Self-directed investing has exploded in popularity thanks to online brokers driving down costs and making it easy for investors to manage their own portfolios. Gone are the days of $29 trades. Today, investors can trade stocks and ETFs for free from their mobile devices or access robust market research tools and charts to help them trade like a pro.
An online broker lets you buy and sell stocks, ETFs, and mutual funds online within your trading account. They’re often called “online brokerage” or “discount brokerage” because this trading method is more cost-effective than a traditional brokerage.
Using an online broker, you’re the boss: you make the investment decisions and choose what to purchase. While you can purchase individual stocks and bonds through your online broker, most DIY investors opt to build their portfolios out of ETFs. This strategy lets you build a highly diversified portfolio without worrying about purchasing dozens of individual stocks.
But with so many platforms out there, you may be asking, “What’s the best online brokerage in Canada for me?” To help you get started, we’ve put together a guide comparing the best online brokers in Canada, as well as some tips on how to choose the best trading platform in Canada for you.
Summary of the Best Online Brokerages in Canada 2022
|Brand||Best For||Promotion||Learn More|
|1. Questrade||Overall Best Trading Platform in Canada||$50 in free trades||Visit Site|
|2. Wealthsimple Trade account||Best for Commission-Free Trading in Canada||For a limited time, get a $25 cash bonus when you open a Wealthsimple Trade account and fund at least $150||Visit Site|
|3. BMO InvestorLine Self-Directed||Best Big Bank Brokerage||N/A||Visit Site|
|4. CIBC Investor's Edge||Best for Stock Trading||N/A||Visit Site|
|5. Qtrade||Best for Customer Service||N/A|
|6. CI Direct Trading||Best for Research||N/A|
1. Questrade: Overall Best Trading Platform in Canada
- Rating: 9.6/10
- Account maintenance fees: $0 per year
- Trading commission: $4.95 – $9.95 + Free ETF purchases
Operating in Canada for 20 years, Questrade wins out as our top choice for the best trading platform in Canada. For starters, using this platform will save you a lot of money: there are no annual fees or inactivity fees, ETF purchases are free, and trading is $0.01 per share with a minimum charge of $4.95 and a maximum of $9.95.
Already got an investment account with another institution? Moving your investments to Questrade is easy. Just fill out an online form and Questrade will handle the transfer. Plus, it covers any transfer fees up to $150 per account.
On the downside, the account minimum is $1,000. So if you’ve got less than that to invest, you might want to go with a commission-free trading platform (like Wealthsimple Trade account) instead. Investors should also watch out for ECN fees, which are charged on buy/sell orders that are filled immediately (avoid these by placing limit orders).
READ MORE: Questrade review
Questrade Pros and Con
Low trading fees for Canadian and US stocks
No annual fees or inactivity fees
Free ETF purchases
Pays transfer fees up to $150
Instantly deposit up to $3,500 into your Questrade account and start trading immediately.
Need a minimum of $1,000 in your account to start investing
ECN fees charged on buy/sell market orders
2. Wealthsimple Trade: Best for Commission-Free Trading in Canada
- Rating: 9/10
- Account maintenance fees: $0 per year
- Trading commission: $0
If you’re looking for the best commission-free trading platform in Canada, Wealthsimple Trade account allows you to buy and sell stocks, ETFs, and even crypto without paying any fees. There are also no account minimums, annual fees, or inactivity fees. So you can test-drive the platform without getting hit with trading fees for each transaction.
If you’ve got investments at another institution, you can move them to Wealthsimple Trade using your desktop, mobile phone, or tablet. It also won’t cost you a dime to do this: Wealthsimple Trade also reimburses transfer fees for investment transfers that are greater than $5,000 in value. Now is a great time to sign up because Wealthsimple Trade is offering Young and Thrifty readers an exclusive deal: Get a $25 cash bonus and $0 commission trades when you open a new Wealthsimple Trade account. All you have to do is fund at least $150. Plus, Wealthsimple Trade will reimburse an outgoing administrative transfer fee of up to $150 on investment account transfers valued at more than $5,000.
The downside: Wealthsimple Trade currently only supports RRSP, TFSA, and non-registered account types, and clients can only hold Canadian dollars.
READ MORE: Wealthsimple Trade review.
