InvestorLine – Page 23

Posted on November 18, 2016 by user — 2 Comments

Discount Brokerage Weekly Roundup – November 18, 2016

With shipping, tripping and champagne sipping, it was another wild week in the markets. There was volatility galore which always makes for exciting times for both traders and the business news media. And, even though this wacky week has come to a close, another very big week is close at hand with ‘Black Friday’ sales and deals already starting to spring up in advance of the infamous shopping weekend. Of course, while many businesses have wised up to the fact that when consumers are out looking for deals, it may be good to start offering them up, Canadian discount brokerages are definitely holding out.

In this special edition of the roundup we take a deep dive into the results from the latest SparxTrading.com survey. Part one of this report looks at whether or not deals matter to DIY investors and analyzes what Canadian discount brokerages can do in response. From there we’ll take a look at what DIY investors had to day about Canadian brokerages on social media and what got people talking on the forums.

What’s in a deal?

For many years now, Canadian DIY investors looking to invest online have had to figure out how to choose a Canadian discount brokerage from among the dozen or so options out there. To help them with that exercise there have been numerous “rankings” of brokerages and of course, lots and lots of opinions. In addition to winning hearts and minds, winning wallets has been another strategy that several brokerages have attempted to employ in various shapes and forms.

While many Canadian discount brokerages try to figure out what DIY investors are interested in, at SparxTrading.com we were curious about whether or not many of the deals and promotions that Canadian online brokerages are using are appealing and relevant. With 26 advertised deals currently in play, and with some interesting moves by certain players in the market in the past year, we thought it would be interesting to see the degree to which DIY investors are enthusiastic about getting a deal when looking to sign up for an online brokerage account.

Additionally, we were interested in learning about which Canadian discount brokerages DIY investors seemed to be considering while hunting around for a deal. With lots of money that goes into marketing, it was interesting to see whether or not those efforts are paying off with DIY investors.

In part one of this analysis, we review the numbers and the story behind whether or not deals and promotions matter to DIY investors when shopping for an online trading account.

Do deals matter to online investors?

In a word, yes.

In the data collected by visitors to SparxTrading.com deals & promotions section in the month of October, we found that the overwhelming majority – 84% of visitors who completed the survey – stated that getting a deal helps to determine which online brokerage they ultimately end up selecting.

While it stands to reason that somebody who has made their way to the deals and promotions section would naturally be interested in or curious about a deal or promotion, it is nonetheless a number that warrants consideration. Those that are in the market for an offer or who are deciding between a short list of candidate online brokerages might just use the deal as a deciding factor.

Looking at the breakdown of deals and promotions, there are currently 26 advertised offers from Canadian discount brokerages. Unpacking that number a bit further shows that not all brokerages are offering the same kind of incentives or promotions. Further, as we reported previously, it shows that there is a disconnect between the offers that the vast majority of DIY investors are looking for and the ones being offered up by brokerages.

Previously we reported that close to two thirds of respondents indicated that cash back promotions were the preferred offer but looking at the deals currently being advertised, only 5 brokerages are offering this to clients. Specifically, BMO InvestorLine, HSBC InvestDirect, Questrade, Scotia iTRADE and Virtual Brokers are offering cash back promotions, however only BMO InvestorLine and HSBC Investdirect do so directly, the remaining firms only offer a cash back incentive via referral offers (which we covered in last week’s roundup).

After cash back offerings, the next most popular were commission credits. These are much more popular for online brokerages to offer because the what consumers pay to execute a trade is not the same as what a brokerage may pay to execute and clear it. Thus getting $100 in trading credits is a win for consumers and a win for brokerages who might only pay a fraction of the face value of the trading commission.

The findings of this survey were quite revealing, in part, because they highlight the gap between what many DIY investors are looking for and what the online brokerage marketplace is prepared to offer. At least at most firms.

DIY investors are constantly looking at and for the next big thing, which means that innovation is always on the minds of investors. So, stepping into trading interface or an online experience that doesn’t convey “innovative” communicates that an online company either doesn’t get it or doesn’t care to. Incentives, such as deals, can help sweeten the deal or focus investors’ attention on price rather than features.

Which online brokerages are DIY investors shopping for?

There’s a saying in marketing, ‘half the money spent on advertising is wasted, we just don’t know which half.’

The results of who online shoppers were looking for certainly got our attention. What they reveal is that marketing dollars or strategies might not be working the way they could at certain online brokerages.

Stay tuned for part 2 of this post in which we report on which Canadian online brokerages DIY investors are actively looking at and which ones they’re looking past.

What can Canadian discount brokerages do?

Data points such as these help to illustrate that the best way to win market share is to listen to the market. Incentive programs are one powerful lever to get individual investors to pay attention or shortlist a brokerage – even to the point of helping to tip the scales in favour of a brokerage. Canadian discount brokerages who aren’t offering a promotion that is widely sought after need to start if they would like to appeal to a broader client base. More specifically, pushing out a cash-back offer appears to be what most DIY investors would find interesting. It should come as no surprise that when it comes to DIY investors, money talks.

Where are brokerages heading next?

Just over a month ago, trading software provider Recognia, organized their 8th Online Broker Summit in Chicago in which many online brokerages from both Canada and the US gathered to discuss trends and developments in the North America online brokerage industry.

One of the major focal points of this summit was on understanding how to navigate the ever changing world of online user experience as well as trends in what DIY investors are looking for.

Below is a quick video highlight reel prepared by Recognia to showcase what online brokerages are thinking about heading into the year ahead.

https://www.youtube.com/watch?v=O-Etqjj9dCY

Discount Brokerage Tweets of the Week

It was a choppy week in the markets but surprisingly only a handful of DIY investors ran into technical issues. Mentioned this week were Credential Direct, Questrade, Scotia iTRADE, TD Direct Investing and Virtual Brokers.

From the Forums

Betting Big

With the recent surge in marijuana stocks, penny stock chatter has picked up. In this post on reddit’s Personal Finance Canada section, one investor is looking to take a big gamble on penny stocks in a TFSA and is wondering what they need to know before taking the plunge.

A fistful of dollars

Is it possible to get a better trading commission rate at TD Direct Investing? One user on reddit seemed to suggest it’s possible in this post however there are some important caveats pointed out by other readers.

Into the close

That’s is for another crazy week. 2016 still has a few weeks left in it but by the looks of things it won’t be going quietly. For those in need of some laughter as a break to the week that was, here are some hashtags from Twitter that will give you a chuckle. Have a great weekend!

Posted on November 11, 2016 by user — Leave a comment

Discount Brokerage Weekly Roundup – November 11, 2016

If the world were to go to hell in a handbasket, the market would respond by going bullish on basket makers and transportation. Such is the lens of a trader. Despite the volatility and uncertainty attached to a Trump presidency, the sell-off in the moments following the Trump election quickly corrected by the time markets opened. For observers of the market, it was a unique lesson in how quickly the great voting machine that is the stock market can recalibrate to figure out where the opportunities lie and where they don’t. What does a ‘Trump’ world look like for Canadian online brokerages and DIY investors? There may not be a simple answer, but the simple lesson seems to be: be prepared for the unexpected.

In this week’s roundup we take a closer look at the latest Canadian discount brokerage to bring a referral program to back online and how it stacks up to offers currently in play. From there we’ll take a look at one non-bank owned brokerage and how its latest set of features are making it more competitive. To round out this week, we’ll take a look at the latest tweets from investors and what forum users were chatting about.

Virtual Brokers Casts a Vote for Friendship

After a break of several months, the refer-a-friend promotion from Virtual Brokers is back on the list of active deals being offered. With the relaunch of this referral program, Virtual Brokers joins three other online brokerages (Questrade, Scotia iTRADE and BMO InvestorLine) that offer some kind of referral program bonus for both the new enrollee as well as the individual who made the referral. Interactive Brokers, another popular online brokerage, does offer a referral bonus but only to the individuals making the referral, not to the individual enrolling for a new account.

Of the group of referral offers, Virtual Brokers’ minimum requirement of a $5,000 deposit is second behind that of Questrade’s and significantly lower than that of either Scotia iTRADE (minimum requirement of $10,000) and BMO InvestorLine (minimum deposit of $50,000). Like offers from Questrade and Scotia iTRADE, Virtual Brokers’ referral plan offers an increase in cash-back reward for higher deposit levels.

Key differences in the refreshed version of their cash back promotion include offering up more money and an additional deposit tier. While the previous promotion offered two tiers, the new referral structure offers 3. The tiers of Virtual Brokers’ new referral plan range from between $5,000 to $24,999 ($25 bonus given), $25,000 to $49,000 ($50 bonus given) and $50,000+ ($75 bonus given). For the individual doing the referring, the amount they receive for each referral ($25) remains unchanged as does the additional amount for every third referral ($50).

Of course, like any offer, it’s important to look closely at the details to see exactly what’s on the table. For the Virtual Brokers referral offer, there are some important caveats.

First, the referral can only happen between friends or family which are defined as follows:

“A friend, for the purposes of this offer, is someone with whom you have a personal relationship. A “personal relationship” is defined as a relationship between two people who have had direct, voluntary two-way communications where it would be reasonable to conclude that the relationship is personal.”

“Family relationship” for the purposes of this offer sharing is a relationship between two people related through a marriage, a common law partnership, or any legal parent-child relationship, who have had direct, voluntary two-way communications (sic)

Of the different referral programs offered by Canadian discount brokerages, only Virtual Brokers and Scotia iTRADE explicitly define the terms “Friend” and “Family relationship” and both use the same definition as part of the terms and conditions. By comparison, neither Questrade nor BMO InvestorLine make this distinction a part of qualifying for their referral programs.

Another important detail for this offer is that referral amounts will be deposited into the referring parties’ margin accounts by March 31, 2017. Between now and that time, the individuals receiving the referral have to keep their account in good standing (i.e. no margin calls) and the referee also has to ensure a minimum qualifying balance is maintained.

