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How to invest in AmeriHome Mortgage

AmeriHome Mortgage has withdrawn its plans to go public in favour of an acquisition by Western Alliance Bancorp.

AmeriHome Mortgage has cancelled its IPO. Instead, the company is being bought by Western Alliance Bancorporation. Even though you won’t be able to buy stock in AmeriHome Mortgage directly, there are still ways to back the company.

What we know about the AmeriHome Mortgage IPO and acquisition

On February 16, 2021, Western Alliance Bancorporation announced that it reached an agreement to buy AmeriHome Mortgage from Apollo Global Management, Inc. and Athene Holding Ltd. The deal is valued at approximately $1 billion and will reportedly close in the second quarter of 2021.

Prior to this, AmeriHome had been indecisive about whether it should go public. On October 1, 2020 AmeriHome filed a draft registration with the US Securities and Exchange Commission. The company had planned to go public on the NYSE under the ticker symbol AHM. The value of the proposed deal was $250 million.

About a month later, on October 29, AmeriHome announced it was postponing its IPO due to unfavourable conditions in the financial market. But by early January, 2021, the company had resumed its plans to go public.

Western Alliance has not indicated that it will move forward with an AmeriHome Mortgage IPO in the future.

About Western Alliance Bancorporation

Western Alliance Bancorporation (NYSE: WAL) is a large public bank headquartered in Phoenix, Arizona (US). It manages over $35 billion in assets and provides full-service banking, loan, deposit and treasury management services under a number of individually-branded divisions. Such divisions include Alliance Bank of Arizona, the Bank of Nevada, First Independent Bank in Nevada and Bridge Bank in Northern California.

Western Alliance also provides customized financing solutions to niche markets like hotel franchises, public and nonprofit organizations and homeowner’s associations (HOAs). As of April 2021, the company is among the top 100 largest banks in the US out of more than 5,000 commercial banks and savings institutions.

How to invest in AmeriHome Mortgage from Canada

Although you won’t be able to buy stock in AmeriHome Mortgage directly, there are 2 ways investors can back the company.

1. Buy stock in Western Alliance Bancorporation (NYSE: WAL)

Although it’s a less direct investment than purchasing AmeriHome stocks outright, one option is for investors to buy stock in its soon-to-be parent company, Western Alliance Bancorporation. Western Alliance trades on the New York Stock Exchange (NYSE) under the ticker symbol WAL.

You can access stocks sold on the NYSE using Canadian trading platforms like Questrade, Wealthsimple, Scotia iTRADE and Interactive Brokers.

How to buy stocks in Western Alliance Group

You’ll need a brokerage account to invest in Western Alliance Group. Here’s how it works:

  1. Compare share trading platforms. If you’re a beginner, look for a platform with low commissions, expert ratings and investment tools to track your portfolio. Narrow down top brands with our comparison table.
  2. Open and fund your brokerage account. Complete an application with your personal and financial details, like your ID and bank information. Fund your account with a bank transfer, credit card or debit card.
  3. Search for Western Alliance Bancorp. Find the stock by name or ticker symbol: WAL. Research its history to confirm it’s a solid investment against your financial goals.
  4. Purchase now or later. Buy immediately with a market order or use a limit order to delay your purchase until Western Alliance reaches your desired price. To spread out your purchase, look into dollar-cost averaging, which smooths out buying at consistent intervals and amounts.
  5. Decide on how many to buy. your budget against a diversified portfolio that can minimize risk through the market’s ups and downs. You may be able to buy a fractional share of Western Alliance, depending on your broker.
  6. Check in on your investment. Congratulations, you own a part of Western Alliance Bancorporation (and, indirectly, AmeriHome Mortgage). Optimize your portfolio by tracking how your stock — and even the business — performs with an eye on the long term. You may be eligible for dividends and shareholder voting rights on directors and management that can affect your stock.

2. Buy ETFs

You can also indirectly buy into AmeriHome Mortgage by investing in exchange-traded funds (ETFs) that track Western Alliance Bancorporation. By purchasing these ETFs, you can potentially earn gains when Western Alliance holdings like AmeriHome Mortgage are performing well.

The following ETFs hold investments in Western Alliance Bancorporation:

  • Direxion Fallen Knives ETF (NYSEARCA: NIFE)
  • Opus Small Cap Value Plus ETF (BATS: OSCV)
  • Direxion Daily Regional Banks Bull 3X Shares (NYSEARCA: DPST)
  • SPDR S&P Bank ETF (NYSEARCA: KBE)
  • SPDR S&P Regional Banking ETF (NYSEARCA: KRE)
  • iShares U.S. Regional Banks ETF (NYSEARCA: IAT)
A beginner’s guide to exchange traded funds (ETFs)

Tax implications of buying US stocks in Canada

Agreements between Canada and the US require Canadians holding US stock investments to pay the US Internal Revenue Service (IRS) a 15% withholding tax on any dividends earned on their US stocks. Interest earned from bonds or other interest-yielding US investments are similarly taxed at a rate of 10%.

