Best investment platforms for Canadians.

The Most Popular Services for Canadians to Trade Stocks

Are you looking to trade online? There are a plethora of options and these cater to various aspects. Therefore, the variety can sometimes be confusing. Yet, it is necessary to understand them to know what serves your purpose the best. Here we compare some of the popular services on a common basis.

They are Questrade, Qtrade Investor, TD Direct Investing, Interactive Broker, and WealthSimple.

Trading Platform Fees:

Questrade:

With no annual account fees, this is possibly the best trading service not just in the Canadian Stock Market, but also in the US market. There are two pricing plans --- Democratic pricing also the default one and Questrade Advantage, or the active trader program. The democratic option is considered the best because the pricing is fair, transparent, and capped for regular stock trade. As per the Advantage plan, you are asked to select one advanced market data offering, before opting for the variable or fixed-rate pricing plan. In the democratic plan, the regular stock trades are $.01 per share, with charges varying between the minimum of $4.95 and a maximum charge of $9.95. The options trades are $9.95 + $1 per contract and Exchange-traded funds or ETFs are commission-free. In the advantage plan, you have trading options, in which the cost is $6.95 + $0.75 per contract (Variable plan) or $4.95 + $0.75 per contract (as per fixed plan).

Qtrade:

The trading fee and commissions are comparatively higher in this service. However, one can avail of considerable discounts if they are active traders. There is almost a $2 difference between the fee for active trader fee and standard fee, as Qtrade offers considerable discounts to active traders who make 150 or more trades per quarter. There are commission discounts if your investment balance on the platform is at least $500,000 through their Investor Plus program. There is also a boost for young investors in the age group of 18 years to 30 years, with discounts for stocks and ETFs, apart from waiving off quarterly administration fees. The other fee structures you have to know are the fee charged when you transfer your account to other financial institutions, when you close your account within the first year of opening it, paper account statements, and paper trade confirmations.

TD Direct Investing:

The fees are not competitive--- this is a unanimous opinion in most of the reviews for the service. The trading commissions are a flat $9.99 for Canadian and U.S. stocks. Further, there is $1.25 added to this base fee under the options contract. However, as an active trader with 150 or more trades per quarter, you can instead pay $7 per trade (almost$3 less). If you make a transfer of $25,000 or more to TD Direct Investing, you get a transfer-fee reimbursement of up to $150.

Interactive Brokers:

Interactive Brokers has two primary pricing plans--- IBKR Pro (professionals) and IBKR Lite (casual investors). Since it is for professional traders and institutional investors (e.g., hedge funds), it is the best for active trading. Under IBKR Lite, there are no inactivity fees or data fees. All US stock and ETF trades are $0, while options traders follow the same IBKR Pro pricing. While IBKR Pro is designed for professionals, you have IBKR Lite for casual investors. In the case of IBKR Pro stock trades, there is a standard fixed pricing US stock trades run $.005 per share between a minimum of $1.00 and a maximum of 0.5% of trade value. With IBKR Pro options trades, using Interactive Brokers SMART routing, commissions per options contract are tiered. For premiums between $.05 and $.10, the rate is $.50 per contract. For those less than $.05, the rate is $.25 per contract.

What new and casual investors should be aware of are the miscellaneous fees and minimums charged by Interactive Brokers.

Wealthsimple:

Wealthsimple is a new option for Canadians to use for investing. It offers no-fee trading and there is no account minimum. Wealthsimple also offers a robot investing plan, in which portfolios are managed by Wealthsimples algorithms. There is a .4% to .5% management fee and benefits based on how much money you deposit into the account.

Exchange rates:

Questrade:

The service claims that you get competitive pricing on over 110 currency pairs with target spreads of as low as 0.8 pips under normal market conditions.

Qtrade:

Like most competitors, Qtrade has 2 base currencies: USD and CAD. If you fund your trading account in the same currency as your bank account or you trade assets in the same currency as your trading account base currency, there is no conversion fee applied. The best way to manage this is by opening a multi-currency bank account at a digital bank. These usually offer bank accounts in several currencies with great currency exchange rates, as well as free or cheap international bank transfers. Opening an account only takes a few minutes on your phone.

Interactive Brokers:

The integrated account helps you to convert the amount into a many as 23 currencies through the currency conversion tool. There are two venues to convert currencies on Interactive Brokers –IDEAL PRO and FXCONV. IDEAL PRO is quite similar to a stock trade. There is an order book assembling quotes from the largest international forex banks as well as other IB clients and market makers. While there is no markup, there is a commission of around 0.1 to 0.2 basis points of the trade value, subjected to a minimum of US$2 per trade. FXCONV costs less and is quicker in execution. It is available on their Trader Workstation (TWS) platform.

Wealthsimple:

Though all trades on Wealthsimple are fee-free, in order to buy US stocks, users must use the exchange rate of 1.5 x their Corporate FX rate. Wealthsimple plans to introduce US accounts but the timeline has not been announced yet.

Base currencies:

  • Questrade: You can choose from two base currencies--- USD (American Dollar) and CAD (Canadian Dollar).
  • Qtrade: There are again two base currencies--- USD and CAD.
  • TD Direct Investing: There are two base currencies for the service---USD and CAD.
  • Interactive Brokers: You can trade in as many as 23 currencies with one single account.
  • Wealth Simple: The base currency is Canadian dollars, CAD, you can choose to buy US stocks with Canadian dollars with the WealthSimple exchange rate.

Ease of Use:

Questrade: Its web trading platform has been reviewed to be user-friendly, while its desktop platform is highly-customizable. For the alert and notifications, you can also set price and trading volume alerts and combine them with various equations. The alerts can be received on multiple email addresses and SMS as well. The mobile trading platform is again as user-friendly as it can be and has a two-step verification process to make it convenient and safe to use.

