Wealthsimple Trade Review: The Best Online Brokerage for Beginners?
In recent years, Canadian investors have flocked to self-directed investment apps in droves, enticed by the lure of lower fees and convenience. But with so many online brokers to choose from, deciding where to invest can be challenging.
Wealthsimple Trade aims to make the decision easy by offering free trades and a simple trading app. In this Wealthsimple Trade review, I’ll cover the key features, pricing, pros and cons and share a few alternatives.
What Is Wealthsimple Trade?
Wealthsimple Trade is the direct investing arm of Wealthsimple, Canada’s largest robo-advisor. It started as a mobile app but now includes a desktop trading platform.
Wealthsimple Trade’s claim to fame is its commission-free stock and ETF trades. Most online brokerages in Canada charge as much as $9.99 per trade, but trading stocks and exchange-traded funds is free with Wealthsimple Trade. There are some limitations on the types of investments you can buy and sell, but I’ll get to that a little later.
Click here to get started with Wealthsimple Trade
Getting Started with Wealthsimple Trade
It’s easy to open a Wealthsimple Trade account and begin trading. The first step is to provide your email address and a secure password. Existing Wealthsimple members can use their regular login details to access Trade.
From there, Wealthsimple Trade will guide you through the account setup process, including selecting the account type you want to open. Your choices include TFSAs, RRSPs, non-registered accounts, and Crypto accounts.
Unfortunately, Trade doesn’t support RRIFs, LIRAs, RESPs, or margin accounts. Once your account is open, you’ll have an opportunity to fund your account by linking your bank account to Wealthsimple Trade. Note that the funds will take a few business days to arrive.
Wealthsimple Trade Fees
Wealthsimple Trade doesn’t charge any account or trading fees when buying or selling stocks and ETFs. However, depending on how you use the platform, you could pay some fees.
When you trade with Wealthsimple’s Core plan, there are no monthly fees, and you can buy and sell thousands of commission free-stocks and ETFs. However, if you wish to purchase stock on a U.S.-listed exchange, like the NYSE or Nasdaq, you will be subject to a 1.5% currency conversion fee every time you place a trade. This can add up if you are trading U.S. stocks frequently.
You can upgrade to Wealthsimple Trade’s Plus plan for $10/month, which gives you access to USD accounts, so you no longer have to worry about the 1.5% currency conversion fee once the funds have transferred into your U.S. account. (You’ll still pay the 1.5% exchange fee if you fund your USD account with Canadian dollars or transfer funds into your Canadian account). If you trade options with your USD account, you’ll pay $2 per contract.
Wealthsimple Trade Fee Schedule
- Commission for listed US & Canadian securities: $0
- Account Opening: $0
- Account Closing: $0
- Deposits via Bank Transfer (EFT): $0
- Withdrawals via Bank Transfer (EFT): $0
- Electronic Statements & Trade Confirmations: $0
- Inactive account: $0
- Foreign Exchange Fees (CAD – USD): WSII Corporate Exchange Rate x 1.5%
- Outgoing account transfers to another institution: $0
- Options contract fee: US$2
- Options early exercise fee: US$45
- Options exercise fee: US$20
- Options ORF fee: US$0.01815 per contract
- Options SEC fee: US$0.0000229 per gross dollar of sale, applied to sell transactions only.
- USD Account fee: $10
- Paper Account Statement: $20
- Special Requests or Investigations: $75/hour
- Wire Transfer (incoming or outgoing): $30
- Broker-Assisted Phone Trades: $45
- Certificate Withdrawal: $250
It’s possible to avoid most, if not all, of these fees as long as you are trading Canadian securities and using the app to place trades and check your account balances.
Here are some features that set Wealthsimple Trade apart from the competition. Options trading isn’t one of them, but I’ve included it as a newer feature.
I’ve already mentioned this, but Wealthsimple Trades commission-free trades on thousands of Canadian and U.S.-listed stocks and ETFs is, in my opinion, its top-selling feature. Other brokers have better trading platforms, market research tools, and more account types, but you won’t find cheaper stock market trades anywhere in Canada.
