Questrade Review 2019

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by Ratehub.ca July 18, 2019 / No Comments

With twenty years of experience as a discount brokerage, Questrade has become Canada’s leading independent broker. This Questrade review explores in greater detail why the online brokerage has earned the trust of so many Canadian investors, who use this platform to facilitate their investing needs.

Questrade is a suitable option for rookie and veteran investors alike. Whether self-directed or passive investing opportunities, Canadian investors adore Questrade as a reliable, efficient, and cost-friendly investing, saving, and trading platform.

This Questrade review covers the following topics:

What Is Questrade?

Questrade is an online investing platform operating in Toronto, Canada since 1999. Today, the discount brokerage offers some of Canada’s lowest trade commission rates for trading and investing.

The virtual brokerage offers a variety of investment options that cater to all risk profiles, ranging from the conservative GIC investment to the volatile stock market.

Questrade has become incredibly popular as a low-cost option for automated trading and passive investing. It also offers its own robo-advisor called Questwealth Portfolios.

  • Self-Directed Investing and Robo-Advisor options available.
  • No opening or closing fees.
  • Free account transfer.
  • Registered account options available.

Is Questrade Safe?

Yes—Investments made through Questrade include coverage from Canada’s largest investment insurance corporations: the Investment Industry Regulatory Organization of Canada (IIROC) and the Canadian Investor Protection Fund (CIPF).

The IIROC lists Questrade as a regulated dealer, meaning that they are approved and monitored to ensure that best practices are implemented and in place.

CIPF, a not-for-profit insurance security, insures assets and protects investors from insolvency, should the brokerage that they are investing with goes out of business. That said,  is just as safe as any major brokerage in Canada.

Sign Up Process and Account Registration

Questrade’s sign-up process is relatively straightforward. Upon signing up, customers need to distinguish which account or accounts they would like to open before investing. 

Below is a brief summary of each investing account the discount brokerage offers upon sign up.

Margins

Margins are stocks purchased with money borrowed from brokerages to purchase shares or make investments.

Using Questrade Margins to buy stocks can reap you significant gains or losses, as they tend to be riskier investments. 

Tax-Free Savings Account (TFSA)

Tax-Free Savings Accounts (TFSAs) can hold various investments, such as GICs, ETFs, Stocks, Bonds, and Mutual Funds.

The account earns tax-free interest on investments and returns, as long as the gains remain under the yearly TFSA contribution limit.

A TFSA acts as an excellent shelter for tax-free investing. 

Registered Retirement Savings Plan (RRSP)

Registered Retirement Savings Plan (RRSPs) can hold several types of investments, including Bonds, GICs, Equities, and ETFs, among others. 

This savings account is suitable for long-term savings and purposed mainly for retirement.

Forex

Forex (Foreign Exchange Market) is the market where the countries of the world buy, trade, and sell with each other. 

Robo-Advisor: Questwealth Portfolios

Questwealth Portfolios is Questrade’s robo-advising service. A robo-advisor manages a portfolio pre-determined on an investor’s risk tolerance and manages it on their behalf.

Robo-advisors use an algorithm to manage your investments. Unlike financial advisors, robo-advisors manage ETFs for a fraction of the cost.

Questwealth is no different. The robo-advisor manages your investment portfolio and monitors your investments based on your risk profile. There is no need for constant monitoring, financial savviness, or extensive research when investing, just an understanding of your personal risk tolerance.

For the Couch Potato investors, using a robo-advisor is an excellent option, as they do not require constant monitoring. However, consistent control of any investment is always ideal.

Questrade Fees and Features

This section of our Questrade review examines what those fees cover and what features the online-brokerage offers.

Most investors gravitate to Questrade because of their unbeatable low-cost fees.

Recurring fees can add up fairly quickly for active investors, and since online investing platforms charge up to $10 per trade, use of discount brokerages like Questrade is increasing in popularity among Canadians.

This chart provides a brief overview of Questrade’s fees and features.

Questrade Fees and Services (View All)

Service

 
Fee

Sign-Up Fee?

None

Basic Trading Commission

1¢ per share (min. $4.95 – max $9.95)

Basic Option Commission

$9.95, $1 contract

Free ETF trading?

Yes

Minimum Investment

$1,000
Minimum Balance for No Inactivity Fee or Annual Fees?

$5,000

Robo-Advisor MER

< $100k – 0.20% 

> $100k – 0.25%

Mobile App?

Yes

Desktop App?

Yes

 

Questrade Investing Options

Many may assume Questrade only facilitates self-directed stock purchasing. However, the discount brokerage provides many investing and trading options, many of which accommodate to all risk tolerance profiles.

Below are some of the many investment options that Questrade offers Canadian Investors:

Bonds

  • Minimum Investment: $5,000
  • Fees: Varies depending on the investment
  • Risk Level: Varying

Bonds are relatively similar to GICs, except instead of lending money to banks, investors lend their money to various levels of government or corporations.

Once the bond’s term is complete, the investment is returned, with additional interest.

