Sunday, 11 May 2008

Responding to a question on Questrade

I received the following message from Ranv about the Questrade RRSP account:

I read your blog posting review of Questrade at:

I'm currently looking to open an RRSP account with a discount brokerage. I've never opened an account with a brokerage before so this will be my first time. I will likely make less than 20 trades per year so Questrade appears to be a good choice because they have low commissions and don't have an annual fee on low trading or low account balances.

Despite the fees though, I'm curious about their service. You wrote your review of Questrade in December of 2007. How do you feel about them now? If you're not happy with them anymore, can you suggest any other discount brokers that you are satisfied with?

Response to Ranv:

I did not have any issues with them so far, except for this delay with a $50 referral credit that I mentioned earlier. They eventually paid it several weeks later, after I bugged a customer service rep a couple of times, so the issue has been cleared now.

Overall, I think this is a very good discount brokerage, which should appeal mostly to small-scale investors/traders and those investors/traders who do not have a lot of regular account activity. It is true that they not offer the same scope of sophisticated services and investor customer support that are provided by big banks and full-scale brokerages, but they are not competing with the big guys in this market niche anyway.

My other comments so far, based on a six-month experience of having an RRSP account with Questrade:
  • The trading platform was never down when I was logged in during market and off-market hours and worked OK (I use only a base WebTrader);

  • The trades were executed very quickly - market order were processed instantaneously within a second, limit and stop orders worked well too;

  • You can easily track your account-related trading and fund-movement activity online;

  • The chat customer service was fast to get a response;

  • Getting a service rep on the phone was also not a big issue - the wait times were reasonable;

  • They never responded to email inquiries - that is a minus - if you do not respond, then why would you offer the email-message form on your website?

  • The paperwork support (statements, confirmations, income tax receipts, etc.) has been timely - no complaints there;

  • Email notifications about new services and changes in services were sent promptly;

  • All financial statements and other company-related paperwork were properly forwarded to my home address.

Like you, I do not trade very often - no more than 3-8 trades a month, and I think that this account is probably the first-best choice for small investor/trader guys like us. Definitely, nobody can beat Questrade in Canada in terms of fees and some services (like USD balances on an RRSP account). On the downside, you get a plain base package with limited interface capabilities, but you can always get extra services (like real-time live quotes, more advanced platforms with advance charting, etc.) for very reasonable extra fees - you will probably end up paying much more for equivalent services to their competition.

Unfortunately, I cannot comment about the services of other Canadian brokerages. Based on info comparison though, the account and trading fee structure is definitely the best at Questrade.

A bottom line: Six month later, I can still say that I would open an account with Questrade. In fact, next year I am very likely to open a tax-free savings account (TFSA) with them, once the new program starts operating in 2009.

1 comment:

Ranv said...

Thanks for the response BEIT, I appreciate the time you took to answer my questions. This is exactly what I need to know. Thanks again.