5 Best Online Brokerage Canada Reviews in 2021 | Hassle-free Investment Options

September 23, 2021 | Editorial Team

Investing in the stock market is becoming increasingly accessible for the average Canadian. Trading and investments were once reserved for the rich or financially savvy. However, the introduction of online brokerages in Canada has made it easier than ever for the average person to invest their money. The number of online brokers is continually increasing, giving Canadians a plethora of options.

Online brokers are known for having extremely low fees. This makes investing in the stock market attainable for anyone, regardless of how little or how much money you are looking to invest. Once you have decided to invest, how do you find the best brokerage for you? To help make your decision easier, we will look at some of the best online brokerages in Canada.

What is an Online Brokerage?

An online brokerage is a system that allows you to open an investment account and buy and sell stocks, bonds, and exchange-traded funds (ETFs). This trading is done independently, without the help or guidance of a trading advisor. The absence of an advisor or trading agent enables you to keep the fees to a minimum. Trading on the stock market using an online brokerage can be much more cost-effective.

To trade on the stock market, you must first open your investment account. Although investing in the stock market can be a higher risk than other investment options, the potential gain is also much higher. When you trade using an online brokerage platform, choosing which companies to invest your money into is 100% your decision. You are responsible for building your trading portfolio, managing your assets and knowing when to buy and sell stocks. For long-term investors, it helps to track Canadian bank earnings as bank stocks are considered safe (see also ‘Best Canadian Stocks to Buy Right Now‘).

You can trade using your online account as frequently as you choose. You also have the option of downloading the mobile app connected to the brokerage you select, making trading even easier!

Best Online Brokerages Reviews

1. Questrade (BEST OVERALL)

Questrade is frequently voted as the best online brokerage in Canada. Founded in 1999, it has remained a firm favourite with Canadian investors. Questrade offers an interface that is extremely easy to use, as well as a competitive fee structure.

One of the reasons it is so highly regarded is because of the low fees it charges an investor to open and use a trading account. Questrade also scores highly for its customer service and mobile app experience. Questrade caters to both long-term and short-term investors. Their trading platforms are easy to use. They help you find new investment opportunities and monitor the stock market in real-time. They also allow you to easily track your investments.

Questrade has been helping investors to trade online for over 20 years. It is popular with both new investors and experienced traders. Over 200,000 accounts are opened every year with Questrade. They also have more than $25 billion in assets under administration. Questrade is also a 9 times winner of Canada’s Best Managed Companies, making them an online brokerage that can be trusted and relied upon.

For those who are less confident trading independently or want someone to help them manage their account, Questrade also offers a robo-advisor service. Rebranded as Questwealth in 2018, your investment goals will be matched with smart technology.

You will be asked to answer a questionnaire about how you would like to trade and your investment goals. You also decide the level of risk you are willing to trade with. Questwealth will then choose a trading portfolio for you. This will be made up mainly of ETFs, as these have lower fees attached. Portfolio managers will adjust your portfolio to reduced risk and maximize gains. All rebalancing will be done in real-time.

They also offer Self-Directed Investing. This allows you to build your own portfolio and save money on the fees.

For new or inexperienced investors, Questrade offers a demo account. IQ Edge is a risk-free demo account that can be used for 90 days. This allows you to test the markets, experience the trading platform and develop your skills. Questrade will give you $500,000 CAD and $500,000 USD virtual cash to practise trading with.

Questrade is a discount brokerage as they help you invest for a reduced commission rate. Using Questrade, you can trade stocks, bonds and ETFs. You can also trade mutual funds, initial public offerings (IPOs) and even precious metals such as gold and silver.

