The 6 best day trading platforms in Canada
By Lucas Elliott | Published on 09 Oct 2023
Post
Share
Share
Post
Pin
Send
SendDay trading involves rapidly buying and selling financial assets within a single trading day to profit from short-term price fluctuations. While it offers the potential for quick gains, it also carries significant risks due to its fast-paced nature. In Canada, day traders can find an ideal environment with access to various markets and competitive brokerage platforms.
Selecting the right day trading platform is crucial, considering factors like low commissions, advanced trading tools, speed, reliability, market access, and customer support. The platform should align with the trader’s experience level, style, and capital.
In this comprehensive guide, we will compare the top Canadian online brokerage platforms, which include Questrade, Wealthsimple Trade, BMO InvestorsLine, TD Direct Investing, Interactive Brokers, and QTrade Investor. We aim to equip traders with valuable insights to make informed decisions, considering pricing, tools, supported markets, account types, and overall usability.
By understanding the strengths and weaknesses of these platforms, traders can choose one that suits their specific needs and trading strategies. The competitive landscape among Canadian brokers offers diverse and high-quality trading experiences, enabling traders to enhance their chances of success in day trading.
What is Day Trading?
Day trading is when individuals buy and sell financial assets on the same day. They profit from short-term price movements. This practice spans various assets, including stocks, currencies, options, and futures contracts. Day traders rely on technical analysis, real-time data, and fast execution to identify and capitalize on intraday trading opportunities.
One of the key attractions of day trading is its ability to harness the volatility and fluctuations in asset prices over short periods. Day traders aim to profit whether markets are rising or falling, employing short-selling and options trading strategies. The strategy involves making numerous small gains throughout a single trading session to accumulate profits over time. Additionally, day trading typically requires less exposure to long-term market risks since positions are held briefly.
However, it’s crucial to note that day trading is demanding. Success in day trading necessitates high skill, discipline, and emotional control. Traders must swiftly identify opportunities, make decisive decisions, manage risks effectively, and maintain focus throughout the trading day. While it offers the potential for higher rewards, day trading can also be riskier than traditional long-term investing. Most day traders are not profitable, so we don’t recommend it. However, we have created this guide for the rebellious few.
Why Day Trade in Canada?
Canada is a favourable place for active traders. The Toronto Stock Exchange (TSX) allows Canadian and global stock access. Additionally, U.S. markets like NASDAQ and NYSE offer liquidity through various platforms in Canada. Canadian brokerage firms offer competitive pricing and diverse trading platforms, providing investors with many options. The country’s robust banking system and well-regulated investment industry instill confidence in the trading environment. In essence, Canada provides an attractive setting for day trading a wide range of securities on regulated exchanges with sufficient liquidity.
Benefits and Risks of Day Trading
The chance to profit from intraday swings motivates day traders. Trades can be opened and closed within the same trading day, freeing up capital for further opportunities. Losses can also be capped quickly by closing positions. However, day trading requires constant monitoring. Traders must have the expertise to react to news and price movements. It is also easy to over-trade or make emotional decisions under pressure. Day trading is riskier than buy-and-hold investment strategies, and most day traders lose money.
| Benefits of Day Trading | Risks of Day Trading |
|---|---|
| Take advantage of short-term price movements | Requires constant focus on the markets |
| Profit off small intraday ranges | Forces quick decision-making |
| Close losing positions quickly | Increased risk of over-trading |
| Free up capital for additional trades | More prone to behavioural biases |
| Can better utilize leverage | Small mistakes can lead to large losses |
| More flexible than positional trading | No long-term positions to offset losses |
| Potential for high returns | Requires expertise and experience |
Day traders need strategies to manage risk and psychologically handle active short-term trading. The rewards can be great, but so can the challenges.
Choosing the Right Platform
Choosing the right day trading platform involves considering several key factors to align with your strategy, capital, and experience level. Novice traders may prefer user-friendly, commission-free options, while experienced traders may require advanced features. It’s wise to start with a practice account to assess platform features before committing to real capital.
-
- Commissions & Fees: The most active traders need competitive commissions and low-margin rates.
-
- Trading Tools: Platforms should have advanced charting, analytics, trading automation, and risk management tools.
-
- Market Access: Ability to trade the securities needed, whether Canadian, U.S., or global stocks, options, futures, forex, and more.
-
- Platform Performance: Fast and stable platforms are critical for intraday trading.
-
- Research & Education: News, research, and trader education resources help investors make better decisions.
-
- Customer Service: There should be ways to quickly get support and service when needed.
Other factors like account funding options, data feeds, account types, regulatory compliance, and ease of use also matter when choosing a day trading platform.
Most day trading platforms discussed in this article focus on stocks and options. For trading CFDs (Contracts for difference) in specific AvaTrade offers a competitive platform. Geared more towards experienced traders, you can trade extensive forex, CFD and crypto with high leverage.