Third, similar to the conditions stipulated by Scotia iTRADE, this referral offer is not open to residents of Manitoba or Quebec. Curiously, neither Questrade nor BMO InvestorLine have these geographic restrictions in place.

So how do the referral offers stack up with one another?

From the graphic shown below, what DIY investors receive as part of their participation in a referral program depends on what they deposit.

Refer-a-friend incentives at Canadian discount brokerages (all amounts shown in dollars).

Of the four Canadian discount brokerages offering referral programs, Questrade is offering the most to DIY investors and their friends, across all deposit tiers up to the $50,000 mark, where they are tied with Scotia iTRADE.

In the $1000 to $4,999 deposit range, Questrade’s referral bonus stands uncontested.

For Virtual Brokers, the table above shows that they appear to be competing more closely with bank-owned brokerages rather than going toe-to-toe with Questrade’s amounts, even though the payout structure to referrers is identical to the Questrade model.

Finally, what this chart also shows is that BMO InvestorLine, regardless of the deposit tier, is not really interested in attracting deposits underneath $50,000 and is not prepared to offer up what other brokerages are in terms of a referral bonus offer. The one caveat to that is that unlike other brokerages, BMO InvestorLine allows their referral bonus to be combined with another promotion – which at this time only includes an offer that requires a minimum deposit of $100,000 to qualify.

The addition of a new deal into their list of offerings puts Virtual Brokers back on the board for referral offers and gives DIY investors looking for an online trading account one more potential reason to consider starting out with Virtual Brokers, an advantage over the 8 or so other brokerages not offering a referral-based sign up bonus.

From a business perspective, offering a referral bonus makes quite a bit of sense in that referral plans help Virtual Brokers fix their cost of acquiring a new client. In a marketplace that is so competitive, every new client matters and how much it costs to get that new client is increasingly becoming more expensive. Added to that, the fact that the offer is a cash-back promotion rather than a commission-free offer makes it significantly more appealing to DIY investors hunting for a deal.

Ultimately, whether someone wants to recommend a brokerage to a friend or family member comes down to how well a brokerage is doing its job. While enticing, the referral amounts are not set nearly high enough to have someone put their own reputation on the line for a substandard experience. So, while setting up a referral program is a good first step to growing a client base, the success of that program will depend on how great an online brokerage makes its existing customers feel.

Back the Feature with Qtrade

Over the past several weeks, Qtrade Investor has been rolling out new features and pricing changes that signal they’re committed to evolving their offering to DIY investors. In last week’s roundup, several of their feature ‘enhancements’ were referenced, notably their expansion of the list of commission-free ETFs as well as improvements to the online user experience.

A few more features that warrant a mention include their dividend reinvestment tool that simplifies setting up dividend reinvestment strategies as well as additional Morningstar ratings categories for ETFs and mutual funds based on sustainability, which were launched in March of this year.

Another interesting development at Qtrade Investor is the lowering of the threshold to qualify for a transfer fee credit (up to $150) from $25,000 down to $10,000. Although not stated on the website, representatives from Qtrade have indicated this offer is open until the end of December. This update to their transfer fee promotion positions them atop the transfer fee offer group, ahead of second place RBC Direct Investing who requires a minimum transfer amount of at least $15,000 to be eligible for their transfer fee credit and well ahead of the standard amount of $25,000.

Looking at the big picture for Qtrade, with this long list of features, they are working to remove the ‘friction’ involved in becoming a client.

The combination of lowering pricing, expanded product selection (ETFs), improving accessibility to their platform, both in terms of technology (via mobile trading), as well as by implementing steps such as the transfer-in credit referenced above, mean that over the past year, Qtrade Investor has managed to make big strides in staying competitive with the larger bank-owned brokerages as well as their non-bank owned peers. While not calling out a winner in the upcoming online brokerage rankings, these elements certainly make Qtrade Investor seem like they’re going to finish 2016 much stronger than when they started.

Discount Brokerage Tweets of the Week

As this week’s election has proven, Twitter can spell the difference between election glory or defeat. For Canadian discount brokerages, this past week spoke volumes in terms of what prompted users to speak up and speak out about. Mentioned this week, CIBC Investor’s Edge, Questrade, Scotia iTRADE, TD Direct Investing and Virtual Brokers.

From the Forums

TFSA trading

When is a trade not a trade? It’s a fine line to walk for those actively trading their TFSA accounts – something that is the source of a great deal of controversy. In this post from reddit’s Personal Finance Canada section, more than a few users chimed in to help provide their perspective and learning on when trading in a TFSA might not be so tax-free after all.

Into the Close

That’s a wrap for this week. If ever there was a TGIF card to play, it is definitely going to get played here. Of course, while it would be easy to recoil into sports, Netflix or some other well-deserved distraction, today more than any other it is important to remember and honour the sacrifice and service of the many men and women who helped fight for the freedom, democracy and way of life we enjoy in Canada. Thank you to our veterans and to those unsung heroes working to keep Canada safe and welcoming.

Posted on November 4, 2016 by user — Leave a comment

Discount Brokerage Weekly Roundup – November 4, 2016

Patience is a virtue. Or for some, it’s a way of life. Cubs fans can finally celebrate winning the world series, somewhat ironically on a week when market bears were also cheering their recent victories. For Canadian discount brokers, more than a handful have decided that they’re done playing the waiting game and are going to be chasing the prize of getting new clients as we head into the final stretch of 2016.

In this week’s roundup, we start with a look at what’s happening in the deals and promotions space as we head into a new month and whether Canadian discount brokerages are starting to pick up signals from what investors are asking for in the market. Next we take a look at a few brokerages that we spotted rolling out some upgrades and changes. From there, we’ll take a look at the latest feedback from investors on Twitter (hint: US presidential candidates aren’t the only ones catching heat). Finally we close out with a few choice threads from the Canadian investor forums.

Market Clearing Price

Now that a new month is here, it’s time for a deals & promotions refresh. Heading into November there wasn’t a lot of turnover forecasted to take place with only three promotions set to expire at the end of October.

A pair of promotions from BMO InvestorLine as well as an offer for commission-free ETF buying at Qtrade Investor were on the chopping block however two of the three offers, both from BMO InvestorLine actually managed to get extensions into 2017.

The commission-free ETF buying offer from Qtrade Investor did expire at the end of October however as the sun was setting on that offer, Qtrade Investor announced that they are adding 40 more ETFs to their commission-free list, bringing the total number of commission-free ETFs that can be bought and sold with them to 100.

On a month over month basis, then, the deals and promotions section shrank by one compared to October, bringing the total number of active advertised offers to respectable 23.

Transfer offers edged ahead of the cash back/free trade offers as the most popular category of deal offered, and, Scotia iTrade pulled ahead of competitor firms as the discount brokerage offering the highest number of deals getting ahead of Desjardins Online Brokerage and Questrade. Interactive Brokers is still not on the list of Canadian discount brokerages pushing a sign up promotion however their ongoing growth and success at client acquisition suggests they’re doing well in this department all things considered.

Even though the start of November has been quiet, there still might be a few interesting promotions launched before the month and year are out.

Several brokerages have expressed interest in launching something noteworthy to DIY investors in November, and data from our own internal sources show that bargain hunters were out in droves this past October signaling DIY investors are actively looking for incentives and providers.

Early data from the survey we ran last month also indicated that not only does having an offer make a huge difference to the overwhelming majority of DIY investors shopping for a discount brokerage but there is a significant mismatch between the brokerages offering deals and the brokerages DIY investors are seeking deals from.

For certain Canadian online brokerages, the data paints an interesting picture in that offers alone, while clearly important, aren’t enough to get on DIY investors’ radars. There also has to be a significant degree of marketing and awareness building that precedes the moment where a DIY investor decides to kick the tires.

On the flip side, for DIY investors, lesser known brokerages are going to have to be able to compete much more aggressively and creatively to get attention.

This has already started to take place with Desjardins Online Brokerages’ latest offer of a flat 1% of deposit size being put towards commission credits. This offer positions them as one of the most competitive offers out there for this kind of promotion within the last four years and has already moved the needle on who’s paying attention to them.

Looking ahead to the next several weeks, it will be interesting to see just how many brokerages sit up and start to pay attention to what the marketplace seems to be asking for and who will be content sitting on the sidelines.

Qtrade Banks on Change

As we had reported in a previous roundup, Qtrade Investor quietly rolled out their removal of the ECN fees for standard trading commissions. This past week, Qtrade also rolled out a few more enhancements to their offering, adding 40 commission-free ETFs to the existing list of 60 and bringing the total number of commission-free ETFs to 100. Along with Qtrade Investor, Questrade, Virtual Brokers, National Bank Direct Brokerage and Scotia iTRADE each offer some kind of commission-free element to buying (or buying and selling) ETFs.

In addition to improvements in the number of ETFs available for commission-free trading, Qtrade Investor also announced upgrades to their mobile offering by adding an Android app as well as telegraphing an upcoming improvement to their dashboard – presumably making it easier and more intuitive for investors to get important information and navigate the site.

Qtrade wasn’t alone this week with launching upgrades and enhancements – National Bank Direct Brokerage also fine-tuned its homepage layout and CIBC Investor’s Edge also upgraded their investor newsletter with a much more modern look and feel.

Changing layouts and online technologies is not without its inherent risks, however.

One very interesting case study happening in real time is the roll out of WebBroker “improvements” and generally mixed reactions it has received from DIY investors. Given the large number of users and the popularity of TD Direct Investing, there were more than a few investors who became entrenched in the “old” layout and interface who were less than pleased at having to change. Add to that stability issues with the platform and an already impatient and vocal DIY investor crowd has not taken kindly to this transition (a quick review of Twitter comments and forum chatter makes this clear).

