Looking for firsthand Canadian experience with Questrade.

[techwiz]

I currently have a TFSA trading account at TD bank and also have a self-directed RRSP, RESP and taxable investing accounts with BMO Investorline. My trades or purchases of ETF’s are $9.95 per trade. There are no other fees since I have over the minimum balances so other fees are waived.

On the whole I am happy with the service I receive from both brokers, but hearing about Questrade on this site has got me interested.

Not having to pay to purchase ETF’s sounds too good to be true.

I did some research on them and can only really find information on them from their own website.  I would like to have some non-bias outside input and also get some insight on any gotcha’s from their service.

Some negatives I read while researching them. (most of the information I found was dated so hopefully these are no longer the case)
 
1.   Hidden fees. (I assume only if you don’t carry a minimum which will not a problem)
2.   Is it difficult to get your money out.
3.   Issues with end of year reporting for income tax. 
4.   Security issues. (When I went on their website and clicked their link to the information on security it took me to a broken link…this got me worried)
5.   Slow or problems with trading platform.

On the positive side.

•   Save money and make balancing cheaper and easier. I would like setup automatic purchases since the purchases would be free.

Some things I am looking for, but not sure if Questrade can do it.
•   Be able to automatically view asset allocation over multiple accounts. Currently I am doing this manually and it’s a pain.
•   Automatic Tax loss harvesting on my taxable account. (I was reading about their IQ service and it seems does this automatically.) Although the more I read about the rules and restrictions of tax loss harvesting seems even if I am purchasing in tax free or registered account the same type of investments it would become a wash trade and cause issues.

Anyone with firsthand experience I would appreciate your insight. 

Thanks,

[dess1313]

fellow Canadian posting to follow!  I am interested as well

[TravelJunkyQC]

Also posting to follow! I'm also with TD for my TFSA, and Banque Nationale for my RRSP. Looking for a taxable account... looking forward to hearing some first-hand accounts of Questrade.

[GuitarStv]

Posting to follow.

[okits]

I can answer a few of your more basic questions.  I've been using Questrade for 2.5 years (prior to that I was all mutual funds, so no other experience to compare it to.) I'm a passive indexer and just about everything I own is ETFs.  Accumulation phase so I've never tried to get money out.

You can buy ETFs without a trading commission (the few times I've paid a commission it's been $4.95).  You will probably pay electronic communication network (ECN) fees on the trade, but this is a trivial amount.  You pay commission and ECN fees to sell an ETF.

Other than those fees I've never paid anything else to use Questrade (there are account minimums but they're pretty low). 

Income tax slips: IIRC, I've typically received them just before/at the legal deadline where they are obligated to provide them.  Earlier would be nice but this is acceptable to me.

Website: typically at/after midnight (EST) they do website maintenance and upgrades, so if you're visiting at that time you may get wonky or no access to parts of their website. 

Trading platform: I use the basic one you access by logging in from their web page (I think there's a fancier one you install on your computer, too).  I think it's fine.  What kind of slowness concerns you?

Reporting: I haven't seen a feature where you can see your total AA (but I haven't looked for it, either).  In the trading platform, each account does have a pie chart showing what portion is in which asset.

No idea about tax loss harvesting.

The only complaint that comes to mind is that there's a lag of at least several business days between when my distributions are supposedly received by QT and when they actually show up as cash in my accounts.  Not sure if it's like this everywhere and it's not a big deal to me, but I like receiving that money.  :)

Last thought: keep an eye out for new account promotions (e.g. cash or gift cards for opening a new account with a minimum level of assets within X days of application).  These often require you to execute at least one commissionable trade.  Sometimes the bonus you get by using another customer's referral code is better (better bonus or the minimum level of new assets is lower).

Hope that helped!

[techwiz]

Thank you Okits for your response.

I did pose my questions/concerns directly to Questrade and got a reply.  Since a few people posted they are following this with similar questions I am posting the response.

>>>>>>>>>>Email from Questrade responding to my questions>>>>>>>>>
We are glad to hear back from you! Yes you are right, ETF buy order at Questrade are free of commission. Only ETF sell orders are charged regular commission of $4.95 minimum and $9.95 maximum.