The Best Day Trading Platforms in Canada
Canadian investors should look for low commissions, advanced trading tools, real-time data feeds, and educational resources when choosing a day trading platform. Here are in-depth comparisons of the best day trading platforms available:
1. Questrade
Since its founding in 1999, Questrade has grown into a leading online brokerage in Canada, serving over a million clients. It offers many asset classes and stands out for commission-free ETFs and competitive fees. This makes Questrade an economically attractive choice for high-volume day traders in Canada.
Pricing
Questreade has two main pricing plans for active traders:
| Asset Class | Fixed | Variable |
|---|---|---|
| Stocks | $4.95/trade | 1¢/ share min $0.01 to max $6.95 |
| Options | $4.95 + $0.75 / contract | $6.95 + $0.75 / contract |
| ETFS | Buy for free, sell for $4.95/trade | Buy for free, sell for 1¢/sharemin $0.01 to max $6.95 |
| FX and CFDs | Pips as low as 0.8 | Pips as low as 0.8 |
Platforms
Questrade Trading/ Questrade Mobile:
A user-friendly trading platform designed more for beginner traders. It is available on desktop, web and mobile. It includes a Learning Mode to boost investment knowledge, provides a quick overview of your account balances and portfolios, and offers easy research, trading, and monitoring features with just a few clicks.
Questrade Edge/Questrade Edge Mobile:
Questrade Edge is a fast, powerful web, desktop, and mobile trading platform. It includes a Learning Mode to boost investment knowledge and provides a quick overview of your account balances and portfolios. Additionally, it offers easy research, trading, and monitoring features with just a few clicks.
Questrade Global:
Questrade Global offers a user-friendly foreign exchange platform for convenient trading of currencies and commodities on global markets. With this platform, you can execute FOREX and CFD trades from anywhere. It also provides features like customizable watchlists and supports advanced transactions such as multi-leg options, enhancing your trading experience.
Market Data Packages with Questrade
Questrade offers a range of market data packages to enhance your trading experience, providing valuable insights and real-time information for informed decision-making. These data packages cover various asset classes, including stocks, options, ETFs, and FX & CFDs.
Included in All Data Packages: Real-time streaming and snap quotes for select exchanges and indices.
Additional data Packages:
| Data Package | Description | Monthly Cost | Rebate |
|---|---|---|---|
| Real-Time Options | Access up-to-the-second streaming level 1 data for Canadian and U.S. options. | CAD $19.95/mo | 100% rebate if you spend more than $48.95 CAD in trading commissions. |
| Advanced U.S. Streaming | Dive deeper into U.S. exchanges with level 1 and level 2 data, including indices data. | USD $89.95/mo | $19.95 USD rebate if you spend +$48.95 USD in trading commissions.100% rebate if you spend +399.95 USD in trading commissions. |
| Advanced CDN Streaming | Explore Canadian exchanges with level 1 and level 2 data, alongside indices data. | CAD $89.95/mo | $19.95 CAD rebate if you spend +$48.95 CAD in trading commissions.100% rebate if you spend +399.95 CAD in trading commissions. |
Benefits
Low Trading Commissions: Questrade offers competitive pricing with low trading commissions making it cost-effective for day traders who frequently buy and sell securities. The fee structure can help traders maximize their profits by minimizing trading costs.
Advanced Trading Platforms: Questrade offers advanced trading platforms. Their flagship platform, Questrade IQ Edge, is renowned for its customizable interface and robust charting tools. These features are essential for day traders who require real-time data, technical analysis, and customizable layouts.
Multiple Account Types: Questrade offers various account types, including margin accounts for leveraged trading. This is advantageous for day traders who want to amplify their positions for potential higher returns.
Education and Support: Questrade offers educational resources, webinars, and a customer support team. They assist traders in navigating the platform and understanding market dynamics.
Drawbacks
Limited Research and Analysis: While Questrade offers research tools, some traders may find that the depth and variety of research resources are not as extensive as those provided by larger brokerages.
Mobile App: The mobile app has received poor reviews on both the Google Play Store and Apple App Store. People cite bad responsiveness, missing features, and poor charting experiences.
2. Wealthsimple Trade
Wealthsimple Trade, a branch of Wealthsimple, started in 2019, offering commission-free stock and ETF trading. It prioritizes accessibility and simplicity, catering to novice investors through user-friendly mobile and web platforms.
Pricing
| Fee type | Core Account | Premium Account |
|---|---|---|
| Commission fees | +$1 | +$100,000 |
| Commision fees | $0 | $0 |
| Options Contract Fee | $2 USD/ Contract | $0.75 USD/ Contract |
| FX Fees | 1.5% or $10 per month to have a USD account | 1.5% and free $USD account |
| Instant Withdraw Fees | 2.5% | 2.5% |
Benefits
Fractional Shares: Stocks and ETF’s can be purchased fractionally (You can own $10 of a $100 share 1/10th ownership)
Wealthsimple Tax: A simple and free tool to help you file or auto-file your taxes. Audit support is available for an additional $30.
