Brokerage investment savings accounts | Page 39 | General comparisons | Discussion forum

Norman1 said

usephrase said

ScotiaBank ISA:
https://ads.scotiabank.com/investment-savings-account

Can a Personal ISA account buy Series F at 3.70% rate?

Yes, a personal brokerage account or a RRSP/RRIF/TFSA brokerage account can place funds in a Series F Scotiabank Personal ISA if the brokerage agrees to it. Some brokerages do. Some don't. I know first hand that Scotia iTRADE does allow this.

What is Trailer Fee 0.1% for Series A at 3.60% rate? Is the actual interest rate =3.60%-0.1%=3.50% ?

Holders of $100,000+ of Series A Scotiabank ISA's will receive a yield of 3.60% per annum. Their dealer will receive a trailer of 0.10% per annum.

Holders of Series F Scotiabank ISA's will receive a yield of 3.70% per annum. Their dealer will not receive any trailer. That's why some brokerages will not accept orders to purchase the Series F Scotiabank ISA's.  

Thank you, norman1, for your explanation. May I ask you further?

1.
CIBC Edge does NOT accept the order to purchase DYN 6004 Series F, I tried to buy and showed me error.

2.
I do not understand, can you explain please? does CDIC cover DYN6004 Series F ? How much the amount to cover?

I see somebody posted the below information:
" I agree the distinction between HISA (retail direct) and ISA (brokerage in nominee name) designations are important in these discussions. They are different animals.
The concern here being how CDIC handles the distinction?
https://www.cdic.ca/financial-community/for-brokers-and-other-financial-professionals/
"

usephrase said

ScotiaBank ISA:
https://ads.scotiabank.com/investment-savings-account

Can a Personal ISA account buy Series F at 3.70% rate?
What is Trailer Fee 0.1% for Series A at 3.60% rate? Is the actual interest rate =3.60%-0.1%=3.50% ?  

Yes, at some discount brokerages, chiefly Scotia iTRADE and Desjardins Online Brokerage. Scotia iTRADE is likely to always be a distributor of the Series F of the ISA, so you have certainty there.

If you use CIBC Investor's Edge, have you tried putting in an order for the Renaissance Series F ISA? It likely has a rate higher than series A and should be comparable to Scotia iTRADE's Series F.

Cheers,
Doug

CIBC EDGE online account shows information which mutual funds, HISA, or Money Market funds, available to purchase.
I do not buy mutual funds, I remember CIBC Edge charges commission fee for most of the mutual funds, waive commission fee for a few of mutual funds.

Norman1 said
CIBC Investor's Edge may be willing to waive the $6.95 mutual fund trade commission on brokerage ISA's. But, that doesn't mean they are also willing to give up the 0.10% to 0.25% trailer commission too by accepting orders to purchase the Series F versions of the brokerage ISA's.

BMO InvestorLine also doesn't offer the Series F versions of the Bank of Montreal brokerage ISA's.  

Few brokerages will allow the purchase of F series ISAs and few (big bank) brokerages allow one to purchase anything other than their own in-house series of ISAs. There is no compelling reason to do so since, as many of us know, they are simply deposit accounts. Some independents (like QTrade I think) do offer a range of ISAs, including, or even limited to, F series.

Within BMOIL, I have moved to F series money market mutual fund BMO95142* because BMOIL, as you have articulated, won't offer their F series of BMO ISAs to us. Fortunately, they also do not charge commissions for either product.

Within Scotia iTrade, I can buy their F series DYN ISAs, such as DYN6004, and without commission, so I do so.

It is a mixed bag out there in terms of offerings and which ones by which brokerages, and under what conditions (commission or not), so it behooves each of us to research the best choice we can find within the brokerage we are with. ISAs and MMFs are simply minor appendages (cash reserves) to me and are thus a small percentage of the value of my brokerage accounts. What is offered does not dictate with whom I have my securities holdings.

* I suspect most brokerages will offer a range of F series MMFs so it is quite possible "usephrase" should look at CIB237/238 or BMO95142 as a MMF alternative to purchasing an ISA. Granted this means not having CDIC insurance coverage, but the risk of a big bank MMF being anything but 100% solid is probably as big a risk as the sun rising in the West instead of the East.

Discount brokerages can only sell F series (or their equivalent) mutual funds that have no trailer fees to DIY investors. Regulations for at least 2 years now prohibit that for true mutual funds like MMFs. That has made them more attractive with better yields relative to alternatives than they used to be.

As for ISAs like TDB8150 insured by CDIC, it would be CDIC that would take over the deposits (like TDB8150) and pay out to account owners. Whether the payout would be directly to the retail client or via another brokerage that would have 'bought' TDDI is likely the only unknown. Everyone should assume the funds are not available in that transition period, just as they would not be for an ordinary deposit account.

My post was indeed about TD Bank and CDIC insurance. If TD Bank, the issuer of TDB8150 fails, CDIC steps in with deposit insurance to cover deposits up to $100k. Like any other deposit account with CDIC deposit insurance, CDIC will pay out (backstop) to insurance limits.

That said, everyone should assume there will be some disruption in accessibility to accounts until CDIC transfers said accounts (either by themselves or through another corporation) to process transactions. That might be 24? 48? 100? hours or more if TD login credentials no longer work.

In reality, CDIC will almost certainly have already known TD Bank was failing and would have already taken over TD operations and/or have strong armed another bank to pick up at least the insured deposit accounts....for a relatively seamless operation to the account holder with existing (or new) login credentials and a new letterhead at the top of the page.

Since TDDI is a minor appendage of TD Bank, there is little doubt it will have also failed in practice if not necessarily legally. CIPF will take over brokerage operations and will have arranged for someone to take over management of its operations as well, including access to TDB8150 (which is in nominee name). I think it would be wrong to expect access to TDB8150 to be seamless and immediate though in practice it may well be seamless. One scenario could be that one's holdings of TDB8150 actually disappear and CDIC deposits equivalent cash into the brokerage account now operated by another entity.

Never, ever expect transitions of this size to entirely seamless. There will be glitches.

P.S. I have never had chequing and savings accounts with an institution that has failed but I have had an investment account (RRSP) with an institution in the 1980s that failed. Back then, everything was done by snail mail. A month later, I got my regular monthly account statement with a new letterhead (another institution's name) on the top of it.

FWIW, I don't consider it important to have immediate access to my banking, and especially investment account funds, with any one institution. I bank at more than one institution for immediate needs and can wait some days or even a few weeks for CDIC (banking) and CIPF (brokerage) to sort out whatever needs to be sorted out.

Dean said

Dean said
.
FWIW . . .

TDB8152 (TD US$ ISA) remains @ 4.90% ... but I don't expect that to last
much longer.

Dean

TDB8152 is now down to 4.40% .

We thank Mr. Powell for that ... LOL

Dean

  

Update . . .

As of today, it's now Down to 4.15% .

Dean