TD Direct Investing Review: Are The High Fees Worth It?
Online investing platforms have lowered the costs for Canadians who want to manage their own investments. Whether it’s a robo-advisor platform or an online brokerage, you can now trade thousands of stocks and ETFs from your desktop computer or mobile device for little to no cost.
But with so many investment platforms to choose from, how do you know which one is right for you?
This TD Direct Investing review looks closely at one of Canada’s leading self-directed trading platforms. We cover the various trading platforms, pricing, and pros and cons, to help you decide if TD Direct Investing is worth considering.
About TD Direct Investing
TD Direct Investing, from TD Wealth, is Canada’s largest online brokerage and a division of the Toronto Dominion Bank. The brokerage originated in 1984 under the name Greenline Investor Services. Eventually, Greenline became TD Waterhouse before it was renamed TD Direct Investing in 2012.
TD Direct Investing is well known for its robust trading platform and is popular with active traders who appreciate its advanced dashboard’s market research tools and powerful trading capabilities.
TD Direct Investing’s fees are considerably higher than many other non-bank Canadian brokerages. However, the services and resources offered can justify these fees for certain investors looking for comprehensive support and a broad range of investment options.
TD Direct Investing Account Types
You can open the following types of accounts through TD Direct Investing:
- Cash Account (non-registered)
- Margin Accounts
- Tax-Free Savings Account (TFSA)
- Registered Retirement Savings Plan (RRSP)
- Registered Education Savings Plan (RESP)
- Retirement Income Fund (RRIF)
- Locked-In Retirement Account (LIRA)
- Life Income Fund (LIF)
- Registered Disability Savings Plan (RDSP)
TD Direct Investing Fees And Pricing
As is the case with all of the big bank brokerages, TD Direct Investing is one of the more expensive self-directed platforms. Here’s a closer look at their various fees:
Standard Trader Fees (On
- Stocks & ETFs: $9.99 per trade
- Options: $9.99 + $1.25 per contract
- Mutual Funds: No commission fees to buy, sell, or switch
Active Trader Fees
- Stocks & ETFs: $7.00 per trade
- Options: $7.00 + $1.25 per contract
- Mutual Funds: No commission fees to buy, sell, or switch
To qualify for Active Trader pricing, you must place more than 150 trades per quarter.
- Maintenance Fees: $25/quarter (waived if household account balances are $15,000 or greater.)
- Transfer Fees: $150
- Registered Account full withdrawal fee: $100.00 (excludes RDSP, RESP, TFSA, and RRIF)
- Partial withdrawal fee: $25.00 (RRSP, Basic RRSP, LIRA, LRSP only)
- Account Statement Fee (Mailed): $2.00
- Electronic Account Statements: Free
For a full list of fees, see the TD Direct Investing Commission Schedule and Statement of Disclosure of Rates and Fees.
Fixed Income Investment Fees
Fixed-income investments such as bonds and GICs can have varying fees depending on the type of security and how it is traded. The fees are generally built into the security price rather than being charged as a separate commission.
TD Direct Investing Platforms And Trading Tools
TD Direct Investing offers a variety of trading platforms to cater to all types of investors, from beginners to advanced traders. This section will cover the three main platforms: TD WebBroker, Advanced Dashboard, and TD Easy Trade.
TD WebBroker is a web-based platform that is user-friendly and suitable for both beginner and experienced investors. You can access WebBroker on a desktop computer or through the TD app. Key features of this platform include:
- A personalized dashboard that allows you to see your account balances, watchlists, and market updates at a glance.
- Advanced order types, including stop, stop limit, trailing stop (by price and %), and trailing stop limit orders, help manage your trades more effectively.
- Multi-leg options strategies (up to 2 legs)
- Charts and research tools to better understand the market and make informed investment decisions.
The WebBroker platform also includes the following market research tools: Daily, weekly, and special reports, Morningstar and TD Economics data, fundamentals, equity and mutual fund screeners, and charting.
If you are an active trader looking for more powerful and in-depth tools, TD Direct Investing offers the Advanced Dashboard platform. This platform provides:
- Full dashboard customization
- Real-time streaming market data is essential for active traders to react quickly to market changes.
- A range of advanced charting and technical analysis tools, such as moving averages, trendlines, and momentum indicators. Over 100 technical and fundamental indicators and 50+ intelligent drawing tools and technical studies
- Stock screeners, bubble charts, and heat maps
- Access to market news, earnings reports, and analyst research to stay informed about the companies you’re invested in or watching.
