Canadians have long been paying premiums for buying securities and having them managed when our friends down south have gotten options to invest cheaply, or even for free. When WealthSimple Trade hit the market, Canadians were given the option to invest for free, with no minimums and very little hassle, much like U.S. residents with Robinhood. This is our review of the WealthSimple Trade stock trading platform that we have grown to like since it was released.
- Introduction to WealthSimple Trade
- Protection & Security
- Installation and Account Setup
- Deposits & Withdrawals
- Buying & Selling
- WealthSimple Trade vs Questrade
A Brief Introduction to WealthSimple Trade
WealthSimple is a privately owned fintech company founded in 2014. Since inception, WealthSimple has grown to manage over $5 billion in assets across its different products. It’s important to note that WealthSimple’s first product offering was a robo-investor, however the Trade product is a separate mobile application that allows investors to purchase, hold and sell stocks and ETFs traded on Canadian and U.S. exchanges.
A couple things to know:
- WealthSimple Trade offers zero commission trades (0%) for buying and selling stocks and ETFs.
- WealthSimple Trade currently offers RRSP, TFSA and non-registered accounts.
- WealthSimple Trade does not offer a U.S. Dollar account, and charges a 1.5% conversion fee when buying and selling U.S. stocks or funds.
- WealthSimple Trade quotes are delayed. Real time quotes will have to be sourced elsewhere.
- WealthSimple Trade is a mobile-only trading platform. There is no way to trade with a traditional computer on the web.
Protection and Security
WealthSimple’s affiliated custodial broker Canadian ShareOwner Investments Inc., is protected by the Canadian Investor Protection Fund. To read more about what would happen in the case of WealthSimple closing, check out this help section on WealthSimple’s website.
This protection is the standard for brokerages, and means that funds invested within WealthSimple accounts are protected for up to $1 million per account. This leaves us with peace of mind, as WealthSimple is insured and under the majority control of the Power Corporation, one of the largest financial corporations in Canada.
Getting Started with WealthSimple Trade
Installing WealthSimple Trade on your iOS or Android device is as easy as any other application. The process is as follows:
- Install the app from the iOS App Store or the Google Play market.
- Open the application to be greeted by the welcome screen.
- Create an account (you will be asked the typical questions needed to open a trading account).
- Set up a bank transfer connection (this can be done in the Funding section in the application).
- Transfer funds!
The process of opening up an account and getting started is very simple, although it’s much easier if you bank on your mobile device as well. In our experience, it’s possible to get an account set up within 15 minutes. So far, this brokerage is winning us over with its ease of use.
Deposits & Withdrawals
Deposits and withdrawals in WealthSimple Trade are easy to make. You open the application, press Funding in the application sidebar, and choose the Add funds or Withdraw funds options, You will then be asked to choose which accounts to deposit or withdraw to/from, and the process will begin.
Note: The deposit and withdrawal process may take around 5 business days to complete, and in busier times this generally holds true. In our experience though, there are times where money was deposited or withdrawn within 2 days of starting the process. If there is any let down in the process it is the processing times, we hope these are improved in the future.
Buying & Selling
Buying and selling on Trade is facilitated by a clean search interface as well as the options to set limits for purchases or sales. WS Trade currently offers Market, Limit and Stop Limit orders. There are also Market Sell, Limit Sell and Stop Limit Sell orders available for selling stocks or ETFs.
WS Trade does not offer real time stock data, so it may be confusing at first to see delayed numbers. This is typical of free or discount brokerages, and although we would like to see real time data we understand that for zero commission trading this is a tradeoff that is acceptable.
Tip: The best way to buy or sell on WS Trade is to view realtime pricing externally, and use the Limit Buy or Sell orders to ensure that there are no surprises. This has worked well in our testing, and has resulted in our buy and sell activity being accurate and reliable.
Overall the buying and selling experience in WealthSimple Trade has been good, and although we would like to see realtime stock data, we understand that this is a zero commission trading platform and some delays in both data and orders being fulfilled is to be expected. We’ve noticed most orders are filled within minutes, however sometimes there can be a delay of up to an hour. Using limits to buy or sell is a great way to ensure accuracy in orders.
WealthSimple vs. Questrade
WealthSimple Trade and Questrade can both be considered discount brokerages and they are both frequently compared for this reason. Below is a comparison table to better understand the differences.
|Fees||$0 Annual Fee|
Zero Commission Trades
|$0 Annual Fee|
$4.95-$9.95 per trade
|Accounts Available||RRSP, TFSA, non-registered||RRSP, TFSA, non-registered, RESP, Margin, LIRA, RIF, LIF, Corporate, Joint|
|Platforms||iOS & Android||iOS, Android & Web|
Questrade is the clear winner if you’re looking for a brokerage where you can trade on margin or buy and sell contracts, however for the average investor looking to invest for retirement WealthSimple Trade wins with its zero commission trades. A beginner will have no issues with using Trade, and for the typical long term investor Trade makes sense just for the lack of fees.
Upon completing our WealthSimple Trade Review for both non-registered and TFSA investing, we can confidently conclude the following.
- Trade offers a simple interface for investors looking for a simple way to invest long term.
- The zero commission trades are great for casual investors, and do make Trade a better alternative compared to other brokerages for that use case.
- Trade makes good use of mobile UIs to make investing easy, however we would like to see a web version at some later date.
- Trade does not have a US dollar account, although they have put this feature on their roadmap.
- Trade should not be used by individuals looking make advanced trades (i.e. options trading) – for this we recommend Questrade.
- Quote data, buy order and sell order delays are expected, however we would like to see this improved along with deposit and withdrawal times.
- We especially recommend WealthSimple Trade for individuals looking to invest for the long term or achieve FIRE with a TFSA.
Our WealthSimple Trade Review Conclusion: WealthSimple Trade is a great method for regular investors to get in on the markets and invest for the long term. The features and service meet or exceed the requirements of the average retail investor.
Do you use WealthSimple Trade? Why or why not? We would love to hear from you!