Questrade Review
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Commissions
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Trading Platforms
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Customer Service
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Shorting Stocks
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Overall Value
Summary
In this Questrade review, we look at the pros and cons offered by this brokerage. At Questrade, you pay higher commissions for better service and software. As a client you get access to sophistocated software like IQ Edge, and have a 13-hour window open for customer support on trading days. Is the trade-off worth it?
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Questrade Broker
Founded in 1991, Questrade has been serving the investment needs of Canadians for nearly two decades. It launched an online platform in 2001, and in 2006 it introduced an ultra-low CAD $4.95 stock commission. Since then, it has received awards from The Globe and Mail and has recently built some useful trading tools. The broker offers a dual-currency account that allows traders to buy U.S. equities. Let’s take a closer look.
Questrade Pricing
Commissions
Questrade clients pay 1¢ per share for stock trades, and this rate applies to both Canadian and U.S. equities. The broker does impose a $4.95 minimum commission, with a $9.95 maximum. Buying any U.S. or Canadian ETF is absolutely free at Questrade, although the brokerage firm does charge on the sell side. The fee is the same as the stock commission.
Options
The company’s pricing schedule for derivatives isn’t as generous. Option contracts cost $1 each plus a $9.95 base charge.
Account Requirements
Questrade charges nothing to open or close an account. TFSA, RRSP, and RRIF accounts cost nothing extra, either. There is a quarterly inactivity fee of $24.95. It can be avoided by placing one trade.
Software and Data Fees
Questrade doesn’t charge anything for its software, but it does charge for some market data. Snap quotes are free. This data includes Level I quotes on both U.S. and Canadian stocks. The information could be delayed up to 15 minutes. Other data packages are available from $19.95 to $89.95 per month, depending on how many exchanges you want. The data is live streaming. Commissions paid can reduce data fees.
Questrade Trading Platforms
Web Platform
Questrade offers a simple browser-based platform via its website. Despite its purpose of being a simple trading solution, I did find many good resources during my tour of the system. For example, a watchlist can be created and saved. In fact, multiple watchlists can be stored in an account.
Options chains are available for any entered ticker symbol, for both American and Canadian exchanges. I was disappointed to find that only calls and puts are available. I also could not figure out how to manually add a second leg to an order. TradeStation’s browser-based platform offers multiple strategies to choose from, by comparison.
On a more positive note, I did like the order ticket, which is displayed in the upper-right of the platform. There are several order types available, including limit on close and trailing orders. Duration can be set to immediate or cancel, fill or kill, and a few other choices.
Position information is displayed below the order ticket along with balances. The balance window displays current buying power, so you can quickly see what you have available for trading purposes.
The website platform also has a section devoted to financial news. These resources come in both article and video format. The articles come from Business Wire and Canada Newswire, while the videos are from Morningstar.
I especially liked the platform’s custom alerts. I was able to set alerts based on a variety of criteria, including volume, price, and 52-week milestones. For example, I set one alert to be delivered to my cell phone whenever IBM’s bid price was greater than or equal to $165.00. I was able to set an expiration date within one year.
IQ Edge
Hands down, IQ Edge is one of the best desktop platforms I have ever traded on. At the top of the platform is a row of icons for a variety of functions. The pictures represent what the function is. For example, the icon for Level 2 quotes shows two columns of information. Other icons include charting, screener, market movers, and a P&L calculator.
These icons produce windows which can be resized or deleted. I thought that the software did a good job of laying out information. Everything was easy to read and manipulate. The order ticket is easy to use, and a convenient option window has strategies.
A chart can be shown full screen or kept as a small window among the other tasks on the platform. There are several drawing tools and technical indicators. Graph styles include candlesticks, OHLC bars, and area. Colors of everything can be adjusted. I did have trouble at times getting a graph to display correctly when the time scale was beyond three years. The maximum timeframe is ten years.
Mobile
A mobile trading site is available at my.questrade.com/trading. The brokerage firm also offers Apple and Android apps. Charting is available with studies and drawing tools. Real-time quotes can be accessed, and account functions like funds transfer can be performed.
Questrade Customer Service
Questrade was able to answer some of my questions through a convenient on-line chat function. There is also phone service and a brick-and-mortar location in Toronto. Hours of operation are Monday through Friday from 7:30 am to 8:00 pm, EST. Chat service has more limited hours.
Executions and Routes
Direct-access routing is available on the desktop platform. The default choice is AUTO. Other selections include NYSE, LAMP, ARCA, NASDAQ, and ITG. Unfortunately, there are no routing choices on the website platform.
Shorting Stocks
Questrade does not charge interest on a borrowed stock unless the security is classified as hard-to-borrow. The APR can be anywhere from 1% to 150%. If you want to short an HTB stock, you have to call the broker’s trade desk.
Type of Trader Questrade is Best For
Because of Questrade’s great platform and low commission schedule for stocks and ETF’s, active equity traders will do very well here.
Pros…
- Forex and CFD’s are available on a separate platform. Some currency spreads are below 1 pip.
- Mutual funds, precious metals, and bonds are available.
- Alternative commission plans are available for stock, ETF, and option traders.
…and Cons
- Market data fees are rather steep.
- Transferring an account to another firm costs $150.
Judgment
With a suite of trading tools, multiple investment vehicles, and access to the U.S. stock market, Questrade is hard to beat for Canadian investors. The broker should add weekend customer service, though.
Questrade is NOT number one in Canada!
I used Questrade webapplication for about 15 years and in general it was quite good. But something changed drastically for the last 2 years!
1. Before withdrawal of money was done the same day if submitted before 3 pm. Now it is 3-5 business days. Why? Banks do it right away. Looks like Questrade is using customers’ money (they introduced mortgage service – very likely use your many to land to others)
2. Extremely difficult to reach Questrade in any way and support is quite useless.
3. Questrade covered my position though I sent an e-transfer with the required amount of money and confirmation email 3 (!) hours before the deadline. Questrade put in their auto message that they company is not responsible if it will do this (before Questrade did not have this statement).
4. Questrade’s core software for desktop is buggy (though has many nice features). I put in an order to sell stock. I did not see it on the screen for 1 min. Streaming worked fine (no Internet delay). So I decided that the order was not registered and put the same order again. Got “pending” status. Tried to modify/cancel this order but was not able to do this. Next day I found that both orders went through. It was not my intention to sell that many stocks. I called the next day and the day after – both support people told me that it was a software “glitch/outage”. Then in about 1 week the Questrade’s reprehensive told me that it was not software failure and even if it was Questrade is NOT responsible for this! So if one lost hundreds thousands of dollars Questrade is not responsible? And there are more bugs in Questrade’s desktop application though they are minor (the bugs that I found).
5. Questrade’s system generated completely wrong report – another bug in their application. So I cannot submit my tax return with this corrupt data. And what is even more threatening I do not know how Questrade calculated money. I need to do a full audit to find out if a financial mistake was made and I lost money or not.