Wealthsimple Trade Pros and Cons
Buy fractional shares
$0 annual fees
Offers crypto trading
Reimburses transfer fees for investment transfers that are greater than $5,000 in value
Limited account types (RRSP, TFSA, non-registered)
Can’t hold USD so clients pay FX fees when buying and selling US-listed stocks and ETFs with a free account
3. BMO InvestorLine Self-Directed: Best Online Brokerage with a Big Bank
- Rating: 8.5/10
- Account maintenance fees: $0 - $100 per year
- Trading commission: $9.95
BMO InvestorLine Self-Directed is an excellent choice for anyone looking to get started with an online discount brokerage at a big bank who doesn’t want to pay commissions on ETF trades.
In 2021, BMO InvestorLine Self-Directed launched an impressive list of 80 commission-free ETFs for clients to trade (including Vanguard, iShares, and BMO ETFs).
BMO InvestorLine Self-Directed’s user-friendly portal, along with its impressive library of third-party research and solid customer service, will help you invest with confidence, whether you are a seasoned investor or a complete beginner.
BMO InvestorLine Self-Directed isn’t the least expensive discount brokerage, with fees on accounts under $25,000. Still, their zero minimum balance requirement, 80 commission-free ETFs, and award-winning platform are enough to overcome any drawbacks.
READ MORE: BMO InvestorLine Review
BMO InvestorLine Pros and Cons
80+ commission-free ETFs to trade
Excellent online and mobile app
Hold USD and CAD in non-registered and registered accounts
Great third-party research
$0 minimum account balance for RRSPs and TFSAs
$9.95 per trade on stocks and ETFs that aren’t included in the 80 commission-free list
$100 for account balances less than $25,000
4. CIBC Investor’s Edge: Best for Stock Trading
- Rating: 7.5/10
- Account maintenance fees: $0-$100 per year
- Trading commission: $6.95 per online equity trades only
CIBC Investor's Edge is the discount brokerage arm of CIBC Investor Services Inc. and a subsidiary of CIBC bank. Its newly redesigned website has given the platform a nice user experience.
CIBC Investor’s Edge offers flat fee commissions of $6.95 for stock and ETF trades. That’s the cheapest of all the big bank brokerages, although CIBC doesn’t offer any commission-free ETF trading.
Clients won’t pay account fees when they hold more than $25,000 in their RRSP and more than $10,000 in a non-registered account (TFSAs and RESPs are free).
CIBC Investor’s Edge Pros and Cons
Flat fee stock and ETF trading at $6.95 (lowest among all big bank brokers)
Newly designed website
Advanced quotes and research
Ranked dead last for customer service in Surviscor’s annual brokerage review
No commission-free ETFs
5. Qtrade: Best For Customer Service
- Rating: 7/10
- Account maintenance fees: $100 per year
- Trading commission: $8.75
Qtrade is a good alternative to Questrade and has a reputation for amazing customer service, ranking in the top 1 or 2 in Surviscor’s annual brokerage reviews. The company is trustworthy, too. Operating since 2001, Qtrade has $11.5 billion in assets and is a member of the Canadian Investor Protection Fund and Investment Industry Regulatory Organization of Canada.
If you’re interested in purchasing mutual funds yourself, Qtrade is one of the few discount brokerages with the ability to do so – and you won’t pay any fees or commissions when buying them.
Maintaining an account with Qtrade is slightly more expensive than Questrade, but still very cost-effective, setting you back $100 per year for RRSPs and TFSAs with less than $25,000 in combined assets. You’ll pay $8.75 per trade with Qtrade, and there are no account minimums. If you incur fees when transferring your assets to Qtrade, they will cover up to $150.
To better understand what you get with Qtrade, read and compare Qtrade vs. Questrade in our review.
Qtrade Pros and Cons
Free mutual fund purchases
Stellar customer service
Pays transfer out fees
Fees for accounts smaller than $25,000
Investment performance reporting could be better
6. CI Direct Trading (formerly Virtual Brokers): Best Online Broker in Canada for Research
- Rating: 7/10
- Account maintenance fees: $0 - $100 per year
- Trading commission: $1.99 to $7.99
CI Direct Trading ( formerly Virtual Brokers) is one of the best online brokers in Canada, with offerings on par with Questrade and Qtrade.
