CIBC Investor’s Edge Discount Brokerage Review

by Mike Holman

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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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{ 9 comments… read them below or add one }

1 larry macdonald

Mike
Have you done any comparisons of the research the online brokers make available from their securities analysts? One thing I like about CIBC is the access to research reports from their analysts. But I’m wondering how RBC, Scotiabank, BMO and other compare in terms of access to, and quality of, research?

2 Mike Holman

Hi Larry. I have not tried to compare the research available from the different brokers. That would be great info, but it would be difficult to collect the data. The other problem is that different investors want different types of research so it would be hard to do a “ranking”.

Metrics like fees are pretty straightforward in comparison.

3 Paul T

I’ve been using CIBC for 7+ years now. Mostly a good experience.

Bad Points:
- The research part of their site. The stock screener is pretty weak, I use it for CAD screening only (for US stocks I use the yahoo advanced screener).
- Few screener criteria to choose from
- For the screener criteria that is available, you can only choose a min and max value (ie all stocks under 15 P/E). You can’t choose a range (all stocks between 5 and 15 P/E)
- Performance tracking of my portfolio is abysmal. I would love to see this improved (like categorizing stocks into buckets for reporting, better cost basis for calculating returns, etc…). A long way to go on this one, but I doubt that CIBC is any better / worse than the other big investing firms (BMO/BNS/RY/TD)

Good Points:
- I can get statements up to 7 years old online in PDF format. And I still receive a paper copy every month.
- Trade execution is quick and accurate with e-mail notification when trades are filled.
- All of my experiences with the call center staff have been great.
- Site is generally pretty snappy, but there have been more outages (during trading hours) than I would like to see.
- I can search for transactions up to 13 months old. This includes buy / sell / divs (I know TD only allows 3 months, which is way too short in my opinion)

Generally I’m happy and don’t plan on jumping ship anytime soon

4 Vlad Dutko

“$7.90 – $395 annual fee buys 50 trades – Additional trades
are $6.95 ” discontinued from Jan 1, 2011

5 Bob

Their website is unfit for active traders. I myself am not one and I still find their site clumsy, cumbersome, and not user friendly. When you enter a trade, you have to fill a lot of things from scratch. But you are working blind because this page has no data for the real time quote. By the time you are finished entering the data, you proceed to the second page, where you finally get to see the real time quote, only that it has changed. If you need to adjust the trade, you have to remember the price, go back to the first page and reenter everything. Not only is switching between pages inconvenient, the website takes a long time to switch pages. You are often left waiting only to be timed out.

Once you execute the trade after all that work, it takes a while for it to show up in the account pages. Your cash/margin balance stay unchanged the whole day so you never know if the trade did go through and at what price. This can mislead active traders of their cash position who I am sure have lots in their minds on top of dealing with a website with outdated information. Or they may reenter the trade thinking it failed to go through.

Other issues include partial fills. Their system erroneously charges commission for each partial fill. It gets corrected the next day but to me this is just plain stupid.

Also, when you transfer in cash from a CIBC bank account, it does not show up on time. Trades will be rejected due to insufficient funds when in fact it is due to their website not being up to date.

Their site breaks down frequently, often during the morning right after the markets open, which is a huge inconvenience.

Overall the Investor’s Edge platform is bizarre and frustrating to use. It is only tolerable if you trade once every month.

6 Jing

If I only have $10,000 in my investor’s edge accounts, does that mean if I get a $40,000 LOC and deposit it in my investor’s edge accounts I can get the 9.95 trades?

7 Mike Holman

@Jing – I don’t see why not. You should call CIBC to verify.

8 Justin

@Jing. To get $9.95, you have to have $50k in the brokerage acct. However, you can easily get $6.95 per trade if you already have CIBC products over $100k (e.g. a mortgage, LOC). to get it, you just have to call ‘em up.

9 Eric

I recently transferred my account over $50k to CIBC IE from other FI , and they rebate the transfer fee to me. However, they do not have the USD holding within the RRSP account where other FI does have it, and they don’t show the book value of my investment. So I transfer the account to the other FI, they reverse the transfer fee rebate without telling me and took the fund from my account. My worry is that they can do anything they like to take fund out from my account, at least they should have called me and told me about the situation. So be careful when you deal with this bank. I am going to file a complaint to their VP.

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