Tag: review

Categories
Investing

Questrade Mutual Fund Fee Rebate And Free Transfer Offer

Questrade discount brokerage has just come out with a great way for retail mutual  fund owners to save on high management fees by offering to rebate up to 1% of those  fees.

What’s the deal with the Questrade mutual fund rebate?

Questrade will rebate up to 1% of the management fee for any mutual funds  held at Questrade.  This amount has to exceed $29.95 per month for the  investor to get any rebate.  This means that you need to have more than $36,000 in mutual funds before the rebate kicks in.

How is this possible?

When an investor buys a mutual fund from an advisor then the advisor is paid  a “trailer” each year which is based on the amount of the investment.   Typical trailers for equity mutual funds are 1%.  Bond and money market funds  will be lower.  The amount Questrade will rebate will be equal to the trailer  paid on the funds you owned.

The problem is for a do-it-yourself investor who wants to buy retail mutual  funds is that they can only buy them through an advisor or a discount  brokerage and they are charged for the trailer even if they don’t have an  advisor.  With this new program the investor will be able to save most of the trailer amount.

How much will it cost to transfer my mutual funds to Questrade?

If you transfer before March 2, 2009 from a different financial institution and transfer at least $25,000 then it will be  free of charge.

How much are mutual fund trading fees?

Questrade charges $9.95 per mutual fund trade.

I don’t have $36,000 – is it still worthwhile?

Depends on the situation – if you are close enough to $36k (ie $30k or more)  and will be buying more mutual funds then it might be worth doing even though  you won’t get the rebate for a while.  At the very least it won’t cost you  anything.

Another situation might be if you have some back-end funds that you don’t want to pay commissions on.  If you are planning to just buy low cost ETFs then you might consider moving the mutual funds to the same institution.

Where do I sign up?

Click on the banner below or on any of the links you see in the article.

I demand more information!

Check out my Questrade discount brokerage review and my Questrade referral promotion articles for more information.

Is it really cheaper to pay $10 per trade rather than get my advisor to do it for me?

Let’s look at an example – say you have $100k in mutual funds with an average mer of 2.5% and the only service you get from your “advisor” is he completes 12 trades per year for you “free of charge”.

With the advisor you will pay a total of $2,500 per year for the fund management, the advisor’s services and the 12 trades.

With Questrade you will get a rebate of $1,000 (approx) and you will pay $120 for the trading fees for a grand total of $1620 for the fund management and the 12 trades.

$2,500 (current fees) – $1620 (Questrade fees) = a savings of $880 per year.

Personally, I’d rather invest in passive index funds and ETFs which are way cheaper (also available at Questrade) but for anyone who wants to own retail mutual funds – this is a great deal.

Categories
Investing

RBC Direct Discount Brokerage Review

I recently moved my investment accounts from Questrade to RBC Direct in order to take advantage of the RBC 1% rebate deal so I thought it would only be fitting to do a review of their services.

Who are they?

RBC Direct is the discount brokerage arm of the Royal Bank of Canada which is the biggest Canadian bank.

Good things about RBC Direct

I like the trading platform – it looks nice, easy to use and is well designed.  There is also access to analysts reports etc.  It does the job.

If you would like to compare all the different Canadian discount brokerages, check out the Canadian discount brokerage comparison.

Bad things about RBC Direct

Everything else.  🙂

Fees – ridiculous fees in my opinion.  $10/trade is not bad for a passive investor but why anyone would pay $29 a trade is beyond my comprehension.  I’ve outlined the fees at the bottom of the post.

No electronic money movement unless you have a RBC bank account.  This is the stupidest thing about RBC – yes, I understand they want to ‘bundle’ all their services but forcing investors to open up new accounts to use their discount brokerage when most of the other discount brokerages offer excellent electronic money movement options is just bad business.  Get out of the stone age RBC!

