Westpac jumps into the discounting lead

Westpac has leapfrogged Comsec and Quicken in the discount trading war, offering online trading up to $15,000 for $15 in brokerage. This rate is to become effective from 10 April 2000.

Customers are not required to set up a specific bank account and must be sponsored into CHESS by Westpac.

How does this compare to the offers from Comsec and Quicken ?

1. Westpac is offering the reduced fee ($15) for online trades up to $15,000, while the Comsec ($19.95) and Quicken ($19.90) offers are for trades up to $10,000.

2. The Comsec offer requires you to open a cash management trust account with the Commonwealth Bank with a minimum initial deposit of $5,000, while with Quicken and Westpac the customer is not required to set up a specific bank account.

3. Effective dates :

Quicken 30/3/2000
Comsec 3/4/2000
Westpac 10/4/2000.

4. All offers require that the customer be sponsored into CHESS by the broker. A CHESS sponsorship form is required to be completed upon application. The customer’s existing shareholdings must also be transferred to these brokers.

It is interesting to note that the discounting is not extended to the non – advisory phone services offered by each of these online brokers. Online brokers generally, have received negative publicity in regard to their phone services. While the discounting represents an attempt to increase market share, it is also an attempt to push investors online.