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Tradefreedom Discount Brokerage Review
We have done many discount brokerage reviews, from the good to the not so good. I thought that we had most of the brokerages covered, but after some comments from readers, I was missing an essential piece of the Canadian discount brokerage market, Tradefreedom.
This article will provide a preliminary view of the discount brokerage Tradefreedom. As I don't have an account with them, I can only go by what it stated on their website and by what readers are saying about them. I would be grateful if more Tradefreedom clients to add their comments.
Note that MDJ is not affiliated with Tradefreedom.
Account Types Offered:
- Cash, Margin, Short, Options, Futures, Forex and Registered (RRSP, RRIF, LIRA, LIF, RESP)
Trading Platforms
- Tradefreedom Online. As with all Canadian discount brokerages, Tradefreedom provides an web based trading platform that includes direct access trades, along with free real time quotes and charts. Seems to be similar to Questrade's interface.
- Tradefreedom Edge. This includes all the features of the web platform but with the addition of advanced trading tools. Their online demo looks fairly advanced.
Commissions/Fees for Trading Stocks and Options (+ ECN fees)
- U.S Equities: $9.95 Flat
- Canadian Equities < $3.00: $9.95
- Canadian Equities > $3.00: $9.95 up to 1,000 shares, $0.01/share after that.
- Options: $9.95 + $1.25/contract
- Broker Assisted Trades: $20 + regular commission
- Mutual Funds: $37.95/transaction
- No trade, account minimum or annual fees
Datafeeds
- This is where Tradefreedom really shines. They provide free REAL TIME streaming quotes AND charts (level 1). I believe that this may be the only Canadian discount brokerage to do this.
What the Readers are Saying
Michael Watkins
If your account is relatively small, and you do not trade very often at all, then TradeFreedom is a good provider.
However if you are at all active - even swing trading I push through more than 30 trades a quarter - the transaction costs will quickly make TradeFreedom the most expensive choice.
Andrew
You can open an account with TradeFreedom Securities and get free real-time STREAMING quotes for both USD and CAD exchanges includes free US market depth. No trade minimums either - all clients can obtain $9.95 rates regardless of your trade and asset levels.
Why would you want to toggle between one website (for the last quotes price - not even streaming quote) and then go to another site to place the trade?
Mr. T
They have great rates, and great Windows platform. (rich client Windows app that you install on your desktop) They also have a Web interface which lets you do all the trades, quotes and account maintenance, but it needs some work to make it look nicer.
The Windows app is great, real time quotes, blotter, watchlists, all that you need. Trades are around $9.95 per trade (I didn't quite figure out the formula, but it depends on how many shares, at what price, but for my last 5 trades I paid $9.95, $10.08, $11.03, $10.02, and $10.08) They have been bought by ScotiaBank, but so far they are running the shop independently.
I would like to see great FX rates and great premuim interest rate for cash balances. Currently cash balances earn 0% interest. With TradeFreedom you can have CAD or USD balance on the account. To transfer money to TradeFreedom, you just set-up a bill payment on your web banking, and there you go, you "pay a bill" to transfer any amount to your TradeFreedom account.
To transfer money back, you need to call them, and after password validation on the phone, you can tell them to EFT your cash amount back to your bank. This takes about 2 days to EFT (electronic fund transfer).
Final Thoughts
I'm not sure why I missed this brokerage before, but now that I've noticed them, they are a legitimate player in the low cost discount brokerage market. What I like most about them are the fact that they have no account trade or cash minimums, they provide free real time streaming quotes/charts and they have direct access to the markets.
For those of you interested, you can see how Tradefreedom stacks up against other discount brokerages.
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15 Comments, Comment or Ping
1. 45free
MDJ…While they are still building out their “Canadian Content” (RRSP’s and CDN Securities are coming) I find the trading platform of OptionsXpress to be absolutely fabulous. I have used TD, CIBC and BMO (Still have a BMO account) and they simply pale in comparison. The rates are not the best on the street but are definitely competitive and given how much I have lost in profits trading on other websites needing to take extra time to get a trade in or waiting for a human to approve the trade or entering multiple legs of a strategy, the few extra dollars I pay to OX in a year is money well spent.
Apr 8th, 2008 @ 11:53 am
2. Daniel
When I decided to implement the Smith Manoeuvre I wanted a simple way to invest my money for the long term. I wanted an account where I could pick a security, transfer money into my account and buy it.
I have opened an account with Canadian ShareOwner Investments which allows me to pick from selected stocks and ETF’s.
I chose to go with Canadian ETF’s and I chose the option to buy a set dollar amount each month. For each individual ETF I buy I pay $9 for the first 4 trades then it’s free. Over the years I will be increasing my portfolio without having to pay more than $36 in commission per security. Another feature I like is that dividends are re-invested at no extra costs.
Apr 8th, 2008 @ 11:57 am
3. Koan
I agree with 45free. I also use Optionsxpress Canada. If you trade options or futures contracts or futures options, it is one of the best. Their platform is amazing with lots of extra reports and free stuff if you have an account. Unfortunately all transactions are in US $ and US Stocks and options and no RRSP’s are available, but if you are a trader then its a great deal.
Apr 8th, 2008 @ 12:36 pm
4. DAvid
Daniel,
Do you have to enter through their Shareowner educational process, or can you choose to enter the investment wing directly. If you need use the Shareowner training seminars to gain a foothold, then those costs should be included in your tally.
DAvid
Apr 8th, 2008 @ 12:38 pm
5. Daniel
I just opened a trading account. I did not take any part of training side of their business.