It may surprise you, but Wealthsimple Trade is the only online broker in Canada that allows fractional trades. Fractional trading is when you purchase a portion of a single share. For example, let’s say you have $50 in cash left over after buying several Google shares, which are trading at $110 per share.
With most brokers, you would have to leave the $50 in cash or use it to buy a different stock listed at $50 or less. With Wealthsimple Trade, you can purchase 45% of a single Google share for $50. It may not seem significant, but in the long run, it’s much more efficient, not always dealing with small amounts of cash sitting on the sidelines.
Click here to get started with Wealthsimple Trade
New! Options Trading
Wealthsimple Trade now offers options trading on hundreds of U.S.-listed stocks and ETFs on the NYSE and Nasdaq stock exchanges. Unfortunately, options trading is only available from the mobile app right now. According to Wealthsimple, they will be adding more stocks to their options list in the future.
If you have the Wealthsimple Trade app, you can access options trades from the Discover tab at the bottom of the screen. Under Options, select Get Started with options.
Wealthsimple supports two options strategies: Long call options and long put options. The former gives you the right to buy a stock at a specific price on or before a certain date. The latter allows you to sell a stock at a particular price on or before a specific date.
Pricing on options trading is $2 per options contract. Remember that there are no additional trading fees.
You can buy, sell, and stake your favorite crypto coins with Wealthsimple (staking is only available for Ethereum and Solara.) At the time of this writing, Wealthsimple supports the following 50+ coins:
- 0x (ZRX)
- 1 inch (1INCH)
- Aave (AAVE)
- ApeCoin (APE)
- Amp (AMP)
- Ankr (ANKR)
- Avalanche (AVAX)
- Axie Infinity (AXS)
- Balancer (BAL)
- Bancor (BNT)
- Band (BAND)
- Basic Attention Token (BAT)
- Bitcoin (BTC)
- Bitcoin Cash (BCH)
- Cardano (ADA)
- Cartesi (CTSI)
- Celo (CELO)
- Chainlink (LINK)
- Chiliz (CHZ)
- Chromia (CHR)
- Compound (COMP)
- Cosmos (ATOM)
- COTI (COTI)
- Curve (CRV)
- Dai (DAI)
- Decentraland (MANA)
- Dogecoin (DOGE)
- dYdX (DYDX)
- Enjin (ENJ)
- Ethereum (ETH)
- Fantom (FTM)
- Filecoin (FIL)
- Gala (GALA)
- The Graph (GRT)
- Hedera (HBAR)
- Kyber Network (KNC)
- Litecoin (LTC)
- Loopring (LRC)
- Maker (MKR)
- NEAR Protocol (NEAR)
- Pax Gold (PAXG)
- Polkadot (DOT)
- Polygon (MATIC)
- Quant (QNT)
- Ren (REN)
- Sandbox (SAND)
- Shiba Inu (SHIB)
- Skale (SKL)
- Solana (SOL)
- Stellar (XLM)
- Storj (STORJ)
- SushiSwap (SUSHI)
- Synthetix (SNX)
- Tezos (XTZ)
- Uma (UMA)
- Uniswap (UNI)
- USD Coin (USDC)
- Yearn Finance (YFI)
Pros and Cons
Spoiler alert: When it comes to online brokers, Wealthsimple Trade is my top pick for beginner investors because of the free trades and because their platform is so easy to use. However, it’s not for everyone and has its share of drawbacks. Here is my list of Wealthsimple Trade pros and cons:
- No commission fees on stock and ETF trades
- No account minimums
- Intuitive, easy-to-use app
- Fractional trading available for many popular companies
- TFSA and RRSP accounts are available
- Wealthsimple Invest is available if you want robo-advisor access
- No advanced trading tools
- Can’t trade mutual funds, bonds, GICs, IPOs
- No RRIF or LIRA accounts
- Can’t automate dividend reinvesting
- Account withdrawals are delayed (1-2 business days)
- Have to pay $10/month for the Plus plan to avoid the U.S. currency conversion fee
Wealthsimple Trade Alternatives
There’s a lot to like about Wealthsimple Trade. But opening an online brokerage account is a big decision, and you really need to know whether the platform is right for you. Before you sign up with Wealthsimple Trade, consider the following alternatives.
