The best online brokerages in Canada for 2020

Craig Sebastiano
by Craig Sebastiano January 3, 2020 / No Comments

An online brokerage—also known as a discount brokerage—is a must if you want to trade individual stocks, bonds, or exchange-traded funds (ETFs). The best thing about an online broker is you decide how to invest. Looking for the best online brokerages in Canada? Keep reading.

The best online brokers in Canada for 2020

What makes the best online brokers? They have reasonable account fees and commissions, a variety of tools and research, an up-to-date trading platform, excellent customer service, or some or all of the above.

1. Questrade

More information about Questrade


Questrade is for everyone. Commissions start at $4.95 per stock trade and there are no commissions for ETF purchases. There are also sophisticated trading platforms for active traders.

There’s a quarterly fee of $24.95 if your account is inactive and you have less than $5,000 in all of your accounts combined. The fee can sometimes be waived. Unlike most brokers, Questrade charges a fee for mutual fund trades.

  • Annual Fees: $0
  • Minimum Investment: $1,000
  • Monthly Fee: $0
  • Mobile App: Yes
  • Online Interface: Yes
 

2. Qtrade Investor

More information about Qtrade Investor


Qtrade Investor caters to both beginner and active investors. It charges an $8.75 commission or $6.95 for those who make 150 trades a quarter or have $500,000 in assets. There’s also commission free-trading on 100 ETFs with a minimum order value of $1,000. The administrative fee of $25 per quarter on accounts with assets of less than $25,000 is waived if you meet certain criteria.

Qtrade offers a discount for investors under 30 who make pre-authorized contributions of $50 or more a month to their account. Commissions are $7.75 each, there are no account minimums and no quarterly administrative fee.

  • Annual Fees: $0
  • Minimum Investment: $0
  • Monthly Fee: $0
  • Mobile App: Yes
  • Online Interface: Yes 

 

3. Wealthsimple Trade

More information about Wealthsimple Trade


Wealthsimple Trade launched earlier this year. It’s for investors who don’t want to pay a commission or an administrative fee.

As of today, Wealthsimple Trade only offers taxable and TFSA accounts. It does plan on launching other account types in the future. However, you can’t currently buy bonds, GICs, options, preferred shares, or mutual funds.

  • Annual Fees: $0
  • Minimum Investment: $0
  • Monthly Fee: $0
  • Mobile App: Yes
  • Online Interface: Yes

 

4. BMO Investorline

More information about BMO Investorline


BMO InvestorLine caters to every type of investor. Commissions are $9.95 each. There are no minimum investments for TFSA and RESP accounts.

Clients with a non-registered account will be charged a $25 quarterly fee if the account balance is less than $15,000, but it can be waived if you meet certain criteria. 

  • Annual Fees: $0
  • Minimum Investment: $0 for TFSA and RESP accounts; $5,000 for all other accounts
  • Monthly Fee: $0
  • Mobile App: Yes
  • Online Interface: Yes

 

5. TD Direct Investing

More information about TD Direct Investing


TD Direct Investing is for everyone. Commissions are $9.95 each or $7 apiece if you make 150 or more trades every quarter. If the total balance of your account is less than $15,000, you’ll be charged a quarterly fee of $25. But this fee can be waived in some cases.

It also offers advanced streaming market data platforms and thinkorswim for U.S. options trading for an additional fee. TD also has 24/7 customer service. 

  • Annual Fees: $0
  • Minimum Investment: $0
  • Monthly Fee: $0
  • Mobile App: Yes
  • Online Interface: Yes

 

6. Virtual Brokers

More information about Virtual Brokers


Virtual Brokers, a subsidiary of asset management firm CI Financial, caters to every type of trader. Commissions are $0.01 per share (a $1.99 minimum and a $7.99 maximum per trade) while it’s free to purchase ETFs. Traders who make 150 trades a quarter pay a flat commission of $3.99. 

The brokerage also offers sophisticated trading platforms for investment experts. Virtual Brokers charges a quarterly fee of $24.95 to each account if their combined total assets are less than $5,000, but it can be waived in some cases.

  • Annual Fees: $0
  • Minimum Investment: $1,000
  • Monthly Fee: $0
  • Mobile App: Yes
  • Online Interface: Yes

 

What is an online brokerage?

An online brokerage is for the do-it-yourself investor who wants to choose their own investment products. Many brokers also provide free research, tools, and educational content. 

On the other hand, most full-service brokers charge a fee based on the size of your portfolio instead of commissions for each trade. These brokers also offer more services, such as tax and estate planning, insurance advisory, and even strategies involving philanthropy.

How to choose the right online brokerage

With so many online brokerages, it may be difficult to choose. If you plan on making a few trades a year, just about any broker will do. But, if you’re a sophisticated trader and plan on trading often, the ones that offer additional features and options trading are probably the best for you.

Investing knowledge and expertise

When choosing a credit card, many people get one offered by their bank. When choosing a broker, it’s a similar process and they choose their bank’s brokerage. Depending on your investment experience, you might find that the features your bank’s brokerage offers aren’t enough for you.

Personal investment needs

Do you want to make trades on your phone? Are you going to trade options? Do you think you’re going to need to call customer service late at night or on a weekend? Are you looking for research reports you can’t find anywhere else? Before choosing a broker, you need to decide how important certain services and features are for you.

Commissions and fees

An online brokerage account can be costly. If there’s a quarterly maintenance fee, you might want to wait until you meet the criteria required to get the fee waived. If you trade frequently, your commissions can be fairly high and may reduce your annual return. That’s why you will want a broker with low commissions.

Are online brokerage accounts safe?

All of the online brokerages on this list are safe. However, you can determine whether or not an online brokerage (or any brokerage for that matter) is safe, depends on included insurance.

There are two types of insurance for online brokerages (and brokerages in general) in Canada. One is the Investment Industry Regulatory Organization of Canada (IIROC) and the second is the Canadian Investor Protection Fund (CIPF). 

Both organizations are non-profit companies that protect investors from fraud, theft, insolvency, and bankruptcy. Each offers coverage different from the next. 

Whatever online brokerage you choose to invest with, always make sure should check and make sure that it comes with IIROC and CIPF coverage. You can usually find both logos at both of the brokerage’s website, or, listed on each insurer’s website. 

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