Apr 8th, 2008 @ 12:51 pm
6. Dividend growth investor
That sounds like an expensive brokerage account. If you want to invest in US equities I would recommend Zecco trading. If you want to be a day trader, I would recommend Interactive brokers.
Apr 8th, 2008 @ 1:54 pm
7. Jesus
Their platform is good but I have had problems with customer service, I set up my account to have e-confirmation and e-statements but every month they charge me a paper confirmation and statement fee, I am tired of sent them emails every month to reimburse me the fee. Also, they charge $1 for the dividend reinvestment program, I have to call once because they had not reinvested the dividends. A couple of time they have rejected the electronic transfer, after a couple of emails and a call they deposited the money.
Apr 8th, 2008 @ 1:54 pm
8. Nicolas
DGI,
Perhaps this has changed, but Zecco is not available to canadians (yet?).
The entrance of Zecco on the canadian field might force the other players to react. This would be a good thing.
Nicolas
Apr 8th, 2008 @ 2:37 pm
9. Dividendgrowth
Nicolas,
I was not aware about that. Can’t you open an account as a NON-US account holder?
Apr 9th, 2008 @ 11:42 am
10. Nicolas
I got my answer on the Zecco FAQ page:
Can Canadian residents open a Trading Account?
Canadian citizens residing in the U.S. are able to open an account at Zecco Trading; however residents in Canada are currently unable to establish an account due to current Canadian security regulations.
Doh!
Apr 9th, 2008 @ 2:26 pm
11. Dividend growth investor
Nicolas,
I wasn’t aware of that. Maybe one day Zecco will bring a similar package to Canadians?
Apr 10th, 2008 @ 3:34 pm
12. Stocker
I am currently using TradeFeedom.com for some of my trading.
There is only one benefit to using this company. PRICE. If you trade less than 30 times a quarter and do not have a large $ amount in your account than you should consider TradeFreedom, but only if you will never require customer service.
You are assigned an account manager that truly has no purpose other than holding that title. The company provides nearly zero research tools of any kind. Account statements are useless as you will need to calculate nearly all trading costs on your own (if you can find them). Their platform goes down on a very regular basis.
However, you are using the same platform for free that ETRADE charges $200 a year for… I guess it is simply a matter of ‘you get what you pay for!’
Bottom line: If you are patient and will require zero assitance and are not trading extensively, they may be worth the try. I am still using their service, but will not be depositing any new $ into their account.
Apr 17th, 2008 @ 5:41 pm
13. TheBroker
I would avoid TradeFreedom.com as well. The customer service is not very good. The comment above mentions that they are good if you are just starting out or do fewer trades with lower dollar amounts. I feel that their total lack of research is another reason to avoid them, especially if you are just starting out. Newbies need the extra research to assist in the learning process.
May 5th, 2008 @ 8:52 pm
14. Drew
I have to disagree with Stocker and TheBroker regarding TradeFreedom. I have had an account with them for about 5 years - I know that I can get a better price elsewhere because I am quite active but no else has provided me with the service that they have.
I am willing to pay a premium for their service - TF like most online brokers in Canada (questrade,disnat,TD,etrade) all license the same platform from Nexa Technolgies, except TF doesn’t charge for the platform and all the quotes are streaming. That is unique so if your not active and want direct access trading, premarket and after market and not have to worry about a platform fee then TF is the place to go.
TF platform used to crash a lot until they upgraded in Jan or Feb of this year. But if you were at any of the other brokers using the same platform you would have experienced the same issues because they all license the platform from the same company. At least TF doesn’t charge for it.
When they did have technical issues I was supported by a team of employees called the Elite group - available for active traders (30+ quarter). I was always well served - yes I agree there were some lengthy wait times but that only happened when the system would crap out. I understand lengthy wait times when all your clients are calling at the same time, any broker would experience that issue. In general though I dont wait very long at all - I actually prefer to send emails if I have questions or cal my former account manager.
I have a friend who says the customer service is not great and that is only because of his lack of understanding basic tenets of a self-directed account. They have great technical anaylsis research for free - if you want fundamental research then you probably aren’t a very active trader. Either way - I was advised that they will be providing an extensive list of research reports and daily fundamental research including mutual fund & fixed imcome research. This will be available to all clients and some of it exclusive to the Elite clients (active). The research will come from a variety of sources including their new owners Scotia and CSFB. I am looking forward to this new feature that will provide me with new trading ideas.
For newbies you can take a free trading course (i beleive they still offer it) with CyberTrading University. I took it and thought it was great way to learn about US Level 2 trading and the benefits of ECN’s.
Either way…these are my two cents …for all they are worth :) happy Trading and Good Luck To Us All!
May 12th, 2008 @ 1:13 pm
15. TheBroker
(DREW) - I have never been in the ELITE program with TF. Mainly due to the fact that I use two online brokerages and the initial customer service was so awful that I do not want to trade 30 plus times per quarter with this company. The ‘free’ platform is a great feature, but the RECOGNIA technical anaylsis is available through nearly every other competing brokerage as well.
As you are an acitve trader with TF, how do you find the overall trading costs on large volume orders? Another individual on this site had ranked TF as one of the most expensive online brokerages with high volume traders and it would be great if I could get your opinion on it.
Have you or do you use other online brokerages? If so, how do they compare with TF?
I had started to make the switch to TF based solely on the free platform, but have had so many issues on items that should not be issues. I want to use their services, but currently, from my personal experience, I have found more negatives than positives.
May 13th, 2008 @ 12:24 am
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