$0 commission Canadian stock and ETF trades: There is a $0 charge for buying and selling stocks and ETF’s but a 1.5% FOREX fee is charged for buying and selling USA stocks/ETFs. This can be avoided with a $10/month USD account.
Exceptionally easy-to-use investing app: Wealthsimple’s platform is designed with simplicity in mind. Its user-friendly interface makes it easy for beginners and experienced investors to navigate. Setting up an account, making deposits, and initiating trades are straightforward.
Drawbacks
No advanced trading features or platforms: Wealthsimple primarily caters to long-term investors and emphasizes a passive, set-and-forget approach. It lacks the advanced trading features and tools necessary for day trading. These include real-time data, customizable charts, and advanced order types.
No Intraday Trading: It does not provide the capability for intraday trading. This can be a core feature for day traders looking to profit from short-term price fluctuations.
No Margin Trading: Wealthsimple does not offer margin accounts. These accounts are frequently utilized by day traders to leverage their positions and enhance potential gains. The absence of this feature can be a significant limitation for day trading strategies.
3. BMO InvestorLine Self-Directed
BMO InvestorLine is a prominent and trusted online brokerage platform in the Canadian financial landscape. It offers a comprehensive spectrum of investment and trading services, catering to individual investors and seasoned active traders. It operates under the Bank of Montreal (BMO), one of Canada’s largest and most established financial institutions. This provides clients with access to BMO’s extensive resources and expertise.
Pricing:
| Asset Class | Flat Fee |
|---|---|
| Stocks & ETFs | $9.95 |
| Options | $9.95 + $1.25 |
There is no minimum account balance to sustain or activity fee.
Benefits
Bank Integration: InvestorLine is part of BMO (Bank of Montreal), offering seamless integration with BMO accounts. This provides clients a convenient way to manage their banking and investments in one place.
User-Friendly Interface: The platform features a user-friendly and intuitive interface, making it accessible to novice and experienced investors.
Account Maintenance Fees: Most banks in Canada charge a quarterly or annual fee if you fall under a certain dollar amount in your trading account, but BMO does not have this stipulation.
Drawbacks
Still Higher Fees Than Discount Brokers: BMOs’s trading rates are some of the highest among the Big 5 banks in Canada. They are significantly higher than many of the discount brokers.
No Commission-Free ETFs (For active traders): Unlike some other brokerage platforms, BMO InvestorLine does not offer a selection of commission-free ETFs for active traders. If you want to buy and hold, there are +80 ETFs you can invest in for free.
4. TD Direct Investing
TD Direct Investing, an offshoot of TD Waterhouse, the brokerage division of TD, fuses banking resources with advanced trading tools. It offers robust trading platforms, tools, education, and services, catering to traders of all levels.
Pricing:
| Asset Class | Active Trade Pricing (+150 trades) | Standard Pricing (Less than 150 trades) |
|---|---|---|
| Stocks | $7/trade | $9.99/trade |
| Options | $7 + $1.25/contract | $9.99 + $1.25/contract |
There is an additional quarterly fee of $25 per for non-registered accounts with less than $15,000 in it.
Benefits
Comprehensive Research Tools: TD Direct Investing provides extensive research and analysis tools, including market research, news, analyst reports, and third-party research, helping users make informed investment decisions.
Integration with TD Bank: For TD Bank customers, the integration between TD Direct Investing and TD Bank accounts can simplify the management of finances and investments.
Access to Thinkorswim: Thinkorswim is a sophisticated trading platform known for its advanced charting tools, technical indicators, and customization options, making it an excellent choice for experienced stock and options traders.
Drawbacks
Higher Trading Commissions: TD Direct Investing tends to have higher trading commissions than many other brokerages, which can impact the overall cost for frequent traders.
Account Maintenance Fees: Some accounts may be subject to maintenance fees, depending on account balance and type.
Advanced Features May Overwhelm Beginners: While the platform is user-friendly, its advanced trading features and options trading tools may overwhelm beginners or those with less experience.
5. Interactive Brokers Canada
Interactive Brokers Canada is a subsidiary of Interactive Brokers LLC, established in 1978, and it serves professional traders with an institutional-grade platform featuring ultra-low commissions. Ideal for seasoned traders prioritizing cost-efficiency and advanced tools, it’s less beginner-friendly and tailored for those with expertise.