In order for me to put money into the account, I have to write a cheque and mail it to them.  If I want to remove any money – I have to pay $10 for a cheque to be written.  My plan is to keep all cash in the account until next year when I can move back to Questrade and then withdraw it electronically.  The most annoying part of this is that when I looked into the 1% deal – a customer service rep told me on the phone that I could do electronic money movement which turned out to be false.  Speaking of customer service….

Bad Customer service

I won’t bore you will the multitude of issues I’ve encountered with RBC but suffice to say that I think their computer system was probably build sometime in the 20’s which makes it very hard for the customer service reps to do their job.

Most of the reps are pretty good although one time I called without an account number and the rep told me it was “very hard to look up an account without the account number”.  I challenged him on it and he somehow was able to find the account immediately just using my name.  Kudos jackass…kudos.

Conclusion

I can’t really recommend RBC Direct since I really don’t like them and can’t wait to collect my 1% and go back to Questrade.  However, if you already do your banking with RBC and have a $100,000 in assets then they are not a bad choice.  If you don’t meet those criteria then look elsewhere.

Trading Fees

  • $28.95 per trade unless you have $100,000 in household assets at RBC Direct or complete more than 30 trades per quarter.
  • $9.95 if you have $100,000 in household assets at RBC Direct.
  • $9.95 if you make between 30 and 149 trades per quarter.
  • $6.95 for those super-active traders who do at least 150 trades per quarter.

Annual account fees

  • No fees if total client assets are $15,000 or more.
  • If assets are less than $15,000, a $25 quarterly fee will be charged regardless of the number of accounts.  Can be avoided by making three or more trades in all accounts

Other discount brokerages reviews

Questrade discount brokerage review.

Categories
Book Review

Book Review: Outliers by Malcolm Gladwell

I first heard about Malcolm Gladwell’s new book, “Outliers: The Story of Success” about a month ago and was delighted that he was putting out a new book. I was wildly enthusiastic about “Blink” and “The Tipping Point” and after reading an extract online I couldn’t wait. By a happy coincidence, a friend gave me an early Christmas gift, and it was Outliers!

In “Blink” Gladwell looked at very fast cognition (things your brain processes in the blink of an eye). In “The Tipping Point” he looked at what led to ideas propagating and spreading through society (why some take off and why some die). In this book he looks at incredibly successful people (they’re the outliers) and argues that there’s more behind their success than the myth society tells us about them (that they’re naturally brilliant & gifted).

As with all of Gladwell’s work, he’s a delight to read. He takes an interesting idea, chews away at it, and presents his thoughts, building a surprising, yet plausible, model around them. In “Freakanomics” they debunked one of the big ideas he argued for in “The Tipping Point”, so that’s the one danger of Gladwell’s work: he’s very persuasive, even when he’s wrong.

The idea behind this work is that people who are great at something (we’re talking world class talent) are great primarily because of the time they’ve invested, rather than an inherent ability. A certain threshold of “raw ability” is necessary (which is lower than you’d think), but beyond that it’s often luck whether they managed to accumulate the time required to become world-class. The time investment, he argues, that’s needed is 10,000 hours, and its often circumstance that determines whether someone who has the interest to invest that amount of time is also given the opportunity.

He gives examples supporting this from violinists at an elite Berlin music academy, Canadian hockey players, high-tech entrepreneurs, and the Beatles (apparently they’re some minstrels from England achieved a bit of fame a long time ago).

Following up on the lucky circumstances, he also builds the case that even a small lucky break early on compounds as someone who has shown an “early aptitude” is given more opportunities, which leads to an increase in aptitude, in a reinforcing cycle until they accumulate the hours to become good or extraordinary at something. He argues that the reason Chinese people are often good at math is because Mandarin has a cleaner, more regular syntax for naming numbers. This gives young Chinese students a leg up when they first start learning math, and they’re able to build on this lead (and have a positive first experience with the subject).

He presents counter examples of Lewis Terman’s study of high IQ students (they tracked the top 1% of the top 1%) in California, who didn’t really amount to much as a group (and even within the group, socio-economic status was a better indicator of success than their IQ). Terman’s study rejected two boys as not smart enough to participate who went on to win Nobel prizes.