Clearly the paradox with online brokerages is balancing what existing clients have come to learn about a platform and product with what new clients (especially younger clients) are looking for in terms of user experience and design features.

For Qtrade Investor, it will be interesting to monitor the reactions to their latest changes to see whether they were able to keep things similar enough to have users feel comfortable with the change but also to upgrade the user experience in a way that makes Qtrade look and feel modern and forward thinking.

Whatever the outcome for Qtrade Investor, the move to update their look and feel is a sign of the times.

In such a competitive space, it is evident that Canadian online brokerages who can get the balance between fresh and familiar right are going to get significantly more points with investors and therefore not end up being complained about online.

Discount Brokerage Tweets of the Week

While Twitter users are trying to sift through the many tweets from US presidential candidates, they still managed to find some time to pipe up about what’s happening with Canadian discount brokerages.

From the Forums

Investor’s Edge keeping current

In this post from the reddit Personal Finance Canada thread, one user shared the latest update to the service agreement for clients, specifically with regards to multiple currencies. It’s an interesting move that seems to be setting the stage for trading in foreign currencies.

Broker vs Broker

It’s been a while, but that favourite comparison between Virtual Brokers and Questrade is back – but with a twist. This post from reddit’s Personal Finance Canada reveals that the choice between the two is no longer really about just these two, a signal that big banks have gained significant ground on the “value” front.

Into the Close

With the finish line in the world’s sights, there has been all kinds of wackiness in the markets heading into this weekend and undoubtedly heading into next week. If you can find a way to avoid the election speak, either a walk in the crisp fall weather or a Netflix binge watch or all the sports action might be in order. For traders, however, this would be a great weekend to double check your trade setups heading into what is likely going to be a wild week ahead. Have a great weekend!

Posted on November 1, 2016 by user — Leave a comment

Discount Brokerage Deals & Promotions – November 1, 2016

*Updated Nov. 23* Nothin’ lasts forever, even cold November rain. It seems odd yet appropriate to reference a Guns & Roses song as we head into a new month of deals and promotions coverage of Canada’s discount brokerages. Like the band, however, deals & promotions are still rocking on even as we head into the last two months of 2016.

While it may feel a bit gloomy heading into a new month with no new offers to report, in reality there are still 23 26 active offers for DIY investors interested in opening an online trading account to take advantage of. Also, several sources from across the online brokerage space have hinted that a number of deals are in the pipeline, some of which may be launching this month. No need to sing the blues after all.

Another interesting piece of news on the discount brokerage deals front, which was reported in the weekly roundup from October 14th, reveals that there is a substantial mismatch between what online brokerages are and have been offering, and what it seems that DIY investors want.

Based on our survey from September, it is clear that DIY investors on the hunt for an incentive are much more inclined towards cash-back offers instead of commission-free trades. Other than those two types of offers, there really was little to no interest in other types of discount brokerage deals.

When compared against what is being pitched to investors, however, this might explain why so many DIY investors might be feeling ‘underwhelmed’ by the offers being pitched thus far.

The results from our most recent survey will also be published soon and they promise to have some very intriguing findings. In the meantime, check out our latest quick survey below.

New Deals

*Update Nov. 11: Virtual Brokers has relaunched their cash-back referral offer with a slight upgrade. Their latest cash-back referral offering now has three deposit tiers starting at a minimum of ~~$5,000~~ $1,000 and going up to $50,000+ and they’ve increased the maximum cash-back amount from $50 to $75. See table below for more details.

Qtrade Investor has also launched an upgrade to their transfer-fee rebate offer. The threshold to qualify for this offer has been reduced from $25,000 down to $10,000 making switching to Qtrade much more accessible. See table below for details.*

Nothing to report at the moment.

Extended Deals

Two offers from BMO InvestorLine that were scheduled to conclude at the end of October have been renewed and extended. BMO InvestorLine’s commission-free/cash-back offer has been extended into January whereas their refer-a-friend program has been extended well out into 2017, ending in June. See tables below for more information.

Expired deals

Qtrade Investor promotion in which DIY investors could purchase ETFs commission-free in October officially concluded at the end of the month. That said, it appears that Qtrade has also added 40 new commission-free ETFs into its lineup bringing the total number of commission free ETFs to 100.

Survey

Create your own user feedback survey

Discount Brokerage Deals

Cash Back/Free Trade/Product Offer Promotions
Referral Promotions
Transfer Fee Promotions
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
	A Sparx Trading exclusive offer! Use the promo code “Sparx Trading” when signing up for a new account with Jitneytrade and receive access to their preferred pricing package.	n/a	Discounted Commission Rates	none	For more details click here	none
	Open and fund a new account (TFSA, Margin or RRSP) with at least $1,000 and you may be eligible to receive 5 commission-free trades. Use promo code 5FREETRADES when signing up. Be sure to read terms and conditions carefully.	$1,000	5 commission-free trades	60 days	5 commission-free trade offer	December 31, 2016
	Open and fund a new account at Virtual Brokers with at least $5,000 and you may be eligible to receive 3 months of commission-free equity trading and a $150 USD/mo credit towards Edge Trader Pro for 3 months. Use promo code sent at sign up to qualify. Be sure to read full terms and conditions for details.	$5,000	3 months commission-free equity trading + $150 USD/mo platform fee rebate.	3 months	3 months free trading / Sign up form for promo code available here	none
	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	December 31, 2016
	Open and fund a new account with HSBC InvestDirect with at least A) $25,000; B) $50,000; C) $100,000; D) $250,000; E) $500,000 or F) $1,000,000+ and you may be eligible to receive a cash bonus offer of A) $88; B) $188; C) $288; D) $388; E) $688 or F) $988. Be sure to read terms and conditions for full offer details.	A) $25,000 – $49,999 B) $50,000 – $99,999 C) $100,000 – $249,999 D) $250,000- $499,999 E) $500,000 – $999,999 F) 1,000,000+	Cash back bonus A) $88 B) $188 C) $288 D) $388 E) $688 F) $988	Bonus will be credited to the qualified accounts by July 31, 2017	HSBC InvestDirect Cash Bonus Promo	December 30, 2016
	Open and fund a new account with Scotia iTRADE with at least A) $25,000; B) $50,000; C) $100,00 or D) $250,000+ and you may be eligible to receive A) 75; B) 150; C) 200 or D) 250 commission-free trades. Use promo code F16FT when signing up. Be sure to read terms and conditions for full details.	A) $25,000 – $49,999 B) $50,000 – $99,999 C) $100,000 – $249,999 D) $250,000+	Commission-free trades	90 days	250 free trade offer	November 30, 2016
	Open and fund a new account with Scotia iTRADE with at least A) $25,000; B) $50,000; C) $100,00 or D) $250,000; E) $500,000 or F) $1,000,000+ and you may be eligible to receive 50 commission free trades plus A) 5,000; B) 7,500; C) 20,000; D) 35,000; E) 50,000 or F) 100,000 SCENE points. Use promo code F16SC when signing up to qualify. Be sure to read terms & conditions for full details.	A) $25,000 – $49,999 B) $50,000 – $99,999 C) $100,000 – $249,999 D) $250,000- $499,999 E) $500,000 – $999,999 F) 1,000,000+	A) Commission-free trades + B) SCENE reward points	90 days (for trades) SCENE points will be awarded by June 30, 2017.	Free trade + SCENE points offer	November 30, 2016
	Open a new qualifying account with BMO InvestorLine, and fund it with at least $100,000 and you may be eligible to receive $200 cash back as well as 20 commission-free equity trades. Use promo code PROMO200 when signing up to be eligible. Be sure to read the terms and conditions for more details on the offer.	$100,000	$200 cash back + 20 commission-free equity trades	Cash back will be deposited the week of August 7, 2017.	Fall 2016 Promotion Phase 2	January 3, 2017
Expired Offers
Last Updated: Nov. 1, 2016 13:30 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
	If you refer a friend/family member who is not already a Scotia iTrade account holder to them, both you and your friend get a bonus of either cash or free trades. You have to use the referral form to pass along your info as well as your friend/family members’ contact info in order to qualify. There are lots of details/conditions to this deal so be sure to read the details link.	A) $10,000 B) $50,000+	A) You(referrer): $50 or 10 free trades; Your “Friend”: $50 or 10 free trades (max total value:$99.90) B) You(referrer): $100 cash or 50 free trades; Your “Friend”: $100 cash or 50 free trades (max total value: $499.50)	60 days	Refer A Friend to Scotia iTrade	tbd
	If you (an existing Virtual Brokers client) refer a friend or family member to open a new account with at least $1,000 you may be eligible to receive $25 cash per referral. For 3 or more referrals Virtual Brokers will add a $50 bonus. Referred individuals depositing either A) $1,000 – $24,999; B) $25,000 – $49,999 or C) $50,000+ may be eligible to receive A) $25; B) $50 or C) $75 cash back. Be sure to read the full terms and conditions carefully for full details.	A) $1,000 – $24,999 B) $25,000 – $49,999 C) $50,000+	Referrer: $25 per referral; $50 bonus for each 3 or more referrals. Referee: A) $25 B) $50 C) $75	Cash to be deposited to VB account by March 31, 2017.	Cash Referral Program	January 31, 2017
	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: Nov. 23, 2016 08:30 PT