CI Direct Trading offers free ETF trades, which is perfect for index investors, and they charge 1 cent per share for stock trading (minimum $1.99, maximum $7.99). There is a $25 per quarter fee on accounts with balances under $5,000.
CI Direct Trading has several trading platforms to choose from and a huge research center to help you stay ahead of the curve when making trades.
CI Direct Trading Pros and Cons
Free ETF purchases
Stock trades at 1 cent per share (minimum $1.99)
No fees for accounts over $5,000
Excellent research tools for beginner to advanced investors
Robust investment performance reporting options
$1,000 minimum account balance
Comparing the Best Online Brokerages in Canada
|Online Investing Platform||Account Minimum||Commissions per equity trade||Free ETF Transactions||Mobile/Desktop Trading||Paid Transfer Fees|
|1. Questrade||$1,000||$4.95 - $9.95||Yes (purchase only)||Both||Up to $150 per account|
|2. Wealthsimple Trade account||$0||$0||Yes||Both||Yes, for investment transfers greater than $5,000.|
|3. BMO InvestorLine Self-Directed||$0||$9.95||80 commission-free ETFs||Both||No|
|4. CIBC Investor's Edge||$0||$6.95 per online equity trades only||No||Both||No|
|5. Qtrade||$0||$8.75||100 commission-free ETFs||Both||Up to $150|
|6. CI Direct Trading||$1,000||$1.99 - $7.99||Yes (purchase only)||Both||Up to $150|
How do online trading platforms work?
Online brokers have democratized investing for investors who are willing and able to self-manage their own portfolios. Clients can build their own portfolio of stocks and/or ETFs online or from their mobile device. Trades can be made with a click (or tap) of a few buttons. Most importantly, online brokers have reduced trading fees to as low as zero in many cases, making it easy and cost-effective for investors to build and manage their own investments.
Why should I use an online brokerage?
What is the benefit of purchasing your own investments directly and rebalancing manually when your investments slip out of their ideal asset allocation? There is one thing that draws in DIY investors: low fees.
The reason that most DIY investors choose to work with an online broker is to minimize the management expense ratio (MER) they pay on their investments. MERs are the management fees associated with individual funds. MERs are expressed as a percentage of your assets and vary depending on the style of investing you choose.
Mutual funds in Canada have some of the highest MERs in the world, at an average of 2.5%. Robo advisors offer a lower MER, usually less than 1%. DIY investing offers the lowest MER possible, with a portfolio of ETFs easily coming in at 0.25% or less.
The differences in these fees may not seem like much, but they can erode thousands, or even hundreds of thousands of dollars from your portfolio, given a long enough time horizon.
How much do online brokers charge?
Big bank brokerages typically have the highest trading fees at $9.99 per trade for stocks and ETFs. But many online brokers offer commission-free ETFs and low cost stock trading. Online brokers may charge other fees, such as an account fee for small balances, or an inactivity fee for accounts with no trades over a period of time.
Are online brokers safe?
Yes! Online brokers are members of the Canadian Investor Protection Fund (CIPF), which protects your cash and securities in the event of a member firm’s insolvency. CIPF protection covers $1 million for combined general accounts (cash, margin, TFSA), $1 million for combined registered accounts (RRSPs, RRIFs, and LIFs), plus $1 million for all RESPs.
What is the best trading platform in Canada?
Our extensive research into Canada’s online brokers found that Questrade offers the best trading platform in Canada thanks to its free ETF purchases, no account fees, availability of every account type, and extensive trading tools.
The Bottom Line
When it comes to getting the most out of your portfolio, the best option is to invest your money yourself, cutting out the middle person and vastly reducing the fees you’ll pay over the lifetime of your investments. While using an online broker to invest your money may seem intimidating at first, a simple portfolio built out of ETFs will give you the growth needed to reach a comfortable retirement, while keeping you in the driver’s seat of your money.
All of the online brokers listed above are good choices, but each has strengths and areas for improvement. However, if you’re looking to take the hassle out of DIY investing plus save big on fees, Questrade is your best bet and our top choice for the best online brokerage in Canada. Ultimately, the right one for you depends on your financial situation, but it’s not a question of if you should switch to an online broker to manage your money – it’s when.