Canada’s #1 Questrade Review 2020 [$50 Promo Offer Code]
Edited in November 2019 by FT with help from our newest author Kyle Prevost.
Background: When I first wrote this Questrade review back in 2008, there were very few Canadian online discount brokerage accounts available to Canadians who wanted to open a DIY RRSP account, TFSA, or non-registered account, and trade their own stocks and ETFs.
In the last 11 years, we’ve seen an explosion in online broker competition, but for my money (literally) Questrade is still the best Canadian DIY option due to their commission free ETF purchases, low fees, and easy-to-navigate website.
Questrade Canada Review Summary
Our Opinion & Rating
For ETF Trading
Annual Fees ($0)
For High Volume Traders
Questrade is GREAT, for Investors
Unless you’re making 10+ trades per day, or or trading 1,000+ units of funds at one time, Questrade is the best Canadian discount brokerage in 2020. Moneysense Magazine ranks them as the #1 online broker, and the Globe and Mail gives them a leading “A” rating. The new Questrade app and website upgrade provide the shine and polish on top of their usual leadership in the low-fee categories. With $50 in free trades available via our promotional offer code, there is no better time to try Canada’s leading online brokerage.
Questrade Fees for Dividend Investing and Commission Free ETFs
While Questrade has introduced some shiny new features (and excellent marketing) the last few years, the key reason that they are our choice for best discount brokerage in Canada is their low overall fees, and especially their commission-free ETF investing options. It’s worth noting that Questrade has NO ACCOUNT Fees on popular accounts such as RRSPs, TFSAs, RESPs, and non-registered accounts.
If you’re new to MDJ, you might want to have a look around for more information on why I prefer dividend-investing and index-investing approaches for 99%+ of investors. Basically, if you’re trying to trade stocks daily or think that you can do some fancy research that allows you to time getting in and out of the market, then you’re probably costing yourself serious money. If you wish to stick basic tried-and-true strategies that are supported by math and the last 100+ years, then Questrade is the place to DIY your nest egg and cut your costs to the bone. Experts have consistently pointed out that while the average investor can’t control their returns, they can (and should) control their investment costs.
Some critics point out in their Questrade review articles that Questrade only covers free ETF purchases.
While this is technically true, what they fail to mention is that the vast majority of our transactions will be purchases if we are building a basic “couch potato” passive index investing portfolio.
With today’s excellent “all-in-one” ETF options, the average Canadian would do very well to just log into their Questrade RRSP or TFSA each month and purchase that same ETF over and over again for their entire working lives. Alternatively, if you want to really cut costs to their absolute minimum, you can buy your bond ETF, domestic market ETF, and international ETF separately, and then rebalance each month simply by adding a little more to the asset class that has the worst over the preceding month, in order to keep your overall asset allocation where you want it.
The only selling you should really have to worry about is when your portfolio gets close to the $1 Million level and can’t be re-balanced by monthly additions, or when you are ready to start selling pieces of your portfolio to fund your retirement living. Paying $5 to take my spending money out for the year is a small price to pay when I’ve been getting to invest for free over the last 30+ years!
Here’s how the Questrade free ETF purchasing stacks up against some of the big names in Canada.
|Questrade (Rated #1)||$4.95 for up to 495 shares ($9.95 max)
$9.95 per mutual fund trade
ETFs are free to buy, reg commission to sell
|Yes (for buying)||$0 for balance above $5k
$19.95/ quarter if balance < $5k
|QTrade||$8.75/ trade or $6.95/ trade if assets > $500k||Yes (select group)||$100/ yr admin fee if under $25k balance
$60/ yr for USD RRSP
|Scotia i-Trade (formally e-trade)||$24.99 or $9.99 /trade with $50k in assets
30+ trades /quarter, $4.99/trade with 150+ trades /quarter
|Yes (select group)||Yes|
|IB||Min $1 /USD trade.
