Is Wealthsimple Trade the zero-commission broker for you?

By   |   Verified by Nikita Sheth   |   Updated 16th April 2021

Finty review Weathsimple
  • Wealthsimple Trade, the trading division of the popular investment company, Wealthsimple, offers investors that want to take a self-directed path the tools to manage their money in the market.
  • Beautifully designed, Wealthsimple Trade removes the complexity and opens investing to the broader population.
  • Find out how their platform compares against others available in Canada.

Wealthsimple Trade is the ideal broker for Canadians looking to invest in the US stock market. It is Canada's only "zero-commission" broker, meaning they don't charge you anything for placing trades on its platform.

That's good news for traders, as commissions and fees take up a substantial chunk of profits, especially when you have a small account.

As of February 2021, Wealthsimple Trade has over $8.4 billion in assets under management. It's also won several awards for its innovative trading platform that makes it easy for millennial and zoomer investors to trade on their mobile devices.

If you're looking to invest in Canadian and US stock, but don't know if you should go with Wealthsimple Trade or a different broker, this review is for you. Let's get started!

Who is Wealthsimple Trade aimed at?

Wealthsimple Trade is a trading app allowing access to the Canadian and US stock markets. It's similar to the popular US-based investment app, Robinhood. You get commission-free trades and access to a bevy of ETFs and financial assets to trade with your account.

Wealthsimple Trade focuses on new investors and traders, especially those in the millennial and Gen Z age groups (18 years to 36 years old). If you're just getting into trading, fees and commissions take up a sizable amount of your profits, especially if you're only working with a small amount of capital.

Commission-free trades allow you to build a small account fast, giving you the best chance to make it as a day trader. If you're comfortable managing your own investment account, Wealthsimple Trade offers the best platform for Canadian day traders and investors.

The app permits users to trade in non-registered accounts and TSFA or RRSP accounts.

What can you trade with Wealthsimple Trade?

Wealthsimple Trade focuses on the most popular assets for trading. The platform gives you the opportunity to trade thousands of ETFs and common stocks listed on American and Canadian stock exchanges like the NYSE and TSX.

Wealthsimple Trade constantly adds new assets to its offering, giving traders a choice of assets to trade. While you can't trade all tickers and assets through Wealthsimple Trade, there are plenty of options to help you grow your account.

Trading tools

Wealthsimple Trade focuses on providing newbie traders with a trading platform that's easy to manage and use. Unlike other trading platforms like Interactive Brokers' "FlightDesk", you get a straightforward, user-friendly trading platform you can access through your mobile device.

Wealthsimple Trade offers you simple chats, allowing traders to identify trends and watch pricing to time their entries and exits according to their trading strategy. The mobile platform is available for iOS and Android devices, with simple setup and registration.

Wealthsimple Trade won several awards for its unique and user-friendly trading platform, making it the market leader and attracting new traders that want a simplified trading experience that delivers results.

Trading fees

The best part about Wealthsimple Trade is its "zero-commission" policy for trading through its platform. There are no fees associated with trading stocks or ETFs on US or Canadian stock exchanges like the TSX, NYSE, and Nasdaq.

While there are no trading commissions, Wealthsimple Trade does charge a 1.5% currency conversion fee when converting your CAD deposit to USD to buy US stocks or ETFs.

Pros and cons

Pros

  • Commission-free trading on stocks and ETFs.
  • User-friendly mobile trading apps for iOS and Android devices.
  • No minimum account balance.
  • CIPF protection on account balances up to $1 million.
  • Invest in TFSA and non-registered accounts.

Cons

  • No margin accounts available.
  • RESP accounts not available.
  • No real-time market data.
  • Not suitable for "scalping" strategies.

Alternatives

Qtrade

This Canadian-based firm offers traders access to the Canadian and US stock markets. You get hundreds of commission-free ETFs as well as assets like stocks and options to trade in your account.