- Contingent orders
- Multi-leg option strategies (up to 2 legs)
TD Easy Trade
TD Easy Trade is a separate platform from TD WebBroker and is designed for beginner traders looking for an affordable trading option with the convenience of a mobile app. The standout feature of TD Easy Trade is the 50 commission-free stock trades per year and unlimited commission-free TD ETFs.
There are also no monthly or quarterly account maintenance fees.
TD Easy Trade is clearly meant to be an alternative to Wealthsimple Trade, a highly popular commission-free trading platform from Canada’s largest robo-advisor. TD Easy Trade is available for download on both iOS and Android devices.
With TD Easy Trade, you can open Cash (non-registered), TFSA, and RRSP registered accounts.
TD Direct Investing Pros And Cons
There’s a reason that TD Direct Investing is Canada’s largest online broker. But it’s not for everyone. Here’s my list of TD Direct Investing pros and cons:
- Arguably the most powerful stock trading platform in Canada, with the best market research tools
- Benefit from the stability of a trusted financial institution
- No charge for non-registered accounts
- Highly intuitive mobile app
- One-stop shop for existing TD banking customers
- Commission-free mutual fund trades
- Access to many account types, including TFSA, RRSP, Margin, RESP, RRIF, RDSP, LIRA, and LIF
- Set up DRIP reinvestment plans with ease.
- TD Easy Trade is an excellent commission-free alternative to Wealthsimple Trade
- Expensive standard trading fees ($9.99 per trade)
- Annoying account maintenance fee of $100/year (without minimum $15,000 balance)
TD Direct Investing Alternatives
If the high trading fees put you off and you want a more robust trading platform than TD Easy Trade offers, you may want to consider the following online brokers instead of TD Direct Investing.
Questrade is one of the largest independent online brokers in Canada. By independent, I mean they’re not owned by a big bank. Questrade’s trading platform doesn’t have the same capabilities as TD Direct Investing, but they offer lower trading fees, including commission-free ETF purchases. That’s right, you can purchase thousands of ETFs free of charge through Questrade.
As for stocks, the fees start at only $4.95 per trade. Like TD Direct Investing, Questrade offers a variety of account types to meet your specific needs. Another nice feature of Questrade is their Questwealth Robo-Advisor portfolios. Questwealth robo-advisor portfolios are ideal if you’re looking for a hands-off investing solution.
Wealthsimple Trade is a free stock trading platform from Canada’s largest robo-advisor, Wealthsimple. Starting out as a mobile-only trading option, you can now place trades through your desktop as well. While they lack the advanced trading features that TD Direct Investing offers, Wealthsimple offers hundreds of commission-free stocks and ETFs.
The Bottom Line On TD Direct Investing
In terms of capability and features, TD Direct Investing is Canada’s best overall online brokerage. But it’s very expensive, and that’s a consideration you’ll need to make when deciding where to open a self-directed trading account.
If you don’t need to place frequent trades, then the $9.95 trading fee may not turn you off. Active traders will appreciate the advanced dashboard with all of its market research tools and customization.
But if you’re a fee-conscious investor, you will save money with Questrade, especially if you’re an ETF investor. If you want basic stock trading and don’t need all the bells and whistles, look at TD Easy Trade or Wealthsimple Trade.
Is BMO InvestorLine or TD Direct Investing better?
It’s important to compare BMO InvestorLine and TD Direct Investing based on your needs and preferences. BMO InvestorLine doesn’t offer the same level of market research data as TD Direct Investing. However, its fees are slightly lower. The standard trading fee is $9.95, but they offer more than 80 commission-free ETFs, and there is no account fee for TFSA accounts. If you’re an existing BMO customer, InvestorLine is probably your best bet. If you bank at TD, then stick with TD Direct Investing.
Is it better to invest with Wealthsimple Trade or TD Direct Investing?
If cost is your primary concern, you’ll save money by investing with Wealthsimple Trade, which allows you to buy and sell hundreds of stocks and ETFs commission-free. However, if you’re an active trader who wants access to a powerful trading platform with the best market research tools, you may prefer dealing with TD Direct Investing. If you qualify for active trader pricing, your fees will be reduced.
How does TD Direct Investing perform for trading stocks?
TD Direct Investing offers a robust platform for trading stocks, with excellent charting and performance tracking tools. When it comes to trading fees, they might be higher compared to other Canadian brokerages, but their platform, market data, and customer support are known to be strong. Your experience with trading stocks on TD Direct Investing may depend on your investing style and preferences. Therefore, it’s essential to weigh the benefits of their platform against the higher fees to determine if it’s the right choice for your stock trading needs.