How To Buy Canadian Stocks On Scottrade
There are a couple different ways non-U.S. investors can open an international brokerage account. You could open an account with a financial services company in your country of residence that offers access to U.S. stocks. Or, you might open a brokerage account for non-U.S. residents with a U.S.-based broker. But before you do that, make sure the services are available for your country of residence. Plus, know that there may be additional paperwork involved, including tax documentation. Here are some general tax considerations to keep in mind.
how to buy canadian stocks on scottrade
A small "activity assessment fee," related to Section 31 of the Securities and Exchange Act of 1934, applies on sell transactions. The rate through March 27, 2013, is $22.40 per million, or about two cents per $1,000 of sale proceeds. This rate is adjusted annually by the SEC and posted on its website.PennTrade requires only $500 to open an account, which can be met with cash, equivalent securities or any combination of the two.For more information on PennTrade, check out their website at www.PennTrade.com.Interactive BrokersInteractive Brokers is another firm that readers like because they allow U.S. citizens to economically trade Canadian equities, stocks from eight other countries as well as FOREX and bonds.The commission on Canadian trades is only one cent (Canadian) per share traded, with a minimum commission of CAD1.00 and a maximum commission of 0.5% of the trade value.Check out some of the commission fees below.
For a full list and more information on Interactive Brokers' commission fees, click here.Interactive Brokers offers all the same standard trading tools that you would expect from AmeriTrade or any other big name online broker.For more information on Interactive Brokers, check out their website at www.interactivebrokers.com.Here is some information on two more brokers that will allow you to trade Canadian stocks, though I am less familiar with these companies:CIBC Investor's Edge CIBC charges $28.95 for trades up to 1,000 shares in U.S. or Canadian equities. The majority of mutual funds available through CIBC can be purchased without front-end loads. As long as you keep $10,000 in your nonregistered account, you won't have to pay any maintenance fees. They also provide a nifty commission calculator that you can access here.
Scottrade also requires a $500 minimum balance for a new brokerage account. Fees and commissions are generally lower than with E-Trade. However, there is an additional 0.5% of the principal value commission for penny stocks. Scottrade also charges slightly higher margin rates.
Like its stocks, E-trade charges $9.99 for under 149 trades per quarter and $7.99 for 150 or more trades/qtr. for ETFs. Scottrade charges $7 for stocks and options if ordered online, and $32 if ordered by phone or via broker.
TD Ameritrade is a stockbroker that offers an electronic trading platform for the trade of financial assets including common stocks, preferred stocks, futures contracts, exchange-traded funds, forex, options, mutual funds, fixed income investments, margin lending, and cash management services. The company receives revenue from interest income on margin balances, commissions for order execution, and payment for order flow.
In general, most brokers withhold income tax on some Canadian stocks even though they are held in US retirement accounts. Of the 24 brokers for which I had responses, only one, Wells Fargo (WFC), had never made this mistake in my sample. This may or may not be meaningful, since only two respondents had Wells Fargo as a broker.
Charles Schwab charges $4.95 per trade for U.S. stocks or U.S. listings for Canadian or Australian stocks, but for non-U.S. stocks one can open a global account. For Canadian stocks, the online fee is C$14 and A$32 for Australian stocks. Additionally, there is a 1% foreign currency conversion fee (reduced for transactions in excess of $100,000).
Interactive Brokers charges a commission of $0.005 per share (or $.01 in Canada) with a $1.00 minimum, but it caps the commission at 0.5% of the value of the trade. For those trading high-priced securities, this may prove to be the best choice. For example, 800 shares of Canopy Growth (TWMJF) would cost just $4 in commission. Australian stocks cost 0.08% of the transaction value, with a minimum of $6.00. Where IB excels is for those who want to trade Canadian stocks directly, as the trades can be done online at a much lower price than at competitors.
TD Ameritrade charges $6.95 for online trades and appears to be offering commission-free trades for the first 60 days an account is opened with more than $3000. Like E*Trade, the website makes no mention of the ability to trade stocks outside the U.S.