Pros

  • They charge no annual fees – regardless of how big or small your account is.
  • There is no fee for trading ETFs. Other trading fees can vary from $4.95-$9.95 per trade. Management expense ratios are only 0.2%.
  • There is no cost for opening or closing online brokerage accounts with Questrade.
  • They offer socially responsible investing options. This means the company focuses on environmental, social and corporate governance qualities.
  • You will be reimbursed $150 if you transfer your investment account from another brokerage.
  • There is no inactivity fee for less frequent traders.
  • Multiple trading platforms are available, including the mobile app.
  • You can trade in US$ and CA$, meaning that you do not pay currency conversion charges.
  • They are a member of the Canadian Investor Protection Fund (CIPF). This means investments are protected, up to $10,000,000 in the event of bankruptcy.
  • Active traders can access special pricing plans. They can also receive fee rebates.
  • Investors can access various investing and market researching tools to help you make the right trading decisions for you.
  • You can create a watch list or set your investment goals. If there is any important activity, Questrade will send you a notification.
  • As they are a discount brokerage, you save money by not paying high commission fees.
  • Pre-built portfolios are available for relatively low management fees. Fees range from 0.20%-0.25%. This involves an expert designing your portfolio based on your financial goals.
  • There are no annual RRSP or TFSA account fees.
  • They provide excellent customer service that can be contacted through a variety of channels.
  • They provide multiple options for funding your account.
  • They offer tax-loss investing.
  • Questwealth offers automatic rebalancing of your account.

Cons

  • You must have a minimum of $1,000 in your account before you can trade.
  • If you have less than $1,000 in investments, you will be charged $24.95 per quarter.
  • Bonds have a minimum purchase amount of $5,000.
  • You can only hold cash in CAD or USD.

Summary

For investors who are looking to pay the lowest possible fees, Questrade is frequently rated as the best online broker in Canada. You still have access to advice and investment information to help you optimize your investments and use your account wisely. Questrade can accommodate all different kinds of investors. This can range from inexperienced, less frequent users to more knowledgeable and skilful traders.

Questrade is known for its excellent customer service. They are always on hand if you have any questions or concerns regarding your account or trades. If you are only looking to trade occasionally or are only looking to invest a very small amount of money, Questrade online brokerage may not be the best trading platform for you.

Signing up for a Questrade account is quick and simple. There are multiple ways to transfer funds to your account. Keep in mind that there is a minimum deposit amount of $1,000. You can choose whether to make all our investment decisions yourself and be an active trader. Alternatively, you can automate your portfolio. You could choose a robo-advisor, a portfolio manager or a Questwealth portfolio.

2. Wealthsimple (BEST FOR NEW INVESTORS)

Wealthsimple is the largest robo-investing company in Canada. This means you receive financial advice and investment management with minimal human interaction. A computer algorithm is used to design, organize and manage your investment account and portfolio. Using robo-investing is a passive, hands-off way to invest. Wealthsimple aims to make trading simpler while still maintaining a low cost.

Over 1 million people use Wealthsimple products around the world. They have over $3 billion in global investments and more than $8 billion in assets. This worldwide broker has offices in Canada, the US and Europe. Wealthsimple Trade provides the only commission-free trading platform in Canada.

Wealthsimple will ask questions about your trading style, risk level and stock interests. This helps them to create your portfolio. There is no minimum investment for you to open an account. Wealthsimple uses Modern Portfolio Theory to design your portfolio. This is a Nobel Prize-winning theory that helps minimize risk and maximize gains/

Robo-investing is not for everyone. For those who would like to have more control over their account, Wealthsimple has launched a new trading platform. This allows you to have a more hands-on approach to your investments. All Wealthsimple customers can receive a free portfolio review. It will analyze the fees you pay, the tax efficiency of your investments and your overall portfolio allocation.

Both the trading platform and the trading app include superior technology and are easy to use. You can choose to organize trending stocks by category or market type.

Wealthsimple takes security and safety very seriously. They protect your account with the highest security measures. This includes two-factor authentication and data encryption. All assets are held and protected by the Financial Services Compensation Scheme (FSCS).

Wealthsimple has three trading tiers to match your finances.

  1. Wealthsimple Basic – For those investing less than $100,000. There is a 0.5% management fee.
  2. Wealthsimple Black – For those investing $100,000 – $500,000. The management fees are 0.4%. You also have access to a financial planning session and tax information.
  3. Wealthsimple Generation – For investments over $500,000. The management fees are 0.4 %. You have access to a team of financial advisors, a more individualized portfolio and higher investment options.

