(My book, Findependence Day, is aimed at just these types of investors who want to build low - cost portfolios of
ETFs at discount brokerages, but who also value good advice).
On the other hand, a self - directed investor with the same $ 500,000 who is buying their own
ETFs at a discount brokerage will be paying only small commissions to buy and sell securities (typically $ 10 per transaction) plus whatever the underlying MERs of their investments are.
Certainly, mutual fund salespeople may not be inclined to recommend well - heeled clients start buying
ETFs at a discount brokerage.
Not exact matches
Plus — and this is a pretty nice bonus — many
brokerages have their own
ETFs they'll let you trade for free or
at a steep
discount.
Many MoneySense readers are tempted to go it alone by picking their own stocks and bonds, or
ETFs,
at discount brokerages.
With the launch of their new
ETF line, Questrade looks and feels like a very different brand than it did last year
at this time when it was «just» a
discount brokerage.
One problem with that method is that I suspect a lot of investors will set up the account
at TD but they won't switch to a
discount brokerage at the right time or
at all which means in the long run they will end up paying more fees compared to if they had just started buying
ETFs even when the account was fairly small.
He notes that
ETFs are an alternative to mutual funds and can typically be bought and sold
at a
discount brokerage for less than $ 10 a trade, with no ongoing fees.
If you've got
at least $ 50,000 to invest and plan to make infrequent purchases, open up a
discount brokerage account (look for one with no annual fee and that doesn't charge more than $ 10 a trade), and pick an
ETF.
Bank - owned
brokerages outside of the big 5, such as National Bank Direct
Brokerage with their commission - free
ETF program and now HSBC InvestDirect are aggressively looking
at winning marketshare through
discounted pricing.
I think
ETF's can be traded
at a
discount, especially with new
brokerages like motif investing, which allow a
discount for trading up to 30 or 15
ETF's.
They could sell these
ETFs to their
discount brokerage customers and Jon Chevreau notes that they have garnered a 1 % market share (which isn't shabby
at all).
The Scotia iTrade
discount brokerage currently offers commission - free
ETF trading on 50
ETFs at the time of writing this article.
The book retails for just $ 9.95, or about the cost of a single
ETF trade
at your
discount brokerage.
However, we suspect that many MoneySense readers are largely self - directed investors who are acutely cost - conscious: perhaps they set up Couch Potato portfolios of
ETFs that they buy themselves
at a
discount brokerage.
Let's say you have a traditional Couch Potato portfolio
at a
discount brokerage, with 40 % in a bond
ETF and 60 % in Canadian, U.S. and international equity
ETFs.
Commission - Free
ETF Trading
at Canadian
Discount Brokerages: A Clever Lure or a Good Deal for Investors?
In the final part of our series on commission - free
ETF trading
at Canadian
discount brokerages, we look
at the offers from Virtual Brokers and Questrade and conclude the series with some lessons learned from researching commission - free
ETF offers.
In it, there were some key highlights about the commission - free
ETF trading offers
at Scotia iTrade and Qtrade as well as some interesting stats on the dominant provider of commission - free
ETFs for the various
discount brokerages.