Low cost investing

Canadians have a wide variety of institutions to choose from when setting up their investment arrangements. Costs matter, a penny saved is a penny earned. A wise brokerage choice has the potential to save hundreds of dollars a year.

Do you need a brokerage account?
Some simple portfolios do not require brokerage accounts, and can be held at banks or mutual fund companies.

Discount brokers
Discount brokers allow investors to buy and sell securities on-line while typically offering comparatively fewer services and/or support, relative to a full-service broker. The types of products that can be purchased in a brokerage account include: In exchange for this service the brokerages charge commissions and various fees. It is worth shopping around! The Globe and Mail does an annual review, The Globe and Mail's 17th annual online broker ranking -- December 2015, that may serve as a good starting point.
 * individual stocks trading on the Canadian and US exchanges (common shares and preferred shares)
 * individual bonds and guaranteed investment certificates (GICs) from the brokerage's inventory
 * mutual funds, including index funds, ultimately from the fund companies
 * exchange-traded funds on the Canadian and US stock exchanges
 * options

Full service brokers
Although full service brokers will charge more to trade stocks than discount brokers, they may have a larger bond inventory and possibly better bond pricing. Investors who trade stocks infrequently or who intend to use an account entirely for fixed income may wish to investigate use of a full-service broker for purchasing individual bonds.