They also have three primary portfolio options:

  1. Conservative – This is heavily weighted to low volatility bonds. It is best for investors who want extremely low-risk investments with a modest return.
  2. Balanced – This has a 50/50 ratio between bonds and equities. It is best for investors with a low-medium risk comfort level.
  3. Growth – This is heavily weighted to stocks. It is best for those with a medium to high-risk tolerance level. The potential growth is likely to be higher.

Pros

  • Trading stocks on Weathsimple is entirely commission-free. This is great for those who want to trade more frequently for lower amounts as they will not have to pay fees each time they trade.
  • ETF MERs are only 0.1%-0.2%. This is much lower than Wealthsimple’s competitors.
  • Your investments are protected by the Canadian Investor Protection Fund. Up to $1,000,000 is protected in your account.
  • There is no minimum investment amount. You also do not need a minimum amount in your account at any one time.
  • It is quick and easy to open an account. You simply need to answer a few questions about your financial goals and risk comfort level. Weathsimple will then suggest a portfolio based on your answers.
  • You can set up automatic contributions. This ensures you are consistently contributing to your investments.
  • They offer Socially Responsible Investing (SRI) and halal-compliant portfolios.
  • Transfer fees from other brokers are reimbursed, as long as your transfer amount was above $5,000.
  • Wealthsimple Black and Generation clients will receive automatic tax-loss harvesting.
  • Although they are known for their robo-advisors, Wealthsimple also has human customer service. You can contact them via phone, email, or social media.
  • They are the largest robo-advisor platform in Canada. This means they are experienced and knowledgeable web brokers.
  • There is a wide range of investment options in both Canada and the US.
  • They provide access to free tax-loss harvesting information.
  • They are a discount brokerage, meaning you will not pay high commission fees.
  • You can choose registered investment accounts, such as RRSPs and TFSAs.

Cons

  • The online trading platform is still in the early stages of development. This means most trading is done on the mobile app. This means that stock analysis tools are less detailed than other online platforms.
  • There is a 15-minute delay, so the latest market prices and information may not be accurate.
  • You are charged a 1.5% currency conversion fee per trade in the USA.

Summary

Wealthsimple is the online broker best for those who want to invest their money with minimal effort and involvement. It is great for those who do not feel that their trade knowledge is sufficient or are worried about their lack of experience in direct investing. It is particularly popular with first-time investors.

Weathsimple has moved to a trading platform with more independent investing. This makes them even more attractive, compared to other online brokerages. Their low fees and minimum account requirements make them popular with a variety of Canadian investors.

Wealthsimple is a fantastic option for the average Canadian. Particularly, those who want to invest their money without the time commitments and with low effort. However, experienced traders may require more trading information and a less simplistic interface. If this sounds like you, Wealthsimple may not be the best option.

3. Scotia iTrade

Scotia iTrade is a top-rated online brokerage for any level of investor. Scotia iTrade is owned by Scotiabank, one of Canada’s ‘Big 5’ banks. Scotiabank purchased E*Trade Canada in 2008, before launching Scotia iTrade one year later. It has been an extremely popular online broker ever since.

They offer an impressive number of educational tools and resources for their clients. This includes articles, videos and webinars. They also offer a Knowledge Navigator to help you find the best educational path to meet your investment goals.

You can choose to open a registered, non-registered or non-personal investment account. Scotia iTrade is registered with the Investment Industry Regulatory of Canada (IIROC). They are also a member of the Canadian Investor Protection Fund (CIPF). This insures your investments, up to $1 million.

Scotia iTrade also offers a security guarantee. Any fraudulent activity or unauthorized transactions will be refunded.

Scotia offers numerous discounts to its customers. They encourage young investors by waiving the low activity quarterly fee for investors under 26. Active traders and high net worth traders will also receive a discount. Newcomers to Canada also receive 10 free equity trades through the Start Right program.

Pros

  • The trading platform is excellent. It allows you to manage your investments from your computer or mobile device. It has integrated banking and trading all on one screen.
  • The practice accounts allow you to try online investing without the risk of losing money. You can test the trading platform and improve your investment skills and knowledge risk-free.
  • They offer competitive pricing with some of the lowest commission structures in the industry.
  • They are one of only a few online brokerages that offer commission-free ETFs.
  • They offer low-cost commissions and innovative technologies. This helps you maximize gains on your investments.
  • Scotia iTrade offered the first sustainable investing tool in Canada.
  • You can invest in several products, including stocks, bonds, ETFs, Mutual Funds and GICs.
  • Receive $100 or 50 free equity trades for every referral you make.
  • Opening an account is quick and simple, taking less than 30 minutes. You can open an account online, over the phone or in person.
  • There is no minimum deposit or balance requirement.
  • There are no surcharges for trading penny stocks or for making large orders.

