A very minor point with buying 3rd party GICs in a self directed investment account is, when they come due we may lose day(s) of interest because (a) automatic renewal is not possible, (b) information displayed on clients computers is prior day, (c) might be weekend days immediately following, and (d) have to diarise to phone and talk to a broker on expiry day to do a renewal/alternate purchase as, at some point unlike us, they should be able to see the same day credit for P & I.

dougjp said

I do 1 year terms and Peoples has pretty consistently offered more than 25 BP less when dealing directly than I can buy through my investment account (where they are quite competitive but not the best) AND on top of that, they pay a fee for selling this way!

Looks to me like they think they can save money, believing their own clients are uninformed, an attitude which really bothers me. I have 4 coming due this year and because of this, they are probably going to lose all my business. I wrote to them about this a week ago, no reply.  

I have opined before that a GIC issuer, while it pays a commission of 25bp times face value times years of term to the agent (brokerage), one reason why it can do this economically is it eliminates the CSR client interface burden that would otherwise go with serving retail clients directly. It costs money to have CSR staff.

The other, probably primary, reason is the degree of and type of competition in each of the two markets (retail and brokerage). An issuer will pay only what it needs to pay to attract the funds it needs. Over years of observation, I think I can say that retail yields have generally been higher by 25-50bp than through a brokerage but is not always the case, like now. That may due to competing yields of other products through a brokerage, e.g. short term (1-5 year) bonds, and money market mutual funds and ETFs et al.

I don't think anyone should take it personally. It is simply the market in which one decides to play.

Today, Fairstone Bank is stepping up at BMO InvestorLine:

hwyc said
Peoples is absent on TDDI's GIC rate sheet as well 🙁

… double sadness - rates on Peoples own site (2Y 3%) is unrealistically out of line!  

I do 1 year terms and Peoples has pretty consistently offered more than 25 BP less when dealing directly than I can buy through my investment account (where they are quite competitive but not the best) AND on top of that, they pay a fee for selling this way!

Looks to me like they think they can save money, believing their own clients are uninformed, an attitude which really bothers me. I have 4 coming due this year and because of this, they are probably going to lose all my business. I wrote to them about this a week ago, no reply.

… double sadness - rates on Peoples own site (2Y 3%) is unrealistically out of line!

One is buying pre-owned bonds out of an inventory. Like buying used cars!

The inventory, markup, and commissions vary. All those bankers acceptances and Quebec municipal bonds I bought through BMO InvestorLine weren't even available at Scotia iTRADE.

BMO InvestorLine doesn't have minimum commission or a fixed commission for bonds. That often results in better yields than Scotia iTRADE's $1 per $1,000 bond, $24.99 minimum per order.

Norman1 said
I don't know if RBC Direct Investing offers US treasury bonds in its bond inventory or not.

BMO InvestorLine does. One can get a bit better than 3.4% at BMO InvestorLine through US treasury bills 69 days or longer:

DaysPriceYield
(semi-annual)Yield
(annual)
US GOVT TBILL 29SEP261899.842 U3.143.165
  

RBC DI doesn’t show US Treasuries online. I called them and they said they do sell them.
The only way I could compare would be to get a BMO IL account, now that it is 0 commission. But wanted to avoid having 1 more account.

Do you think the rates would be much different between RBC or BMO on US Treasuries?

I was thinking of moving some funds from QUESTRADE USD ISA to some higher yielding US Treasuries. Any thoughts?

Something must have gone wrong. It's always worked for me, and I've never had to wait.

Dean