CIBC Investor’s Edge Discount Brokerage Review

by Mike Holman

CIBC Investor’s Edge is owned by the Canadian Imperial Bank of Commerce (CIBC), which is not too hard to figure out from the name.

Overall impressions

Investor’s Edge is pretty typical for the big bank-owned discount brokerage in that the trading fees are sky high unless you are an active trader.  They recently made a big change to their fee structure so that you can qualify for cheaper trades if you have $50,000 in household assets with CIBC.  These assets include mortgages and bank accounts.  I’m assuming they use the positive value of the mortgage.  :)

Please note that the cheaper trades don’t come into effect until January 1, 2011.

If you already bank with CIBC and qualify for the cheaper trades or if you trade 50 or more times per year, then it’s a pretty reasonable option.

Online trading commissions

  • $28.95 is the default commission.
  • $6.95 – If you have at least $100,000 in household assets.  This includes any CIBC products including bank accounts, mortgages.
  • $9.95 – If you have at least $50,000 in household assets.  This includes any CIBC products including bank accounts, mortgages.

If you would like to compare all the different Canadian discount brokerages, check out the Canadian discount brokerage comparison.

Phone trading commissions

  • $50 minimum for a phone trade placed with a representative.
  • The basic cost is $35 plus a fee per share.  The exact pricing is here.

Annual account fees

  • RRSP, RRIF, LIRA, LIF – $100 unless balance of all registered accounts is greater than $25,000
  • RESP – $50 unless balance is more than $15,000
  • TFSA – $50  This fee is starting Sept of 2011 – waived if you have a registered account as well
  • FundPlus account – $25  This account can only contain GICs, mutual funds and fixed income
  • Non-registered – $60 unless balance is greater than $10,000 or you have a registered  account

Foreign exchange fees

  • Spot rate + 1.4%

If you are exchanging a larger amount ($10k or more) or have a lot of assets, then phone and try to negotiate a better exchange fee.

Mutual funds

  • Full range of mutual funds available.

Free real-time quotes

  • No

Minimum to open account

  • None

Some opinions on CIBC Investor’s Edge

I asked a few people over at the Canadian Money Forum what their opinion of Investor’s Edge was:

Scomac:

I’ve been a CIBCIE client for many years, in fact we do all of our banking with CIBC. This has a lot to do with the strength of relationships we have with the individuals at the local level. That said, I don’t feel as though we are missing out on anything.

I will preface my remarks by stating that I am typically a buy and hold type of investor. Our investments consist of common and preferred shares, a few trusts/REITs, investment grade bond ladders and a high interest savings account. My taxable investment account is marginable.

Trading platform

1) The trading platform is fine for my needs. Execution is quick and I’m not getting whip sawed on the spread. The interface between the web broker and on-line banking is seamless which really simplifies moving moneys around. Margin interest rates are pretty typical at prime +2.5-3. The only weak spot from my perspective is with the bond desk. The inventory isn’t as broad as some of their competitors and spreads can be plenty wide at times. Never-the-less, with patience, I’ve always managed to find something that would work for our bond ladders. If I was predominantly invested in fixed income securities, then I might be more likely to switch to a provider with a broader inventory such as BMOIL.

Customer Service

2) My experience with customer service has been generally excellent. Sometimes, you may not get the most knowledgeable individual on the other end, but all issues have been solved readily. No problems executing Norbert’s Gambit on several occasions or connecting with a knowledgeable bond trade to source corporate strip bonds.

Research reports

3) I do most of my own research, so I don’t rely on the brokerage’s research reports. That said, I have full access to CIBC World Markets, Reuters and S&P research. The equity research from CIBCWM is pretty typical of sell-side analysts. I find the economic reports more useful. For US stocks, the S&P reports are particularly well done and provide a very good overview without a lot of bias. For those who like to read, there is a lot of choice.

In terms of tools, I’m not really keen on the functionality of their proprietary stock selector tool. They have a few pre-set screens that may offer something to others. The universe of stocks I follow is generally fairly small, so these features don’t have a lot of value to me.

Belguy:

No problems but I don’t trade much or ask much of them. I just invest for the long run mainly in broad-based ETF’s and trade periodically for rebalancing purposes.

Mario 1

Great pricing , if you’re a trader.
Terrible platform/interface.
Decent customer service and research tools.

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