The Frugal Canadian

A frugal spender seeks to find new ways to save money and increase her net worth.

Tuesday, December 19, 2006

Moving to E*TRADE

We've decided to switch our discount brokerage services from TD Waterhouse to E*Trade Canada mainly because of the trading fees.

- E*Trade offers $9.99/trades for accounts with balances greater than $50,000 OR for active traders that place 30 trades per quarter. Waterhouse has a fee of $29.99/trade unless you make 30 trades per quarter or have $500,000

- In addition the launch of the Cash Optimizer Investment account on both Cdn and US taxable accounts is highly attractive. They are currently offering 4.15% Cdn and 4.75% US.

Our applications are currently being processed and we should have our taxable accounts up and running by the end of the year. I've decided to keep my existing TDW RRSP account until I am certain I am satisfied with E*Trade.

Canadian Capitalist just made the decision to go with Waterhouse over E*TRADE because of wash trades on US stocks. I was told by E*TRADE today that they will be implementing a service similar to TDW's USD wash facility in RRSPs, likely in the first quarter of 2007.

Currently, you can hold US stocks in your RRSP at E*Trade but your funds are automatically converted to Canadian dollars. For an active trader, the converting back and forth between currencies, gets really expensive.

If E*TRADE does make this move, I'll quickly be moving all of my accounts over to E*TRADE.


At 8:17 AM, Anonymous Anonymous said...

I would have made the move to E*Trade (from TDWaterhouse) already if it weren't for one little thing: there seems to be a $1/month charge for stocks that you want to re-invest dividends into. I currently have 6 stocks that I have as a DRIP and my understanding is that would cost me $6/month at E*Trade. I haven't looked into it too closely yet (i.e. I haven't called them and asked about the details of that) but that is what is currently holding me back from moving...

At 10:06 AM, Anonymous Anonymous said...

Thanks for the heads up that E*Trade might introduce a wash trade capability soon. I am going to rethink the move because the only thing I will be giving up is eFunds and E*Trade's commissions are low enough to invest in ETFs periodically.

At 7:19 PM, Anonymous Anonymous said...

I never came across DRIP charge before though I would not put it past the company. Maybe it's taken off in the form of the DRIP and not actual $ amount from the account.

One thing I like about etrade is that they offer Digital Security ID which gives an extra layer of security for your retirement funds.

At 4:29 PM, Blogger torontoinvestor said...

I've been with E*Trade for about 4 years now. I opened an account with them over 4 years ago when my company said they only administered their stock options through E*Trade. As I've been happy with the service and low fees, I've stayed with them for all my brokerage needs.

At 4:29 AM, Blogger Unknown said...

You should check out questrade for $4.95 trades:


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