Questwealth Portfolios: A Robo Advisor by Questrade
Questwealth Portfolios Review
- Investment Strategy
- Website and Mobile Usability
- Fees & Costs vs Mutual Funds
- Advice and Personal Finance Help
Questwealth is a much better option for investing your money than traditional mutual funds, but if you’re looking for the BEST way to invest your money, we’d still recommend Wealthsimple as our robo advisor of choice.
- Competitive fees
- Great if you prefer an actively managed robo advisor
- Safe and trustworthy provider
- Minimum investment required of $1,000
- Fairly basic investment strategies offered
Robo advisors are becoming more and more popular as an option for Canadian investors. I’ve done a few robo reviews already, and today will be focusing on Questrade’s new robo advisor in this Questwealth Portfolios review. For those familiar with Questrade you might be thinking: ‘wait a minute, doesn’t Questrade already have a robo advisor?’
The short answer is yes, Questrade having a robo advisor is nothing new.
However, the old robo, Questrade’s Portfolio IQ, has been replaced by their new product: Questwealth Portfolios. So, what does Questwealth Portfolios have to offer and how does it stack up to other robo advisors in Canada? Keep reading to find out.
Questwealth Portfolios Review: Fees
One of the first things to look at with any robo advisor are the fees. Questwealth Portfolio’s fees are actually pretty impressive. In fact, Questwealth Portfolio currently offers some of the lowest fees on the market when it comes to Canadian robo advisors.
- For accounts that have $1000- $99,999 you’ll pay Questrade a 0.25% fee
- For accounts that have $100,000 + you’ll pay Questrade a 0.20% fee
- *These rates are the same for typical portfolios as well as for SRI portfolios
BUT remember, you also have to add in the MER of the underlying ETFs as well:
- Regular accounts can expect to pay 0.17%-0.22% (depending on equities vs bonds allocation)
- Socially Responsible Investing (RSI) accounts will pay a little more, 0.21%-0.35%
While nobody loves the idea of paying a fee, when you break it down it’s really not so bad. If you had $20,000 in your account you would be paying $8 a month. That’s less than a drink at a bar, not such a big deal right?
On top of these low fees, what I really appreciate about Questwealth Portfolios is that there are no hidden fees. There are no transfer fees, no trading fees, and no fees if you want to make regular contributions. What you see listed above is what you pay. End of story.
Curious about how much you can save with Questwealth Portfolios? They have an online calculator that you can play with to get an idea of just what they can do for you and your money. You can find the calculator here and the disclosure page for the calculator (which shares the assumptions they make when creating these estimates) here.
Those interested in opening an account with Questwealth, however, should be aware that there is a $1,000 minimum requirement. For those looking to transfer, Questwealth Portfolios will cover the costs of any transfer fees (up to $150) for transfers of $15,000 or more.
Is Questwealth Portfolios Safe?
Safety is always a concern when it comes to
- Your investments
- Investing online
Of course, we need to remember that in this day and age of the internet, nothing can be guaranteed as 100% safe. That being said, Questwealth Portfolios takes their customer’s privacy and safety very seriously and there are extremely serious security precautions in place for your investments.
First of all, all accounts with Questwealth Portfolios are covered by CIPF (Canadian Investor Protection Fund). If, by chance, Questwealth goes bankrupt (incredibly unlikely) your assets are protected up to $1 million. Questwealth Portfolios (Questrade) also offer free private insurance which provides an additional $10 million in protection and, last but not least, Questrade is a member of IIROC (Investment Industry Regulatory Organization of Canada).
Remember, your safety is as important to them as it is to you. After all, their entire business model run online, if it’s not secure, they can wave goodbye to all of their clients. Also, for further peace of mind, you may be interested in knowing that they have won the award for the best-run Canadian company 8 times. That’s not an award you receive for having poor security and safety protocols!
Is Questwealth Portfolios a Robo Advisor?
Questwealth Portfolios falls under the big umbrella of the term robo advisors, however, compared to other robo advisors, it is a little bit different.
Questwealth is considered to be a hybrid model. This means that they are actively managed, whereas most traditional robo advisors are passively managed. In the case of Questwealth, there is a team of experts who will monitor and manage your portfolio, making adjustments when needed.