Transfer Fee Promotions

Company	Brief Description	Maximum Transfer Fee Coverage Amount	Minimum Deposit Amount for Transfer Fee Eligibility	Details Link	Deadline
	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	December 31, 2016
	Transfer $15,000 or more to RBC Direct Investing and they will pay up to $135 in transfer fees	$135	$15,000	Transfer Fee Rebate Details	none
	Transfer $25,000 or more from another brokerage and Credential Direct will cover up to $150 in transfer fees. Use promo code SWITCHME when signing up to qualify for the transfer promotion.	$150	$25,000	Credential Direct Transfer Fee Rebate	none
	Move your brokerage account to Questrade and they’ll cover the transfer-out fee up to $150.	$150	$25,000	Transfer Fee Promo	none
	Transfer at least $25,000 or more in new assets to TD Direct Investing when opening a new account and you may qualify to have transfer fees reimbursed up to $150. Be sure to contact TD Direct Investing for further details.	$150	$25,000	Contact client service for more information (1-800-465-5463).	none
	Transfer $25,000 or more to Virtual Brokers and they may cover up to $150 in transfer fees.	$150	$25,000	Transfer Fee promo	September 30, 2016
	Transfer $25,000 or more to Scotia iTRADE when opening a new account and they will cover up to $150 in transfer fees.	$150	$25,000	Eligible with both offers: Free trade + SCENE points offer and 250 free trade offer	November 30, 2016
	Transfer $25,000 or more into a CIBC Investor’s Edge account and they will reimburse up to $135 in brokerage transfer fees. Clients must call customer service to request rebate after transfer made.	$135	$25,000	Confirmed with reps. Contact client service for more information (1-800-567-3343).	none
	Transfer $25,000 or more to a National Bank Direct Brokerage account and they will pay up to $135 plus taxes in transfer fees	$135	$25,000	Transfer Fee Rebate	none
	Disnat is offering up to $150 to cover the cost of transfer fees from another institution. To be eligible, new/existing clients need to deposit $50,000 into a Disnat account. You’ll have to call 1-866-873-7103 and mention promo code Disnat500. See details link for more info.	$150	$50,000	Disnat $500 Commission Credit Promo	September 30, 2016
Expired Offers
Last Updated: Nov. 16, 2016 12:30 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
	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
	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
	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) 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: Nov. 1, 13:30 PT

Posted on October 28, 2016 by user — Leave a comment

Discount Brokerage Weekly Roundup – October 28th, 2016

Heading into the unofficial ‘Halloweekend’, just one small piece of news from the US was enough to spook the markets. Investors were left trying to figure out if the latest news on the US presidential race was more trick or treat. Of course, not everything coming out of the US this past week was doom and gloom, especially for a pair of online brokerages.

In this week’s roundup, we take a look at a major shift in the US online brokerage landscape that could offer some clues as to what might be in the cards for Canadian discount brokerages in the not-too-distant future. From there, we’ll take a look at one major Canadian online brokerage that just rolled out a feature that is sure to make some of their closest competitors have to step up their game. As usual, we’ll cap off the roundup with soundbites from Twitter and the investor forums.

Kind of a Big Deal

How does $4 billion sound? If you’re US online brokerage Scottrade, apparently it sounds pretty good. This past week, US-based TD Ameritrade pulled off a major purchase of another online brokerage, Scottrade, and provided an interesting window into the world and marketplace of online trading, perhaps offering some idea of the state of the industry as a whole and where things are headed.

As many value investors are aware of, it’s only when a buyer makes an offer that the ‘real’ value of an asset (in this case, an online brokerage) is known. So, with TD Ameritrade putting up an offer for 3 million accounts, it now offers some insight into what those accounts are actually worth. Like any big investment, however, it pays to look at the details.

In the case of TD Ameritrade and Scottrade, there are actually two parts to the transaction, one for the online brokerage segment ($2.7b) and one for the bank segment ($1.3b). The breakdown of what TD Ameritrade is paying is spelled out in their investor presentation but the takeaway (or at least one of them) is that TD Ameritrade is buying the 3 million or so accounts funded accounts at Scottrade along with the $170B in assets that come with them.

Source: TD Ameritrade Investor Presentation

According to the details of the transaction, some quick math puts the price per account at about $870 and the assets per account at about $57K. With various possible additional opportunities to grow “share of wallet” over time, the price per account falls even further. That said, the figure is in the ball park range of what it costs to acquire a new client, at least in the US. All told, TD Ameritrade is paying 3x revenue for the deal and is looking for the deal to be accretive (12% to 20%) within 3 years, assuming all goes to plan.

For a deal of this magnitude, the numbers have to make sense. That said, there is also the human factor that potentially drove this deal forward. According to some sources, the timing seemed right for Scottrade founder Rodger Riney to cash out. Whether it was age, health or a desire to exit on a high note, the human element likely played a factor.

Within the Canadian context, there has often been chatter and speculation about whether the Canadian marketplace can sustain the number of online brokerage providers that it does. Could a similar deal happen here? The odds would suggest probably not.

Currently, there are only a couple of choices for non-bank owned brokerages for players to purchase – JitneyTrade, Questrade or Virtual Brokers. The other online brokerages have some kind of larger financial institution, such as a bank or credit union as a parent – or in the case of Interactive Brokers Canada, a larger US online brokerage as the parent. So, for a larger player to take out one of the independent brokerages would really be an aggressive move. None of the available ‘independent’ brokerages are particularly large in terms of accounts. On the other hand, for one of the bigger financial firms to try and exit the DIY investing segment might mean ceding market share.

As the Scottrade deal shows, the banking side of the business is always looking for ways to deepen their ‘share of wallet’ not reduce it. Neither buying nor folding seem palatable for the bigger players. Nonetheless, if the asking price is right or there is a catalyst to drive an exit, then business people can usually find a way to make a deal.

For DIY investors, the elimination of some competition may not be a bad thing. In a recent investor conference call published on SeekingAlpha.com, President and founder of Interactive Brokers Thomas Peterffy had the following take on Scottrade ahead of the announced TD Ameritrade acquisition:

“…we are excited about the Scottrade news. Just like the LPL news, the fewer brokers, the easier the comparison and the starker the differences between us and them, and the easier it is to compete for the customers. Also, whenever a broker is taken over, we usually get a bunch of accounts from people who were considering coming over to us, but were reluctant to change. Now that they will have to change anyway, they think they may as well come to us and move on to a better and less expensive platform.”

While trying to put a positive spin on losing 2000 or so accounts to a competitor (Interactive Brokers previously had an agreement to service some of Scottrade’s clients’ trade executions) is basically damage control, there is a valid point that the differentiation between brands will be brought into focus and consumers could stand to benefit by seeing some very compelling offers being made.

Whatever the case, there is a lot of change on the horizon for the Canadian financial services sector. This past week National Bank (parent to National Bank Direct Brokerage) also announced that it is going to be shifting its focus to ‘going digital’, joining its peers in spending massive amounts on meeting the banking and investing needs of consumers in an increasingly online world. Thus, one of the biggest drivers of who is left standing in the online brokerage space here in Canada might very well come down to who can afford to keep innovating. With that in mind, cashing out might not seem so bad after all.

Conditions are Improving

TD Direct Investing seemed to be in the spotlight again this past week with a news release announcing the official rollout of conditional orders to their flagship platform WebBroker (even though clients started to see this feature show up last week).

Ever the savvy marketers, they also announced that they are the first ‘bank-owned’ brokerage to deploy a platform with conditional order types. While that is technically accurate, conditional orders (aka bracket orders) are already available at a number of other Canadian online brokerages, such as Questrade, Interactive Brokers and Desjardins Online Brokerage and on the thinkorswim (aka US trading platform).

Nevertheless, this latest edition to the TD Direct Investing trading platform feature set is a fairly powerful one.

Conditional orders enable traders and investors to set criteria for entering or exiting a trade and then have a trade execute if that criteria is met. Criteria could include when a price goes above or below two different levels or when a condition – such as the value of an index, goes above or below a target. Some traders refer to this as the “set it and forget it” approach, however, with all things online trading, it’s never wise to fully trust that the technology will work as promised.

While there are numerous types of bracket/conditional order types out there, TD Direct Investing has enabled the following order types:

One Triggers Another (OTA)
One Cancels Other (OCO) and
1^st Triggers OCO (FTO)

An example of when this might be useful is if an investor owned a stock at $15 and put in a condition to sell the stock if it hit $20 or if it dropped below $10. If one of those conditions were met, the corresponding order (in this case a sell order) would execute. This enables investors to create rules for how a particular investment or trade should be handled that go beyond the traditional limit order.

Interestingly, at the time of publication, the documentation for conditional orders on WebBroker platform was not available on the TD Direct Investing website. Fortunately, there is a webinar available that walks users through each of the order types and how they work on WebBroker.

Clever marketing aside, TD Direct Investing has continued to distance itself from its bank-owned brokerage competitors in terms of platform offering and now trading experience. And, while they may not be the first or only online brokerage to offer conditional orders, the reality is that as one of the largest and most popular online brokerages in Canada, TDDI has just given DIY investors one less reason to consider looking at competitors who also offer these order types.

Discount Brokerage Tweets of the Week

It was a fairly tame week on Twitter this week. Interestingly, technology was on the minds of investors chiming in on Twitter. Mentioned in the DIY investing conversation was BMO InvestorLine, Questrade, RBC Direct Investing, Scotia iTRADE, TD Direct Investing and Virtual Brokers.

From the Forums

Dash for Cash

One of the platforms TD Direct Investing markets to advanced traders is their advanced dashboard. In this post on RedFlagDeals.com’s investing thread, a user looking for feedback on the experience with advanced dashboard received a few interesting suggestions for data platforms.

Low Cost Education

The stock market can be an expensive place to learn how to trade. Still the fear of not knowing how things work is something that prevents many people from even trying. In this post, also from RedFlagDeals.com, one beginner investor is contemplating using either Questrade or Virtual Brokers for the commission-free ETFs as a way to get their feet wet with investing. Worth a read to see what other forum members had to say.

Into the Close

Just when things seemed like they were on track for a smooth finish to the US Presidential election there was a monkey wrench thrown into the works. It would be a great time to get some rest this weekend because there’s every indication that next week is going to get a little wild. In the meanwhile, with hockey, baseball, basketball and football, not to mention Halloween all on deck, there are plenty of reasons to take a break. Have a spooktacular weekend!!

