Where should I put my money? Top self-directed brokerages.
As someone who has tried all of the major brokerages in Canada I feel as though I should offer some advice to those who do not have as much experience and want to make the best choice.
First of all, it depends greatly on the type of investor you are and what you are looking for from your brokerage. You can see a detailed chart breakdown of all of the strengths and weaknesses here: http://daytradecanada.wixsite.com/financial-services/brokerages
I also have a video review on my YouTube channel: https://www.youtube.com/watch?v=P30qqHY58ko
Personally, my preferences are as follows:
Scotia iTrade: This is my #1 for trading in Canada whether you are a beginner or a day trader. For active traders of over 150 trades per quarter you get $4.99 trades, a dedicated relationship manager, preferential IPO allocation and free FlightDesk Premium which is currently my favourite trading platform. For the new investor they are constantly offering free trade promotions where you can get free trades or cash and FlightDesk Standard is free with as low as 9 trades per quarter. FlightDesk has a wonderfully customizable interface and although it has changed recently for the worse, in my opinion it is still the best.
TD Waterhouse: They have done away with their active trader platform and replaced it with Advanced Dashboard and ThinkOrSwim. For trading in the US ThinkOrSwim access makes TD the best choice as it is a complete platform with everything you could possibly want and more. Pricing is behind its peers however as you only get $7 trades if you make 150 trades per quarter on a rollover basis, which they are very strict with so have one slow or inactive month and you're back to square one paying $9.99. The research component is where TD shines with a thorough set of offerings for all of your research needs.
Others:
Royal Bank has a plethora of investing features on its site in a Community that allow you to communicate with other investors, set goals and see how you stack up against others. However with no specialized trading platform or significant perks for the active investor it simply is not sufficient.
CIBC is great for small, retail investors with $6.95 trades for everyone, but there is no specialized trading platform and the you have to call-in for new issues, IPO's and most option orders other than basic call or put buys, so this is not for the sophisticated trader.
Bank of Montreal has a simple site with a nice 5-star program, but most small retail investors would not meet these requirements and would likely find the features lacking as a result.
Interactive Brokers offers commissions of $1 per 100 shares for Canadian markets, or $1/200 shares for US markets so they are wonderful for investors wanting to dabble in smaller trade sizes. A sophisticated trading platform and many other investment offerings such as foreign exchange and access to all global markets make it perhaps the most complete global offering around. However, additional fees for data, research, complexity. weak customer support and a $15,000 minimum to open an account make it a poor choice for the small investor. Yet the large investor trading huge share blocks would also be overpaying based on the per share commission structure.
QuestTrade has a solid trading platform and a different fee structure from the banks, but it ultimately amounts to the same or more for most investors as they hit you with huge data or platform fees that are just too high compared to some of the equivalent offerings from the banks that throw most of these data plans in for free.
If you have any questions or would like a referral to any brokerage feel free to contact me anytime. I'm always happy to help investors find the financial tools they need and by showing that we are educated and informed we force these institutions to continue improving on their offerings and their pricing.
Day Trade