The take-aways from the book were that if you want to be really good at something, you’ve got to put in the time (along with meeting SOME requirements, you’ll never play in the NBA if you 5’3). You’re fooling yourself if you think you’ll just naturally be world class at something. The trick is to keep practising, and the people who will excel are those who find the motivation to keep at it. If you want to excel in your profession, put in the time at the activities that are important to it. If you want to learn a new skill, put in the hours of study and practising. There’s no royal road to excellence.

I highly recommend putting this book on your Christmas (or Hanukkah, or winter’s solstice) list. Its a fun, fast read.

I kept wondering if he’d mention an age limit, but he didn’t, so maybe it’s still possible for me to get cracking on my 10,000 hours and win a gold metal in Olympic gymnastics!

Categories
Opinion

Google Chrome Internet Web Browser Review

Google released their first web browser yesterday called “Chrome”.  This web browser has some new advancements and will perform much faster than IE and Firefox according to their marketing material (in the form of a comic book).  Being the skeptic I am, I thought I would download it and give it a test run.

As I discussed in this post on how I surf, I use the FireFox browser which I estimate is the most popular browser for most PF bloggers and serious surfers. The release of IE7, which included tabs, closed a lot of the gap between IE and Firefox but for most people who already use Firefox, there was no reason to switch to IE. Keep in mind that I’m talking about a select group of surfers – probably 95% of surfers will use either IE6 or IE7 – whichever is installed in their computer.


chrome.jpg
photo by Incase Designs

Downloading and setting up Chrome

A download link for the beta version of Chrome is on the main google page or you can go here for the download.   The download file is the installer and downloads almost immediately.   After clicking on the exe file, it took about about 60 seconds to completely load up the browser.  Total time spent so far is about 2 minutes.

How does it look?

Like the Google homepage, the Chrome browser is fairly clean.  One of the efforts with this browser has been to decrease the clutter at the top of the screen – unfortunately I don’t have pic to show you but since it only takes a minute or two to load the thing – go look for yourself!  🙂  I would estimate that the non-surfing area is about half as large with Chrome compared to my version of Firefox.  Of course your own customizations of Firefox could change this ratio greatly.  The page tabs are right at the top of the screen where there is normally the title bar and there is no separate search box since the address box and search box are one and the same.  It will take a bit of getting used to but it looks pretty good.

Chrome vs. Firefox speed

To test the speed I just did some simple browsing (ie opening a bunch of sites at once) and compared the speeds.  Of course this test isn’t all that valid since it should be run on a clean test machine but since I was testing for my personal use – it’s valid enough for me!

First run – Chrome was incredibly fast. I was quite amazed at how fast it was until I looked at the browser results and I realized that most of the sites in the test folder required a sign in which Chrome couldn’t do yet – obviously this invalidated the first run. I went through the tabs and logged in – most of the tabs had the info in the sign-in screen but I still had to press “ok”.

After that I did some surfing and tried to determine if one browser was significantly faster than the other.  The truth is that I really couldn’t tell the difference – because of the poor testing conditions and numerous variables which I couldn’t control, both browsers appeared fast and slow at different times.  Things like slow websites, my own internet connection (which is not all that constant) served to interfere with the tests as well as point out that even if one browser is faster, it might not matter that much for my normal surfing.

Surfing anonymously

One of the neat new features of Chrome is the ability to turn on a “incognito” mode (click on the Control Current Page icon and select Incognito) which means that your browser will not keep any trace of your browsing history.  I can’t imagine why *cough – adult* anyone would possibly *cough – situational* have any motivation *cough – photography* for such a strange thing but I’m sure some enterprising surfers will find a use for it.

Conclusions

I found Chrome to be a pretty good browser, but I don’t know if I will switch from Firefox or not since it doesn’t appear to be all that different other than the looks.  I would imagine that a Firefox user who has a lot of plugins would find it difficult to leave for a new browser and would have to start over.  Personally, I haven’t gotten around to installing any plugins so that is not a factor for me.