- >Best Crypto Exchanges
- >Wealthsimple vs. Questrade
Robo-advisors and crypto exchanges have a lot in common. Depending on your needs, either platform can help you get into Bitcoin or any other altcoin. Also, depending on your expertise, either platform can help you invest in the stock market or experiment with the trading strategy as you build up your portfolio.
In Canada, Wealthsimple and Questrade offer some of the best investment services when it comes to online investing. Both platforms offer a range of features including Wealthsimple’s zero-fee crypto exchange as well as access to traditional investment vehicles such as ETF and stocks.
Wealthsimple offers crypto investing with its Wealthsimple Crypto branch and even though Questrade does not have any crypto offerings, it offers access to Canda’s Bitcoin Spot ETFs that continue to grow in popularity. Questrade is known for its low-cost, self-directed investing, and with over 20 years of skin in the game, the company continues to grow managing over $30 billion in assets to date.
Here is a rundown comparing the two platforms and their best features, pros, and cons.
Wealthsimple Overview
Founded in 2014, Wealthsimple is a Toronto-based Robo-advisor that also operates in the United Kingdom with a focus on catering to young investors who are just getting their feet wet in the world of investments.
It features a simple user interface with smart investing tools as well as automated portfolio-building tools designed in line with Nobel-Prize winning research methodologies.
At an affordable cost, you can start investing in ETFs on Wealthsimple or invest in fractional shares, stocks, and cryptocurrencies. Clients can open a TFSA (Tax-Free Savings Accounts), RRSP (Registered Retirement Savings Plan) as well as a non-registered (taxable) account for their wealth management purposes and at zero commission charges. This is a standout features as few wealth management platforms in Canada allow investors to buy and sell stocks and ETFs for free. Most platforms charge as much as $9.99 per trade. Even Questrade only offers commission-free trading for ETFs and nothing more.
If you don’t need too much hand-holding, Wealthsimple can help you make investment decisions with its wealth management software that recommends to you ETFs that are appropriate based on your financial goals. Also, Wealthsimple features an online portal for your investment accounts as well as a mobile app to access them on the go.
Wealthsimple Pros & Cons
Pros
Offers fractional shares of U.S and Canadian companies
Supports the opening of several account types
There is no minimum account balance requirement
Comes with a mobile app available on Android and iOS
Supports about 20 cryptocurrencies
Cons
Doesn’t offer a dividend reinvestment plan
There is a premium on real-time market quotes
Trades can only be placed once a day with the basic account
Limited functionality on its website
Questrade Overview
Founded in 1999, Questrade is one of Canada’s oldest and most reputable financial services providers. It’s especially popular among active traders since its commission fees are low and features a full-fledged online trading platform for clients to trade stocks, ETFs, options, futures, forex, and more.
Questrade is a great choice for investors who are looking to invest in a variety of investment vehicles at an affordable rate without paying too much commission. However, unlike Wealthsimple’s zero commission on trading stocks and ETFs, Questrade charges varying fees based on the financial instrument.
Questrade doesn’t support crypto trading, however, it features a mobile app that is supported on both Android and iOS and its users can set up various registered accounts for long term as well as short term investing. Other investment vehicles offered by Questrade include shares, bonds, ETFs, mutual funds, options, and even Initial Public Offerings (IPO).
If DIY investing is not your cup of tea, Questrade comes with a Robo-advisor called Questwealth Portfolios which allows you to set up an automated investment strategy based on your risk tolerance and investment goals. This feature even goes as far as allowing you to invest in socially responsible companies that prioritize the environment. What makes Questrade stand out is that, unlike most Robo-advisors, Questrade employs real human experts to manage your portfolio using this feature.
Questrade Pros and Cons
Pros
Offers real-time free market quotes
Allows you to buy stocks, ETFs, and options commission-free
Offers over a wide variety of investment vehicles
Features actual expert humans managing portfolios
Cons
Doesn’t offer crypto investing
Minimum account balance requirement
Not ideal for irregular DIY investors
Charges a fee with every trade
Beginner Friendliness
While Wealthsimple‘s user interface might be more appealing to beginner investors, Questrade does offer a very helpful platform as well as a mobile app for those who are intimidated by investing online.
Beginners will enjoy Questrade’s time-saving features such as its dividend reinvestment plan (DRIP) that is designed to re-invest an investor’s dividend payments. Questrade also offers a variety of educational resources on the website to help beginner investors get started. However, Questrade comes with a minimum balance requirement of $1000 which can be high for novice investors and traders.
Wealthsimple has no minimum account balance requirement plus there are no fees for investing in ETFs stocks and fractional shares. This is a huge plus for beginner investors who would prefer to have hands-on experience with their investments at minimal costs. However, even though, Wealthsimple comes with a mobile app that is available on both Android and iOS devices, the functionality of its website application is limited.
Overall, both platforms offer an easy account setup however, Questrade takes the win as its platform goes above and beyond to provide research tools for self-directed clients as well as market intelligence for smart investing and self-education.
Trust and Security
With over two decades of skin in the game, Questrade has a solid track record of security and trustworthiness among its customers.