An exception is made for stock investments held in trust exclusively designed to provide retirement income. Such trusts include RRIFs, LIRAs, LIFs, LRIFs and Prescribed RRIFs. RRSPs are also exempt from US withholding tax if you own US investments in the form of US stocks, bonds or ETFs.

Investment accounts that do not qualify for this exemption include RESPs, TFSAs and RDSPs.

All income from investments, including foreign investments, must be declared as part of your income on your Canadian tax return. Unless your US earnings are exempt from withholding tax, this means you’ll be double taxed on those earnings — first by the IRS, then by the CRA. However, the CRA may allow you to claim foreign tax credits for any taxes you’ve already paid to the IRS.

Speak with a tax professional to find out what rules and exceptions apply to your circumstances.

Compare stock trading platforms

You can compare features of stock trading platforms in the table below. Once you’ve decided on the right fit for your needs, click the “Go to site” button to get started.

Name Product Available Asset Types Stock Fee Option Fee Account Fee ETF Transaction Cost Feature Table description
OFFER
Wealthsimple Trade
Stocks, ETFs
$0
N/A
$0
Free
Get a $50 bonus when you open a Wealthsimple Trade account and deposit and trade at least $150.
Pay no commissions when you trade Canadian stocks and ETFs with Wealthsimple Trade.
BMO InvestorLine
Stocks, Bonds, Options, Mutual Funds, ETFs, GICs
$9.95
$9.95 + $1.25 per options contract
$0 if conditions met, otherwise $25/quarter
$0 - $9.95
Buy and sell a select group of Canada’s most popular ETFs without paying commissions.

An easy-to-use online trading platform with access to research, tools, and the option to access InvestorLine adviceDirect for additional professional support.
Scotia iTRADE
Bonds, Options, Mutual Funds, ETFs, GICs, International Equities
$4.99-$9.99
$9.99 + $1.25 contract ($4.99 + $1.25 contract if completed 150 trades or more a quarter)
$0
$9.99 ($4.99 if completed 150 trades or more a quarter)
Pay no annual account fees.
Buy, sell and trade ETFs, Equities, Options and more with competitive commissions.
CIBC Investor's Edge
Stocks, Bonds, Options, Mutual Funds, ETFs
$4.95 - $6.95
$4.95 - $6.95 (+$1.25 per contract)
$0 if conditions met, otherwise $100/year
$6.95
$4.95 - $6.95 is applicable for online stock, ETF and option trades only. Pay $4.95 when you qualify as an Active Trader (trade 150+ times per quarter).
An intuitive and easy-to-use platform with access to a variety of tools that help you make smart decisions and trade with confidence.
Interactive Brokers
Stocks, Bonds, Options, ETFs, Currencies, Futures
Min. $1.00, Max. 0.5% of trade value
$1.50 min. per order
$0
Min. $1.00, Max. 0.5% of trade value
Extensive trading capabilities and global investment tracking.
Access market data 24 hours a day, six days a week and invest in global stocks, options, futures, currencies, bonds and funds from one single account.
Questrade
Stocks, Bonds, Options, Mutual Funds, ETFs, GICs, International Equities, Precious Metals
$4.95-$9.95
$9.95 + $1 per contract
$0
Free
Get $50 in free trades when you fund your account with a minimum of $1,000.
Opt for self-directed investing and save on fees or get a pre-built portfolio and take some of the guesswork out.
OFFER
Qtrade Direct Investing
Stocks, Bonds, Options, Mutual Funds, ETFs, GICs
$6.95 - $8.75
$6.95 - $8.75 + $1.25 per contract
$0 if conditions met, otherwise $25/quarter
$0 - $8.75
Get up to 50 free trades. Be one of the first 100 new Qtrade clients to use the promo code 50FREETRADES and deposit a minimum of $10,000 (or top up to $15,000 to get $150 transfer fees waived). Valid until September 30, 2021.
Qtrade Direct Investing offers low trading commissions and an easy-to-use platform with access to powerful tools and a wide selection of investment options. Trade 100 ETFs free of charge and thousands more for $8.75 or lower.
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Disclaimer: This information should not be interpreted as an endorsement of futures, stocks, ETFs, CFDs, options or any specific provider, service or offering. It should not be relied upon as investment advice or construed as providing recommendations of any kind. Futures, stocks, ETFs and options trading involves substantial risk of loss and therefore are not appropriate for all investors. Trading CFDs and forex on leverage comes with a higher risk of losing money rapidly. Past performance is not an indication of future results. Consider your own circumstances, and obtain your own advice, before making any trades.

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