For U.S. stocks, most brokers charge a flat fee of $4.95-6.95 per trade, though Scottrade penalizes stocks under $1 with its 0.5% surcharge. Interactive Brokers can be cheaper for higher price stocks but a lot more expensive for shares that trade at lower prices. Two extreme examples:
Larger trades in higher-priced stocks will push the commission at Interactive Brokers above those of its competitors: $10,000 into that $5 stock will cost $10.00 (2000 shares at $0.005 per share). The sweet spot for Interactive Brokers is a few shares of a high-priced stock or a small dollar amount of a low cost stock, which positions it very well for most cannabis stock traders. It could be worthwhile to have two accounts, including one with another online broker if one is executing trades of more than $1000 on very low-priced stocks or is trading larger amounts in general.
I have discussed the best brokers from the perspective of commissions after conducting an independent review, but the levels of service may vary from broker to broker. Additionally, there may be some advantages to being able to trade Canadian or Australian stocks in their home countries, as the liquidity tends to be better. For a long-term investor, this is less relevant, but active traders may want to factor this in. The bottom-line is that Interactive Brokers may be the best choice for cannabis stock traders, while Scottrade appears to be the most expensive.
While stocks are issued exclusively by companies, bonds are issued by both public and private entities. Cities, states, the federal government, government agencies, and corporations issue bonds to raise capital for a variety of purposes, such as building roads, improving schools, opening new factories, and buying the latest technology.
If you are a Canadian resident (or any country other than USA), as long as you can provide a W8BEN to your brokerage, you should be able to sell all your stocks/investments held in brokerage accounts. Submitting this form is asking your brokerage to not withhold the mandatory 30% tax on your proceeds (RSUs, stocks, etc).
@sohran10 / @sysout / others, it has been 1.5 years. I hope some of you might have seen all this in action. Does the information shared by @sohran10 hold true? i.e. after transferring stocks, no one keeps track of US gains?
The exact time window during which you can buy or sell stocks in the pre-market session depends on your broker. For example, Scottrade has a relatively long pre-market trading session that runs from 6 a.m. ET to 9:28 a.m. ET, while TD Ameritrade limits pre-market trading to a 75-minute window between 8 a.m. ET and 9:15 a.m. ET. A few brokerages don't offer pre-market trading at all. The NASDAQ allows pre-market trading as early as 4 a.m. ET, so there are many possible time windows brokerages can offer.
The main benefit of having access to pre-market trading is the ability to immediately react to news items, such as earnings reports. In general, by the time the normal trading session begins, stocks will have made their reactionary moves and it will be too late to place a trade to ride the earnings reaction.
Pink sheets refer to stocks listed on OTC markets. Formerly known as the National Quotation Bureau (NQB), OTC Markets listed the prices of stocks and bonds on pink and yellow papers. The NQB was renamed Pink Sheets LLC in 2000 and again to OTC Markets Group in 2011.
Many stocks trade over-the-counter because the company is still to small or infrequently traded to meet the volume thresholds of larger exchanges. For instance, before Walmart became the conglomerate it is today, it traded OTC.
OTC stocks can be more risky than stocks trading on larger exchanges. Some OTC stocks are highly speculative and therefore come with inherent risk, while others may lack the legitimacy needed to trade on a traditional exchange. If you want to take on some more risk and expose yourself to OTC markets, make sure that you research the company thoroughly, and treat lack of information as a red flag.
Yes. OTC Markets is based in the US, so you'll need a Canada-based trading platform that provides access to US stocks. However, not all platforms allow OTC Markets trades. Check with your platform to find out for sure. See the table above to compare Canadian brokerages that provide access to OTC Markets.
An ETF is a basket of stocks that are bundled together to create a single fund that can then be broken up into shares and sold to individual investors. It gives investors an easy way to buy a piece of the S&P 500 without having to break the bank by buying a bunch of individual stocks.
Index funds also have an advantage in the way they can reinvest the dividends paid by the stocks they hold. ETFs have to accumulate cash over the course of the quarter, whereas index funds can simply reinvest immediately. There are also minor differences in the way capital gains are taxed for each.
S&P 500 index funds might differ in the exact makeup of their portfolios. For example, the Vanguard S&P 500 Growth ETF emphasizes growth-oriented companies in the S&P 500, while the Invesco S&P 500 High Dividend Low Volatility ETF specializes in stocks that offer strong dividends. 041b061a72