Cons

  • There is a $25 low activity fee per quarter. To qualify for active trade pricing, you may make at least 150 trades per quarter.
  • Equity trade fees are higher than the industry average, at $9.99 per trade.
  • There is no robo-investing service.

Summary

Scotia iTrade’s website functions and trading platform offer superior technology. It also offers extremely advanced features. It is viewed as being one of the best platforms in the online brokerage industry. They provide excellent additional features such as the ability to pay bills and access their own Trading Desk Software. You can also access educational resources

Their practice trading feature makes Scotia iTrade a great option for new investors. The advanced trading platform and multiple trading options are perfect for experienced investors.

However, the lack of a robo-advisor could be a deal-breaker for some investors. For those who want to invest without the time commitments or with reduced stress, Scotia iTrade may not be the best option.

4. TD Direct Investing

TD Direct Investing has been empowering self-directed investors in Canada for more than 30 years. Another one of Canada’s Big 5 banks, TD offers convenient and easy-to-use online investing tools. This allows investors to manage their own investments. Even if you are an inexperienced investor,

TD offers a comprehensive database of free educations tools. This includes market research, charting tools, performance reporting, live workshops and seminars.

They pride themselves on being industry leaders in online investing and trading. They were awarded the title of Number 1 Canadian Online Brokerage Firm by Market Data and Research.

TD Direct Investing is a member of the Investment Industry Regulatory Organization of Canada (IIROC). They are also members of the Canadian Investor Protection Fund (CIPF). This means your investments are protected. TD also employs stringent safeguards and security measures. These protect your money, as well as your account and personal information.

TD Direct Investing gives you access to multiple trading and investing platforms. This includes TD WebBroker, the TD app and their Advanced Dashboard.

They offer a number of different investment options. This includes equities, options, mutual funds, bonds and new issues.

Pros

  • TD provides real-time market data and quotes for both the Canadian and US markets.
  • They offer a free live master class every week. This includes a detailed training session and the opportunity to ask questions to experienced brokers.
  • There is no minimum investment amount. This means anyone can open an account without needing to invest huge amounts immediately.
  • You can get up to $150 worth of transfer fees reimbursed.
  • Active traders can receive a discount on their trading fees, from $9.99 per trade to $7 per trade.
  • The investment platform is user-friendly, while still being technologically advanced.
  • Mutual funds have $0 fees.
  • The application is quick and simple, and you can create an account in minutes.
  • They offer a variety of registered and non-registered account types.

Cons

  • You must make more than 150 trades per quarter to be considered an active trader.
  • The fees per trade are higher than the industry average at $9.99.
  • You must pay an inactivity fee of $25 every quarter.
  • They do not offer a practice account.

Summary

TD Direct Investing is designed for both new and experienced investors. It is perfect for people who want to manage their own investments and oversee their own portfolios. Customers of TD bank may be particularly interested in opening an investment account with TD Direct Investing. You can open an account over the phone, online or in-person in a TD branch.

Although TD claims to be perfect for new investors, their lack of practice or demo account is a real shortfall. They also offer no robo-advisor account. For inexperienced investors, or those who do not want to personally manage their own accounts, TD may not be the best choice.

5. BMO InvestorLine

BMO InvestorLine is an easy-to-use online trading platform owned by the Bank of Montreal (BMO).  It is aimed at self-directed investors who want to be in charge of their own investments and portfolio. InvestorLine offers you industry-leading research, expert analysis, and advanced investment tools.

As well as using BMO Capital Markets, InvestorLine has also partnered with other leading research providers. This includes Morningstar and S&P. This gives you access to reliable and independent analysis on investment companies.

