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(This article originally appeared on The DIV-Net) A few days ago one of my colleagues over at the DIV-Net wrote about online brokerages and using Zecco as low cost provider. As a Canadian, I like the sounds of Zecco’s low costs however we Canadians are not eligible to open an account with them. In this post I would like to talk about a Canadian broker that I have been using to good effect that offers cheap trades – not $0 trades but pretty close.
My primary broker for a long time was the Canadian Shareowner Association. However, due to personal situation reasons I was unable to continue using them as my broker. It was too bad because I liked the fractional share ownership and dividend reinvestment packages they offered. However, it became clear very quick that as my portfolio grew and I wanted to expand my dividend portfolio to stocks outside of the ones they offered to investors, I had to make a choice. My primary concern was commissions. In my opinion, online brokers offer a commodity. What you get from one broker is very similar to what you get from another. There are always little differences such as streaming quotes or a better interface, but for the individual investor who does not trade a lot then the differences are negligible.
With commissions as my guide I decided to go with Questrade. I had experience with them in the past for a small trading account that I had and was impressed. Their customer service was alright (and I must admit has improved since then – 1 year ago) the trades were cheap ($9.95 at the time). However, I recently moved my entire RRSP over to them and the experience has been great. The transfer was done in about 48 hours and I have already made two trades for $4.95 each.
I will be writing more about Questrade here at my blog and will be brutally honest about the experience. It is very easy to switch brokers these days so Questrade needs to ensure they keep up and provide quality service at a low cost. However, I believe that I can safely recommend them as a broker if you are Canadian and looking for a cheaper alternative to the bank run brokerages.
I started with Questrade back when they used the Cybertrader platform. Schwab yanked that back and we’re now stuck with the AXIS platform that everyone else uses (except IB). Axis doesn’t to complex options, or provide trailing stops or buys. I wish they would find a better software platform. That’s the main reason I’m looking at Intereactive Brokers.
I had good experience for most part with Questrade. Changing the platform was spectacular easy and professional and impressed me positively. But that’s where it stops.
AXIS is a piece of garbage , it is too demanding on the system. I had to buy a top of the line PC just to be able to trade (high volume stocks) and the platform still freezes sometimes (and not rare mind you). NO improvement whatsoever since they released it. NO ONE CARES at Questrade !!!!!
Then I opened a FOREX account. Almost same bad problem just worse! This time the departement geniuses out of shier incompetence couldn’t figure what to do for a smooth transition like their coleagues did in stock department, so they forced customers into opening NEW accounts when they changed the Forex platform.
If you dare complining you get a lot of non-sense double talk, torturing repetitive.
INCOMPETENCE
Then things got WORSE. The new platform while so-so ok, have some issues. Well, let’s say nothing is perfect, so for the most part we can suck it up a little.
But then there is something evil that you just can’t take. NO excuse. So you open a position. Then another and another and another. You got it, you have multiple open position OF THE SAME THING. Then for whatever reason you decide to close them all AT MARKET. I press the frigging “Close All” , JUST SOMETIMES IT WORKS !!! Other times the positions were NOT close and now NOTHING is actually working. Any attempt to place an order will make a pop-up message say “”A previous “Close All” request is pending. Please wait for your initial request to complete.””…..
How in hll a CLOSE AT MARKET order is pending forever in an extremely liquid market??? Worse, I call in and lines are busy. When finally someone answered the position is deep in LOSS (from being a winner!!!). I am told that there is no trace of my problem. The Questrade broker then AGAINST my will close the position AT LOSS. (I knew as a trader that position will bounce back in green and it would’ve in a big way). Meanwhile the broker close my positions against my will at a loss although there was NO margin call problem and there was NO danger of such. Because I had like just ONE percent invested of my capital !!!
After bitter talk for just $20 the broker said it was aproved to give me back $18 and that it will be given in next 2 days and that he personally will see to it. Well, Mr Paul did NO such thing. A month passed since the promise !!! And NOTHING. Not even answer back from my e-mails to Questrade “customer service” although was promised or rather lied “We have received your inquiry and are assigning it to a representative. You can expect to receive a response from us in 2 to 3 business days.” By the way I wanted to present my case to and hear from a bigger manager – that was at the time the e-mail about. NO manager will come to address your problems. NO technical assistance of any kind. Whoever answer the phone at customer service will give you second hand info and LATER about your problem, and it feels like he gives you a personal opinion.
