# Canadian online brokers and DRIP for US stocks?



## praire_guy (Sep 8, 2011)

Currently I'm with credential direct. 

They allow DRIPs for canadian companies only, and only full shares. 

Are there any places that drip us companies, and allow partial share purchases?

I've searched a few web sites and so far all drip cdn only, and full shares. 

Just wondering if anyone has found a gem that will allow this?


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## Spudd (Oct 11, 2011)

Pretty much any broker will drip US companies, but only in full shares. Credential Direct seems to be an oddball. I'm with TD Waterhouse and it drips US companies for me, no problem. (well, no problem aside from getting charged the FX).

As far as I know, if you want to drip partial shares, you need to use ComputerShare.com.


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## praire_guy (Sep 8, 2011)

Thanks spudd. 
Ted web site says to call and bmo only listed cdn companies as eligible. 

I may switch to Td if they drip us stock.


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## My Own Advisor (Sep 24, 2012)

I can second what Spudd said. I would think most discount brokerages will run a synthetic DRIP for U.S. stocks.


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## Xoron (Jun 22, 2010)

But only the larger, more liquid stocks. MY Brokerage account at CIBC drips some of my US stocks, but not most. Maybe 1/3 of my US stocks are eligible for drips (but I do invest in somewhat smaller cap stocks in the US)

You can call in and ask which stocks they drip, but CIBC doesn't publish a list (I've asked)


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## humble_pie (Jun 7, 2009)

it's not a good idea to drip US stock in rrsp accounts at most brokers unless the broker has a true US dollar rrsp platform. To best of my knowledge only bmo, roybank & questrade offer these. I am not sure what goes on at scotia itrade or Qtrade.

at all other brokers, FX fees are charged not once but twice on US dividends that are dripped into rrsp. This hidden factoid has been thoroughly discussed in cmf forum. It is a bit of a scandal. Unfortunately many broker reps are not aware, therefore they tend to deny it if asked.

in non-registered true USD accounts, of course, dripping US dividends works fine. It's only in registered accounts at brokers that don't offer USD rrsps that the double-dipping occurs.

if yours is an offending brokerage & you hold US equities in rrsp, best to take their USD dividends in cash, not as drips.


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## Xoron (Jun 22, 2010)

humble_pie said:


> it's not a good idea to drip US stock in rrsp accounts.
> .
> .
> .
> if yours is an offending brokerage & you hold US equities in rrsp, best to take their USD dividends in cash, not as drips.


CIBC is only offering the Synthetic DRIP for Registered accounts, so you're 100% right on the double hit on FX.

Which is why I stopped all my USD stock dripping a while back 

One thing that CIBC does offer is Washing of trades. If you do a USD buy and sell on the same day, they'll wash the trades for you at a better rate than you could otherwise get. They apply the same rate to the buy and sell order(s)

The only catch is that you have to call in to request it before 3pm that day. (after you've done all your USD trades for the day).


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## Toronto.gal (Jan 8, 2010)

Xoron said:


> CIBC is *only offering the Synthetic DRIP for Registered accounts.*......Which is why I stopped all my USD stock dripping a while back.


That is not correct at all! I DRIP several stocks under my non-reg. USD account. The issue is that they don't yet offer a USD RRSP platform, though I have been told for the last 2 years that they are working on it. :rolleyes2:


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## Xoron (Jun 22, 2010)

Toronto.gal said:


> That is not correct at all! I DRIP several stocks under my non-reg. USD account. The issue is that they don't yet offer a USD RRSP platform, though I have been told for the last 2 years that they are working on it. :rolleyes2:


Which is why I stopped dripping my USD stocks in my *registered accounts*. Registered accounts are only CAD denominated at CIBC. As you stated, there are no USD RRSP (or TFSA or RESP) accounts available through CIBC.

_I think we're both saying the same thing_ :chuncky:


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## Toronto.gal (Jan 8, 2010)

Yes, we are, but the way you phrased it, it sounded as though DRIPS were not available in non-reg. accounts. 

I'll call CIBC to follow up on 'their work in progress', how about u & everyone else with this broker do the same? We need high number of complainers, LOL.