Max 0.5% of trade value ($0.005/ share)
$50/year annual RRSP fee
Min $10k to open an account
|BMO InvestorLine||$9.95/ trade no minimum balance||No||$100/ yr if balance < $25k|
|RBC Direct Investing||$9.95/ trade no minimum balance
$6.95/ trade if 150+ trades / quarter
|No||$25 / quarter if balance < $25k|
|Credential Direct||$8.88 / trade||No||None|
|TD Direct Investing||$9.99/ trade no minimum balance
$7/ trade if 150+ trades / quarter
|No||$100 / yr if balance < $25k|
|Virtual Brokers||$0.01/share with cap of $9.99 + ECN fees||Yes (for buying)||$50/ yr if balance < $15k, $50/ yr for USD RRSP|
There is another low fee alternative in Canada, have a look at our Questrade vs Wealthsimple comparison here.
Dividend Investing with Questrade
If you’re like me, and looking to build a healthy portfolio of money-generators that will spin of cash for the 50ish years of your retirement, then you probably purchase shares of your targeted companies most months. This strategy makes a ton of sense if your using the Smith Maneuver or investing in a non-registered account (not an RRSP, TFSA, or RESP).
When it comes to the basic standard of buying basic shares, Questrade’s fees are quite low - although not quite as cheap as the free ETF purchases.
Here’s how Questrade’s fee structure works when buying a share of a company.
$4.95 (standard charge on every trade) + ECN Fees (up to a maximum of $5.00) = Overall Cost
If you’re not familiar with ECN fees, the acronym stands for Electronic Communication Networks. All you really need to know is that companies charge Questrade about $0.0035 per share when you buy a share with them. There are ways to shrink this miniscule number even further using limit order and whole board lots - but that starts to be way too much worry for the average Canadian investor. Here’s a common example one might see if they are a monthly dividend investor.
Ex: I decide to target three Canadian Dividend All Stars with my contribution this month, so I split my 1,200 contribution equally between Bell Canada, IGM Financial, and Fortis. All traditionally loved by dividend-savvy investors. This is what my investment would likely look like for the month.
- BCE at $52 per share: 7 shares = $364
- IGM at $36 per share: 11 shares = $396
- FTS at $42 per share: 9 shares = $378
If I wanted to maximize my contribution, I could buy another share of BCE with the leftover money, but let’s just go with this for now.
Each of these trades would cost $4.95 + ECN fees of roughly (.0035 x 10 shares) $0.035, for a grand total of less than $4.96. So the total for all three trades for the month would be ($4.96 x 3 = $14.88).
Now, I realize that some people are buying more than 10 shares at a time. If you purchased $10,000 worth of Bell (BCE) stock, then you’d be buying 192 shares, and your ECN fees would be a grand total of 67 cents. Personally, it’s not really a factor I care to pay attention to.
Plus, don’t forget that with our Questrade promotional offer coupon of $50 in free trades, you can start your dividend investing journey for free!
Here’s how Questrade fees compare to other Canadian discount brokerages.
|Broker||Trade Fee||ETF Fee||Stock Options||Annual Fees|
|Questrade||$4.95||$0||$9.95/m + $1 per contract||$0|
|TD Direct||$9.99||$9.99||$9.99/m + $1.25 per contract||$100 for small accounts|
|Scotia iTrade||$24.99||$24.99||$24.99/m + $1.75 per contract||$100 for small accounts|
|RBC||$9.95||$9.95||$9.95/m + $1.25 per contract||$100 for small accounts|
Questrade Enhanced and Questrade Advanced
While the vast majority of investors in Canada will not get much value from Questrades “professional trader” platforms: Questrade Enhanced and Questrade Advanced
If you’re an active trader, you can also gain access to one of several market data plans that Questrade offers. For a monthly fee, you can get active trader pricing, live streaming data, and other data add-ons. This is perfect for active traders. Here are your options:
Questrade Inactivity Fees
Over the years, I’ve read several comments at the bottom of this Questrade review that refer negatively to Questrade’s inactivity fees. While I’m not in love with the idea, they are fairly up front with them, and it costs exactly $0 to make sure that you never have to pay these fees.
The long story, in short, is that Questrade will charge you $25 if you do not place a trade in three consecutive months (often called “a quarter” amongst tv investment gurus trying to sound smarter than they are).
You can make sure you never get charged this fee simply by purchasing one ETF during those three month stretches. Questrade will charge you $0 to purchase this ETF and you will not trip the inactivity fee wire.
You can also avoid Questrade’s inactivity fee by having more than $5,000 in your account or by being younger than 25!