Posted on October 21, 2016 by user — Leave a comment

Discount Brokerage Weekly Roundup – October 21st, 2016

Well it has certainly been a week to remember. Not so much for what happened in the markets but rather for what happened around them and what this weeks events may do to markets everywhere. While the presidential debate or the loss of championship run were big news, perhaps the biggest news is the major outage of some of the world’s biggest websites because of exploits in technology. Heading into the weekend, it is a stark reminder that with more of the world moving to online, technology is not without its risks.

This past week, technology is the theme for the lead story at one Canadian bank-owned online brokerage. Specifically, how one online brokerage is using video technology to try and pull ahead of its competitors in the digital landscape. From there we’ll take a quick look at the latest figures from US-based online brokerages as many of them reported their earnings this past week and also provided a snapshot of what’s happening behind the scenes at some of the world’s biggest online brokerages. Finally, we’ll check out what DIY investors were talking about in the tweets of the week and in the investor forums.

Scotia iTRADE Keeping it Reel

While it’s been somewhat quiet at several of Canada’s biggest bank-owned brokerages, Scotia iTRADE has definitely been busy working to capture the attention of DIY investors online. Specifically, over the last few weeks, we’ve noted a definite uptick in the amount and diversity of video content coming out of iTRADE’s various social media channels. During this time, they’ve launched a video-based advertising campaign, several new ‘explainer’ videos on investing (in French) on YouTube and recently held a livestream “fireside chat” with personal finance expert Evelyn Jacks.

There’s definitely lots to unpack but let’s start with video advertising. For any regular consumer scrolling through content on just about any social media channel, videos are everywhere. Knowing that video posts are almost certainly going to be more engaging than regular ol’ images, Scotia iTRADE’s latest batch of video ads have started to show up in social media feeds, such as Twitter, and people are noticing. Interestingly, there aren’t that many bank-owned online brokerages with their own Twitter handle and with the exception of Questrade, the non-bank-owned brokerages aren’t nearly as active on social media feeds as they need to be to gain a significant presence. So, for Scotia iTRADE, the fact that they’ve doubled down on Twitter by not only having an account of their own but also buying ads means they’re getting an interesting share of the spotlight with millennial users.

Another place that Scotia iTRADE appears to be moving into is the French speaking market. Case in point is the recent publishing of their market education videos on YouTube en Français. For many of the big Canadian bank-owned brokerages, building an audience within the Quebec DIY investor marketplace has been a challenge. Data from our educational event tracking showed that TD Direct Investing, for example, had a difficult time pulling in people to their in-person seminar topics in Quebec much more so than in other parts of the country. Now it appears that Scotia iTRADE is widening its net to try and provide investor education oriented content to French speaking audience. Again, this is an area in which other brokerages big and small just simply aren’t doing enough of. Add to the fact that this is being done online, and other brokerages are going have their work cut out for them to produce and deploy that kind of information. Interestingly, it is difficult to imagine either Desjardins Online Brokerage or National Bank Direct Brokerage, both of whom are fiercely competitive brands within the Quebec market, making room for Scotia iTRADE to come in and capture mindshare.

Finally, this past week, Scotia iTRADE held a ‘fireside chat’ with personal finance expert Eveyln Jacks on the topic of risk management. This interactive webinar enabled Scotia iTRADE to gather information from attendees (i.e. gather marketing leads) but also demonstrate that they are taking their seminar/webinar formats to the next level. While there are still kinks to be ironed out with the format, unlike several of their peers, Scotia iTRADE is definitely pushing forward faster and more broadly online. And, in a world where DIY investors have so many choices to consider, Scotia iTRADE is making it much harder for them to be overlooked.

Is This Thing On?

A lot of traders know the saying: the trend is your friend (until it ends). For online brokerage Interactive Brokers, there are a couple of trends that are emerging surrounding their online brokerage business, some of which are more friendly than others.

On the positive side, the latest results from Interactive Brokers shows that they continue to crush it with regards to account growth, specifically with attracting more new customers to the platform than having customers leave. It’s actually rather uncanny how long their account growth streak has continued.

On the negative side, when the founder and CEO of the company wonders out loud if the platform is broken because there was no trading activity in the market, there’s definitely something strange in the trading neighbourhood. The impact of a lapse in volatility in the marketplace had a significant negative outcome for market makers (which again continued to lose money) which just goes to show that even the pros have had a tough time trying to time and trade the market when their strategy doesn’t line up with market conditions.

For many brokerages, it will be just a few more weeks until the election is finally over and markets can once again reprice assets without having to hedge against the possibility that Trump may actually win. Until then, however, brokerages and their clients are clearly watching and waiting (except for the brave/impatient few who are already betting into the election).

Qtrade Investor Quietly Drops Fees

Late last week Qtrade Investor sent an announcement to clients stating that ECN charges, the annoying fees that chew into trading profits because of market orders, were being dropped…sort of.

Technically Qtrade Investor reserves the right to charge ECN fees however they have described the situation of when those fees would be incurred as when an individual’s trading pattern makes “repeated, high volume trades on the active side of the market.” In other words, for most low to moderately active investors, this is definitely welcomed news from Qtrade.

While the technical definitions/limits were not spelled out (e.g. how many trades within a specific time frame is too many), Qtrade Investor did go on to mention that in the event of “excessive” trading that generates ECN fees, a Qtrade client service representative will attempt to contact the client.

Undoubtedly, the recent introduction of youth-focused pricing, some commission-free ETF trading and now removal of ECN fees will bode well for Qtrade in Rob Carrick’s online brokerage rankings. With the landscape for DIY investing clients being so competitive, however, there’s a fairly decent chance this news gets broadcast much more loudly before and after those rankings.

Discount Brokerage Tweets of the Week

It was a relatively tame week across Twitter for Canadian discount brokerages. Nonetheless there are some interesting client service moments that highlight why Twitter is a must-have for DIY investing clients looking to get traction on customer service issues with certain online brokerages. Mentioned this week were BMO InvestorLine, Questrade, Scotia iTrade & TD Direct Investing.

From the Forums

How Smart is Your Folio?

Seems like there aren’t many places investors can go online these days without bumping into a BMO Smartfolio advertisement. In this post from RedFlagDeals.com’s investing thread, one curious investor took the marketing to the market to find out what others had to say about BMO’s robo-investor service.

Snug as a Bug

This was an interesting post from a Questrade user also posted on RedFlagDeals.com that highlights the importance of actually keeping tabs on a portfolio. Yes, even technology can fail, however as the author of the post suggests, staying on top of the details helped prevent a potentially bad trade.

Into the Close

TGIF. It’s been a bumpy ride to land the work week. If you still aren’t sick of the debate coverage yet and you want a great chuckle courtesy of the fine folks on Twitter, enjoy the hashtag #trumpbookreport.

Posted on October 14, 2016 by user — Leave a comment

Discount Brokerage Weekly Roundup – October 14, 2016

Like the Toronto Blue Jays’ bats, fall colours are also in full swing. As we head into the halfway point in October this edition of the roundup has an equally interesting feature – something that all Canadian online brokerages are going to want to tune into.

In this week’s roundup, we lead off with a spotlight piece on deals and promotions – specifically we present the findings from our reader survey from September that shows that DIY investors and Canadian online brokerages are out of sync and a suggestion on how to make it better. As with our usual menu, we’ll also be covering reactions from DIY investors this week on Twitter and what investors are chatting about on investor forums. For good measure, we’ve also included some of the interesting upcoming investor education events DIY investors might want to check out as the weather gets colder.

Let’s make a deal

Even though RRSP deadline season is months away, it’s already clear that Canadian discount brokerages are collectively ramping up efforts to attract new clientele. And while it’s one thing to work hard, it’s certainly also important to work smart.

As part of our coverage of the Canadian online brokerage landscape, one of the areas we analyze are the deals and promotions offered by discount brokerages to incentivize DIY investors to open a new online trading account.

Last month, we ran an informal one-question poll of visitors to SparxTrading.com that asked: “what is your preferred deal or promo?” and found some fascinating results about what Canadian DIY investors actually want and what they’re being offered.

Before jumping into the results of our deals and promotions survey from last month, it is useful to take a quick look at the deals & promotions that are currently in play.

As of the first week in October, we’ve uncovered 27 live advertised promotions with transfer offers representing and cash back/commission-free trades tied for the largest portion (31% or 8 offers), followed by (contest/other (7 offers) with referrals rounding out the group (three offers). Currently, Desjardins Online Brokerage, Questrade and Scotia iTRADE are tied with the most number of offers (four apiece) while Interactive Brokers Canada is the only brokerage not currently advertising a promotional offer of some sort (note their referral program is not counted because it only offers the individual making the referral a bonus, not the new account holder). Transfer fee coverage offers may be underreported in this count because certain firms may offer it but have not advertised this on their website.

For a bit of background on the poll itself, respondents could choose between the following options:

Cash back deals (for just the individual)
Commission-free trades (for just the individual)
Referral bonuses (me & a friend)
Transfer fee coverage
Technology items
Contest entry/prizes

These choices were selected as they represented the most popular or prevalent promotional offers typically put forward by Canadian discount brokerages. A total of 59 respondents from across Canada participated.

Results

Our poll showed that the overwhelming majority of DIY investors (68%) surveyed stated that they were interested in cash back promotions while commission-free trades came in a distant second at 27%. Transfer fee deals (3%) and technology items (2%) rounded out which offers DIY investors preferred.

What is fascinating to see is just how far off many online brokerage offers are from what investors are actually interested in. Of the 27 deals currently offered by Canadian discount brokerages, only two (which translates into 7%) offer cash back promotions: HSBC InvestDirect and BMO InvestorLine. That is certainly a major disconnect in the marketplace, one that, upon further reflection, just doesn’t quite make sense.