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## humble_pie (Jun 7, 2009)

u guys are indeed saying the same thing!

moral of the story is don't drip US divs in rrsp at brokers who are going to charge FX fees twice. IE all brokers save & except bmo, roybank, questrade, possibly scotia itrade & Qtrade. (harold can u please tell us about scotia itrade?)

there's no use phoning them up & trying to pressure them to offer USD rrsp. They have all heard all of you, all of the time, long time already. There's nothing more to say each:

the problem is that all of these brokers are built on the ISM mainframe which they lease from IBM. ISM is, in fact, the standard mainframe used in the brokerage business in canada. However it does not lend itself to a US dollar platform in canadian registered accounts. This is why there's not much the ISM brokers (who are the majority) can do about all the USD rrsp uproar, clamour & racket which clients keep raising.

a rival mainframe system is ADP. This accommodates USD platforms for rrsp more easily. BMO & roybank use ADP. Nobody has ever been able to figure out what is going on at Questrade :biggrin:

i for one worry somewhat about the reliability of ADP because at bmo i had one security that completely disappeared from my account one fine day. They were very nice & put it back that same day when i asked them, but still i wonder what might have happened if i had never noticed.

par contre, the rugged ISM system used by majority of brokers - yea the one that doesn't support a USD rrsp - is a blooming workhorse. Nothing ever gets lost. Never. Not ever. Not even one teeny opposed option out of zillions & zillions.

ranting on, td waterhouse has always taken the lead in developing workarounds for rrsps to accommodate their numerous & noisy clients who want US equities in rrsp without FX fees every time something hiccups, sneezes or otherwise moves one millimetre. It was the big green that offered laundry privileges first, not the cibc which copied them. 

the only thing tdw is missing is US divs in rrsp. Little-known is the fact that they tried offering true US dividends in USD to a pilot group of clients a couple years ago, but the experiment failed because it was far too hand-labour intensive for the big green to roll out to all of the clients.

also little-known is the fact that all of the tdw rrsp laundry is done by hand. It's a special team located at one of the call centres that works through the evening & night, making the washday adjustments manually. It's quite astonishing that they almost never make a mistake. Still, it's useful to monitor their work. My own transactions have always been perfect, but one cmf forum has reported a slight error that he discovered in his clean laundry when it was delivered back to him ...


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## Xoron (Jun 22, 2010)

T.Gal, other than the USD RRSP issue, how is your experience with CM brokerage?

I've been with them for quite a few years, and I'm pretty happy with the latest version of the IE website. More evolutionary than revolutionary, but it works well for me. I'm not doing anything too fancy, so it fits my needs.

I've also used TDWH, but I don't like their site nearly as much. One thing that bothers me with TDHW is the limited activity listing. I really like that with CIBC IE, I can search / filter my activities for up to 13 months.

My major beefs with CIBC IE:
- Stock screener / research tools are horrible. I just avoid them
- I can't change an open order's good til date. So I have to cancel the order and reenter with a new Good Til date (I can do this with TDWH)
- I wish there was a better way to look up open orders. I have an RRSP and TFSA at CIBC IE, and I can't see both sets of open orders on a single screen.

And I love the price ($6.95/trade). 

Humble Pie, thanks for the detailed reply.


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## HaroldCrump (Jun 10, 2009)

humble_pie said:


> IE all brokers save & except bmo, roybank, questrade, possibly scotia itrade & Qtrade. (harold can u please tell us about scotia itrade?)


There is no respite in Scotia I-Trade either.
They do not have USD RRSP accounts.
Therefore, all US dividends are converted into CAD and get the worst possible rate.

They do have that one-legged "US-friendly" RRSP account that provides a more competitive exchange rate than the retail rack rate.
But that doesn't help us with dividends.
Dividends still get converted into CAD at the worst possible rate.

Do not even dream of doing a synthetic DRIP because there will be a 2-way currency conversion hit.

The US-friendly RRSP is applicable only to currency conversion for trading activities.



> there's no use phoning them up & trying to pressure them to offer USD rrsp. They have all heard all of you, all of the time, long time already. There's nothing more to say


Yep, been there done that.
I stopped calling a long time ago.
I had a ray of hope when they converted their back-end system to Scotiabank and merged everything with Scotia Capital, but nothing's changed.


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## Toronto.gal (Jan 8, 2010)

Xoron said:


> 1. T.Gal, other than the USD RRSP issue, how is your experience with CM brokerage?
> 2. I've been with them for quite a few years, and I'm pretty happy with the latest version of the IE website.
> 3. I really like that with CIBC IE, I can search / filter my activities for up to 13 months.
> 4. I can't change an open order's good til date.
> 5. And I love the price ($6.95/trade).


