TD Waterhouse vs RBC Direct Investing vs Scotia iTRADE?

[oil&gas]

The buy and sell people have to make TWO correct decisions. The buy and hold people have to make only ONE correct decision (when to buy). Buy Canadian bank stocks and utilities on dips and you should do fine.

Investors who brought into any one of the major Canadian
banks in the 1990s would do very well if they hold their stocks to
this day. I won't be surprised if the dividend payout of Bank of Nova Scotia from the last decade has more than
paid for its 1999 stock price.

Having said that I would have second thought before
I put my money today in the banking sector for long
term buy-n-hold investment. Seeing that even the major
banks in the US and UK can go under I would stay
away from all the too-big-to-fail banks here.

To be sure our banking industry is far healthier
and I would be shocked if the government ever has
to come to their rescue like they did in the US.
What concerns me is the sustainability of a
debt-based economy when its growth ceases or
just become sluggish for an extended period.
I am not expecting a general economic collapse.
My thought is just that many industries will survive
a stagnant economy but banking could turn
out to be the hardest hit sector.

 

[Rockslinger]

Having said that I would have second thought before
I put my money today in the banking sector for long term buy-n-hold investment.

Buy equal shares in the "Big 5" banks. Highly unlikely that all 5 will fail. Alternatively, buy Enbridge Gas. Remember, no risk no reward. Maybe a mix of banks and Enbridge.

 

[21pro]

don't get me wrong... and you shouldn't hijack this thread... but, I don't buy and hold onto perpetuity... usually 3-5 years my stocks hit their sell targets and I most often sell them.

ie, saskatchewan wheat pool (viterra) I've owned now on 5 occassions over the last 15 years. made money each time and sold everytime a sell target was reached. last run was $3 to $14. bought again earlier this month for $9.23... sell target $13.41.

 

[Ginglay]

I use TD...
Benefits are:
- $9.99 commission (if > $100k in assets)
- Rich access to market research from various sources including S&P
- Wash Trades (this is probably the biggest reason i stay with them. A wash trade is useful in trading US$ equity in an RRSP as it avoids being charged a conversion to cdn$ premium which is approx 1.75% each way. all other banks will insist on converting your trades to cnd currency and then back into the US$ currency. if you do a buy/sell this works out to approx 4% premium!!! total BS rip-off. what TD will let you do is avoid the currency conversion premium by 'washing' your trade by buy/sell against a TD-US money market fund. They will also do an automatic wash if you do a buy/sell on the same day so you end up with net currency conversion premium (ie. for those who dont want to use the TD-US mmkt method). As far as i know, there is only 1 other broker in canada that doesnt 'force' the currency conversion and that is questtrade.

 

[Rockslinger]

A wash trade is useful in trading US$ equity in an RRSP .

Are RRSP's not permitted to hold U.S. dollar denominated assets like Microsoft shares? I thought they did away with the "foreign content" rule.

 

[Ginglay]

Yes, RRSPs are allowed to hold foreign equities, such as MS shares, and there is no longer any foreign content rule, we are now able to hold 100% foreign content if we wanted to. what the brokers in canada will not allow is an RRSP holding foreign currency in cash. so in the case of a trade, the broker will force a conversion to cdn$ if the net proceeds is cash. Its a pure money grab imo. The other horrible part of the force conversion is that you may not what to realize the difference in currency at trade time (ie. 1cent change = 1% impact to your proceeds) , but with the force conversions you have no choice but to realize the currency impact. In the case of TD they let you store the cash in the money market fund without charging a conversion premium, or forcing you to realize the impact from currency fluctuations.