Qtrade:

There is a web-based trading platform, apart from iPhone and Android apps. The reviews for the apps have largely been about how to glitch they are, and the website has been rated to have an obsolete look. Users have a 30-day free trial offer for testing the trading platform. However, it is rated high for its stock research center and portfolio analysis tools. The one-step registration process leaves a lot to be desired.

TD Direct Investing:

The mobile app for the service gets huge thumbs up from its users. It has been rated high for its user-friendly approach to all its features. Moreover, TD offers an online and mobile Security Guarantee. If you experience a loss due to unauthorized transactions on your account, you will receive 100% reimbursement (however, terms and conditions apply). The apple and android apps are available in English, French, and Chinese. You can trade stocks, ETFs, and options, and it is also integrated well with a web broker, its popular trading platform. The service is also a comprehensive website platform.

Interactive Brokers:

Mobile trading with Interactive Brokers gets a huge fillip across platforms. It offers everything you need for trading on the go without hassles. As per reviews, a drawback in the apps is that stock alerts aren’t sent via push notification, but they are delivered via email. This is a problem considering how technologically upgraded the service otherwise is. It is also rated less for being a replica of its desktop platform.

WealthSimple:

Trading is easy with Wealthsimple via their mobile app and desktop. Signing up for an account is an easy and quick process. Once you sign-up for one account getting registered for their other services is easy. Users describe the platform as sleek and easy to use.

Services:

Questrade:

You can trade all among the asset classes like stocks, bonds, ETF, forex, etc, but not crypto or future. Moreover, it covers the US and Canada markets alone. Qtrade: The investment choices include stocks, ETFs, mutual funds, bonds, guaranteed investment certificates, options, and new issues.

TD Direct Investing:

The variety of investments include equities, ETFs, options, mutual funds, precious metal certificates, fixed income assets, term Deposits.

Interactive Brokers:

It has the most diverse offering in the industry and gives you a wide margin in multiple areas, including international trading. Globally, customers can trade across more than 135 international markets in 33 countries.

WealthSimple:

WealthSimple Trade allows you to trade stocks and ETFs. If you branch out to their other services you can trade crypto, do your taxes, or use their Robo investors to manage your portfolio.

Types of accounts:

Questrade:

There are options for a margin account, forex, and CFD (contract for difference account), tax-free savings account (TFSA), Retirement Accounts (RRSP, Spousal RRSP, Locked-in Retirement Accounts (LIRA), Locked-In RRSP, Registered Education Savings Plans (RESP, Family RESP), and Entity Accounts (Corporate, Investment Club, Partnership, Sole Proprietorship, Trusts).

Qtrade:

Some of the personal accounts offered are individual and joint taxable accounts and registered accounts such as Registered Retirement Savings Plan (RRSP), TFSA, LIRA, RESP, RRIF, Life Income Funds (LIF), cash and margin accounts. There are corporate and business investment accounts that can be availed by investment clubs, trusts, estates, religious organizations, societies, etc.

TD Direct Investing:

The broad range of accounts includes TFSA, RRSP, RESP, Registered Retirement Income Fund (RRIF), LIRA, LIF, Registered Disability Savings Plan (RDSP), margin, and cash accounts.

Interactive Brokers:

You can invest in stocks, options, futures, currencies, bonds, and funds from an integrated account. You can also fund accounts in multiple currencies and trade assets denominated in multiple currencies. There are options for individual accounts, joint accounts, retirement accounts, trust accounts, and institutional accounts.

Wealthsimple:

With WealthSimple Trade, you can have an RRSP, TSFA, cash, and nonregistered tax accounts. If you would like to invest with a different account, their Robo portfolio option offers a larger variety of account types.

Pros and cons:

Questrade:

Pros:

  • Free withdrawal.
  • Zero deposit fee.
  • Customer-friendly.

Cons:

  • The slow withdrawal time of over three days.
  • Wire withdrawal gets expensive.
  • No debit or credit card.

Qtrade:

Pros:

  • Reimburses transfer fees when you transfer assets of $15,000 or more
  • Innovative portfolio management tools.
  • A broad variety of products.
  • Excellent customer support.

Cons

  • Average trading commissions.
  • 100 free ETFs offered with high requirements.
  • No incentives for new clients.

TD Direct Investing:

Pros:

  • Access to investing platforms and advanced trading tools.
  • Key to multiple investment accounts and securities.
  • A highly-rated mobile app by real users.
  • Comprehensive and free investment education resources.
  • For higher sum transfers, reimbursement of fees
  • Possibility to set up dividend reinvestment plans (DRIP) and pre-authorized purchases for mutual funds.

Cons:

  • High fees
  • A quarterly fee increases investment costs.
  • No discount for young investors like students.
  • Interactive Brokers

Pros:

  • Low commission.
  • Low margin rates.
  • Fractional shares.
  • Supports socially responsible investing behavior

Cons:

  • Inactivity fees.
  • Not so easy to use a website.

Wealthsimple

Pros:

  • Fee Free Trades
  • User-friendly trading platform
  • No minimum account balances
  • Customer Support

Cons:

  • Limited to ETFs and Stocks
  • CAD accounts only (mandatory exchange rate to the US)
  • Less variety of stock when compared to other platforms

Account minimum:

  • Questrade: The minimum deposit amount is $1,000.
  • Qtrade: There is no minimum balance to start trading using Qtrade.
  • TD Direct Trading: There is no minimum investment.
  • Interactive Brokers: The minimum balance is $0.00
  • WealthSimple: No minimum balance

That concludes our list of Canada's most popular investment platforms. If you would like to trade stocks in USD and want to avoid expensive currency exchange rates, try exchanging your currency online with Remitbee Online Currency Exchange.

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