Bonds commonly diversify an investor’s portfolio. They’re also a safe way to increase the overall yield of a portfolio.

The cost of the bond varies and depends on its purchasing price.

Questrade bonds require a minimum investment of $5,000, with provincial, high-yield, and corporate bond options.

If you’re interested in learning more about the GICs vs. Government Bonds debate, our comparison article can help clarify the decision-making process.

Exchange-Traded Funds (ETFs)

  • Minimum Investment: $1,000
  • Fees: 1¢ per share, (min. $4.95-max $9.95)
  • MER: 0.20%
  • Risk Level: Low to High

Exchange-Traded Funds (ETFs) consist of various investments, often purchased through the stock market.

ETFs allow investors to diversify their investments by putting their money in various options. Think of ETFs as pre-built portfolios.

Some of the investments that make up ETFs include Index, Stocks, and Bonds. Other ETF investments include Real Estate, Precious Metals, and more.

Purchasing ETFs comes with a commission fee, known as a Management Expense Ratio (MER).

ETFs are adjustable to different investing styles and risk profiles.

Purchasing Questrade ETFs does not require a minimum investment, and comes with a low MER starting at 0.20%. 

Mutual Funds

  • Minimum Investment: $29.95 per month, with monthly rebate
  • Fees: $9.95 per trade
  • Risk Level: Varying

Similar to ETFs, Mutual Funds allow investors to pool their money in more significant amounts with other investors.

Unlike ETFs, mutual funds, enable many investors to share their money in a spread of different investments with investors across Canada.

Questrade Mutual Funds come with a monthly fee that is dictated by the investment’s performance.

Similar to robo-advisors, mutual funds are suitable for those who prefer passive investing with risk adjustment. 

Precious Metals

  • Minimum Investment: None
  • Fees: $19.95 USD per trade
  • Risk Level: High

Precious metals are rare metals that possess exceptional value. The most common (and valuable) are gold, silver, and platinum.

One of Questrade’s many self-directed investing options includes precious metals. At the moment, the online investing platform currently offers only gold and silver purchasing options.

Purchasing precious metals is generally done through ETFs, stocks, mutual funds, and other investing methods, but are available by themselves.

Registered Retirement Savings Plan (RRSP)

  • Minimum Investment: $1,000
  • Fees: None
  • Risk Level: Varying 

A Registered-Retirement Savings Plan (RRSP) is a registered account designed primarily for retirement planning.

An RRSP can hold many investments, many included in this Questrade review.

Risk level varies with the type of investment placed in an RRSP.

For example, both GICs and equities can be placed in an RRSP and earn tax-free growth, so long as the total amount remains beneath the RRSP yearly contribution limit.

Investments withdrawn from an RRSP are subject to taxation—except under certain plans. For example, with certain conditions, the RRSP Home Buyers Plan allows tax-free withdrawal up to $35,000.

Stocks

  • Minimum Investment: $1,000
  • Fees: 1¢ per share (min. $4.95 – max $9.95)
  • Risk Level: Medium to High

Self-directed investing might be the most popular option provided by Questrade.

Self-directed stock trading allows customers to purchase, trade, or sell shares from corporations of their choosing. For frequent traders, Questrade’s low commission rate makes a significant impact.

Tax-Free Savings Account (TFSA)

  • Minimum Investment: $1,000
  • Fees: Varies on Investment
  • Risk Level: Varies on investment

A Tax-Free Savings Account (TFSA) is a type of savings account that can hold various investments and earn tax-free interest. GICs, stocks, and mutual funds, to name a few, can be held in a TFSA and earn tax-exempt interest, under the yearly contribution limit.

Questrade also provides Tax-Free Savings Account (TFSA) options in which you can hold several investments.

Should I Invest Using Questrade?

Every investor has their own goals, ambitions and risk tolerance, so the answer to that question, as you might expect, depends on the person asking it. Every investor has a different attitude towards investing, and especially towards loss. 

Questrade offers something for everyone of all risk tolerance levels. 

As expressed throughout this Questrade review, the online-investing platform commission fees alone make it an excellent option for people looking to undercut their expenses on trading commissions.

Below are some of the advantages of using Canadian online brokerage:

  • Great for all investing personalities.
  • Lowest commission fees for an online investing platform.
  • Investments are insured by the Investment Industry Regulatory Organization of Canada (IIROC) and the Canadian Investor Protection Fund (CIPF).
  • Telephone and online customer service available.
  • Mobile app and desktop software (Questrade IQ Edge) are also available.

Questrade Offer Code

Ratehub.ca readers can earn a $50 rebate upon sign-up by using our Questrade offer code.

  • Click the link posted in the container below.
  • On the Questrade website, click OPEN AN ACCOUNT.
  • Choose the account best suited for your investing needs.
  • The coupon code that appears on the right and will be applied upon completing registration.
  • Self-Directed Investing and Robo-Advisor options available.
  • No opening or closing fees.
  • Free account transfer.
  • Registered account options available.

 

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