Some people love this approach and are more comfortable knowing that someone is actively managing their investments. Others, however, don’t like this method and prefer the traditional management approach of other robos. Part of this is because active management usually means larger fees – though as I already pointed out, that’s not the case with Questwealth Portfolios; they have some of the lowest fees on the market!
Another reason as to why some people aren’t a fan of the hybrid approach; there’s not much evidence that actively managed accounts do any better than passively managed accounts. However, since the fees are so low, there’s nothing to really worry about. It’s not like you are paying extra for that service. At the end of the day, it’s more about what you feel comfortable with. For some people, having an actively managed account might be more reassuring than a traditional robo advisor, in which case, Questwealth is a great option.
Questwealth Portfolios Review: Features
Many Questwealth Portfolio reviews will tell you that this robo advisor is the best Canadian robo advisor on the market. While I’m not inclined to play favourites, I can see where they are coming from by making this claim. Questwealth has a pretty impressive history backing it up, and plenty of great features.
…A Little Bit About Questrade and Questwealth Portfolios…
To start with, let’s talk a little bit about the company itself. As mentioned earlier, Questrade has been the recipient of the best-managed company in Canada 8 times now. That’s pretty impressive. They are also Canada’s fastest-growing brokerage company, have twenty years experience in the Canadian market, and manage over $8 billion in assets.
On top of being named the best-managed company in Canada multiple years in a row, Questrade has also recently been recognized for holding the top spot in the JD Power 2020 Canada Self-Directed Investor Satisfaction Study. For those unaware, JD Power is considered to be a global leader in consumer insight, data, and analytics.
The research conducted for this took place between November 2019 and January 2019 and analyzed customer experiences, relationships, and overall satisfaction with 8 self-directed firms within Canada. This consumer study also considered investor’s commitment to their chosen firms.
Questrade came out on top and was named the Best Overall in Investor Satisfaction. While this title itself is something worth noting, perhaps more impressive is the fact that they didn’t just win the title by a couple of points. In fact, Questrade took that award by scoring 19 points above the industry standard.
The award itself, as well as the high score, speaks a lot to how this company is viewed among Canadian investors. After all, this award is given based on consumer feedback and we all know that consumers tend to have the strongest (and often harshest and most negative) opinions when it comes to businesses.
Needless to say, Questrade, and therefore Questwealth Portfolios, have a pretty impressive resume and are clearly equipped to be able to handle your money in a safe, reliable, and professional manner.
With that in mind, let’s dig a little deeper into the stand-out features that make Questwealth Portfolios such a great option for a robo advisor.
As discussed above, Questrade has some of the lowest rates on the market which makes it incredibly competitive. Management fees range from 0.20%-0.25% and MERs range from 0.17%-0.22%. If you do that math, you could have a total fee for as low as 0.42%, which is excellent.
Free Tax-Loss Harvesting
While this feature doesn’t benefit everyone, it’s a big draw to those investors who have taxable accounts or are investing their money outside of an RRSP or TFSA. For those who are unsure of how tax-loss harvesting works, essentially the Questwealth Portfolio managers will be able to offset your investment gains with your investment losses which means, come tax time, you won’t have to pay as much. It’s a great investment strategy that could, potentially, save you a lot of money.
Transfer Fee Coverage
If you already have your assets under another institution, you will need to pay something called a transfer fee in order to switch it over to the new institution, in this case, Questwealth Portfolios. The transfer fee varies depending on the institution but, as a general rule of thumb, it’s not cheap. However, if you are switching to Questwealth Portfolios they will cover your transfer fee (up to $150) if you transfer $25,000 or more.
Your Portfolio is Actively Managed
As you’ll remember from earlier in this Questwealth Portfolios review, Questwealth Portfolios are not a traditional robo advisor in that your portfolio will be actively managed whereas most robo advisors manage accounts passively. For some people, this is a huge perk, others could care less. However, this service does normally come with higher fees but that is not the case with Questwealth Portfolios.
