RBC Direct Investing [2021 Review]

When looking for a discount broker, don’t just think about the transaction fees. Learn everything you need to know about the platform to invest with success based on your strategy. The fees are only one factor.

In fact, focusing too much on the fees can prevent you from getting started. Don’t overlook the importance of investing and getting started.

As it happens, RBC Direct Investing is a strong platform with competitive offerings. Keep on reading to learn more.

I have been an RBC Direct Investing for many years now and I am still pleased with the platform and the services. You know what they say, the grass is not always greener on the other side (i.e. other platforms).

This review will cover its features, fees, benefits, downsides, trading platforms, and alternatives. One great option from RBC Direct Investing is the RBC practice account – a no-risk approach to trying the platform.

DISCLOSURE: Please note that links to merchants mentioned within this post might be using an affiliate link. Using an affiliate link means that, at zero cost to you, I might earn a commission if you buy something through that affiliate link.

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RBC Direct Investing Summary

Here is a summary to get you started, but there is a lot more information below if you want to get into the details.

Hidden Sortwdt_IDFeaturesRBC Direct InvestingComments
11Stock Transaction Fee$9.95Represents 1% with a $1,000 trade. Cheapest is Questrade with just under $6 per trade.
22ETF Transaction Fee$9.95If ETFs is what you need, no fees exists with others.
43Dual Currency AccountYesA must to build a growing portfolio. US holdings play a big role in my performance.
64Synthetic DRIPYesA must have with a dividend growth investing strategy.
75DRIP DiscountYesA must for any dividend investor.
88Access To ResearchMorningstarMost platforms are disappointing for research. Don't decide based on this factor.
910Account Minimum$15,000 for all accounts;It's relatively small. There are other ways to waive fees as a client too.
1011AccountsNon-Registered; RRSP; TFSA; RESP; RRIF; LIF; LIRAIt's all of them. Can't ask for more.
1112Mobile AppFresh UpdateThe new update works really well.
313Real-Time QuotesYes, all clients.This is great as you are not 15 minutes behind.

RBC Direct Investing FAQ

Can I have the fees waived with RBC Direct Investing?

Only by using RBC Rewards points can you have $0 fees on your transaction.

Active traders have a $6.95 fee instead of the regular $9.95 which is still higher than Questrade.

You can avoid the quarterly $25 maintenance fee by having a minimum of $15,000 in assets or by meeting other criteria through RBC banking products.

How do I deposit money into my RBC Direct Investing Account?

As an RBC client, you can easily transfer money, otherwise you do it through a bill payment online. You can transfer existing accounts at another institution too. That’s how I started with RBC Direct Investing.

Can I use a mobile app?

RBC Direct Investing is available through the RBC app for banking. There is a fresh new update on the app and it’s a really nice improvement.

How can I contact customer support?

You can do so by phone or by secure message through the site. For anything urgent, do it over the phone but otherwise I have found the message center to work well.

Commissions & Fees

The cost of using a discount broker is probably the most important factor to every DIY investor in order to keep the cost down. My approach has been to assess my trading cost per $1,000 invested with a goal to keep it at or under 1%.

Trading Costs

The cost of a transaction is in line with all the other bank-owned discount brokers with a $9.95 rate per transaction. It’s a 1% fee on a $1,000 investment which I consider acceptable.

In fact, if you want to use DLR to exchange USD for CAD dollars (or vice versa), you spend a minimum of $20 for the currency exchange.

RBC now allows its customers to pay with RBC Reward points for trades which is an innovative way to leverage all the benefits the bank provides.

Accounts Fees

For more details on the RBC Direct Investing fees, see the formal rates from their website. Like many of the other discount brokers, there are no fees on mutual fund transactions outside of the fees paid within the funds referred to as MER.

If you hold mutual funds such as RBC Monthly Income Fund, your only concern is the high mutual fund MER. If you buy ETFs, you will be subject to the same transaction fees as a stock transaction.

If you have a combined household value of $15,000 or more, there are no maintenance fees to pay but if you have less, there is a $25 per quarter fee. If you already bank with RBC, the fees may be waived if you meet some criteria (see details).


