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RBC Direct Investing Discount Broker Review

RBC Direct InvestingIt has been nearly two months now since my accounts have been fully transfered away form ScotiaITrade (previously known as e*trade Canada) to RBC Direct Investing. The process was quite simple but it does take a bit of time for everything to be transfered. During the process, I happen to receive dividends 3 times with one of them repurchasing one share. I was a bit worried I would have to fill out the forms again but luckily, after notifying RBC Direct Investing through the secured message systems, they were able to easily transfer the shares and money every single time. It was quite a pleasure dealing with their service even through the secure messaging system on their website.

Here are my thoughts in the different sections along with a grade.

Trading Experience – Grade A

The experience is similar to the other brokers I have used which include ScotiaITrade, e*Trade US, and Scotia McLeod. I tend to trade with a limit for buy and sell orders anyways. The trade settlement timeline is pretty much the same as what I had with ScotiaITrade and e*Trade; it approximate 3 days.

I had a couple of comments from TD Waterhouse users about the trade execution in a previous post and I am curious what this is about … If anyone want to share, please do so.

Account Transfer – Grade A+

The transfer from ScotiaITrade was just simply easy. I got all the shares transfered in kind by filling the forms. I kept them up-to-date through the secure messaging system on their website of all the dividends I was receiving at the time and they responded quickly. Three times in fact. I had to pay fees to transfer a couple of accounts and RBC kindly refunded me back the fees simply by faxing them the monthly statement.

During the transfer, some of the ACB (Adjusted Cost Basis) weren’t transfered and I was able to let them know of my original ACB for performance tracking. It was really nice to be able to do that as I can rely on the data for my performance tracking.

It was an amazing and easy experience. The icing on the cake is that I also got to get my transfer fees back :)

Customer Service – Grade A+

I was very pleased with the customer service. I live in the computer age so I try to do everything on the web through email and only call as a last resort. They answered all my questions with detailed information for me to proceed. I happen to also open an RESP account as I am moving it away from the mutual funds where it currently is and they were helpful in filling out the forms as well. They even called me to walk me through some information I had missing. I am just in the process of transferring my mutual funds and them I will adjust the investments.

Research – Grade B

The research is mostly focused on economic data and that’s not really my cup of tea. ScotiaITrade had some nice reports with their ratings and recommendation that I liked. RBC happens to have something similar that I can access daily but the format is quite hard to read from an at a glance perspective. I have also seen the TD Waterhouse reports and they are in line with ScotiaITrade. I would love to have the equivalent of the competitors but I knew that going in. I’ll have to live with it.

The alert system works quite well but it takes a bit of fiddling to get it right. I only follow two stocks at the moment with the alerts; MSFT and CNR. I sort of get spammed by the MSFT notification and I need to adjust that a little. I can get up to 7 emails in one day. Imagine having 100 stocks in the list …

I was expecting RBC research and analysis but they are all S&P research. It’s very good for US companies with their 5-star ratings but it’s not as good with Canadian companies.

Accounts – Grade A

The US and CDN accounts are working just like I wanted. Finally! I have my currency as I want them. As a Canadian, my diversification is mostly towards the US with the large conglomerates providing me with my international exposure. I wanted to avoid currency exchange when trading as much as I could since it’s really painful to control and the cost can add up.

The holding tab provides me with a nice at a glance view of all my account summary with a different line per currency and a total in each currency including my cash holding in the currency. The latter was a pet peeve of me with ScotiaITrade as it was painful to really know how much cash I had in each currency. Every now and again I had to top up due to mis-calculation and it was frustrating.

I happen to have an account on the bank side as well – no fees by the way :) and it’s working quite well. The bank and investing accounts are well integrated together and it’s very easy to navigate. In fact, I am slowly moving my accounts over to RBC – they have a real high interest savings account as opposed to Scotia Bank with their Money Master :(

Tools – Grade B

I have many more tools than I had with ScotiaITrade but it’s still far from e*Trade US since I know what is possible although I can’t trade with it. The performance tab with a index comparative graph requires some time to evaluate as I need more data to build the report. It works at a month level so I won’t really be able to assess how my portfolio does against an index until a good number of months have gone by.

The asset allocation and model portfolio are nice touch but it’s mostly catered towards the mutual funds investor. I am still playing with it. There are good education section for new investors though to get started. I thought it was good to teach about the tools but it’s catered to lead you towards RBC mutual funds. Business is business I guess …

Readers: What’s your experience with your discount broker?

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20 Responses to "RBC Direct Investing Discount Broker Review"

  1. Robert Campbell says:

    It would be nice if you had a share link or something like that so I could email your articles to some investing friends. Thank you.

  2. Liquid says:

    Sounds like a great brokerage platform overall. I use TD Waterhouse and I see they have a lot of similarities. Not sure what others mean by trade execution, but I’ve been able to buy and sell stocks in lots under 100 and the trade usually goes through instantly.