Below are the answers to your concerns and questions:

1.       Inactive fee - We have to implement pricing changes to reflect the changing nature of this industry. Each quarter (3 months) your account is inactive, you will be charged a  $24.95 inactivity fee. To remain active and avoid paying this fee you must make one commissionable trade per quarter (3 months). Making one trade per quarter in any of your accounts will make it so you are not charged this fee at all for the quarter. If you trade in the quarter following incurring an inactivity fee, the trades will be commission-free up to $24.95. Meaning that if you do not trade in Quarter 1 you will be charged an inactivity fee of $24.95 – but if this does happen your first $24.95 in trade commissions in Quarter 2 will be rebated back to you. We do this because we understand that many clients may not trade each quarter, so this allows you to use the inactivity fee from the previous quarter to offset the current quarter’s commission charges. All clients 25 years and younger are exempt no matter their activity levels, and clients with combined assets of $5,000 or greater are exempt from this fee. So even if you have one account that has less than $5000 but all your accounts combined are over $5000 you will not be charged this fee. I apologize that we have added this inactivity charge to our pricing structure, but I hope you understand that we have purposely made this fee flexible to allow you many ways to have it reduced or avoided completely.

2.       Withdrawal funds from Questrade - Canadian and U.S. funds can be directly deposited to your account free of charge through an electronic funds transfer (EFT). The daily maximum withdrawal limit per account via EFT is $25,000. Requests greater than $25,000 will be staggered and sent daily until completed. Once you uploaded your void cheque or a stamped direct deposit form from your bank, you can simply create a new withdrawal request and it will certainly be processed for you no problem.

3.        Please see the attached Myquestrade Guide for tax reporting at the year end.

4.       Your security is a priority at Questrade - We have implemented a number of measures that enhance our infrastructure and technology and afford you greater security: Our policies on Internet security and personal privacy are comprehensive and impact all areas of our business. The technologies we use are the best available, and we continually work to improve our software, hardware, and best practices.  We use Verisign's Extended Validation (EV) SSL certificate technology. This is a new release by Verisign, building on their secure socket layer technology which has long set the standard for online security. The address bar in your browser will turn green when it is verified by EV-recognition tools. This indicates that it is safe to continue with any confidential transactions with Questrade. Tip: To ensure the server certificate revocation is enabled, go to tools, select internet options, then the advanced tab. Scroll to the security section and put a tick in the box beside check for server certificate revocation. If you use Windows 7 with IE9, this is the default setting. Above all, any security measures we undertake are constantly evaluated to ensure that we are always in line with — or ahead of — industry standards. Please feel free to visit our  security center.

5.       Platform problems - You can use the 3 platforms that we have: (Trading platforms: IQ Web, IQ Essential and IQ Edge). The IQ Web platform is our standard trading platform. The IQ Edge is our most advanced platform. The IQ Essential is our very basic platform that is used primarily for tablets and clients who do not have administrative rights to download IQ Edge and Microsoft Silverlight to power IQ Web. You can access all these platforms by logging into your client portal, www.myquestrade.com and direct your attention to the top of the page and you can toggle between platforms. You will need to use the same user Id and password as myquestrade.com portal for all the IQ Trading platform.

6.       Yes you are able to view asset allocation over multiple accounts. You can go to myquestrade.com and log into your account. Under “REPORTS” you will see “INVESTMENT SUMMARY”.

7.       For tax issues, feel free to give a phone call to our customer service department. They will be really happy to help you out. 

Thank you for contacting Questrade. I hope my answers clarified some of your concerns and questions.  If you have any more questions please contact us via chat or give us a call at 1.888.783.7866 and we will be more than happy to assist you. Thank you for contacting Questrade and have a wonderful day !

>>>>>>>>>>>>>>>
They got back to me with answers within the day so that seems to be great customer service. I would still like to get some non-biased views on their service. 

[daverobev]

They are ok.

From last year, they didn't/don't do a great job with the tax docs in terms of cap gains and stuff. I think you have to manually track your ACB. AFAIK other brokers will do this properly.

Their margin rates are bad. 6%.

Their forex charge is bad. 2%. You can get around this by doing "norbert's gambit", at the cost of one buy (free if you use an ETF), one sell, and a few days wait.

If your account value falls below (I think $1k) they will IMMEDIATELY close your account. I guess it only happens if you sell everything and withdraw, but there is no "and in a week I'll put more money in" or whatever.

There ARE fees for ETF buys but they are minimal (ECN fees) = fractions or single cents on small buys. The beauty is that you can buy single ETFs with the odd $20 you had leftover for (very nearly) free.