*1.* No major complaints; as you said, it suits my needs also & don't rely on them for everything, ie: research.

*2.* It has been my only bank since a teenager, reason why I figured I would try their DB 1st, and have seen no reason thus far to change; after all, every DB has their own limitations & doubt there is one there that suits everyone's needs. It took a little getting used to their new site, but I have forgotten the old one by now, see how adjustable humans are, or rather adaptable? :biggrin:

*3.* I don't think the 13 months is unique to them though.

*4.* I know, you have to cancel and enter a new order. Be aware, if you aren't already, that even day orders don't have an expiration date. I have had fills for day orders after 4 p.m.

*5.* For active traders like me, it's the best pricing as they have consolidated fees, hence you get that price whether you trade X company once, or 10x on the same day. If I was with another brokerage, I would have changed to CIBC for this!


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## Xoron (Jun 22, 2010)

Toronto.gal said:


> *3.* I don't think the 13 months is unique to them though.


I would expect other brokerages to support this as well, I was just disappointed that TDHW didn't



Toronto.gal said:


> *4.* I know, you have to cancel and enter a new order. Be aware, if you aren't already, that even day orders don't have an expiration date. I have had fills for day orders after 4 p.m.


Really? I've never had that happen. Thanks for the heads up



Toronto.gal said:


> *5.* For active traders like me, it's the best pricing as they have consolidated fees, hence you get that price whether you trade X company once, or 10x on the same day. If I was with another brokerage, I would have changed to CIBC for this!


Are you specifically talking about a single order that takes multiple fills? Or multiple stock orders placed separately, and only one fee charged?


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## Toronto.gal (Jan 8, 2010)

Xoron said:


> 1. Really? I've never had that happen.
> 2. Are you specifically talking about a single order that takes multiple fills?
> 3. Or multiple stock orders placed separately, and only one fee charged?


*1. *It doesn't happen that often, but it has happened to me, so I'm speaking from personal experience. Day-orders technically do expire by end of market-day, but recently an order of mine filled at 5:30 p.m, and when the next day I noticed that the order had filled, I called my broker and asked for an explanation, which was that they always try to find a match for their customers.

*2.* Not referring to single orders that fill in multiple lots on the same trading day, which = a single commission, as is the case with most brokerages. 

*3.* Yes [of same stock]. 

And btw, this is not only good for traders, but buyers in general. Say for example that you purchased 100 sh of x stock @ x price & hours later you want to buy more due to a significant drop, would other brokers not charge a 2nd fee? I think they do, CIBC only charges a single fee per execution per stock per day [execution = buy and sell].

It helps one to average down so to speak. For example, when I buy in high volume, I don't enter a single order for it, but I might break it up in 2 or more orders [depending on the purchased volume of shares/volatility] & use multiple prices.

Scroll down to 'trades' - last paragraph of that section.
https://www.investorsedge.cibc.com/ie/benefits/fees-and-commission/commission-rates.html


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## My Own Advisor (Sep 24, 2012)

TDW is coming out with their USD $ RRSP soon. Spring 2013, which is, uh, like now unless you live in friggin' Ottawa.


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## humble_pie (Jun 7, 2009)

over the past several years, in fact ever since they bought TOS, the big green has experimented with 2 other mainframes - other than ISM, that is. These experiments have been the cause of all the delays tdw has experienced in attempting to build & launch a USD rrsp.

the current initiative is said to be based upon ISM itself, something other brokers have thought would be impossible.

will it launch? i for one am not holding my breath ... i'd move my rrsp to bmo in a flash, except for the fact that bmo is hopeless at options & i have such an efficient rrsp option commish arrangement with the big green.


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## Cal (Jun 17, 2009)

Basically every broker will only allow you to drip whole shares (synthetic drip). If you want to do a traditional drip and get fractional shares, you would have to do it directly (non registered) via registering the shares in your name. 

More info can be found at www.dripinvesting.org. I recommend reading some of the articles first prior to starting to ensure you understand what you are doing in to in regards to witholding taxes/company plans/costs and such.


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## valueindexer (Jun 17, 2011)

How is the synthetic DRIP in TD RRSP worse than getting the dividends and buying more shares? In both cases wouldn't you have the cash converted to CAD in between? Or does TD allow you to avoid the conversion for USD dividends when you aren't using the DRIP?


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