I am new to stock trading and looking to open an account online with one of the many discount brokerage firms. I will only be trading canadian equities to start and probably not executing many trades to qualify as an active trader. I will start with a few thousand dollars. I really dont want to go with the big banks as fees and commisions are really high. My 2 questions are 1)Which discount broker would best suit my direction and 2)-Should i open a TFSA if i deposit under $5000 in my account?:
Which Discount Brokerage to use?
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11 Posts
Hi Izzy,
I use Questrade and have been happy with them. The commissions are way lower than the banks. What you don't get is a lot of hand holding or fancy extras, which IMO can be found for free elsewhere on the net anyway.
On your TFSA question, it depends on what this money is for. Is it longer term or shorter term money?
I suggest you check out a couple of posts by Canadian Capitalist and Million Dollar Journey
I use Questrade and have been happy with them. The commissions are way lower than the banks. What you don't get is a lot of hand holding or fancy extras, which IMO can be found for free elsewhere on the net anyway.
On your TFSA question, it depends on what this money is for. Is it longer term or shorter term money?
I suggest you check out a couple of posts by Canadian Capitalist and Million Dollar Journey
I use TD Waterhouse and am happy with the service. I like the stock screeners and reporting features. I also like how it integrates nicely with my bank account.
On a side note ... Much ado is often made about trading costs, which are generally a moot point to me because I buy in reasonably large quantities to begin with (so my overhead costs are usually a small fraction of the total invested amount), and I trade rather infrequently anyway. (I generally only trade when I find an exceptional deal worth purchasing -- I am a very patient investor.)
On a side note ... Much ado is often made about trading costs, which are generally a moot point to me because I buy in reasonably large quantities to begin with (so my overhead costs are usually a small fraction of the total invested amount), and I trade rather infrequently anyway. (I generally only trade when I find an exceptional deal worth purchasing -- I am a very patient investor.)
Thank you all for the quick replies.
I know that TDW would be a great brokerage to deal with but not being an active trader would put me in the $29.99 fee/commision range. I find that a little high as my purchase will be around the $1000 mark. I think i read somewhere that you shouldnt pay fees more then 1% of your total purchase price. Now i dont know if thats true but i was hoping to get something in the $9.99-$19.99 range.
I know that TDW would be a great brokerage to deal with but not being an active trader would put me in the $29.99 fee/commision range. I find that a little high as my purchase will be around the $1000 mark. I think i read somewhere that you shouldnt pay fees more then 1% of your total purchase price. Now i dont know if thats true but i was hoping to get something in the $9.99-$19.99 range.
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7,256 Posts
The other two discount brokerages for your consideration are Scotia iTrade (formerly E*Trade) and Interactive Brokers (IB)
Check out this comparison link:
http://www.milliondollarjourney.com/review-canadian-discount-brokerages.htm
Check out this comparison link:
http://www.milliondollarjourney.com/review-canadian-discount-brokerages.htm
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450 Posts
Yes... but at that level of capital you also have to ask yourself whether you want to be trading individual securities or if a passive approach would suit you better, in which case TDW also offers you access to their low-cost e-series mutual funds. I'm also a happy TDW customer.
If you do want a cheaper broker then Questrade looks to be the cheapest option, and there are some referral codes around to give you a few free trades to start you off, too.
Definitely use your TFSA room first (you'll have $10k of total room in a few days time).
For what it is worth, and in case you have not already seen it, here is RoB's latest ranking of on-line discount brokers:
http://www.theglobeandmail.com/repo...h-annual-online-broker-survey/article1348448/
http://www.theglobeandmail.com/repo...h-annual-online-broker-survey/article1348448/
http://forums.canadianbusiness.com/message.jspa?messageID=288158#288158
http://www.milliondollarjourney.com/review-canadian-discount-brokerages.htm
http://forums.canadianbusiness.com/message.jspa?messageID=285493#285493
http://www.ndir.com/SI/brokers/discount.shtml
http://www.theglobeandmail.com/v5/content/pdf/0220carrickchart.pdf
http://www.theglobeandmail.com/partners/free/rbc_ic08/onlineinvesting/articles/brokers.html
http://forums.canadianbusiness.com/messageview.jspa?messageID=295326&stqc=true
http://forums.canadianbusiness.com/message.jspa?messageID=295326#295326
http://www.milliondollarjourney.com/review-canadian-discount-brokerages.htm
http://forums.canadianbusiness.com/message.jspa?messageID=285493#285493
http://www.ndir.com/SI/brokers/discount.shtml
http://www.theglobeandmail.com/v5/content/pdf/0220carrickchart.pdf
http://www.theglobeandmail.com/partners/free/rbc_ic08/onlineinvesting/articles/brokers.html
http://forums.canadianbusiness.com/messageview.jspa?messageID=295326&stqc=true
http://forums.canadianbusiness.com/message.jspa?messageID=295326#295326
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83 Posts
I use Questrade (here is a questrade review). It is perfect for what I do, which is similar to your plan (very little trading).