Considering that at least 9 brokerages are prepared to cover transfer fees from accounts from other institutions, it stands to reason that they would offer up as much (perhaps more) for a new client that didn’t put them through the hassle of having to transfer an account. A simple look at some forum comments or on Twitter would show that there are all kinds of issues that can arise that delay a transfer of accounts.

Another interesting finding was that referral or affiliate programs aren’t popular as a first choice. Ironically, all of the referral offers in the market right now actually offer cash back for the person referring and the individual signing up for the account, so it really is a win-win option.

One interpretation of this data suggests that individuals who are looking for a cash back offer don’t necessarily want to go through the effort of finding a referral source. Fortunately for Questrade, for example, they not only have the most competitive offer for referral based deposits, but they also have the easiest system in place for these referrals to be generated. Conversely, Scotia iTRADE and BMO InvestorLine require a bit more effort for each referral.

Finally, it was made abundantly clear that DIY investors were just not that into contests among those who are looking to open an online trading account. It is probably understandable that getting a “chance” at something is akin to playing the lottery except in this case, the payout is far lower and the price of participation astronomically higher. Nonetheless, looking back over the past year, there are numerous examples of Canadian discount brokerages offering up contest entries as a way in which to encourage users to deposit more.

For Canadian discount brokerages, the lesson here seems to be that the market is clearly communicating one thing while most providers are doing another. Like all businesses, online brokerages need to make sensible decisions around adding to their client base, however the results of our survey certainly suggest that a very sensible decision to get attention of new clients is to offer cash back promotions. For those that do offer cash back promotions, even in the affiliate or referral program, that is something that more DIY investors should probably be better aware of.

And, just to show that we’re also into the giving spirit, any Canadian discount brokerage that wants to advertise its cash back offer to visitors of SparxTrading.com may receive up to $250 cash back* for doing so (*conditions apply). Contact us for full terms and conditions.

Discount Brokerage Tweets of the Week

Whether you blame it on the rain, or some other stranger things, this past week there was plenty of blame being tossed around on Twitter, mainly due to outages on trading platforms. It’s a great example that shows, whatever the size of the brokerage, online trading can get interrupted. Mentioned this week were BMO InvestorLine, Questrade, Scotia iTRADE, TD Direct Investing and Virtual Brokers.

Event Horizon

Fall’s in full swing, and it’s a colourful week ahead for discount brokerage-sponsored investor education events. Here are some upcoming sessions that may be of interest to those curious about technical analysis and trading strategies. A pair of special events for options enthusiasts rounds out this week’s selection.

October 15

Options Education Day Vancouver – Autumn 2016

October 16

Options Education Day Calgary – Autumn 2016

October 18

Scotia iTRADE – Understanding Price Action To Make More Informed Trading Decisions

From the Forums

The price of advice

Everyday there are Canadians who are faced with decisions about where and how they should invest their money. With a crowded landscape, it is interesting to see how first time investors have to navigate the choices given to them by financial services firms. In this post from reddit’s Personal Finance Canada thread, there are lots of interesting suggestions for a novice investor looking for a little help in figuring out how/where to park some capital.

Into the Close

Even though it was a short week, there was certainly no shortage of excitement. While folks in Vancouver and Calgary will be able to learn about options, some other options include hunkering down for a serious weekend of sports watching. For those in Vancouver and other parts of BC – stay safe and dry (as much as you can anyway)! Have a great weekend!

Posted on October 1, 2016 by user — Leave a comment

Discount Brokerage Deals & Promotions – October 1, 2016

*Updated Oct. 7* For DIY investors, October is shaping up to be a great month for treats. After a quiet start to September it wasn’t too long before deals and promotions from Canadian discount brokerages started to pop up.

With names such as HSBC InvestDirect stepping into the deals pool mid-September and other more familiar players such as Scotia iTRADE and Virtual Brokers coming back onto the field, heading into October there are now 26 live offers for DIY investors to choose from, and several of them are quite compelling.

All in all, more offers came in than left and with more activity predicted on the horizon, it is a great time to be in the market for an online brokerage even if the markets themselves may be a bit wobbly.

As always, we will continue to monitor the deals and promotions but if there are offers that readers may benefit from knowing about, let us know.

Also thanks to everyone who completed our survey last month, we’ll be publishing the results later this month. We have a new quick survey this month so be sure to check it out below.

Expired Offers

Desjardins Online Brokerage commission credit is listed as expired heading into the beginning of October. It will be interesting to see if this offer, which has been running since April of 2015, will finally come to an end or if this offer continues to live on. Also technically expired is the Virtual Brokers transfer fee offer.

Extended Offers

There were no offers that were listed as extended as of the beginning of the month.

New Offers

*Updated Oct. 7 – Desjardins Online Brokerage launched a potentially game changing offer this week. They’re offering a 1% of assets transferred deal in which they are giving 1% of assets transferred (up to $1,000 in commission credits) for deposits of at least $10,000. Unlike many other offers which offer less on a percentage basis the higher the amount the client deposits, Desjardins’ latest offer is a fixed 1% commission-credit. See table below for more details.*

There were a number of offers that crossed our radar in late September however the first official promotion to launch in October is Qtrade Investor’s commission-free ETF buying program for October. As part of this promotion, new and existing clients are eligible to purchase ETFs commission-free all through the month of October. Selling an ETF still incurs a regular trading commission charge. This applies to both US and Canadian ETFs.

Although it technically launched in the last few days of September, Virtual Brokers’ latest offer is likely to pick up steam heading into October. Their latest deal is a relaunch of a previous promotion (which was only offered to existing clients) that offers new Virtual Brokers clients access to 5i Research’s investment/equity analysis for one year. For many DIY investors, getting access to good research and ideas about where with whom to invest is typically a challenge. Perhaps the biggest challenge, however, will be building the awareness and profile of 5i Research products so that DIY investors can gauge whether this deal is enough to drive opening an account with Virtual Brokers.

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Discount Brokerage Deals

Cash Back/Free Trade/Product Offer Promotions
Referral Promotions
Transfer Fee Promotions
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
	A Sparx Trading exclusive offer! Use the promo code “Sparx Trading” when signing up for a new account with Jitneytrade and receive access to their preferred pricing package.	n/a	Discounted Commission Rates	none	For more details click here	none
	Open and fund a new account (TFSA, Margin or RRSP) with at least $1,000 and you may be eligible to receive 5 commission-free trades. Use promo code 5FREETRADES when signing up. Be sure to read terms and conditions carefully.	$1,000	5 commission-free trades	60 days	5 commission-free trade offer	December 31, 2016
	Open and fund a new account at Virtual Brokers with at least $5,000 and you may be eligible to receive 3 months of commission-free equity trading and a $150 USD/mo credit towards Edge Trader Pro for 3 months. Use promo code sent at sign up to qualify. Be sure to read full terms and conditions for details.	$5,000	3 months commission-free equity trading + $150 USD/mo platform fee rebate.	3 months	3 months free trading / Sign up form for promo code available here	none
	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	December 31, 2016
	Open and fund a new account with HSBC InvestDirect with at least A) $25,000; B) $50,000; C) $100,000; D) $250,000; E) $500,000 or F) $1,000,000+ and you may be eligible to receive a cash bonus offer of A) $88; B) $188; C) $288; D) $388; E) $688 or F) $988. Be sure to read terms and conditions for full offer details.	A) $25,000 – $49,999 B) $50,000 – $99,999 C) $100,000 – $249,999 D) $250,000- $499,999 E) $500,000 – $999,999 F) 1,000,000+	Cash back bonus A) $88 B) $188 C) $288 D) $388 E) $688 F) $988	Bonus will be credited to the qualified accounts by July 31, 2017	HSBC InvestDirect Cash Bonus Promo	December 30, 2016
	Open and fund a new account with Scotia iTRADE with at least A) $25,000; B) $50,000; C) $100,00 or D) $250,000+ and you may be eligible to receive A) 75; B) 150; C) 200 or D) 250 commission-free trades. Use promo code F16FT when signing up. Be sure to read terms and conditions for full details.	A) $25,000 – $49,999 B) $50,000 – $99,999 C) $100,000 – $249,999 D) $250,000+	Commission-free trades	90 days	250 free trade offer	November 30, 2016
	Open and fund a new account with Scotia iTRADE with at least A) $25,000; B) $50,000; C) $100,00 or D) $250,000; E) $500,000 or F) $1,000,000+ and you may be eligible to receive 50 commission free trades plus A) 5,000; B) 7,500; C) 20,000; D) 35,000; E) 50,000 or F) 100,000 SCENE points. Use promo code F16SC when signing up to qualify. Be sure to read terms & conditions for full details.	A) $25,000 – $49,999 B) $50,000 – $99,999 C) $100,000 – $249,999 D) $250,000- $499,999 E) $500,000 – $999,999 F) 1,000,000+	A) Commission-free trades + B) SCENE reward points	90 days (for trades) SCENE points will be awarded by June 30, 2017.	Free trade + SCENE points offer	November 30, 2016
	Open a new qualifying account with BMO InvestorLine, and fund it with at least $100,000 and you may be eligible to receive $200 cash back as well as 20 commission free trades. Use promo code Fall200 when signing up to be eligible. Be sure to read the terms and conditions for more details on the offer.	$100,000	$200 cash back + 20 commission-free equity trades	Cash back will be deposited the week of June 5, 2017.	Fall 2016 Promotion	October 31, 2016
Expired Offers
Last Updated: Oct. 7, 2016 22:30 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
	If you refer a friend/family member who is not already a Scotia iTrade account holder to them, both you and your friend get a bonus of either cash or free trades. You have to use the referral form to pass along your info as well as your friend/family members’ contact info in order to qualify. There are lots of details/conditions to this deal so be sure to read the details link.	A) $10,000 B) $50,000+	A) You(referrer): $50 or 10 free trades; Your “Friend”: $50 or 10 free trades (max total value:$99.90) B) You(referrer): $100 cash or 50 free trades; Your “Friend”: $100 cash or 50 free trades (max total value: $499.50)	60 days	Refer A Friend to Scotia iTrade	tbd
	If you (an existing Virtual Brokers client) refer a friend or family member to open a new account with at least $5,000 you may be eligible to receive $25 cash per referral. For 3 or more referrals Virtual Brokers will add a $50 bonus. Referred individuals depositing either A) $5,000 – $50,000 or B) $50,000+ may be eligible to receive A) $25 or B) $50 cash back. Be sure to read the full terms and conditions carefully for full details. Be sure to read the terms and conditions to this offer carefully for full details.	A) $5,000 – $50,000 B) $50,000+	Referrer: $25 per referral; $50 bonus for each 3 or more referrals. Referee: A) $25 B) $50	Cash to be deposited to VB account by August 15, 2016.	Cash Referral Program	May 31, 2016
	If you (an existing BMO InvestorLine client) refer a new client to BMO InvestorLine and they open an account with at least $50,000 the referrer and the referee may both be eligible to receive $50 cash. To qualify the referee must use the email of the referrer that is linked to their BMO InvestorLine account. See terms and conditions for full details.	$50,000	You(referrer): $50; Your Friend(referee): $50	Payout occurs 45 days after minimum 90 day holding period(subject to conditions).	BMO InvestorLine Refer-a-Friend	October 31, 2016
Expired Offers
	Open a new account (TFSA, Margin or RRSP) and receive $50 commission credit . Use promo code: kdkfnbbc	$1,000	$50 commission credit	30 days	none	none
Last Updated: Oct. 1, 2016 17:15 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 $25,000 or more from another brokerage and Credential Direct will cover up to $150 in transfer fees. Use promo code SWITCHME when signing up to qualify for the transfer promotion.	$150	$25,000	Credential Direct Transfer Fee Rebate	none
	Move your brokerage account to Questrade and they’ll cover the transfer-out fee up to $150.	$150	$25,000	Transfer Fee Promo	none
	Transfer at least $25,000 or more in new assets to TD Direct Investing when opening a new account and you may qualify to have transfer fees reimbursed up to $150. Be sure to contact TD Direct Investing for further details.	$150	$25,000	Contact client service for more information (1-800-465-5463).	none
	Transfer $25,000 or more to 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
	Transfer $25,000 or more to Virtual Brokers and they may cover up to $150 in transfer fees.	$150	$25,000	Transfer Fee promo	September 30, 2016
	Transfer $25,000 or more to Scotia iTRADE when opening a new account and they will cover up to $150 in transfer fees.	$150	$25,000	Eligible with both offers: Free trade + SCENE points offer and 250 free trade offer	November 30, 2016
	Transfer $25,000 or more into a CIBC Investor’s Edge account and they will reimburse up to $135 in brokerage transfer fees. Clients must call customer service to request rebate after transfer made.	$135	$25,000	Confirmed with reps. Contact client service for more information (1-800-567-3343).	none
	Transfer $25,000 or more to a National Bank Direct Brokerage account and they will pay up to $135 plus taxes in transfer fees	$135	$25,000	Transfer Fee Rebate	none
	Disnat is offering up to $150 to cover the cost of transfer fees from another institution. To be eligible, new/existing clients need to deposit $50,000 into a Disnat account. You’ll have to call 1-866-873-7103 and mention promo code Disnat500. See details link for more info.	$150	$50,000	Disnat $500 Commission Credit Promo	September 30, 2016
Expired Offers
Last Updated: Oct. 1, 2016 17:15 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
	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
	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
	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) 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
	For the month of October, Qtrade Investor is offering commission-free ETF purchasing on all Canadian and US ETFs. This offer is open to new and existing clients. Be sure to read terms and conditions for full details, including minimum purchase amounts.	$1,000 (minimum purchase amount)	Commission-free ETF Purchase Promotion	October 31, 2016
Expired Offers
Last Updated: Oct. 1, 17:15 PT

