificate fee-asco in this post from RedFlagDeals.com.

Into the close

That’s a wrap on another busy week. For anyone trading this week’s market, hopefully it ended on a green note along with celebratory (or necessary) drink (or two). Next week should be another wild ride for Canadian DIY investors with the federal budget announcement slated for mid-week. Rest up (while you can) & have a great weekend!