HSBC InvestDirect Review (2022 Update)
HSBC InvestDirect Review
- Fees and Pricing
- Account Options
- Customer Service
- User Friendly Platform and App
HSBC InvestDirect Review Summary:
HSBC InvestDirect offers Canadians a way to conveniently access international markets (30 to be exact), using multiple currencies. Active traders on their platform will receive discounted rates, similar to other online Canadian brokers.
This is good news for more seasoned traders who make a lot of transactions and are looking to diversify what is available on the Toronto Stock Exchange (TSX), but for most of us, it doesn’t really compare to other low-cost options out there.
Free ETF trading has become somewhat of an industry standard, but one you won’t get with HSBC. Users with a regular trading account will pay $6.88 to trade ETFs, which over time can really eat into your bottom line.
On top of not being competitive in terms of commissions and fees, HSBC InvestDirect has some other obvious drawbacks. The deficits in customer services and platform usability simply can’t be denied, and the inactivity fees are inexcusable in 2022.You can read our Qtrade review and see for yourself just how big the difference in offering is. For now, read on for our full HSBC InvestDirect Review.
- One of the biggest banks in the world
- Most markets and currencies to trade in
- Discounts for active traders
- $25 inactivity fee
- No commission free ETFs
- Outdated platform with no mobile app
- Recent drop in customer service quality
HSBC InvestDirect is not among our top Canadian brokers: Higher fees, no mobile app or a signup bonus.View Alternative, Better Rated Canadian Brokers
What Is HSBC InvestDirect?
HSBC (The Hongkong and Shanghai Banking Corporation) dates back to 1865. Today, it’s a multinational conglomerate and the 7th largest bank in the world. HSBC is best known in Europe, the Asia Pacific, and of course, here in North America.
HSBC InvestDirect Canada is one of the country’s well-known online discount brokerages. What sets it apart from most other Canadian discount brokerages is that it lets you trade on North American Stock Exchanges, as well as the Hong Kong stock exchange. HSBC InvestDirect is the only trading platform in Canada that allows access to 30 different domestic and international markets in 10 different currencies.
HSBC InvestDirect Fees and Pricing
While the overall fees are certainly not the best in Canada, and reviews of customer service and the platform indicate that there is much to be desired, HSBC InvestDirect is worth considering for those who have an interest in global trading.
We’ll break it all down for you in this HSBC InvestDirect review further down the page, but first, here’s a quick comparison between it and other leading online brokers.
|ETFs||Mutual Funds||Options||Account Fees|
|HSBC InvestDirect||$6.88 per contract/$4.88 for active traders||Over 4,000 commission-free mutual funds||$6.88 per contract/$4.88 for active traders + $1.25 per contract||A number of fees including inactivity fee, and annual registered account fees|
|Questrade||$0 ETF buy, sell at $0.01/share (min. $4.95 to max. $9.95)||$9.95/trade||$0.75 per contract/$4.95 Min.||$0 monthly account fee|
|Interactive Brokers||Tiered and fixed commission pricing||17,000 commission-free mutual funds||Tiered and fixed pricing, starting at $1.25 per contract||$10 monthly account fee|
If you are into the options trading or day trading game, cutting costs is key, and with the high commissions HSBC charges, it is clearly not the winner here.
If you haven’t gotten into the game yet, but are interested, check out our guide about options trading in Canada.
Along the same lines, if you’re a day trader, you’ll want to keep costs as low as possible, as you’ll be trading in volume. Read our full write up on our top picks for Best Day Trading Platform in Canada to learn more.
HSBC InvestDirect ETFs and Mutual Funds
One of the biggest surprises when it comes to the HSBC brokerage is that HSBC InvestDirect does not offer any commission-free ETFs. Granted, HSBC InvestDirect isn’t the only brokerage who does this, Desjardins Online Brokerage and some of the big banks in Canada don’t offer any free ETFs either.