Accounts

There are many important factors to be aware of about accounts with a discount broker and you should be aware of the details based on your needs. Your needs may also change over time and if that’s the case, don’t hesitate to adjust.

Sign Up Process

You can start the account sign up process online but you may have to submit it by mail with a signature. If you are an RBC client it should be quick and smooth, but as a non-RBC client, you may need to sign documents on paper.

All in all, don’t expect to open an account at 10 pm at night, fund it an hour later and make a trade the next day.

If you intend to transfer accounts from another financial institution, that’s a separate form from the signup process. If you transfer a large amount, chances are that RBC will cover part of the fees from the institutions you are transferring from.

Account Funding

The process of adding money to a trading account is actually critical. You don’t want to wait too long before you can make a trade. When it comes to RBC, and all bank-owned discount brokers, the easiest way is to have a bank account to transfer money to and from.

The best option if you don’t bank with RBC is to use the bill payee approach to transfer cash from another financial institution. Simply add RBC Direct Investing as a bill payee through their online banking site. This is the best option for all non-bank owned discount brokers.

Dual Currencies

The US and CDN accounts with RBC Direct Investing are working just like you would expect. There is a separate balance in the currency for each type of accounts. The currency management per accounts works without paying extra fees or exchange rate to make a transaction within the account.

As a Canadian, my diversification is mostly towards the US with the large conglomerates dividend growth stocks providing me with my international exposure. I wanted to avoid currency exchange when trading as much as I could.

With just over 50% of my holdings in US$, that’s an important feature to have for me as I also DRIP in the currency of the dividend stocks.

Reports

RBC Direct Investing has performance reporting which was new to me after moving from Scotia iTrade. The recent web site improvements show the trailing 12-month performance on each of the account.

Otherwise, there is a performance tab section allowing you to see your portfolio by quarters or annually and compare it with an index. It’s not quite what I want though and that’s why I created my own tracker in a spreadsheet.

The asset allocation and model portfolio are a nice touch but it’s mostly setup towards mutual funds investor. There is good education section for new investors to get started. I thought it was good to teach about the tools but it’s catered to lead you towards RBC mutual funds.


Trading Platform

The website is pretty intuitive and easy to use from my point of view. There has been an update this year and it’s improving the appeal and experience.

RBC has enable real-time quotes for all trades which is not the case for Questrade. As I put limit orders for all my orders, with RBC I know the bid and ask is accurate whereas it can be delayed with other platforms.

The experience is similar to the other brokers I have used which include Scotia iTrade, e*Trade US, and Scotia McLeod (prior to Scotia iTrade). I tend to trade with a limit for buy and sell orders so I don’t need much. The trade settlement timeline is pretty much the same as what I had with Scotia iTrade and e*Trade; it approximate to 3 days.

RBC offers a practice account so it’s really easy to actually see for yourself if it works for you.


Investment Research

The research is mostly focused on economic data and that’s not really my cup of tea to find a stock. The alert system works quite well but it takes a bit of fiddling to get it right. 

I was expecting RBC Direct Investing research and analysis from RBC but they are all external research.


Customer Service

I was very pleased with the customer service. I live in the computer age so I try to do everything on the web through email and only call as a last resort.

They answered all my questions with detailed information for me to proceed with different tasks.

The secured email service works really well and I use it from time to time. It takes at least 24 hours to get an answer so if you have an urgent request, it’s better to call.

Discount Brokers Available

While the easiest path to selecting a discount broker is to use the one affiliated with your bank, there are options available with different feature set and cost that may best fit your needs. Be sure to review all of your options.

 
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DISCLOSURE: Please note that I may have a position in one or many of the holdings listed. For a complete list of my holdings, please see my Dividend Portfolio.

DISCLAIMER: Please note that this blog post represents my opinion and not an advice/recommendation. I am not a financial adviser, I am not qualified to give financial advice. Before you buy any stocks/funds consult with a qualified financial planner. Make your investment decisions at your own risk – see my full disclaimer for more details.