Best trading platforms in Canada

Though some online brokers may provide investment education materials for their users, they generally do not provide personal consultation with the investor.

Investors who do not have the time, patience, or interest needed for responsible self-directed trading and the regular research and autodidactic education it requires might be better off with either a full-service stock broker or a robo-advisor. Check out our list of the best robo nadvisors in Canada if you prefer a ‘set it and forget it’ investing approach.

Though fee amounts and structures may vary from one online broker to the next, they save an enormous amount on overhead by being based primarily online, and will invariably be less costly overall than what you will pay with a full-service broker.

There’s no hard and fast rule as to what portfolio value you need before it makes financial sense to work with a full-service broker, but a rule of thumb is that those with combined assets of $250,000 or more should at least consider moving away from online or discount brokers and robo-advisors toward working with a traditional stockbroker.

Market volatility can make investors prone to rash, emotionally driven decision-making, and it’s easier to give in to that when you can make trades with a single click.

Working with a full-service broker can serve as a rational counterpoint to any knee-jerk decisions you might make independently. Conversely, some full-service brokers may receive financial compensation for selling a specific mutual fund or stock, which can compromise the impartiality of the trading advice they give you.

When you make your own trades, you are making decisions based solely on your own best interest.

Get a feel for an online broker’s platform by checking out some of its preview videos. Do the account management and trading interfaces seem simple and user-friendly? Is the platform available on both mobile and desktop? Is the provided amount of stock info scanty, overwhelming, or just enough?

Keep in mind that some online brokers update stock trading quotes in real-time, but others have a lag, which could be problematic for high-volume traders, like day traders.

Those who are trading independently for the first time might opt for an online discount broker that has extensive investor education resources in the form of tutorial videos, blog articles, FAQs, etc.

Some online brokers might also offer a combination of autonomous trading with personalized advice from investing experts, akin to working with a full-service broker. This might be an attractive option for those who are new to investing, but it could be unnecessary for experienced traders.

Some online brokers require no minimum investment to open an account; others require a minimum investment of several thousand dollars. Keep the amount you’d like to start investing with in mind when researching brokers and make sure it isn’t below the minimum of a broker you’re interested in.

Fees aren’t the only factor to consider, but they are certainly one of the most important. Consider the types of investments you plan to make—stock trading, options, ETFs, mutual funds, bonds, etc.—and check out the different commissions each broker charges on those.

Keep in mind that a broker might charge not only fees for each trade, but also fees for account maintenance, currency conversion, inactivity, and closing/transferring out an account. Some brokers may offer commission-free trades or reduced fees for investors that make a minimum number of trades per month. If you plan to trade frequently, or if you have ambitions to become a day trader, you might opt for a broker with a trading fee structure that incentivizes frequent trading.

If you find yourself stuck between two options that have a seemingly even number of pros and cons, check with both to see if one of them might offer a special sign-up bonus that you may not have noticed, like cashback.

Some online brokers, particularly those administered by banks, might also incentivize the use of other financial products, like savings accounts or credit cards, in tandem with their investing platform.

Related: best brokerage account promotions

Many day traders use online brokerages in order to execute their quick exchanges within the same trading day, due to the little to no trading commission fees that come along with many online brokerages. All of the above online brokers can be used for day trading, with Questrade being one of the top favourites, as it offers discounts if you’re an active trader.

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.

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.

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.

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.

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.