On the other hand, while there are no commission-free ETFs, the HSBC brokerage does offer more than 4,000 commission free mutual funds.
HSBC InvestDirect Trading Fees
HSBC InvestDirect commissions start at $6.88 for HSBC Premier and HSBC Advance clients for online and ETF North American trades, and a flat fee of $288 for most trades on the Hong Kong market. Currently, more than 4,000 mutual funds are commission-free.
For individuals who are considered to be Active Traders, which means they complete 150 or more trades per quarter, that fee drops even further to $4.88.
Options for both the flat rate pricing and the Active Trader pricing are an additional $1.25 per contract.
Keep in mind that you’ll get the best prices for North American trades made online. There are additional commission fees for trades made on international markets. For example, trades made on European exchanges will incur an additional 0.50% if under 25,000 Euro.
HSBC InvestDirect Platform Fees
The HSBC InvestDirect platform is free to use, and has a free demo account for new users to try out for a period of time, if you’re not quite ready to commit. The platform is straightforward and easy to navigate, which is fine for average investors, but more active traders might find it a bit lacking.
HSBC InvestDirect Admin and Account Fees
Of course, we can’t forget about administration fees There are quite a few to take note of. This is a huge negative in our books!
- Non-registered accounts are charged a $25 inactivity fee if no trades are made during the quarter. However, this fee will be waived if you maintain a balance of $10,000 or more in the account.
- Registered accounts including RRSP, RRIF, and Locked-In Plans come with a $100 administration fee each year
- RESP accounts have an annual $50 administration fee
- Each registered account is permitted one free withdrawal, with each additional withdrawal costing $50.
Additionally, there are fees for wire transfers, handling, document administration etc. You can find the full list of admin-related fees here.
HSBC InvestDirect Accounts
HSBC InvestDirect allows clients to hold direct-trading, registered, foreign currency, personal, and corporate accounts. Registered account options include:
It is important to note that you cannot hold US dollars in these registered accounts.
HSBC InvestDirect Trading Platform and Tools
HSBC’s online platform is pretty run of the mill, offering the basic trading tools you need to execute transactions with relative ease.
To be fair, it does have a few bells and whistles if you so desire. Market analysis tools are available for you to monitor real-time stock prices, analyze stock trends and research global economic news and trends, access reports, create your own charts and alerts, and create and monitor your ideal portfolio with the help of HSBC’s Asset Allocation tool.
Does HSBC InvestDirect Have a Mobile App?
While HSBC Hong Kong does have a trading app, and HSBC UK recently rolled out its app in late 2021, HSBC Canada does not have an app for its InvestDirect customers at this time. While HSBC customers will be able to check on their registered accounts through the mobile banking app, they will not be able to trade.
Perhaps that will change in the future, as we can see they are moving in that direction in other parts of the globe.
HSBC InvestDirect Against Cryptocurrency in 2021
HSBC made waves in 2021 by stating that customers of InvestDirect could no longer trade the MicroStrategy (MSTR.O) stock due to its status as a “virtual currency product”.
The company’s press release stated, “HSBC has no appetite for direct exposure to virtual currencies and limited appetite to facilitate products or securities that derive their value from VCs (virtual currencies).”
This bold move runs contrary to several banks’ recent embrace of cryptocurrency and offering various Bitcoin-related product lines to customers.
HSBC InvestDirect FAQ
Who is HSBC InvestDirect Best For?
So, who is HSBC InvestDirect best for? In our opinion, there are much better options out there for Canadians. If you are coming from a country such as Singapore or Hong Kong, and want to keep the same bank for simplicity’s sake, then HSBC might provide some value to you.
HSBC’s combination of high fees, low-rated customer service, dated trading platform, and relatively poor customer educational materials is why we don’t recommend HSBC InvestDirect.
Our number one pick for discount brokerages in Canada is Qtrade. To learn more about why they have finally overtaken Questrade as our top pick after several years, read our detailed 2022 Qtrade review.