I have heard they have poor customer service, but thus far I've been pleased. It was a bit of an issue when I subscribed for to an IPO for a Capital Pool Company on the TSXV, but a phone call cleared that up (and quickly).
Their low commissions can't be beat.
I have heard they have poor customer service, but thus far I've been pleased. It was a bit of an issue when I subscribed for to an IPO for a Capital Pool Company on the TSXV, but a phone call cleared that up (and quickly).
Their low commissions can't be beat.
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15,845 Posts
re the Globe and Mail's recent ranking of online brokers:
a disgrace. Journalist Carrick has held a grudge against the big Green for many years, never granting TDW the leadership position they routinely enjoy in other polls and, this year, bizarrely dumping the Green into # 6 slot.
if this were panama or peru one would assume that the journalist had been bribed. But it's canada, so we have to presume that Carrick thought he knew what he was doing.
even more bizarre is the # 3 rating given to bmo investorline. What is Carrick thinking of. BMO doesn't even offer real-time quotes, except by single quote on the order entry platform or except to elite clients. BMO's watch list is primitive, while their efforts to sell the super-expensive streamer - and they intend a hard-core sell, for payment, although the streamer is presently being offered to BMO's elite clients for free - these efforts are surely going to crash. Trade faster, easier, cheaper at TDW or TDWATP, IB, ITrade, Questrade.
a disgrace. Journalist Carrick has held a grudge against the big Green for many years, never granting TDW the leadership position they routinely enjoy in other polls and, this year, bizarrely dumping the Green into # 6 slot.
if this were panama or peru one would assume that the journalist had been bribed. But it's canada, so we have to presume that Carrick thought he knew what he was doing.
even more bizarre is the # 3 rating given to bmo investorline. What is Carrick thinking of. BMO doesn't even offer real-time quotes, except by single quote on the order entry platform or except to elite clients. BMO's watch list is primitive, while their efforts to sell the super-expensive streamer - and they intend a hard-core sell, for payment, although the streamer is presently being offered to BMO's elite clients for free - these efforts are surely going to crash. Trade faster, easier, cheaper at TDW or TDWATP, IB, ITrade, Questrade.
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172 Posts
+ 1
Questrade is great for starting out. I test drove BMO Investorline first and found a lot of useless features and lack of actual trading features in comparison
I refuse to hold a certain balance or trade x amount just to avoid fees when its cheaper elsewhere
I log in to Questrade, fill in my limit order and log out. If the price drops to what I wanted the trade is filled and I pay my $4.95 + pennies ECN fees. Everything else I do for free elsewhere
Aren't we all? Maybe some more that others.
Re: the RoB ranking, I also find the ranking itself a little odd, thus why I started my comment by saying 'For what it is worth...'. I think the article still gives a good list of the options out there.
I have no idea about the authors biases in the article, but he is human too so there are likely at least some, hopefully not based on any external rewards.
I do know that I use iTrade and, up until the account # change, LOVED IT. I still use iTrade, even with the grief that should be temporary, and am starting to love it again.
So IMO, iTrade should have been ranked #1.
I still want 100 free trades for all the problems post account # transition though.
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29 Posts
Since Scotiabank bought E-Trade a while back, they have operated two on line investing services----Scotia I-trade and ScotiaMcLeod Direct Investing.
I have read that they intend to combine them into one, but have not been able to find any time lines as to when this will take place. Has anyone seen any information on this subject?
I have read that they intend to combine them into one, but have not been able to find any time lines as to when this will take place. Has anyone seen any information on this subject?
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15,845 Posts
re journalists' broker ratings "hopefully not based on any external rewards ..."
zero chance of any extenal rewards. The globe and mail's rob carrick is a top-ranked canadian journalist with the highest possible standards. No one will ever know what possessed him to construct the bizarre online broker rankings that he did a few weeks ago. He was using a sub-contracted outside survey source, so perhaps that is what led him astray. I don't always agree with carrick's views, but this rating - along with his previous annual discounters' ratings for the past few years - is the only time i've ever seen his judgment go berserk.
problem is that globe & mail is widely read & widely respected, so these ratings are misleading a lot of people.
this globe online broker survey does present a full list, with the omission of Interactive, and many will find the individual commentaries useful even if the individual ratings are bizarre. Rationale for omitting IB, apparently, is that it doesn't offer a rrsp.
zero chance of any extenal rewards. The globe and mail's rob carrick is a top-ranked canadian journalist with the highest possible standards. No one will ever know what possessed him to construct the bizarre online broker rankings that he did a few weeks ago. He was using a sub-contracted outside survey source, so perhaps that is what led him astray. I don't always agree with carrick's views, but this rating - along with his previous annual discounters' ratings for the past few years - is the only time i've ever seen his judgment go berserk.
problem is that globe & mail is widely read & widely respected, so these ratings are misleading a lot of people.
this globe online broker survey does present a full list, with the omission of Interactive, and many will find the individual commentaries useful even if the individual ratings are bizarre. Rationale for omitting IB, apparently, is that it doesn't offer a rrsp.
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