Socially Responsible Investing Options
Socially Responsible Investing (SRI) is gaining popularity quickly, especially among the younger generations. The concept of being able to invest in companies whose policies align with your beliefs is a very attractive concept to many. Yes, the MERs for SRIs are higher than they are for the more traditional portfolios, however, for many the ability to focus on the environment and social responsibility and governance may be worth that extra little bit. Questwealth Portfolios allows you to choose if you want to go with SRIs right from the start, which means you can put your money where your heart is right away.
The ‘set it and forget it’ or ‘couch potato’ strategy is a huge reason as to why robo advisors are so popular. Questwealth takes care of monitoring and keeping tabs on your asset and rebalancing when needed, so that you can spend your time and energy doing more exciting things while having the peace of mind that your assets are being looked after and taken care of.
Reinvesting your dividends (the money you receive as an investor) is one of the best ways to make your money work for you. Any dividends you receive with Questrade Portfolios are reinvested for you.
A Top-Notch Customer Service Team
Just because your Questwealth Portfolios isn’t managed by an individual at a brick-and-mortar institution, doesn’t mean that you can’t get access to a great support network. You can access customer support via the phone, email, or virtual chat.
From Monday-Friday 8am-8pm customers can use the ‘chat with us’ option that will give you instant access to a customer service agent. If you need assistance outside of these hours, there is a self-help function which allows you to search through online information for the answers to your question.
In 2018, Questrade received the DALBAR seal for service excellence which recognizes exception service leaders within the financial service industry.
Questwealth Portfolios RRSP and TFSA
Questwealth Portfolio has several account options but the two most popular options are RRSP and TFSA accounts.
Questwealth Portfolios RRSP
Opening an RRSP with Questwealth Portfolios is easy. It takes minutes and can be done from the comfort of your own home. There are no account opening or closing fees and no annual RRSP account fee. If you have an existing RRSP with another institution, Questwealth Portfolios will transfer it over to you for free (maximum up to $150 in fees/ account).
Questwealth Portfolios TFSA
Many people consider TFSA accounts to be savings accounts, but the truth is that a TFSA account is a great investment account. (I’ve long advocated that we change the name to Tax -Free Investment Accounts.) With Questwealth Portfolios, you will get a pre-built portfolio of ETFs designed to help you reach your financial goals.
With the Questwealth Portfolios, you can open a TFSA in minutes as it’s all done online. There are no opening or closing fees, and no annual TFSA fee. You can also hold both Canadian dollars and American dollars in your account.
Questwealth Portfolio Investment Options
At this time, Questwealth Portfolios has five different portfolio options to choose from depending on your goals and the amount of risk that you are willing to take. They are:
- Conservative: Perfect for low-risk investors. This portfolio option will keep 80% of your balanced in fixed income and 20% in equities. It is the portfolio with the least amount of risk; however, it is then by default, also the portfolio with the least potential for growth.
- Income: This portfolio is a step up from conservative, ideal for those who are willing to take a bit more of a risk. It’s 60% fixed income and 40% equities.
- Balanced: For medium investors. The breakdown here is 60% equities and 40% fixed income.
- Growth: A little more aggressive, but still holding back a little. This portfolio holds 80% in equities and 20% in fixed income.
- Aggressive: For high risk investors, these portfolios are 100% equities.
While you may be thinking five portfolio options doesn’t seem like a lot, these options tend to fit most Canadian investing wants and needs. However, if you are looking for something a little more niche or specific, than Questwealth Portfolio sprobably isn’t the best robo advisor for you.
Those that are interested in socially responsible investing (SRI) will be happy to know that Questwealth offers SRI portfolios as well. As mentioned previously in this article, the MERs for SRIs are a little higher than they are for the typical portfolios, however, with Questwealth Portfolios these fees are still very reasonable and competitive.
How Does Questwealth Work For You?
Robo advisors receive a bit of scepticism at the best of times, so if you are wondering how Questwealth actually works for you and your money, well, here’s what you need to be aware of.
- Real time rebalancing: This doesn’t just happen at a certain time of year once a year. Your portfolio will be rebalanced when needed as needed.
- Lowered tax obligations: Remember earlier when I was talking about tax harvesting? This is a huge asset and really does have the potential to save you a good chunk of money come tax time.