Questrade is one of Canada’s largest independent online brokers, meaning a large bank or credit union does not own it. Questrade’s key competitive advantage is its low trading fees. You can buy and sell stocks for as little as $4.95 a trade, and ETF purchases are free. Next to Wealthsimple Trade, it’s the lowest-cost brokerage in Canada.
While Questrade doesn’t offer no-fee stock trades, its product and service offering is much larger than Wealthsimple Trade. Questrade offers more powerful trading platforms with plenty of research tools for advanced traders and more account types. In addition to Cash, RRSP, and TFSA accounts, you can open Spousal RRSP, LIRA, RRIF, RESP, Margin, Corporate, Sole Proprietor, Trust, and Forex&CFD accounts with Questrade.
Learn more in our full Questrade review.
TD Easy Trade
TD Easy Trade is a mobile-only stock trading app from TD Direct Investing, Canada’s largest online brokerage. It’s designed for beginner traders and is clearly meant to be an alternative to Wealthsimple Trade. Users get 50 commission-free stock trades per year and access to unlimited commission-free TD ETFs. Like Wealthsimple Trade, it offers an intuitive app that lets you place trades with the click of a few buttons.
While Wealthsimple Trade doesn’t limit the number of free trades (a key advantage), TD Easy Trade offers something that Wealthsimple Trade does not: A Canadian and U.S. Dollar component on every account. This allows users to buy and sell U.S. stock without currency conversion fees. With Wealthsimple, you must pay a $10/month Plus plan to avoid the currency conversion fee. Not a big deal if you don’t plan to trade U.S.-listed stocks, but worth mentioning, nonetheless.
Qtrade Direct Investing is a division of Aviso Wealth, a wealth management firm owned by Canada’s credit unions, CUMIS, and Desjardins. Qtrade is known for its competitive pricing, which is higher than Questrade and Wealthsimple Trade but lower than the big bank brokerages. Its standard trading fee is $8.75 per trade, but they offer more than 100 commission-free ETFs.
Like Questrade, Qtrade has a more robust trading platform and more account types than Wealthsimple Trade. It’s worth considering, especially if you’re a credit union member and are happy with the occasional stock trade and the free ETFs Qtrade offers.
Interactive Brokers (IBKR) is going after a different type of client than Wealthsimple Trade. Where Wealthsimple Trade is best suited for new traders and cost-conscious investors, Interactive Brokers appeals to advanced traders who want access to global markets. With IBKR, you can trade stocks, ETFs, options, futures, currencies, bonds, mutual funds, etc., on more than 150 global markets using a single trading platform. You can also fund your account and trade assets in 26 different currencies.
IBKR doesn’t offer commission-free trades, but their pricing is very competitive, with a minimum trading fee as low as CAD 1.00 per order.
How Does Wealthsimple Trade Compare?
Wealthsimple Trade is an excellent stock trading app for new investors and those who prioritize low-fee trades over other considerations, such as number account types, platform functionality, research tools, etc.
Click here to get started with Wealthsimple Trade
If you fall into one of those categories, Wealthsimple Trade should be at the top of your list. My only caveat would be that if you are a well-entrenched TD customer, you may find it more convenient to open a TD Easy Trade account as long as you can stay under the 50 free trades annually.
However, if you’re looking for the best balance between price and performance, Questrade is your best bet. In addition to the free ETFs and $4.95 stock trades, you get a much more robust trading platform that will grow with you.
Interactive Brokers also supports fractional shares. Questrade offers FHSAs (First Home Savings Account).
Hello Thank you for the review. I looked into Wealthsimple in the past but they did not offer joint accounts for husband and wife. Do you know if this still the case? Thank you. Mike