Posted on September 30, 2016 by user — Leave a comment

Discount Brokerage Weekly Roundup – September 30, 2016

There are busy weeks and then there are busy weeks. With all the news focused on the debate between Clinton and Trump, it’s kind of difficult to remember that the world doesn’t revolve around those two. Of course, those two are fighting it out to get attention (the good kind anyway) which is a fight all Canadian discount brokerages know about all-too-well.

In this week’s roundup there’s a lot on the menu. A major spike in promotional activity this week signals that Canadian brokerages are upping their efforts to get attention in just about any way they can. We’ll take a look at three major releases from the week. From there we take a look at one brokerage’s victory lap with online brokerage rankings but also dive into the bigger story that seems to be lurking in the DIY investing space. From there it’s a brief trip through some very interesting tweets and conversation threads from the Canadian investor forums.

Promotions, Promotions

Halloween is about a month away, but that’s not stopping Canadian online brokerages from offering up lots of deals & promotions candy to generate new interest and new business.

Virtual Deality

While it took a little while to iron out their offers, Virtual Brokers is back in the deals race. This past week Virtual Brokers launched a promo offering a free 1-year subscription to Peter Hodson’s 5i Research when opening a new account at VB. Although this promotion was previously run as a “clients only” promo, the updated offer is actually now being offered to only to new clients.

At a value of $150, this is an enticing offer especially since the minimum deposit to qualify for this is $1,000. It also may explain why Virtual Brokers appears to be trying to make a bigger splash with the promo by creating a commercial for it.

For Virtual Brokers, there is clearly a win-win-win to be able to offer equity research from 5i as part of their offering to new clients. Without an army of in-house analysts that bigger bank-owned brokerages have, providing access to research and analysis of stocks means going to the “usual suspects” of services such as Morningstar, something that many other brokerages can offer. Adding a research product from 5i, however, enables Virtual Brokers to differentiate themselves courtesy of the ‘star power’ of Peter Hodson, a familiar face to BNN viewers.

With a focus on building value through equity research, it will be interesting to see how other brokerages, especially non-bank owned brokerages, respond. Good information is hard to come by but it is definitely what some DIY investors really seek out so we’ll be watching to see if additional research offers start to hit the marketplace quite soon.

Qtrade Launching Commission-free ETF buying

In another sign that competition between Canadian online brokerages is heating up, Qtrade Investor is about to launch a new commission-free ETF buying promotion starting October 1^st and continuing for the rest of the month.

As one of only a handful of online brokerages that offers commission-free ETFs to DIY investors (Qtrade Investor offers 60 commission-free ETFs), this latest move enables both new and existing clients access to purchase any ETFs (Canadian or US) commission-free. Upon selling any ETF (excluding those that are completely commission-free to buy or sell), the regular commission rates apply.

This appears to be an interesting experiment on the part of Qtrade Investor and is not unlike the initial stages of how National Bank Direct Brokerage’s commission-free ETF promotion rolled out and eventually turned into National Bank Direct Brokerage offering completely commission-free ETF buying and selling of Canadian ETFs. Some noteworthy differences, however, include the fact that the minimum purchase amount is set much lower at $1,000 and that both US and Canadian ETFs are eligible.

Qtrade Investor’s latest move also provides them with an opportunity to gain ground on non-bank-owned brokerages such as Questrade and Virtual Brokers, both of whom offer commission-free buying of ETFs as standard. Whether or not the promotion comes returns after October, it seems the door to this kind of offer has been opened.

As we press forward into fall, there are more interesting announcements to come out of Qtrade Investor. More than likely, we’re not the only ones watching to see what they’ll get up to next.

RBC Direct Investing’s Talking Points

Shifting gears to the bank-owned brokerage arena, it looks like RBC Direct Investing is ramping up the marketing machinery around its latest promotional effort: trading using reward points. More precisely, paying for trading commissions using RBC’s reward points.

As we’ve mentioned in a couple of previous roundups, Canadian bank-owned brokerages have the scale and partnerships to offer up promotions that combine features offered in one area in the bank (such as reward points) with another (in this case trading).

This past week RBC officially put a spotlight on the program and also took the opportunity via press release to pitch readers on how they changed the pricing landscape by lowering commissions (in 2014) and on their ‘community’ program.

It will be interesting to see how the points-for-trades scheme works out and whether it sees a response from DIY investors. After some detective work to find a page which looks like it was intended to be the information page for the Trade with Points program, it lists the conversion ratio as approximately 1200 points for a 9.95 trading commission. That page also contains a number of important details about the Trade with Points program that anyone interested in the program should read. Some important limitations of the program, for example, apply to which platform can be used to pay for trade commissions via points. At this time only the investing site can be used; neither the mobile trading app nor the trading dashboard can be used. Trades placed through an investment representative also can’t have those commissions paid for with points.

What the Trade with Points option looks like. Source: RBC Direct Investing website screenshot

Even though DIY investors are hungry for innovation, they are much more receptive to price. While RBC Direct Investing may have gotten the ball rolling in 2014 by lowering standard commissions to $9.95, the fact that almost everyone of RBC Direct Investing’s peers landed at $9.95 and have stayed there means that a lower number on commission pricing will get noticed.

Of course, the online brokerage market is an increasingly tough space to make money, and banks being what they are, probably don’t want to give up the top line revenue anyway. Alternatively, if lowering commission prices isn’t an option, then there has to be much more emphasis on the technology and an upgrade to the trading experience. That is something that almost all bank-owned brokerages face an uphill battle with.

As we reported in last week’s roundup, BMO InvestorLine is clearly pointing it’s cross-hairs to be a winner in the trading platform experience; TD Direct Investing is already well ahead with its ThinkorSwim platform but has had to deal with a number of issues with its flagship WebBroker. While trading with points might be convenient, for DIY investors, the points for being a bank-owned brokerage that is tech savvy and innovative are still up for grabs.

