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A Deep Dive into the Best Discount Brokerages in Canada

Guest Post | Aug 13, 2021

Discount brokerages in Canada - A Deep Dive into the Best Discount Brokerages in Canada

With a growing number of options in Canada, the competition between discount brokerages such as Interactive Brokers and Questrade, has never been more fierce. Companies are introducing new and exciting features constantly in a bid to gain more attention and attract new users. With so many options available, users are taking more time to research their options and figure out which is the best choice for them.

Discount brokerages are constantly reviewing user feedback and looking at competitor offerings when developing new features. In the United States and Canada, major developments such as the introduction of commission free trading were made possible in response to customer demands. In the United States, Robinhood was the first brokerage to offer commission free trading to its user base. As Robinhood continued to grow and gain market share, competitors such as Charles Schwab sensed the threat posed. In response, Charles Schwab announced that they would also be offering commission free trading a few years later in 2019. That same day, both E-Trade and TD Ameritrade were quick to respond to these developments, announcing that they would also be offering commission free trading.

These developments not only impacted U.S. based brokerages but Canadian ones as well. Wealthsimple was the first to launch commission free trading for thousands of Canadian stocks and ETFs, following a similar timeline in 2019 as its American peers. Other brokerage firms like Questrade joined in as well, but only offer zero commissions on ETFs.

Over time, Wealthsimple introduced other new features in response to feedback from customers as well. Registered accounts like RRSPs and TFSAs were added to Wealthsimple, and a desktop application was developed to accompany the mobile app. In fact, the company has an entire forum dedicated to Wealthsimple Trade Feature Requests where users can submit ideas!

These are just some examples of how new features were introduced into the Canadian market. Each of these announcements helped to increase competitiveness between discount brokerages and provided users with more choices. But these were just the start, and the discount brokerage firms are continuing to develop new products and services to meet the needs of customers.

 

Wealthsimple New Features

A major feature that Wealthsimple Trade has recently introduced is fractional shares. Rather than buying an entire share, the feature allows users to choose to buy and sell portions of shares in US and Canadian companies, starting with increments as low as 1 dollar. This benefits users who want to buy shares of Amazon but do not have enough money in their account to invest in a single share that is currently worth over $3,500.

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Wealthsimple is not the first Canadian company to offer the feature, as fractional share trading is already available on Interactive Brokers. The feature is currently being rolled out for fourteen stocks — four Canadian and ten American companies.

Shopify (SHOP)
Royal Bank of Canada (RY)
Toronto Dominion Bank (TD)
Canadian National Railway Co. (CNR)

Amazon (AMZN)
Google (GOOGL)
Apple (APPL)
Microsoft (MSFT)
Facebook (FB)
Netflix (NFLX)
Tesla (TSLA)
AirBnB (ABNB)
Coinbase (COIN)
Nvidia (NVDA)

 

Questrade new features

One of the biggest additions to the Questrade platform over the past few months has been the introduction of Instant Deposit. Launched in June 2021, the feature allows customers to deposit money and trade with it instantly rather than waiting for a transfer processing period. Users can take advantage of the feature through their Visa Debit accounts, with a limit of $3,500 per transaction. Later this year, Questrade is also planning on offering the service through transfers by Interac as well.

Interactive Brokers Canada (IBKR) new features

Already jam-packed full of features, Interactive Brokers released a major update in June 2021 that added even more products and services for their clients. The new tools include basic upgrades like a “Hot News” tab in the platform, redesigned menus for improved ease of access, and the addition of several new research providers. More sophisticated investment instruments also received important upgrades, such as the introduction of US Spot Gold trading and Micro Bitcoin futures contracts. A full list of updates is available here.

Qtrade new features

Qtrade has recently undergone a major rebranding, with a new look, name, and logo. Now known as Qtrade Direct Investing, the company hopes that the new look will help attract new investors to their platform. The new website features a large range of educational tools, with articles targeted towards both new and experienced investors.

Each brokerage firm is bringing their own fresh and new ideas into the market. As a result, consumers are benefiting from new and improved products and services. As new ideas become successful, other companies are likely to introduce similar services. Offerings such as fractional shares have been highly requested, and if Wealthsimple sees good uptake, other brokerages may also choose to follow suit.

 


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