- Your dividends will be reinvested: Questwealth Portfolios continue to make your money work for you. So, your cash isn’t just sitting around. It’s re-invested so you can accumulate even more.
- Questwealth Portfolio has proven historic returns: While the past can’t predict the future, you can rest a little easier knowing that Questwealth Portfolios has a great track record. In fact, four out of 5 of their portfolios have 10+ years of historical performance. (This claim is not based on the actual Questwealth Portfolios product, but rather the underlying investments’ track record.)
Don’t believe me? You can take a look at their website, Questwealth Portfolios has their public records on full display for your consideration. Don’t worry, you don’t need to have an account to find this information, it’s there for anyone to see. Personally, I love this type of transparency, it makes me feel more confident about who I choose to invest with.
How Does Questwealth Portfolios Compare to Other Robo Advisors?
There’s no doubt that Questwealth Portfolios has a lot of great features going for it. But, at the end of the day, we need to consider how it stacks up compared to other Canadian robo advisors.
First of all, we need to remember that Questwealth Portfolios is not a traditional robo advisor in that it is considered to be a hybrid. Whether this is important to you or not, it definitely makes it a stand-out feature compared to other robos on the market. As for the other perks and features, well they are great, however, most robos offer the same or quite similar.
The quickest and easiest way to figure out how Questwealth compares to other robo advisors in Canada is to look at the basics: the fees and the minimum investment requirement.
How to Sign Up
Ready to sign up for Questwealth Portfolios? It’s all done online and trust me when I say, it’s also very easy.
- Upon visiting the website you will see a big green button to open an account- that’s where you want to go!
- Scroll down Questwealth Portfolios and click add. You’ll then see a little pop up on the right hand side where you have to agree to the terms and conditions and you can click ‘open now’.
- Once you have done this you will be asked to fill out your information. This includes: full name, email address, home address, social insurance number, and phone number. You will also have to scan or take a photo of a government issued photo ID (passport, driver’s license etc.)
- If you are transferring funds that you currently have held at another financial institution, you will need to print off some documentation to sign.
- You’re all set! Now you just need to transfer your funds from the bank into your Questwealth Portfolios.
Questwealth Review: A Look Inside
So, by now you may be thinking that Questwealth Portfolios sounds like a pretty good option. But, there’s one more thing you are concerned about: is it user friendly?
In a nutshell, it’s very sleek and user friendly, but you don’t have to take my word for it. I’ll show you an inside look at what you can expect your user experience with Questwealth Portfolios to be like. Here are a few screenshots of what the signup process, as discussed above, looks like.
The first step is to open your account. Now, be aware that the top options are for self-directed accounts. This is not what you want so you will have to scroll down a bit until you see ‘Questwealth Portfolios’. This is what you want.
Once you make your selection, you’ll be asked to create an ID and password for your account. After you have this set up, you will be given a questionnaire to determine your objectives for the account you want to open.
These questions will correspond with the 5 account options I discussed above. Once you have completed the questionnaire you will be shown your ideal portfolio. This is broken down in an easy, visually comprehensive way so you can see the breakdown for the proposed account. You will also have the option at this stage to choose to make it an SRI should you like; just tick the box. This is all available for you to see and consider before you invest any of your money.
Upon finalizing your account, you’ll be directed to the dashboard which, like the entire set-up experience, is clean, crisp, and easy to understand. Should you need assistance, you can always reach out to the Questwealth Portfolios support team. They will also call you a day or so after opening your account just to check in and make sure you are happy with your choice.
It’s an easy process and thanks to the low rates and excellent customer service, Questwealth Portfolios truly are a great option for those looking for a robo advisor.
Questwealth Portfolios: A Final Verdict
If you have used Questrade’s excellent discount brokerage product in the past, and really trust the company – OR – simply love the idea of an actively managed robo advisor, then Questwealth portfolios is probably right in your wheelhouse.
For my money though, I’ll stick with the robo advisor that has almost identical fees, no minimum start up amount, better features, and *most importantly* an index-based passive investing philosophy. See our Wealthsimple Review for more details.