BMO InvestorLine offers several investing options:

  • BMO InvestorLine Self-Directed – This allows you to invest in stocks, bonds, ETFs, Mutual Funds and more. It offers performance tracking, research tools and professional support.
  • InvestorLine Advice Direct. – This is an online trading platform that gives you access to personalized advice for an additional fee. It combines the freedom of self-directed investing with personalized advice and support. You will also receive 24/7 account monitoring and buy and sell recommendations.
  • BMO Smartfolio – This is a robo-advisor. It will invest in low-cost ETFs and design a portfolio based on your financial goals and level of risk. Dedicated advisors will manage your portfolio. Advisory fees range from 0.4%-0.7%.

You can choose from a variety of investment accounts. This includes registered and non-registered accounts. They have a web trading platform and a mobile app. Both give you access to your watchlists, alerts, interactive charts and all the trading tools.

BMO InvestorLine is a member of the Canadian Investor Protection Fund (CIPF). It is also regulated by the Investment Industry Regulatory Organization of Canada (IIROC). This means your account is protected up to $1 million.

Pros

  • They are currently running a special offer of up to $2,000 cash back when you open an account.
  • Trade in more than 2,000 stocks across North America.
  • They offer an ‘Analyst Ratings’ feature. This records the ratings and target prices for both Canadian and US stocks.
  • You can use Screeners to filter stocks, ETFs, Mutual Funds, and fixed income products.
  • Receive full access to InvestorLine watchlists. You can also create your own watchlists, with up to 50 watches at one time.
  • Registered trading accounts include RRSPs, TFSAs, RRIFs, and RESPs.
  • If you make more than 75 trades per quarter, you will have access to BMO Market Pro.
  • You can access investment advisors at any time.
  • Active traders will have access to research tools.
  • For help and support, you can contact InvestorLine via phone, online or in a BMO branch.
  • Traders with larger accounts will receive discounts.

Cons

  • Trade commissions may be higher than other online brokers.
  • Non-registered accounts with less than $15,000 pay a $25 maintenance fee per quarter.
  • Registered accounts with less than $25,000 pay a $100 fee annually.
  • Some accounts have a $5,000 minimum investment amount to open an account.

Summary

BMO InvestorLine has excellent portfolio options for all types of investors. Inexperienced investors or those who would prefer additional support can opt for an Advice Direct account. Those who do not want to actively trade and would rather have their account managed for them can choose Smartfolio. Finally, confident investors who want to choose their own investments and manage their own accounts can opt for a Self-Directed account.

InvestorLine may not be recommended for cost-conscious investors. The high trade commissions and minimum investment requirements can be problematic.

Frequently Asked Questions

Why Should I Open an Account with an Online Brokerage?

Investing with an online broker allows you to invest in the financial future of you and your family. Traditionally, investors would hire an investment or account manager to handle their money. However, this usually comes with high fees and requires larger financial investments. This may not be feasible for the average Canadian.

Using an online brokerage means that you save exponentially on fees and charges. Management Expense Ratios (MERs) are the management fees associated with your investments. Online investments, particularly of ETFs, have extremely low MERs. This helps you to save money in the long term and maximizes your growth.

Furthermore, with the introduction of robo advisors, investing with an online broker can now involve a minimal time commitment. This means you can invest your money in a way you are comfortable with, without needing to research and plan your investments.

How to Choose a Portfolio with an Online Brokerage

When using an online brokerage, stocks and bond options can seem endless. You are responsible for deciding what to invest in, how high your risk tolerance is and how much money you want to invest. You also need to decide whether to focus on individual stocks, ETFs, mutual funds, bonds or fixed-income products. Consider whether you are interested in indirect or direct investing. So how do you make the best decision for you? Below we will look at some tips for building your portfolio and making the best trading decision for you.

  1. Do your research – Research any companies you are interested in, look at their growth per quarter and their stock predictions.
  2. Consider your short-term and long-term aims – Some investments are long term, meaning that you may not expect to see growth within the first year or two. Decide when you plan to sell each stock before you begin to trade. Holding stocks (meaning not to sell them) can be difficult if you see the price begin to fall. However, by holding them, you could see significant financial growth in the long term.
  3. Diversify your portfolio – Rather than putting huge amounts of money into one or two investments, it can be beneficial to invest less per trade. Instead, invest in more companies and invest across the stock sectors. You could also look at investing in some dividend stocks, as well as those that invest their profits back into the company.

