Investing can be overwhelming and confusing, with a plethora of options and platforms to choose from. Two of the most popular online investment platforms in Canada are Questrade and Wealthsimple. Each platform offers its own unique features, benefits and drawbacks, and choosing between the two can be a daunting task. But, don’t worry, we’ve got you covered! In this article, we’ll be taking an in-depth look at both Questrade and Wealthsimple, comparing everything from account types, types of assets, fees, US dollar purchases, customization and control, and size and reputation. By the end of this article, you’ll have a good understanding of which platform is the best fit for your investment goals.
Account Types:
Questrade offers a wide range of account types, including registered and non-registered accounts, as well as TFSA, RRSP, and RESP accounts. They also offer corporate and trust accounts, which can be useful for businesses and high net worth individuals. For a Questrade trading account, you need a minimum balance of $1,000 to start trading.
Wealthsimple, on the other hand, specializes in providing simple and easy-to-use investment products for individuals. They offer TFSA, RRSP, and non-registered accounts, as well as corporate and trust accounts. They do not have a minimum account balance requirement, and you can technically open an account with $0.
Types of Assets:
Questrade is known for offering a wide range of investment options, including stocks, options, forex, and precious metals. They also have a wide range of ETFs and mutual funds.
Wealthsimple, on the other hand, specializes in providing a curated selection of low-cost ETFs, which are well-diversified and easy to understand. They also offer GICs, and only recently started offering more stocks and options.
Fees:
Questrade charges commissions on trades, and there are also other fees, such as inactivity and account transfer fees. The commission fee varies depending on the type of account you have and the trades you make.
Wealthsimple, on the other hand, has a tiered fee structure based on the value of assets under management, starting at 0.5% annually for assets under $100,000 and lowering to 0.4% for assets over $100,000. They also have an option for commission-free trades on their Wealthsimple Trade platform.
Handling US Dollar Purchases:
Questrade allows you to open a US dollar (USD) account, which can be used to trade on US markets in US dollars, with no additional currency conversion fees. They also offer a USD Visa debit card that can be used to make purchases in the US without incurring currency conversion fees. They also offer a USD-denominated RRSP and TFSA account.
Wealthsimple, on the other hand, does not currently offer a dedicated USD account, so purchases of US-listed securities on their platform will be subject to currency conversion fees. However you can avoid this fee by subscribing to Wealthsimple Trade Plus for $10 monthly.
Customization and Control:
Questrade offers advanced trading tools such as options trading and level 2 quotes, which can be useful for experienced investors and traders. They also have a powerful trading platform, Questrade Trading, which can be customized to suit your preferences, and can also be accessed on mobile devices. They also offer a self-directed investment option, where investors have complete control over their portfolio and can make trades on their own.
Wealthsimple, on the other hand, is geared towards investors who are looking for a more hands-off approach. Their platform is designed to be easy to use, with a simple and user-friendly interface. They also offer a robo-advisory service, where investors can choose from a selection of pre-built portfolios based on their risk tolerance and then let Wealthsimple’s algorithm handle the rest. They also offer the option to work with an expert human advisor for more comprehensive financial advice.
Size and Reputation:
Questrade is one of the largest independent online brokerage firms in Canada. They were founded in 1999 and have been growing rapidly since then. They have a reputation for being a reliable, innovative, and cost-effective option for online investors. They have over $30 billion in assets under administration (AUA) and over new 200,000 accounts registered in 2022.
Wealthsimple is a newer company compared to Questrade, founded in 2014. However, it has grown rapidly to become one of the largest and most popular robo-advisors in Canada. They have over $15 billion in assets under management (AUM) and more than 1,500,000 registered accounts as of 2022.
Both Questrade and Wealthsimple are well-established and reputable online investment platforms in Canada, with a large number of registered accounts. Questrade has been around for longer and is slightly bigger in terms of AUM, but Wealthsimple is growing rapidly and becoming more and more popular.
| Feature | Questrade | Wealthsimple |
|---|---|---|
| Account Types | Wide range (TFSAs, RRSPs, RESPs, Margin, Spousal RRSPs, LIRA, Locked-In RRSPs, RIFs, LIFs, Family RESPs, Cash, Corporate Cash and Joint Cash accounts) | Fewer account types (RRSP,TFSA, Corporate, Trust) |
| Types of Assets | Wider range (stocks, options, forex, precious metals, ETFs, mutual funds, GICs) | Simple selection of stocks and mostly low-cost ETFs (Canadian, US, and foreign stocks, corporate debt, government bonds, and gold) |
| Management Fees | 0.25% of value for portfolios under $100,000, drops to 0.20% for portfolios over $100,000. No annual RRSP or TFSA fees. | 0.5% of value for portfolios under $100,000, drops to 0.4% for portfolios over $100,000. No annual RRSP or TFSA fees. |
| MER | Commissions and other fees (varies depending on account type and trades) 0.1% to 0.2% (weighted avg) and 0.23% for SRIs | 0.2% (avg) and 0.21% to 0.35% for SRIs |
| US Dollar Purchases | Offers USD account, no currency conversion fees, USD debit card available | No dedicated USD account, currency conversion fees apply. You can avoid this fee by subscribing to Wealthsimple Trade Plus for $10 monthly. |
| Customization and control | Advanced trading tools, self-directed trading options, powerful trading platform | Simple, easy-to-use interface, robo-advisory service, human advisor options |
| Size and Reputation | Established and reputable, around since 1999, Over $30bn AUM, Over 200k registered accounts added each year | Growing rapidly and becoming more popular, Established and reputable, around since 2014, Over $15bn AUM, Over 1.5M registered accounts |
Research Tools
Questrade offers a wide range of research tools to help investors make informed decisions. They offer access to market data and financial news, level 2 quotes, stock and option screener, and a variety of educational resources such as webinars, tutorials, and articles. They also offer a feature called “Virtual Advisor” which provides a personalized investment plan based on your risk tolerance, time horizon, and investment goals.
Wealthsimple on the other hand, offers a more simplified approach to investing, focusing on providing a curated selection of low-cost ETFs that are well-diversified and easy to understand. They don’t offer as many tools and resources as Questrade, but they do provide a portfolio performance analysis, which is helpful in tracking the performance of your investments. They also offer access to financial news, market data and educational resources through their website and blog, but not in as many as Questrade.
Market Data
Questrade offers a wider range of research tools and resources to help investors make informed decisions, while Wealthsimple focuses on providing a curated selection of low-cost ETFs and a simplified approach to investing. Questrade’s research tools can be useful for experienced and self-directed investors, while Wealthsimple’s simplified approach is more suited for those who are looking for a hands-off approach to investing.
A basic Questrade account comes with free access to snap quotes. Snap quotes are real-time data that need to be refreshed to update it. and they are generally adequate for most traders. Clients can pay $19.95 to $89.95 per month for access to streaming real-time data. Wealthsimple Trade offers free stocks and ETF price data with a 15-minute delay. You can upgrade your account to Plus (which costs $10 per month) and get access to snap quotes.
Conclusion
In conclusion, Questrade and Wealthsimple are both popular online investment platforms in Canada, with different strengths and weaknesses. Questrade is well-suited for investors who want a wide range of account types and investment options, a powerful trading platform, and self-directed approach, while Wealthsimple is geared towards those who prefer a simple, easy-to-use, and low-cost investment experience with robo-advisory service and human advisors options. It’s important to carefully consider your personal investment goals, risk tolerance, and financial situation before choosing a platform. As always, it’s important to thoroughly research and carefully consider the features and fees of each platform before making a decision.