Editor’s note: the section on RBC Direct Investing’s Trade with Points program has been updated since publication to provide additional details on the program as well as an image of the interface.

Owning the Podium

On the heels of a big victory by Team Canada at the World Hockey Championships, there was another story of national success that was only slightly less exciting. This past week, National Bank Direct Brokerage took home the top prize in the latest Canadian discount brokerage rankings by J.D. Power and Associates.

With a top score of 774 out of 1000, National Bank Direct Brokerage was able to handily beat out the rest of the pack in terms of overall investor satisfaction, making this the 2^nd consecutive year in which NBDB has managed to take the title. Coming at first runner up was BMO InvestorLine who ranked second with 762 and CIBC Investor’s Edge and RBC Direct Investing both tied for third each scoring 751.

This year there appears to have been a number of changes, starting with the change in name of the study from the Canadian Direct Brokerage Investor Satisfaction Study to the “Canadian Self-Directed Investor Satisfaction Index Ranking” (try saying that three times fast).

There also appears to have been a methodology change which unfortunately means that results from 2016 cannot be compared to previous years.

The study itself was conducted across May and June of 2016 and polled 2800 self-directed investors on investor satisfaction, defined as a combination of: interaction, account information, trading charges, product offerings, information resources and problem resolution.

Numerical scoring aside, it was interesting to see that it was a very close race at the bottom end of the pack with 7^th and 10^th place only being separated by 3 points.

Starting at the bottom of the pack was a surprising appearance by Qtrade Investor (734) who fell three positions and has otherwise scored well on other rankings, especially from the Globe and Mail. Perhaps the biggest position move year over year was CIBC Investor’s Edge who went from 7^th in 2015 to 3^rd this year. In the opposite direction, it was interesting to see the drop of TD Direct Investing from 3^rd last year to 6^th.

One of the biggest things that stood out from this year’s results wasn’t so much the online brokerages but rather the discussion about robo-advisors.

It seems quite interesting that in a survey about DIY investing that the biggest talking points would not be about the direct brokerages themselves but rather about a possibly competing product – the robo-advisor. Clearly there is an industry interest in finding out what “millennial” investors’ preferences are and what role robo-advisors are playing with DIY investors’ purchase behaviour for financial services.

The flurry of interest, most recently from DALBAR Canada, have shone a spotlight on the emerging robo-advisor industry to show that there is still lots of room to grow and many lessons to be learned by fintech firms. Nevertheless, the observation that the JD Power survey has now evolved to include and discuss robo-advisors means that online brokerages – and especially those without a robo-advisory relationship – are going to have a tougher time standing out (in a good way) from other brokerages who do.

Discount Brokerage Tweets of the Week

What an interesting week on Twitter. Lots of chatter on new features, features that aren’t working and an interactive tweet session. Mentioned this week were BMO InvestorLine, Questrade, RBC Direct Investing, Scotia iTRADE and TD Direct Investing.

From the Forums

Factor in a Name

What started out as a reference to an ETF deal launching quickly spun into a fascinating discussion of security at Canadian online brokerages and also highlighted the perennial confusion that exists between Qtrade Investor and Questrade (they are separate companies that happen to start with the letter Q). Check out this post on reddit if you’re a fan of security and online trading.

Into the Close

If you made it this far, congratulations! At least it’s great to enter the weekend on a high note with Team Canada winning gold and TV talking about something other than Hillary and the Donald. Enjoy it while it lasts. Have a great weekend!

Posted on September 23, 2016 by user — Leave a comment

Discount Brokerage Weekly Roundup – September 23, 2016

Now that fall is here, the weather may be cooling down but the competition at Canadian discount brokerages is definitely heating up. Rather than sitting back Canadian online brokers are firing on all cylinders, from deals and marketing to technological revolutions.

This edition of the roundup launches with a look at yet another new deal from an online brokerage that might shake things up for offers yet to come to market. Next we take a look at what one big bank-owned brokerage is doing to drum up interest in their online offering. From there we take a look at one brokerage’s strategy to bring the DIY investor experience of the future into reality. Lastly we wrap up with a look at the latest chatter on Twitter and around the Canadian investing forums.

HSBC InvestDirect Antes Up

September keeps on getting more lucrative for DIY investors looking to open an online trading account. Already this month, there has been an uptick in deals and promotions being offered from Canadian online brokerages and this past week yet another brokerage jumped onto the promotion bandwagon. HSBC InvestDirect has once again stepped off the sidelines and launched a cash back promotion ranging from $88 to $988 depending on the amount individuals deposit.

The latest promotion by HSBC InvestDirect now brings the number of active advertised offers up to 24 but more importantly, it puts a very competitive cash-back offer on the table for investors to consider.

Source: HSBC InvestDirect website screenshot

Recently, there have been a number of offers being put forward by Canadian discount brokerages however they have tended to be commission-free trade promotions or contest-type offers. The field for cash-back offers was certainly thin (compared to points last year) so the $88 for a $25,000 deposit is the highest cash-back offer at this deposit level. In fact, the HSBC InvestDirect offer even surpasses the cash back amount being put forward by BMO InvestorLine at the $100,000 mark and, from a total value perspective, eclipses BMO InvestorLine for deposits of $500,000 or more.

It should be noted that BMO InvestorLine’s offer is a combination of $200 cash back and 20 commission-free trades, so the total face value of the commission free trades (approximately $200) makes this offer a very competitive one all around.

Another interesting observation about HSBC Invest Direct’s latest promotion is that it runs through to the end of 2016. This duration is somewhat longer than competitor firms that have put offers into the market until the end of October or November.

Thus, not only has HSBC InvestDirect raised the stakes for other brokerages looking to incentivize new clients into considering them, they’ve also doubled down by making this offer available through the beginning of winter. This is good news for DIY investors because any subsequent offers from other brokerages are going to have to be more appealing than the current cold, hard cash being offered by the latest HSBC InvestDirect promo. With only a week to go before the end of September, there is still time for other brokerages to launch even more at investors so we’ll be watching the space closely to see what happens next.

Cut to Commercial

It takes money to make money, or so the saying goes. It’s therefore interesting (and a tad ironic) to see the latest move from bank-owned brokerage Scotia iTRADE as they start to ramp up their marketing and advertising efforts to put their brand back on the map with DIY investors.

This past week, in addition to their Twitter feed starting to feature big, bold, and very red picture cards, Scotia iTRADE also launched a series of video commercials on their YouTube channel. Ranging from quirky commercials to the quick ‘infomercial’ primers on the market, it looks like Scotia iTRADE has been busy building a video presence after quite a long absence in that space. We’ve bundled them into the playlist below.

What is interesting is that there has been a recent push back into video commercials, with BMO’s robo-advisor service (SmartFolio) and now with video coming back at Scotia iTRADE. Why this is relevant is because these are not inexpensive marketing choices to make, so it appears Scotia iTRADE is banking on the ads moving the needle on consumer awareness and buy in of their brand.

The ads themselves are amusing and well put together so there’s likely to be a positive reaction. Nonetheless, the bigger picture is that Scotia iTRADE appears to be spending more resources (read: money) in order bring Scotia iTRADE back into the ring to be considered. With the addition of new deals/promotions and now the latest spend in advertising, the onboarding engine is getting itself in gear.

Canadian discount brokerages are all trying to figure out where to place their marketing dollars to get the best ROI. For Scotia iTRADE, they’ve continued to resist lowering their standard commission fees, choosing instead to try other tactics. As a result, while other brokerages have lowered standard commissions, Scotia iTRADE continues to have the highest standard commission fees for smaller (<50K in assets) investors.

Whether or not these ads fly or flop, it’s a sign that given the choice to go big or go home, Scotia iTRADE is definitely betting that being big and bold will keep them in the discount brokerage race.

BMO InvestorLine Looking for an Edge

When putting together the weekly roundups, there are all kinds of interesting things that pop across our radar. In the case of the Canadian online brokerage industry (and the financial service space generally), one thing is abundantly clear: technology is the big battleground.

BMO InvestorLine recently posted (yet another) job posting that caught our attention, this time for a senior technical specialist. That they were hiring more IT wasn’t so exciting, however their vision for InvestorLine (and adviceDirect) to develop “bleeding-edge technology and the next generation of Online Self Direct Investment and adviceDirect platforms.”

Screenshot from https://bmo.taleo.net/careersection/2/jobdetail.ftl?lang=en_GB&job=957988&src=JB-10207

Fortunately, if there’s one group that can spend the resources needed to take on the wave of fintech firms and massive IT budgets of their competitors, it’s bank-owned brokerages. Of course, this past year (and week) has shown DIY investors that bigger brokerages aren’t necessarily without bugs when trying to roll out new trading platforms or features.

Historically, banks have been conservative and reluctant to roll out platforms or technology that is too new because of the risks associated with them. Clearly, the risk of being left behind technologically or the risk of losing market share has spurred BMO InvestorLine (and its peers) to innovate much more quickly. It should be exciting to see where the “bleeding-edge” takes online trading next.

Discount Brokerage Tweets of the Week

It looks like a rough start to fall 2016 for brokerages this week on Twitter – Scotia iTRADE in particular as their website crawled to a halt. Bitten by the tech bugs this week were BMO InvestorLine, Questrade, RBC Direct Investing and Scotia iTRADE.

From the Forums

Yay or Nay to Interactive Brokers

An interesting thread on reddit’s Personal Finance Canada section caught our attention this week from a Qtrade Investor client looking to jump ship to Interactive Brokers. It would be a move to a very different experience online so it was interesting to read what insight Interactive Brokers users had to offer.

Into the Close

That’s a wrap for another edition of the roundup. If you’re lucky enough to get good weather this weekend, hope you can make the most of it. For the rest of us, guess we’ll just have to watch hockey, football and get a bit of a break from the crazy debate week next week. Of course, for those that want a bit of that crazy ahead of time, here’s the hamdog. Seriously.