Tag Archives: RESP

How Do I Start Getting $9.95 Trades at RBC Direct Investing Now I Have $50 000?

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UPDATE: This article is historical, from 2013. I no longer invest with RBC Direct Investing.

While on the phone asking where my money is, since it left ING Direct on November 7 and it still isn’t in my RBC DI account on November 14, I asked a more important question: “How do I start getting the $9.95 trading commission fee given that I will have $50,000 in my account.”

I remember several years ago when we set up accounts at BMO InvestorLine that we had to wait till month-end after reaching the minimum qualifying balance to get the reduced trading fee. (I suspect you can now phone them and ask to get the fee applied immediately once you qualify, but I’m not sure.) I wasn’t sure if we would have to wait with RBC DI as well or not.

When Will You Usually Get the Reduced Trading Commission Fee Rate at RBC Direct Investing?

The support person told me that generally the computer system will spot new qualifiers. The check is made once a month on the 22 nd day. It checks what the lowest balance was during the previous month. [Which is not what the website says. The website says it will check the asset balance on the last day of the previous month.] If the lowest balance was $50,000 then the account will be upgraded to $9.95 trade status.

Can You Get the $9.95 Rate Immediately at RBC Direct Investing?

Yes. Once you have the $50,000 minimum in your account you can phone RBC Direct Investing support and request a change. They should be able to update your account quickly. (They didn’t tell me *how* quickly, but the implication was it would happen overnight.)

I guess if my money ever arrives in my account I can test this!
UPDATE: It did; I can; and I did. The update was made over night. So the day after I phoned in, when I placed a test trade, the trading commission correctly reported as $9.95.

What Happens If the Market Value of my Portfolio Drops Below $50,000?

While I’m sure your stocks, ETFs and Mutual Funds will always go up in value, mine don’t. In fact, I tend to buy things right before they plummet in value.

So I sent a Secure Message to RBC DI to ask whether the $50,000 qualification applies to the Book Value (when I bought my stocks) or the Market Value (what they’re worth today). I waited with bated breath for their reply.

To my surprise and dismay, they replied “In order to qualify for preferred pricing of $9.95 you must hold $50,000 in market value on the last day of every month.”

That’s right: the *Market* Value of the account must be $50,000 or higher on the last day of every month to qualify for the $9.95 trading fee! So if your stocks take even a temporary dip on the last day of the month you will be back to $28.95 trading fees. It appears that changes in the fees, up or down, occur on the 22 nd of the month after the month-end balance went below or above $50,000.

Frankly, I’m not impressed.

Can I Get the $50,000 Discount by Adding Up My Accounts with my Spouse’s?

Yes. You can ask RBC DI to add up the assets in various accounts held by members of the same household such as you and your spouse. You have to phone them to ask them to do this. It is not automatic.

Where Do I Get $50,000 to Qualify

Of course the hardest part is coming up with the $50,000 to invest in the first place. That’s a lot of packed lunches and skipped designer coffees. With time and patience, though, you may get there sooner than you think.

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Did you get caught paying an excessive brokerage fee because you thought you’d get the better rate immediately once you qualified? Please share your experiences with a comment.

How to Buy Units in a High Interest Savings Account Fund in a CIBC Investor’s Edge Account

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Recently, I’ve been tidying up our investments in our CIBC Investor’s Edge RRSP account. These included some bond mutual funds that were purchased as part of a self-rebalancing mutual fund investment portfolio about 20 years ago. The actual dollar amounts invested were negligible and the returns of the funds were reasonable on a percentage basis but miniscule in a real dollar way. Instead of keeping this money in risky foreign bond mutual funds, I decided to sell them and temporarily park it in a HISA while I decide where better to invest it. Here’s how to buy units in a daily interest savings account fund, such as ATL5000, in an Investor’s Edge Account.

(This approach is intended for registered accounts where you can’t just shift the money to a conventional high interest savings account at another bank. For example, for TFSAs, RRSPs, RRIFs, LIRAs, RESPs, RDSPs, etc.)

Just How “High” Is the “High Interest” Offered in a HISA Fund?

Don’t get your hopes up.

Today, in October 2013, ATL5000 the Renaissance HISA fund, is paying 1.25% per year. Yep, that’s $12.50 if you invest $1000 for an entire year. Still that would buy me a large dim sum lunch with tax (before tip).
UPDATE: On March 18, 2017 ATL5000 is paying 0.75%.

For more info on ATL5000, you can visit Renaissance’s website.

Buying ATL5000 in an Investor’s Edge Account

  1. Sign On to your Investor’s Edge account.
  2. From the link list on the left side of the screen, click on Trading.
  3. From the link list on the left side of the screen, click on Trade Mutual Funds.

On the Mutual Fund Order Entry Screen

  1. Ensure that the Account selected is the correct one for the transaction.
  2. From the Action: section, select
    • Buy; or
    • Buy More of Holdings (if you already have some units of ATL5000 in this account)

    by clicking the radio button beside the appropriate phrase.

If You Are Buying Units of ATL5000 for the First Time

  1. In the Mutual Fund: section,
    click on the Mutual Fund Search link.
  2. In the Keyword box, type ATL5000 and click on the Search button.
  3. Review the details about the Renaissance High Interest Savings Account.
    It states that this is a Front End load fund. It is true that the issuer, Investor’s Edge, is paid a commission. It’s paid by Renaissance, though, not you, so while your interest rate will be lower because of the fee, you will not actually give up any principal to pay.
  4. Click on the Buy link.
    You will return to the Mutual Fund Order Entry Screen.

If You Are Buying More Units of ATL5000

  1. In the Mutual Fund: section,
    click on the drop-down list.
  2. You will see all of your mutual funds. Just highlight to select ATL5000.

Continuing Down the Mutual Fund Order Entry Screen in Both Instances

  1. If desired, click on the Get Quote button. Because this is a daily interest savings account, the price should always be $1 CAD per unit.
  2. In the Amount: section, type the amount you wish to put into your savings account in dollars, or in units, which is the same thing anyway!
  3. In the Dividend Section, select either
    • Reinvest in Units Of This Mutual Fund; or
    • Deposit Cash To Brokerage Account

    by clicking on the appropriate radio button.

  4. In the Pay From: section, ensure that the correct account is selected.
  5. Click on the Next button.

To have fun, I tested buying an additional $100.
The system replied “The order Amount is less than the minimum allowed value.”
In fact, it wouldn’t let me buy an additional $200, $300, $400, $500, $600, $700, $800, or $900 either. I had to buy $1000 additional units to proceed.

(NOTE: If I had only $40 to add to my HISA, I could have sold 1000 units of the HISA, and once the cash was back in my account, purchased $1040 units. It would cost me a few days of daily interest, but it could be done.)

Finalize the Purchase

  1. Review the purchase details. If they look OK, in the Trading Password field, type your password.
  2. Click on the Submit Order button.
  3. Copy and paste your confirmation including the Order Tracking Number into a document and save it until the transaction is properly reported for your account.
  4. If you are finished with your Investor’s Edge account, click on the Sign Off button.
    For increased security, clear your browser history and cache and close your browser session.

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Do you park your cash in a high interest account while you decide where to re-invest? Does the phrase “high interest” make you laugh? Please share your experiences with a comment.