To sell, you pay 1c/share, min $4.95, max $9.95 (plus fees). For low value stocks this can really add up.

If you are planning on making one or two purchases a year, I'd strongly recommend looking at CIBC Investor's Edge. $7/trade, but my feeling is that they will just "be better" in the long run. Questrade is not backed (I read recently) in the case that someone hacks your account, sells, and withdraws - I mean, that should be pretty unlikely and you'd have a good case if they processed that because obviously the name on the new linked account would be different, but still.

Don't get me wrong, I have stuff with them and will keep stuff with them. IF I was starting now, I might consider other options. If you are putting a decent chunk of cash in, I would recommend Interactive Brokers - 1c/share, min $1. You need $100k USD equivalent to avoid account fees.

[Retire-Canada]

Some negatives I read while researching them. (most of the information I found was dated so hopefully these are no longer the case)
 
1.   Hidden fees. (I assume only if you don’t carry a minimum which will not a problem)
2.   Is it difficult to get your money out.
3.   Issues with end of year reporting for income tax. 
4.   Security issues. (When I went on their website and clicked their link to the information on security it took me to a broken link…this got me worried)
5.   Slow or problems with trading platform.

On the positive side.

•   Save money and make balancing cheaper and easier. I would like setup automatic purchases since the purchases would be free.

Some things I am looking for, but not sure if Questrade can do it.
•   Be able to automatically view asset allocation over multiple accounts. Currently I am doing this manually and it’s a pain.
•   Automatic Tax loss harvesting on my taxable account. (I was reading about their IQ service and it seems does this automatically.) Although the more I read about the rules and restrictions of tax loss harvesting seems even if I am purchasing in tax free or registered account the same type of investments it would become a wash trade and cause issues.

Anyone with firsthand experience I would appreciate your insight. 

Thanks,

My comments:

Negatives:

- Hidden Fees: I haven't noticed any.
- Difficult to get money out: I haven't tried this. I don't expect it will be a problem, but I'd plan on 2-4 business days for money to hit my bank so if you are looking for same day transactions that may be an issue.
- Tax reporting: Other than having to wait to get my tax slips I didn't have any issues.
- Security Issues: I haven't noticed any problems.
- Problems with trading platform: There has been the odd bit of downtime when I wanted to do something. Given my once a month purchases [typically] having to wait a moment to access the site doesn't bother me. It has not been a frequent issue and it hasn't ever made me miss anything in terms of buying when I wanted to. That said I am typically not chasing after a trade that has to happen in the next 5mins.

I do my asset allocation calculations in a separate spreadsheet. I hold 4 different ETFs in 2 accounts and 1 ETF in my third account so once a month it takes me like 60 seconds to update my spreadsheet.

I only hold VCN in my Non-Reg account so I have no way to tax loss harvest so I have not looked into it.

All in all the free ETF purchases are well worth whatever minor quibbles I have with their website/service.  I'm no wheeler dealer high powered investor though. My needs and trading frequency are very modest. I really just needed a low cost way to buy Vanguard ETFs and QT seems to do that quite well.

[techwiz]

***Update***

Thanks for the replies.

I decided for now to not go ahead with opening Questrade Accounts and transferring over my current investments accounts (taxable,RRSP,TFSA).

I can always change my mind at a later date ,but since I already have two online brokers(BMO, TD) adding a third in the mix seemed too risky in my case.  I just couldn't take a chance of having transfers getting messed up and screwing up my taxes. 
If I was starting out over again knowing what I do now. I would have started with Questrade accounts and take advantage of their free ETF's purchases.

I just have too much mess to clean up in the current accounts. I have a lot of left over investments before I started following a real investment plan using index funds. I am slowly starting to cleaning up the left overs and fixing my asset allocation mix and making sure they are in the right accounts.  It will cost me $9.95 per transaction ,but so far I feel it's not worth the headache of transferring at this time.

I seem to wait for a larger chucks of investment funds before making purchases and might end up purchasing only a few times a year instead of weekly or monthly if I had the ability to do so for free like Questrade.  I might need a few :facepunches: to break this habit and make sure I get my money working for me right away rather than sitting on the sidelines.

I am taking Retire-Canada advice and going to use a spreadsheet to do the calculations between accounts manually rather than trying to consolidate accounts and hope that the software will do it for me.