Tradefreedom Discount Brokerage Review

Time for another low cost discount brokerage review: Tradefreedom.  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

  1. 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.
  2. 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.

If you are interested in stock trading, here are some free online stock trading tools that I have used and recommend.

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FT is the founder and editor of Million Dollar Journey (est. 2006). Through various financial strategies outlined on this site, he grew his net worth from $200,000 in 2006 to $1,000,000 by 2014. You can read more about him here.
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Peter
10 years ago

Tradefreedom has now been shut down and Scotia Itrade has taken over all the accounts. They have all the junk fees that TF didn’t. I was never charged the platform or low useage fee. However, It took them 2 months to set up my account, and another month to get the edge platform working.
It seems Questrade is now the only other option for low costs and light trading.

RIP Tradefreedom!

RKN
10 years ago

I signed up with Tradefreedom in early 2007 and finally have the courage to take my meager savings and run.

These guys are charlatans and thieves of the highest degree. My father signed up with these guys after one of their sales reps met my dad in person and offered *very very competitive* exchange rates for US equities in RSP accounts, and same for margin.

After trading lots and lots of options and stocks over 3 years, the service kept getting worse. Our accounts were shrinking. New fees like the data fee and recently the low activity fee were added.

Then suddenly one day I found out how they were gaming us. They would show how much we earned in a trade but you could NEVER see how much Canadian Dollars they ACTUALLY credited to your account. Both my father, me and my mother’s rsp and margin accounts had HUGE spreads.

On some trades I paid over 400 basis points over the exchange rate. I was furious. So they offered to refund us with preferred rate for this last quarter that ended in june, 2010. I got 400$ back. My father got $2200 + $185 in 2 accounts.

Right now another broker is processing my in-kind full transfer. Tradefreedom should be investigated by the government. The sales rep was a total d…che when the push came to shove.

My father slowly is moving things to another broker for margin and has already made quite a few trades very happily with them. You will regret TF once you’ve lost tons of money to their criminal ways of doing business. If this is slander so be it. I got papers to prove it.

TL
10 years ago

Same here!
I’d add that there’s also an inactivity fee that they’ll charge, something like $60/year /not too sure/ on accounts with smaller value. Also read several posts on the net and the overall impression is that Questrade is the worst and iTrade is the second worst discount broker out there in terms of user experience and (dis)satisfaction. Seems to me there’s not much choice for us the little guys, so I think I’d me switching to QTrade – not that I really want to but at this point I kinda have to. I’d be paying between 25-30 per trade probably but considering the fact I don’t trade that often anyways it’s probably the right thing to do.
I’d like to hear QTrade user experience out there – share your insights with us pls.

Mathieu
10 years ago

Just got my info pack for TradeFreedom’s move to Scotia iTrade. It is as I suspected; my commissions will be doubling effective October 18.

(equities)

150+ trades/quarter
$6.99

30+ trades/quarter or $50,000+ assets
$9.99

others
$19.99 + $0.02/share over 1000 shares

They refer to these values numerous times as “low” and “competitive”. Ha ha, I’ll be shopping around thanks. The transfer-out fee alone will be less than the extra I’d have to pay to sell everything off.

JT
10 years ago

It seems that most people complain about $30 a month fees, then they complain about trade fees being to high, then inactivity fees. Maybe trading isn’t for you if $30 a month or $100 a year causes such an uproar. That is the cost of entry. A retail business owner does not expect to find free rent!

On another note, due to the poor customer service I have closed my accounts at TF (although they were very infrequently used). I continue to use and be very happy with DISNAT Direct for my RSP account and IB for my trading account.

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