Opening a Questrade TFSA, RRSP, RESP Account
Opening your Questrade RRSP, TFSA, or RESP accounts is easier than ever before. Given how complicated this process was the last time I wrote my Questrade review, the guys/gals in green have really upped their game.
Opening your Questrade Canada account can now be done completely online, and in as little 24 hours.
Basically you click here and our $50 questrade promotional offer code will be automatically applied. Then you simply select which accounts you would like to open. The main options available are TFSA, RRSP, Margin (non-registered), and Forex. There are also options for “more” and then a Questrade Portfolios option which is similar to a robo advisor, and which I’ll talk about a little later.
The Questrade sign up process will guide you through the following three steps:
- Create a user ID
- Build Profile
- Setup Account
You’ll need a few documents and/or snippets of info including:
1) Your preferred email address (used to create your User ID)
2) Your name and home address as they appear on your Government ID
3) After creating your User ID, you’ll need your new Questrade login and password
4) Your Social Insurance Number (SIN)
5) Employment information including your income, plus your income from other sources
6) A Government-issued photo ID such as a driver's license or passport (which can be uploaded via scanned document or picture)
Once you’ve completed the sign up with these documents, the final step to opening your Questrade RRSP or TFSA is to go to your normal “all-in-one” bank account or chequing account that your pay gets deposited into, and then to send your investing dollars over to your shiny new DIY Canadian discount brokerage account. From every bank account that I’ve ever used or helped people through, it’s the same process as you would use to send money to pay your credit card or utility bill from your online banking platform. Setting up your seperate Questrade RRSP and TFSA accounts as recurring payees will significantly help you cut down on time going forward.
Technically you can open a Questrade brokerage account without any actual money in it! In order to actually purchase your first share of a stock or unit of an ETF though, you’ll need to have $1,000 in the account.
While pretty much everyone reading my website over the years knows that I recommend sticking to dividend-stock investing and basic index investing, Questrade offers a ton of choice when it comes to what you purchase within a TFSA or RRSP.
Questrade RRSP Account Details
Once you have setup your Questrade RRSP and have your deposit info all setup within your online banking platform it’s time to choose how to invest that money. It’s also worth noting that Questrade will transfer your current RRSP or TFSA over to their platform for FREE!
In case you haven’t brushed up on some of the specifics of RRSPs lately, the point of the Registered Retirement Savings Plan is to help you save for retirement but sheltering your investments from the tax man’s icy grasp, and allowing you postpone paying taxes when you are working (and hopefully in a high tax bracket) to when you are retired (and likely in a lower tax bracket).
You can check your last tax return to find out how much you can invest within your Questrade RRSP account. A lot of people don’t realize that RRSP room is like a fine wine - it just gets better with age! Each year the Canadian government allows you to put up to 18% of your income into your RRSP up to a maximum amount (in 2019 the RRSP contribution maximum is $26,500). This amount is adjusted if you contribute to a workplace pension plan. For example, since I’m a teacher and make pre-tax contributions to my pension plan, I get less RRSP room than other Canadians might.
If you just opened a Questrade RRSP account, and have never had other RRSP investments over the years, it’s quite possible that you have a significant amount of room that you can make use of over the next few years.
Questrade TFSA Account Details
Your new Questrade TFSA account will be the flip of the RRSP. You’ll get taxed when you put money into it, but there is no “postponement” of taxes to worry about paying on the back end when you take the money out. Just like the RRSP (and RESP for that matter), the TFSA is what’s known as a registered account, and consequently, the TFSA umbrella will prevent the taxing rain from eroding away your investment returns over the years.
The other similarity the Tax Free Savings Account has with your Questrade RRSP is that it is extremely easy to open, as you simply select which accounts you want to open when you register at Questrade for the first time.
One point worth nothing when it comes to your Questrade TFSA Account: It should be called a Tax-Free Investing Account. I’ve long believed that adding the “S” to the TFSA has misled about 90% of Canadians into believing a TFSA is basically just a premium version of a high-interest savings account. Of course it is so much more than that, and can be used to shelter the same wide variety of investments as the Questrade RRSP account does.
