HSBC InvestDirect Review
InvestDirect by HSBC (short for Hongkong and Shanghai Banking Corporation) is one of a very small number of discount brokerages that lets you trade on North American stock exchanges as well as on the Hong Kong stock exchange.
HSBC InvestDirect is an interesting option for individuals looking to do overseas stock trading as well as trade on North American markets. One thing that has to be factored in for pricing is the foreign exchange rates as InvestDirect doesn’t offer US dollar registered accounts (TFSAs, RRSPs and RESPs). The pricing and account balance and trading volume requirements for best commission pricing have been lowered to be more competitive with the other Canadian online discount brokers. There are some inactivity fees that are levied if either your account balance falls below $5000 on non-registered accounts and/or if your trading activity is less than twice a year. That said, from pricing perspective, if you are an active trader that wants the flexibility of international trading, you may want to consider HSBC. If you are not as active a trader, you may want to understand what your investing/trading requirements will be on a monthly basis to see if HSBC InvestDirect is the most cost-effective option.
|Standard Equity Commission||$9.88|
|Best Commission Price||$6.88|
|Minimum to Open Account||Not Required|
|Commission Free ETFs||No|
|Account Types Offered||Funding Requirements and Fees||Registered Account Types and Fees|
|TFSA||Minimum Opening Balance||Not Required||TFSA||Annual Charge||$0|
|RRSP||Minimum Account Balance||Not Required||Transfer Out||$135|
|RESP||Minimum Balance for Best or Discounted Commission||$500,000||Withdrawals||$0|
|Cash||Minimum Commission per Equity Trade||$6.88||US Dollar Account|
|Margin Short||Maximum Commission per Equity Trade*||$9.88||RRSP||Annual Charge||$100 (if account balance is <$25,000)|
|Margin Options||Minimum Trades per Quarter for Best Commission Rate||100||Transfer Out||$135|
|CIPF Member||Inactivity or Maintenance Fees||$25/quarter||US Dollar Account|
|Conditions for Inactivity/Maintenance Fees||if account balance is <$10,000 and if 0 trades have been made within a quarter and client does not have a registered account with HSBC InvestDirect||RESP||Annual Charge||$50|
|US Dollar Account|
|Last Updated: Mar. 8, 2016
*applies to North American Equities and ETFs
Pricing & Fees
Trading commissions for HSBC InvestDirect clients depend on the tier of account. Specifically, HSBC has divided their online investing accounts into three main categories of pricing: ‘HSBC Premier’, ‘HSBC Advance’ and “standard”.
For the HSBC Premier account commissions for trading stocks are $6.88 flat. Trading commissions for options are $6.88 + $1.25 per contract. To qualify for these commission rates clients have to have either $500 000 in assets or make at least 100 trades in the quarter.
The HSBC Advance account charges $8.88 flat per equity trade and $8.88 +$1.25 per contract for options trades. To qualify for the HSBC Advance rate clients have to have between $50 000 and $499 999 in assets or trade between 30 and 99 times per quarter.
As of September 2015, HSBC has lowered their standard commission pricing to $9.88 per North American equity/ETF trade from their previous pricing of $28.88+
Options commission pricing for standard tier clients has also been drastically reduced and simplified to $9.88 (standard base fee) plus the per contract fee of $1.25.
The accounts you can hold with HSBC InvestDirect can either be registered, such as the tax-free savings account (TFSA), registered retirement savings plan account (RRSP) or the registered education savings plan (RESP) or non-registered (“personal investment”) such as the cash and/or margin accounts. For registered accounts you cannot use margin or short stocks. Options trading in registered accounts is limited to buying and selling options and there is no writing of options allowed in these accounts. In the non-registered investment account category, clients advanced options trades can be made and stocks may also be shorted.
Reviews & Ratings
|What Review Measures||Score||Date of Ranking|
|Dalbar Canada Review||Client Service||Top Rating
|Globe and Mail Review||Overall Impression||Letter Grade “D”
12th out of 12
Letter Grade “D”
12th out of 12
Letter Grade “F”
12th out of 12
Letter Grade “D”
|JD Power Review||Investor Satisfaction||7th out of 10
10th out of 10