HSBC InvestDirect Review

   (Editor Rating)

HSBC InvestDirect Review
  • Fees and Pricing
  • Account Options
  • Customer Service
  • User Friendly Platform and App
2.6

HSBC InvestDirect Review Summary:

Overall we can’t recommend HSBC InvestDirect for many Canadians other than those who really need direct access to some of the previously mentioned world stock exchanges. For the vast majority of investors, the Toronto Stock Exchange (TSX) will fulfill all of your needs, and if more is needed, then certainly the New York Stock Exchange (NYSE) can handle what you need.

The deficits in customer services and platform usability simply can’t be denied, and the inactivity fees are inexcusable in 2020. Nowadays, there are many discount brokers who are simply just more competitive. You can read our Questrade review and see for yourself just how big the difference in offering is.

Pros

  • One of the biggest banks in the world
  • Most markets and currencies to trade in

Cons

  • $25 inactivity fee
  • No commission free ETFs
  • Outdated platform with no app
  • Recent drop in customer service quality

HSBC InvestDirect is not among our top brokers in Canada

See The Best Discount Brokers In Canada Here

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.

HCBC 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. 

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. 

HSBC InvestDirect Fees and Pricing

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 the big banks in Canada don’t offer any free ETFs either. While it’s not enough to turn everyone away, it’s a definite turn-off for some would-be investors.  Our preferred online brokers at Questrade and Virtual Brokers offer commission-free ETFs.

On the other hand, while there are no commission-free ETFs, this HSBC broker does offer more than 4,000 commission free mutual funds. 

Special offer: From April 4th to December 31, 2020, Active Traders (those who complete 150+ trades per quarter) will pay $0 in commission fees on ETFs. This is a limited time offer.

HSBC InvestDirect Trading Fees

HSBC InvestDirect only has two options when it comes to trading fees. In 2017 they introduced flat rate pricing which is $6.88 per trade online. This is a pretty impressive rate for Canadian online brokerages, as it is lower than that charged by the main big bank brokers.

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 these prices are 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. The platform generally receives positive feedback from users in terms of ease of use. However, those who are considered to be more active traders do wish for more detailed reporting and information. While some other brokerages offer platform upgrades for an additional cost, this is not an option with the HSBC broker.

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 my 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:

  • TFSA
  • RRSP
  • RRIF
  • RESP
  • LIRA/LRSP
  • LIF/LRIF

It is important to note that you cannot hold US dollars in these registered accounts.

HSBC InvestDirect FAQ

Does HSBC have a ‘try before you buy’ option available?

Yes, there is a demo account for prospective new clients to try HSBC InvestDirect out for a short time. 

Do existing HSBC Clients Get any benefits?

Yes, Premier and Advance clients both get some added perks including preferred pricing for some aspects. The benefits vary depending on which type of client you are, so take a look at the HSBC website to read all the fine print and get the details.

Is there an HSBC InvestDirect App?

No, not at this time. You’ll have to rely on the platform only. 

Are there any Young Investor account options?

No, young investors do not get any special rates or perks with HSBC InvestDirect.

What’s customer service like?

HSBC InvestDirect’s customer service, unfortunately, seems to have dropped off in the past 5+ years. Back in 2015, they scored the top rating for customer service in a report by Dalbar Canada Review.

Today, however, reviews claim they leave much to be desired with reports of customers waiting for as long as 73 hours to hear back from customer support. That being said, they do offer customer service in multiple languages including French, English, Mandarin, and Cantonese which may be beneficial to some clients.

Who is HSBC InvestDirect Best For?

So, who is HSBC InvestDirect best for? In our opinion, the HSBC brokerage is best for those who are interested in trading on North American and international markets. Ideally, you will also be an ‘Active Trader’ to be able to take advantage of those lower fees. Especially considering that you will have to tack on extra commissions for anything overseas.

That being said, from our point of view, HSBC InvestDirect isn’t the best choice for Canadian traders. The global aspect is a definite perk, however, when it comes to ETFs, customer service, and the fact that they don’t have an app, the HSBC brokerage is definitely lacking.

Our number one pick for discount brokerages in Canada is still Questrade. To learn more about why they have been our go-to recommendation for the past several years, take a look at our Questrade review.

Kornel

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