It's either a display of incredible acumen or investing's equivalent of the charge of the light brigade.
Amid a ferocious bear market, people are rushing to open new accounts at online brokers. TD Waterhouse, the country's largest online broker, reports an incredible 80-per-cent increase in new account applications in the past couple of weeks over the same time last year. At Qtrade Investor, the increase is 91 per cent, and at RBC Direct Investing it's 70 per cent.
This 10th anniversary edition of The Globe and Mail's annual ranking of online brokers appears at a time when stock market conditions are as volatile as many people have ever seen them. And yet, investors want in.
Are they about to scoop up stock market bargains like we haven't seen in ages, or will they be sideswiped by unpredictable markets? It's too early to say, although one thing is clear already. At a time when fear rules the markets, it's quite the validation of online investing to see a big surge in new account openings.
Now to the question of which brokers are best. Qtrade Investor, a small firm out of Vancouver, has taken top spot for the third straight year, while BMO InvestorLine, E*Trade Canada and TD Waterhouse also scored well. Qtrade is an example of a broker that does almost everything well. Whether it's keeping costs low, providing tools that help investors make smart decisions or offering a sturdy trading platform, Qtrade has it covered.
As usual, this year's ranking focuses strictly on the mainstream investor, not aggressive traders, and it considers only services delivered over the Internet, where costs are lowest and services for clients are plentiful. Brokers report they're doing almost nine in 10 trades online these days.
Breaking down the brokers
The Globe and Mail's 10th annual online brokerage ranking evaluated 13 different firms in six different categories. Here are the results:
| Rank | Broker | Costs/25 | Trading/25 | Tools/20 | CS /15 | AI /10 | Website/5 | Total/100 |
|---|---|---|---|---|---|---|---|---|
| 1 | Qtrade Investor | 21.0 | 22.0 | 16.0 | 12.1 | 10.0 | 3.0 | 84.1 |
| 2 | BMO InvestorLine | 15.5 | 17.0 | 18.0 | 11.5 | 9.5 | 5.0 | 76.5 |
| 3 | E*Trade Canada | 23.0 | 18.0 | 14.0 | 11.5 | 4.5 | 3.0 | 74.0 |
| 4 | TD Waterhouse | 16.5 | 15.0 | 19.0 | 11.8 | 7.5 | 4.0 | 73.8 |
| 5 | Credential Direct | 17.0 | 18.0 | 11.0 | 12.1 | 9.5 | 3.0 | 70.6 |
| 6 | RBC Direct Investing | 17.5 | 14.0 | 19.0 | 11.3 | 5.5 | 3.0 | 70.3 |
| 7 | CIBC Investor's Edge | 17.5 | 15.0 | 17.0 | 11.2 | 4.5 | 3.0 | 68.2 |
| 8 | Disnat | 16.5 | 17.0 | 11.5 | 11.9 | 6.0 | 0.0 | 62.9 |
| 9 | ScotiaMcLeod Direct Investing | 10.0 | 17.0 | 16.0 | 11.1 | 3.0 | 3.0 | 60.1 |
| 10 | National Bank Direct Brokerage | 10.5 | 15.0 | 15.5 | 10.9 | 4.5 | 3.0 | 59.4 |
| 11 | HSBC InvestDirect | 17.5 | 13.0 | 10.5 | 10.9 | 2.5 | 3.0 | 57.4 |
| 12 | TradeFreedom | 18.0 | 14.0 | 7.0 | 11.2 | 4.0 | 3.0 | 57.2 |
| 13 | Questrade | 21.0 | 15.0 | 4.0 | 11.8 | 5.0 | 0.0 | 56.8 |
Qtrade Investor
qtrade.ca
Ownership
Privately held
Comments
Some online brokers are slacker operations that do little more than take up cyberspace. Qtrade is the opposite. It's as aggressive as any firm out there in marching forward year by year to bring clients a better product. In 2008, the firm has added new equity research, improved client account reporting, added online ordering of guaranteed investment certificates and introduced a new kind of stock order called a trailing stop (useful for protecting against falling markets). Qtrade's also good on costs, and its customer satisfaction ranking is strong. If you're thinking of joining the rush to open an online brokerage account, be sure to consider Qtrade.
BMO InvestorLine
bmoinvestorline.com
Ownership
Bank of Montreal
Comments