In 2012, Questrade launched one of the first comprehensive Mobile App Privacy Policies as well as receiving recognition for being compliant with best practices that protect client data across all forms of communication. In addition to this, Questrade has gone above and beyond its legal requirements to appoint a Chief Privacy Officer and submit a full copy of its Canadian Personal Information Protection and Electronic Documents Act (PIPEDA) application to the Office of the Privacy Commissioner.
As for Wealthsimple, its brokerage division is registered with both the U.S. Securities and Exchange Commission as well as Canadian securities regulators meaning that your personal information is in good hands.
Overall, both Wealthsimple and Questrade come with strong security credentials; however, Questrade takes the top score for its dedication to transparency and accountability over many years of its existence.
Fee Structure
When it comes to fees, comparing Wealthsimple vs. Questrade is more like comparing apples to oranges.
As a passive investment manager, Wealthsimple does not charge you any fees for investing your money and has no minimum balance requirement. This means that with as little as $1 you can fund an account on Wealthsimple even though you will need more to invest in ETFs or stocks. Wealthsimple charges a 0.5% portfolio management fee for basic accounts with a balance under $100,000. Wealthier account holders with a balance above $100,000 get slightly cheaper charges at 0.4%.
Wealthsimple also charges an operations fee per cryptocurrency transaction set at 1.5% to about 2%. For ETFs, Wealthsimple charges a management expense ratio (MER) that starts as low as 0.2%. However, despite being touted as a low-cost Robo advisor, Wealthsimple charges a higher MER for socially responsible investing options with rates that could go as high as 0.4%. Plus, Canadian investors looking to trade U.S stocks and ETFs could incur more expenses with the platform’s 1.5% currency conversion fee.
Questrade also charges a currency conversion fee however, the costs are not as pricey as Wealthsimple as Questrade allows you to keep your investments in U.S stocks and ETFs in U.S dollars indefinitely. Wealthsimple on the other hand requires all assets to be in Canadian dollars.
In terms of management expense ratio, Questrade free range between 0.17% to 0.22%, and even with socially responsible investments or SRIs, Questrades fee only go as high as 0.35%. There are no fees in addition to these MERs on Questrade.
Available Cryptocurrencies
Wealthsimple is the only one of the two platforms that offer crypto investments. As such, Wealthsimple can provide investors with a complete Robo investing experience where investors can trade up to 34 different cryptocurrencies at a 1.5% to 2% fee per transaction.
Here is a list of some popular coins you will find on Wealthsimple:
- Bitcoin
- Avalanche
- Bitcoin Cash
- Chainlink
- Cosmos
- Doge
- Cardano
- Ethereum
- Litecoin
- Polygon
- Decentraland
- Solana
Even though Wealthsimple provides a variety of cryptocurrency investments, investors and traders don’t get to own their private keys. This can either be considered an advantage or a disadvantage based on the user’s need for control over their crypto investments.
Questrade, unlike Wealthsimple, does not offer crypto investment. However, given the availability of Bitcoin ETFs in Canada, investors looking for exposure to the crypto market can invest in Bitcoin Spot ETFs through Questrade.
Customer Support
Both companies offer 24/7 customer support. Wealthsimple can offer better customer support because of its smaller client base. Even so, Questrade notably has a larger client base, allowing more investors the opportunity to speak with an agent on specific concerns.
This is not to say that Wealthsimple does not do a good job in this regard; however, Questrade appears to be able to proactively work with clients and to get to the root of their problems. In terms of using live chat, Wealthsimple and Questrade come out in a dead tie with both companies offering these options on their websites and in their mobile apps.
Standout Features
With Questrade, investors get to trade in forex using the MetaTrader 4 (MT4) platform. MT4 is a well-known trading platform that many investors are familiar with and can be used in conjunction with Questrade’s mobile app.
Questrade also offers Robo Investing features such as DRIP (dividend reinvestment plan) while Wealthsimple does not. You can also use Questrade to set up automated deposits for dollar-cost averaging into an investment vehicle. Questrade also stands out for the various account types you can open on its platform. These include TFSA, RRSP, RESP, LIRA, RIF, LIF, and margin accounts. Therefore, whether you are looking to set up a retirement account or looking for sophisticated investment options Questrade has you covered.
With Wealthsimple, you get to use all of the standard Robo investing features that are common throughout the industry but at minimal costs. Apart from its crypto investing option, Wealthsimple also stands out for offering socially responsible investing (SRI) options similar to what you get on Questrade.
Conclusion: Wealthsimple Ultimately Better for Crypto
Both Wealthsimple and Questrade offer good online platforms that allow Canadian investors the benefits of Robo investing. However, it can be argued that Questrade offers more investment options for those who are looking to make the most out of their retirement accounts. But for those who want exposure to cryptocurrencies while also having access to ETFs and stocks, Wealthsimple is a better option.
Either way, if you are looking to invest your money and grow it into a bigger portfolio, both Wealthsimple and Questrade make for great investment options. Who knows; maybe one day with the help of Robo investing tools, we might be able to escape the grasp of financial institutions and finally take control of our investments.