You can contribute $6,000 per year to your TFSA and the federal government has stated that the plan is to increase that amount along with inflation over the upcoming years. Just like it’s RRSP cousin, TFSA contribution room does not disappear if it is not used in a given year.
In fact, if you were 18-years-old in 2009, you will have accumulated $63,500 in contribution room (increasing to 69,500 in 2020), and can immediately deposit this amount into your new Questrade TFSA account if it is your first time using a TFSA.
Holding USD In My Questrade RRSP and TFSA
Investing in USD can save you a ton of money in currency conversion fees when you think about how much it costs to convert dividend income and new stock purchases back and forth over your investing lifetime. Questrade RRSPs and TFSAs allow you hold both USD and CAD in your portfolio - and they do this for no added fees. (Each account is still $0).
Questrade was the first online discount brokerage to allow investors to hold USD in a registered account.
Questrade RESP and Family RESP Accounts
If you have children and you think they might one day attend post-secondary schooling of ANY KIND (it does NOT have to be university) then you are throwing away free money by not opening a Questrade RESP account. Given how quickly post-secondary education costs are rising (2.5x-3x the rate of general inflation) can you afford to throw away free money?
Here’s how to get $10,000 in free money from our government.
- Setup a FREE Questrade RESP account and deposit $208.34 into it every month.
- Collect the free $500 Canada Education Savings Grant (CESG) each year, up to a lifetime limit of $7,200.
- Invest the money in a conservative all-in-one ETF or even just a basic Canadian bond ETF.
- The interest/investment return you will make on your own money that you put it is nice - but you know what’s nicer? The $2,500-$3,000 return that you make on someone else’s money! (Especially when that someone else is the government!)
If your income is below $42,000 then there are some extra incentives for you.
The CESG cash, plus your investment returns within the Questrade RESP account will be taxed as income in the hands of the student. This means that it’s almost always tax-free because of the large amount of tax credits and deductions that students enjoy. Your original cash can be withdrawn tax-free as you already paid tax on it before investing it.
If you have more than one child, you can combine their contribution room into one big easy-to-manage Questrade Family RESP account (which is also free to open with no annual fees). The advantage to these accounts is that you can handle the withdrawals amongst your children in whatever way is convenient for you.
What If My Child Doesn’t Go to University? Do I Lose My Questrade RESP Money?
Here are the main points to think about if you’re worried about “wasting” RESP contributions:
1) The Questrade RESP account can be active for up to 35 years and you can use the RESP money for a HUGE variety of post-secondary studies. Everything from massage therapy to airplane mechanic courses can be covered. This combination means that it’s VERY likely your child will be able to use the RESP help at some point.
2) If you haven’t maxed out the CESG or contribution room for Child 2, you can simply take Child 1’s RESP money and use it for Child 2 within your Questrade Family RESP account.
3) If you have no children that ever attend any sort of post-secondary education, you can roll $50,000 into your RRSP (assuming you have the contribution room) and all you would lose is the free CESG money, and the investment earnings on the government’s cash.
4) You can withdraw the money you originally contributed tax-free without any penalties.
5) If you withdraw the investment returns that you made on your money, you will be taxed as if you earned the money as income, plus an additional 20% penalty. (This is a very unlikely scenario.)
Questrade Margin and Non-Registered Account
First of all - kudos to you for maxing out your Questrade RRSP and TFSA accounts! If you haven’t done that yet, you can probably keep life simple and skip this part of our Questrade review.
Once you have contributed the maximum amount to your RRSP and TFSA accounts, and (if you’ve got children) the Questrade Family RESP is on autopilot, your next step becomes a good news - bad news situation.
The good news is that you are in great financial shape, and there are options available for continued investing.
The bad news is that there is no more space under your tax-sheltered registered account umbrella. From here on out, you will be investing in the rain, and the tax man will get his chunk.
So, while there are semi-exotic accounts one could open if they want to exchange foreign currency or invest within a corporation, the option most people will opt for is a Questrade Margin Account.
The Questrade Margin Account is a fancy name for a basic non-registered account, with the added feature of being able to borrow money from Questrade and invest that money alongside your own. When you borrow money to invest it, this is called “investing on the margin”.
