Questrade Investing Platform

Questrade Review

This post is for Canadian investors. 

I’ve been investing and trading for many years, and it amazes me how many online platforms get their user interfaces wrong. Investing can be challenging enough without ill-conceived layouts to make matters worse. Questrade offers an excellent layout and many other benefits which we can explore together.

My Background

My investing experience dates back to 2001 when I worked on a client trading desk. Since then, I’ve worked at PH&N (now part of RBC), SEI Investments, and more recently as a fee-only investment consultant. I’ve been featured in the Financial Post and Toronto Star. I authored an investment book, Eight-Hour Investor, and a bestselling online course that has attracted 10,100+ students.

My investment strategy and the one I recommend to investors is to build a portfolio of low-cost index funds and trade a small portion of their portfolio (less than 10%) should they desire. It’s a fact that thousands of overpaid fund managers underperform the markets every year. Also, the majority of investment “advisors” are salespeople masquerading as stewards. For these two reasons, I believe more investors would benefit from disciplined do-it-yourself investing in conjunction with my investment philosophy.

Questrade $50 CampaignI’ve been a client of TD Bank since the mid-90s, so naturally, my first trading account was opened with them. I used TD Investing out of convenience, not out of admiration. Their fees have always been competitive, but never the best, and their platform has always been clunky and never the sharpest. As a result, I opened an account with Questrade in May 2013 and had transferred all my assets there since.

Questrade and Me Sitting in a Trade

There are many things to like about Questrade compared to TD Investing and other brokerages.

1) Dedicated Trading Provider

Questrade isn’t one of many moving parts; they focus solely on providing a first-class investing experience. TD, RBC, CIBC, BMO, and Scotiabank offer trading platforms that make up one of many divisions. As a result, their trading departments have to compete with other departments for resources sometimes to the detriment of customers.

2) Lowest Fees in the Land

At a penny a share, Questrade offers the best commission rates in Canada.

Online Trading Fees

Questrade TD BMO CIBC RBC Scotia
Equities *1¢ per share $9.99 $9.95 $6.95 $9.95 $9.99
Options per contract $9.95 + $1.00 $9.99 + $1.25 $9.95 + $1.25 $6.95 + $1.25 $9.95 + $1.25 $9.99 + $1.25
ETFs Buy for free N/A N/A N/A N/A Limited selection

*$4.95 minimum per trade

– Warning –

TD allows you to buy U.S. stocks in a Canadian margin account, but according to them,

“If you make a trade involving a security which is denominated in a currency other than the currency of the account in which the trade is to settle, or receive a payment to your account in a currency other than the currency of the account, a conversion of currency may be required. In all such transactions and at any time a conversion of currency is made, we will act as principal with you in converting the currency at rates established or determined by us or parties related to us. We and the parties related to us may earn revenue, in addition to the commission applicable to such a trade, based on the difference between the applicable bid and ask rates for the currency and the rate at which the rate is offset either internally, with a related third party, or in the market. The charge to you and the revenue earned by us and parties related to us may be higher when a transaction requires more than one currency conversion or when the currency is not commonly traded.”

Yes, TD is profiting from your currency conversions hence the reason I lost money on a trade even though I sold for a profit while exchange rates barely moved. Conversely, Questrade offers a more transparent approach.

“For accounts that settle in CAD, you still save big when you buy and sell USD securities in the same day. Questrade only converts the net proceeds of the trade ― the difference between any buy and sell…

Important notes about currency conversion and interest.

Except for RSP accounts, Questrade will not automatically exchange currencies. You must initiate all conversion proceedings. For example:

  • If you buy U.S. securities, and you do not have sufficient USD, you are borrowing the money from Questrade.
  • You are charged interest on 100% of the amount you borrow.
  • Interest rates begin to apply when the security trade settles, three days after the trade date for stocks (T + 3 business days), and one day after the trade date for options (T + 1 business day). For example:
  • If you buy stock ABC on Monday, May 1st, the settlement date will be Thursday, May 4th (T + 3 business days).
  • If you sell stock ABC on Wednesday, May 3rd, the sale will settle on Monday, May 8th (T + 3 business days).

Therefore, you will have been borrowing funds for four days: from Thursday, May 4th (the day your buy trade settled) to Monday, May 8th, (the day your sell trade settled).”

Between TD and Questrade, TD is better for buy and hold long-term investing and Questrade is better for short-term trading. Moreover, if you’re thinking about trading U.S. stocks ongoing, you’re better off opening a U.S. dollar trading account and converting your money than having to worry about fees and nuances. At Questrade, you can request to have your money converted for a fee of up to 1.99%.

3) Buy ETFs for Free

In addition to already low fees, Questrade allows you to buy ETFs for free. This is excellent for passive investors who trade and rebalance infrequently.

4) User-Friendly Dashboard

TD Investing has poured a lot into a new trading dashboard, but before I left, I opted to use their old one. TD’s platform confuses the bear market out of you whereas Questrade has thought through the user experience to deliver a minimalist and highly customizable interface.

5) Complete Product Selection

Questrade is a trading platform’s platform. They offer the full product portfolio compared to other Canadian discount brokerages. Most platforms offer common products such as stocks, options, ETFs, and bonds, but Questrade adds CFDs and forex to the mix.

Questrade vs. TD Investing

Questrade TD Investing
Stock, Options, ETFs
Bonds
Mutual Funds
Precious Metals
CFDs (Derivatives)
FX/Forex

6) Live Chat and Call-back Support

They reach the highest standard of customer support by offering both live chat and call-back assistance.

7) Even More Benefits

  • No annual account/administration fee (minimum $15,000 in investments across multiple accounts)
  • You can hold U.S. dollars in registered accounts
  • You can get personal rates of return
  • Equities and options can be traded on their app
  • Active traders can qualify for even lower fees
  • Active traders can access trader-centric platforms and streaming market data

I’ve been using Questrade since 2013 and recommend it for your investing activities. Have assets to transfer? No problem. Move a minimum of CAD $25,000 from another brokerage into a new or existing Questrade account, and they’ll pay your transfer-out fees up to $150 plus give you $50 in free trades (use referral ID: ue8pugcj).

Note: you should understand the difference between transferring in-kind and in-cash. If you want your portfolio to remain as is during the transfer process and not converted into cash, request an in-kind transfer.

Rating for Questrade 

 

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