Thursday, 12 March 2009

HSBC Lets You Trade Around the Clock

The title of my post is a bit of a teaser. HSBC InvestDirect Canada has actually just announced that it is adding direct online stock trading in the three major European markets - the London Stock Exchange, Euronext Paris and Frankfurt Stock Exchange. HSBC already offers direct online trading to the Hong Kong market as well as the usual Canadian and US market access. There's a market open somewhere to trade in 24 hours a day for you trading junkies.

The HSBC accounts offer the ability to settle trades and hold account cash in 10 different currencies. That is beneficial to avoid currency exchange costs and may be useful to Canadians like me in foreign lands who want to hold the local currency.

HSBC's action of enabling online DIY online access is a step in the right direction of making investing worldwide a level playing field. As I noted recently, the TSX is getting to be a thinner market all the time so diversifying internationally is necessary.

It is possible to diversify internationally using index ETFs through US markets but purchasing individual company shares is limited to a few ADRs. (It is interesting that the US ETF for the UK FTSE index, symbol EWU on NYSE seems to do as good a job tracking the index as the one in pounds sterling traded in London under symbol MIDD.)

HSBC needs to do one thing to make their offering more compelling and competitive - lower the trading fees. The minimum trade commission is £55, or about $100 for the London exchange. That is steep for a "no advice" service. I find it strange that their UK arm can offer trades for a flat price of £11.95. Why not in Canada too?

1 comment:

Charles said...

Yikes, that's steep indeed. For that kind of money wouldn't it be better to use IB for international exchanges (with the proviso that they don't do RRSPs)?

(Disclosure: I am neither an HSBC nor IB customer.)

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