Many times Questrade system is down but they won’t admit to it blaming it on YOUR computer. Then you call back and if you are lucky and find one of those rare nice people they will admit that it was their end. It is hugely frustrating.
Worse than everything there is no end to the problem with the Forex platform. I think that there is NO problem but the broker blocked it from their side. I know it is illegal and criminal but what can one do for now until it’s exposed with some proof? The only proof I have are screenshots.
Why he would go and do such criminal act? I think because I was honest and expressed my frustration with their incompetence in handling transition to new platform and ONE MONTH wait to open an account which I souldn’t need to open in the first place since I had one. Jeeesh
If they have criminal elements amongst them then you can wonder. Are you safe ?
At the time of this post, after a VERY long time of many WEEKS, I have NOT been contacted by ANY manager to solve ANY of the issues. Today is Dec.10/2008 p.m.
Best company? It can be. But it is not!
I`m curious as to why you had to switch from CSA entirely? I for one, have 3 brokerage accounts. My Canadian Shareowner Account is just to take advantage of free fractional dividend re-investments. I have a non-registered margin account with Tradefreedom and have my RRSP and newly created TFSA with BMO Investorline. This arrangement serves me well right now as I rather not keep all my eggs in one basket.
If you’re thinking of switching to Questrade, I’d advise you to reconsider. I switched to them from E-trade due to the $4.95 trades, and I regret it.
The bottom line is: For stock transactions, you want to be certain that you are doing it right and it worked. Questrade lacks this feature. With Questrade, I managed to make a trade, but I am not certain it went through. Is this uneasy feeling worth the savings of $15?
Quite frankly, their web site is horribly designed and offers too many account choices with no explanation of why you would choose one over the other. I think they only get positive comments through bloggers because of the lucrative referrals.
The biggest problem is that you have several different accounts and passwords You use one for logging on and making trades, and the other for checking your account balances (I think — their welcome package is several large PDF files that don’t help you make a trade).
Because it is so hard to login, I never even check my account. Hopefully it is still active. I much prefer E*trade.
Wow – interesting comments. Let me address some of them…
Dan Mcco – I use the basic webtrader as I am not a trader. It works just fine – it is very basic but it does the job. I do have to admit it is not as intuitive as brokers such as CBMO or RBC, but it does not take long to figure out.
Joe Whistleblower – it sounds like you had a bad time with them. I have never tried a forex account (never will either) so I cannot comment. I am not really sure what things you were trying to do with some of your orders, but I have found that for normal orders things work just fine. I even entered a stop loss on one of my holdings and things worked great.
Sarafina – The reason I had to change was because I recently located abroad and rules required me to do so. I also agree not to keep all your eggs in one basket – I too hold a Scotia account.
Steve Hanov – There are two passwords – one for the trading platform (webtrader) and one for the account balances. This should be fixed in my opinion. I too have had an eTrade account and actually find their site difficult to navigate.
Overall, it sounds like most of the issues are either with the more advanced trading features of the company, or that it is difficult to figure out. I myself have not had any problems with it, but like I would do with any broker, I will watch my account like a hawk. Crap has happened to my trades in a big bank broker, so I would suggest that no one is immune from poor service!
Hi, I don’t think you can beat $4.95 per trade deal in Canada, the only one lowest than that is Zecco which is only for US, not Canada.
It looks like this blog is advertising for Questrade. That makes it hard for people out there who are just trying to honestly research a brokerage, like me. I’ve heard rumors abroad that Questrade has some issues. I was with TD but I was paying close to $80 for a trade. Its hard to make a decent profit when your almost spending $200 in commission costs. I’m just switching to Questrade because I figure if I can break even on $200 commission rate in day trading then I can make a good daily penny with $20 at Questrade.
I have recently traded Questrade in Canadian stocks but Questrade does not allow me to use stop loss. How come? In my opinion, that is quite dangerous.
If someone knows how to trade Canadian stocks using stop loss, please let me know.
I have never used a stop loss, but there must be a way. That is a pretty standard thing brokers offer these days. Anyone know?