    • The Passive Income Earner says:

      @Liquid
      Same here. I tend to buy in lots under 100 anyways when the stock price is near $100 :)

  3. Crystal says:

    With the number of choices available, choosing a broker can be tough. Smart Money magazine and Barron’s provide annual reviews of brokers and provide their rankings of the top discount brokers. You should review several brokers based on the costs and features that are important for your investing style and goals..

    • The Passive Income Earner says:

      @Crystal
      You hit on a very good point -> “The features that are important to you”.

      I have a post coming that highlights my filter as a dividend investor. Stay tuned.

  4. Claire says:

    I use TD Waterhouse and I see they have a lot of similarities. Thanks that you’ve shared this with us.

  5. Jimmy says:

    When I transferred out of Scotia iTrade they charged me transfer fees AND a fee to close my account, and they “forgot” to transfer three dividend payments.

    I absolutely hated the platforms.

    I thought they were somewhat less then ethical in their dealings when they purchased my old brokerage (TradeFreedom) and transferred it to them.

    • The Passive Income Earner says:

      @Jimmy
      I have actually become unsatisfied with Scotia in general. They appear to attempt to keep up but it seems they are always behind …

  6. Matt says:

    I currently use CIBC Investor’s Edge and before reading this article was going to switch to RBC since it is my main banking institution.
    Thanks for the review!

  7. Brian says:

    I use BMO Investorline and Canadian Shareowner. They are both good. Canadian Shareowner uses a full drip investing with shares to 4 decimal points and also is dollar based for purchases which means you never have to worry about having large amounts of money accumulated before making a purchase.

    • The Passive Income Earner says:

      @Brian

      Thanks for commenting. I had a quick look at Canadian Shareowner, would you mind elaborating on how you are using it?

  8. Brian says:

    I am using it as a regular account. I have an RRSP account and accounts for my children to introduce them to investing. I like the service because, there are no share certificates to keep track of and also a single investment statement instead of one for each company. I hold all of my US investments that I have in my RRSP account in the Canadian Shareowner account because they offer dividend reinvestment on all dividends and issue shares to four decimal points. You can use it as a regular broker and place “immediate trades”, but the commission for that is 29.00 I think. Mostly, I use the co-operative trading feature. Each of their pre-screened investments trades on a certain day of the month or week. You book a set dollar amount to trade in any number of stocks for the coming month for a total commission of $40. You could buy 12 stocks for a total of $1500. You can book individual trades for 9.95 and they still trade on the desiginated day for that security. They also produce a monthly magazine and stock selection software to analize investments. I have used the account for about 15 years and I would rate it as excellent.

  9. Michael says:

    Great post.
    Is it possible to transfer fund into RBC direct invest account from a bank account of other banks?
    RBC bank account all have fees, even you keep a balance. Just wondering how you get bank account free.

    • The Passive Income Earner says:

      @Michael
      Not really. I open a bank account – a no fee one by also getting a VISA. A bit of a gimmick but it works.

  10. Carlos says:

    If you are trading options, this is one of the worse platforms you can use to trade. I recently joined RBC DI, stock trading is OK. Not great. It still feels like I am using a 1998 web page. My biggest problem with this platform is that you cannot place a stop loss order on options. Add to that the 20 minute delay and the slow order processing and what you have is a perfect formula to loose all your money. It is impossible to keep up with the options price (up or down) and it seems I am always pricing myself out of the market. I had to modify my order at least 15 times before I finally got my order filled. When that happened the price had fallen more than 50% when I could have stopped my loses at 20%. THIS IS UNFORGIVABLE for a company that claims to be conservative.

  11. Chris says:

    I’ve been with RBC Direct Investing now for just over 4 years and my experience has been quite mixed. As Carlos infers, the website is extremely outdated but I have not had any trouble with real time quotes for equities, preferred shares, debentures or options. My major complaints are with the DRIP options (only market DRIP available and no option to enroll by individual security) and with the customer service. An error was committed by an investment representative in my account that has so far required more than 5 phone calls to fix – additional mistakes were made by RBC in trying to fix the error (a foreign exchange was made in the incorrect account, interest charged for RBC’s mistake, instructions not followed, phone calls not returned, treated disrespectfully, etc.). Working in the industry and having worked in a similar role with a competitor out of university, my customer service experience has been a nightmare. I would suggest avoiding RBC DI if at all possible – I will be transferring my account out.

  12. Suzanne says:

    I have just moved my investments over to RBC Direct Investing from RBC Bank and after less than 2 weeks I will be transferring my account out! I am incredibly dissatisfied with their poor customer service, very lengthy wait time for phone inquiries (over 45 minutes hold on average) and slow order processing time (3 days for mutual funds). RBC Direct Investing is a huge disappointment!

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