Now, I don’t recommend investing on the margin unless you really really know what you’re doing, and even then it often isn’t a good idea. The main takeaway from this though, should be that YOU DO NOT HAVE TO BORROW MONEY to invest within a Questrade Margin Account. Most everyday investors in Canada will be best served by using this account to invest in Canadian-dividend payers (my Smith Maneuver account for example) or other Canada-based ETFs.
You can however, put almost any kind of investment in a Questrade Margin account. Here’s a few more quick Questrade review facts about the non-registered option:
- You can invest in short-selling (watch the Big Short to have Margot Robbie in a bathtub telling you what this means)
- There are no contribution limits to worry about like there are with the Questrade RRSP, TFSA, and RESP accounts.
- Investment returns inside an unregistered account are still treated much nicer than income you make from a job. Capital gains and dividends are eligible for special tax treatment in Canada.
- There are no taxes to worry about upon withdrawal like there are in a RRSP.
- You can engage in complex options trading (again, not my thing).
- Questrade Margin accounts are governed by margin falls. This part is important: If you borrow money from Questrade, and the investment drops below the margin requirement, Questrade will essentially demand that you pay them their money back. If you don’t immediately pay them back, Questrade can sell your investments and take the money in lieu of your payment.
Overall, using the Questrade Margin Account as a basic non-registered account is a great option. Getting into the more exotic options like leveraged options trading is not my cup of tea.
Questrade's Trading Platforms - A Peak Inside
Questrade offers quite an exquisite and exclusive trading experience. It's true that I believe that there are better brokers out there in Canada for mobile app functionality or ease of use, but all in all Questrade delivers a home run, especially when you compare it to its immediate peers. The Questrade Trading and Questrade IQ Edge (web), as well as the Questrade App look and feel smooth and are generally bug-free, a thing which can't be wholeheartedly said about most Canadian brokers' software.
Below you can find a myriad of screenshots we have gathered from Questrade's website which will be soon replaced by more exclusive imagery (we are working on it!).
Is a Questrade Online Brokerage Account Safe to Use?
One of the most common questions that I have gotten in the comments below is:
Is investing my money through a Questrade online brokerage account safe?
Is Questrade as safe as RBC, TD, CIBC, ScotiaBank, and BMO?
The answer: Yes!
Here’s the deal. Off the top Questrade is a member of the Investment Industry Regulatory Organization of Canada (IIROC) and the Canadian Investor Protection Fund (CIPF).
Why this should matter to you is that these organizations hold Questrade to a pretty high standard as far as investor safety goes. Since the CIPF was founded in 1969, no eligible customers have suffered a loss of property. The CIPF has paid claims/expenses of roughly $43 million, net of recoveries, on the odd occasion where there has been a member insolvency.
Questrade has been around since 1999, and controls over $9 Billion in assets! On top of MoneySense and Rob Carrick giving them their stamp of approval, Questrade has won eight annual awards as one of Canada’s Best Managed Companies.
Finally, Questrade has created an online security Guarantee. The company will 100% reimburse you for any authorized transactions in any of your Questrade accounts that result in a loss to you AND your account is insured for up to $10 Million in the incredibly unlikely event that Questrade goes broke (“insolvent”). This is of course on top of the latest in online security features. My guess is that if you’re promising 100% reimbursement on losses, you’re going to take security pretty seriously.
An Award-Winning Online Brokerage
As you can tell from this Questrade review, Questrade has a lot going for it. Not just in my opinion, but in the opinion of many Canadian financial experts.
In fact, in early June it was announced that Questrade was named as the number one overall online brokerage in the JD Power 2020 Canada Self-Directed Investor Satisfaction Study. JD Power is considered to be a global leader in consumer insights, advisory services, and data analyses. They do not run their own in-house reviews, but rather rely on customer feedback which, I think, says even more about the quality of this ranking. After all, consumers are generally the most trustworthy when it comes to opinions.
As the winner for the Best Overall Investor Satisfaction for 2020, Questrade actually scored 19 points above the industry average. A pretty impressive feat for what is now becoming a competitive market.
Of course, this isn’t Questrade’s only award. Questrade is regularly named as one of the best managed companies in Canada. This year, in March of 2020, they scooped that award for the 9th year in a row!
Needless to say, Questrade is a pretty impressive and trustworthy business in the eyes of Canadian consumers and experts alike.