What to Look for in an Online Brokerage

When looking for the best online brokers, there are several factors you should consider.

  • Trade Fees – There are several fees and charges you should consider. Some brokers charge a fee per trade (usually between $4 and $10). Other charges include the Electronic Communication Network (ECN). This can be more expensive than traditional stock market fees. Some brokers also charge platform fees for access to more advanced features. Look at all the fees each broker charges and the services that you will get for this price before making a decision.
  • Platform Interface – Watch demo videos and test the platform before committing to a broker. Is the platform easy to use? Is it available in mobile and desktop forms? Is the information provided beneficial? Do they provide stock quotes in real-time?
  • Customer Service – This is an important factor that is often overlooked by many investors. Look at the level of help and support you could get. How do you contact customer service? Can they offer you trading advice or help with your account if you need it? Quite often, having exemplary customer service can be an indicator of a great company.
  • Account or Investment Minimum Amounts – Decide how much you are looking to invest initially and annually. Some brokers will charge you a fee for not meeting the minimum requirements. Others will not allow you to open an account unless you deposit a specific amount.
  • Sign-Up Incentives – Some brokers will offer incentives such as a sign-up bonus. Others may offer reimbursement of any transfer fees.

Are Online Brokers Safe?

Many Canadians worry about the safety of investing online. What if someone manages to access their account? What if the online brokerage ceases operating and they lose their money? As long as you use a regulated online broker, such as Questrade or Wealthsimple, your money will be protected.

Online brokers should be members of the Canadian Investor Protection Fund (CIPF) and be regulated by the Investment Industry Regulatory Organization of Canada (IIROC). This will help to protect your investments if the brokerage was to go out of business.

Furthermore, online brokers should employ stringent security measures, such as two-factor authentication, account monitoring and password encryption. This should prevent hackers from accessing your account.

However, it is important to note that all investments come with some level of risk. It is possible to lose money as market changes occur. It is recommended to never invest money that you cannot afford to lose.

Financial Advisor vs Online Broker

Deciding between using a financial advisor or an online broker for your investments can be difficult. Which option is best for you will depend on how much money you are planning to invest. A financial advisor will recommend investments to you and can even trade on your behalf. You will pay them either a percentage of your portfolio worth or a per-trade fee (usually several hundred dollars).This may differ for non registered accounts.

An online broker is an online platform that allows you to open an account and invest in the stock market yourself. Fees for using online brokers are minimal. As you are not paying high fees to use the service, online brokerages do not usually provide much investment advice or support. You are expected to make trade decisions based on your own research and judgement.

A financial advisor may be best for wealthy individuals who are looking to invest substantial sums of money. This is because the service cost is higher, so it would not make financial sense for those with a small investment portfolio. Those investing less than $250,000 may be more suited to an online brokerage.

Online Broker vs Robo Advisor

When choosing between online brokerages and robo advisors, consider whether you want to be an active or passive investor. Choosing to invest with a robo advisor means that you do not have to do any extensive research. You also do not have to monitor your stocks regularly. Investing with a robo advisor is also popular with those who feel they do not have investment knowledge or experience.

For those who want to be an active investor, an online brokerage would be the best option. You are responsible for opening your account, doing your research and making your own investment decisions. You will also need to monitor your investments regularly to see when to buy and sell stocks.

Another popular online broker you could consider is RBC Investdirect. They charge $6.95 per trade for more than 150 trades per quarter. TD Direct is another brokerage to consider. TD Direct charges $7 for more than 150 trades per quarter. Both of these companies are popular for online investing and direct investing.

The Bottom Line

Taking the leap into online investing can seem daunting. However, it could be financially rewarding. To help you decide how to proceed, there are several things to consider. Do you want to be an active or passive investor? How much money are you looking to invest? What fee amount are you comfortable paying? What are your long-term and short-term goals?

Once you have answered these questions, you should find it easier to choose the right broker for you. Creating an investment portfolio with an online broker, such as Questrade or Wealthsimple, can be extremely financially rewarding. Investing with an online broker is a fantastic way to plan for retirement, for your children’s education or simply to make money.