Qtrade focuses its offering on providing a functional, user-friendly trading platform for new traders. The streamlined trading platform gives you everything you need to execute orders, with different order types available to suit your trading strategy.

Its basic trading platform has easy-to-read charts, fast order placements, and easy navigation of your trading platform layout.

Questrade

Questrade is Canada's largest independent fintech firm. Founded in 1999, Questrade offers you self-directed and managed trading accounts, allowing you to invest in a range of assets, from stocks to ETFs, forex, commodities, and options.

You get competitive pricing and a user-friendly trading platform, making it an excellent choice for active traders and cost-conscious investors. Questrade offers you easy-to-read charts and excellent customer service for managing your account.

TD Direct

TD Direct Investing is a leading Canadian discount broker. Originally branded TD Waterhouse, the company now offers trading services. However, it's far behind other leading companies like Wealthsimple Trade, Scotia iTRADE, and Questrade.

TD charges a standard $9.99 commission for trading ETFs, which eats into your profits, especially if you're trading with a small account. Therefore, TD Direct probably isn't the best choice for less experienced traders or those new to the market.

Scotia iTRADE

Scotia iTRADE is the trading division of Scotia bank, one of Canada's "Big 5" banks. The company has an award-winning trading platform that's suited to new traders learning the ropes. You might think that a big bank would fleece its clients with fees, but that's not the case with Scotia iTRADE.

iTRADE gives traders discounted commissions and free educational resources for beginner traders. The platform also offers powerful trading platforms suitable for experienced day traders.

Interactive Brokers

Interactive Brokers is one of the leading international brokerages. The company also offers commission-free trades through its IBKR Lite account.

Interactive Brokers Canada (IBKR) is a good choice for advanced day traders that have experience. The IBKR Lite platform and account are not available to Canadians. That's unfortunate, as the IBKR Lite platform is the closest competitor to Wealthsimple Trade.

FAQs

Who owns Wealthsimple Trade, and can I trust them?

Founded in 2014 by Michael Katchen, with headquarters in Toronto, Wealthsimple Trade is a division of Wealthsimple. The company has an excellent track record with Canadian investors.

Is Wealthsimple Trade slow?

According to user reviews, Wealthsimple trade doesn't offer real-time market data. The app isn't "slow", but it may take up to 15 minutes to place your trade. Using limit orders to prevent fills at higher prices is a way to circumvent risk in your trade.

How long does it take to withdraw settled funds from Wealthsimple Trade?

In most cases, it takes one to two business days to receive a withdrawal from your Wealthsimple Trade account into your nominated bank account. For your first withdrawal, you might have to wait up to 5 business days for the funds to reflect in your bank account.

How old do you need to be to sign up for an account?

Wealthsimple Trade requires all new account holders to be over 18 years when opening and funding an account.

Why does Wealthsimple Trade need my SIN when signing up?

Wealthsimple Trade requires your SIN to verify your identity. The firm doesn't run a credit check on your name.

What is the minimum deposit required?

There is no minimum deposit required for opening your Wealthsimple Trade account. However, there is a maximum limit on deposits, capped at $50,000. If you want to deposit more than $50,000, you'll need to contact the client support team.

Does Wealthsimple Trade have real-time market pricing?

No, Wealthsimple does not offer real-time market data. Unfortunately, there's a 15-minute delay on the quoting system. Therefore, Wealthsimple Trade is not suitable for day traders using a "scalping" strategy.

How do I deposit funds into my Wealthsimple Trade account?

Depositing with Wealthsimple Trade is easy. Follow these steps for funding your account.

  • Sign in to the app on your Android or Apple device.
  • Tap your profile icon.
  • Select the funding menu.
  • Select "Add funds".
  • Select your bank account to withdraw money and fund your account.

Does Wealthsimple have a Tax-Free Savings Account (TFSA) and Retirement Savings Plan (RRSP)?

Yes, Wealthsimple Trade lets you trade a TFSA and retirement account. You can also transfer your accounts from your Wealthsimple Invest platform.