Pricing
Stocks/ETFs: There is a tiered and fixed pricing with a minimum of $1 CAD per order max 0.5% of the trade value.
| Monthly Volume (shares) | Tiered | Fixed |
|---|---|---|
| ≤ 300,000 | $0.008 CAD | $0.01 CAD |
| 300,001 – 3,000,000 | $0.005 CAD | |
| 3,000,001 – 20,000,000 | $0.004 CAD | |
| 20,000,000 | $0.003 CAD |
Options: There is a minimum of $1.50 CAD per order
| Monthly Volume (shares) | Tiered |
|---|---|
| ≤ 10,000 | $1.25 CAD per contract |
| 10,001 – 50,000 | $1.15 CAD per contract |
| 50,001 – 100,000 | $1.05 CAD per contract |
| +100,001 | $1.00 CAD per contract |
Futures:
| Monthly Volume (shares) | Tiered | Fixed |
|---|---|---|
| ≤ 1,000 | $1.25 CAD per contract | $2.40 CAD per contract |
| 1,001 – 10,000 | $0.80 CAD per contract | |
| 10,001 – 20,000 | $0.60 CAD per contract | |
| +20,000 | $0.30 CAD per contract |
Benefits
Low Commissions: Interactive Brokers is known for its competitive pricing and low commissions, making it cost-effective for frequent traders. The pricing structure can help day traders maximize their profits by minimizing trading costs.
Advanced Trading Tools: Interactive Brokers provides various advanced trading tools and features. This includes real-time market data, customizable charts, technical indicators, and various order types. These tools are invaluable for day traders who require precise and up-to-the-minute information to make informed decisions.
Education and Support: Interactive Brokers offers educational resources and customer support to assist traders, including those new to day trading, in navigating the platform and understanding market dynamics.
Drawbacks
Complexity of Platforms: Interactive Brokers’ platforms and apps can be complex and overwhelming for novice investors, potentially deterring those new to trading. IBKR Desktop and IBKR Global Trader are best suited for beginners and intermediate investors. They offer both begginner and advanced trading desktop platforms and apps. Choose carefully!
Complex Pricing: Interactive Brokers pricing is more confusing than other platforms, requiring more time to thoroughly understand.
6. QTrade Investor
QTrade Investor, under the ownership of Aviso Wealth, caters to active traders with discounted commissions and streamlined tools, striking a balance between pricing, tools, and support. While it may not lead in a specific category, it offers an appealing option for day traders seeking cost-effective commissions and efficient platforms.
Pricing:
Qtrade has two tiers of pricing based on the activity of the trader. Investors would qualify for Investor Plus if they make +150 trades per quarter or/and have +$500,000 in total assets.
| Asset Class | Investor | Investor Plus |
|---|---|---|
| Equities | $8.75 | $6.95/trade |
| Options | $8.75 + 1.25 per contract | $6.95/trade |
| ETFs (Select) | Free | Free |
| ETFs (Others) | $8.75 | $6.95 |
| Mutual Funds | $8.75 | $6.95 |
| Fixed Income | $1 per $1,000 face value | $1 per $1,000 face value |
Accounts under $25,000 must pay a quarterly admin fee of $25 and an extra $15 per quarter for USD registered accounts.
Benefits:
Comprehensive Research Tools: Qtrade offers extensive research and analysis tools, including market research, analyst reports, and investment screeners, aiding users in making informed decisions.
100+ commission-free ETFs: Qtrade provides a broad range of commission-free ETFs with no minimum investment required, allowing traders to access diverse asset classes, geographies, sectors, sizes, and currencies for portfolio diversification.
Drawbacks:
Higher Commissions: Qtrade’s trading commissions are higher than other brokerages listed, which could impact the overall cost for frequent traders.
Account Fees: The administrative fee of $25 per quarter might be a burden to some traders vs other platforms that don’t charge it.
The Best Day Trading Platforms in Canada: Bottom Line
Day trading can be an exciting way to profit off short-term market movements, but it also comes with risks. When selecting a day trading platform in Canada, choosing one that aligns with your skill level, trading style, and goals is crucial.
Wealthsimple Trade provides an easy introduction for beginners with its simple mobile app and $0 commission stock and ETF trades. As your experience grows, platforms like Questrade, CIBC Investors Edge, QTrade, Interactive Brokers and TD Direct Investing offer robust tools alongside competitive pricing.
No matter your level, opening a practice account first is prudent. Test the platforms using virtual money to ensure they have the speed, tools, and reliability needed to execute your strategies. At the end of the day, the best online broker for any trader is the one that empowers their strategy while fitting their budget and style. With the right broker, you can take your day trading to the next level in Canada.
FAQs About The Best Day Trading Platforms in Canada
Interactive Brokers is often considered Canada’s best day trading platform due to its comprehensive suite of advanced trading tools and features. With a focus on providing traders with real-time market data, customizable charts, and numerous technical indicators, it offers the tools necessary for making informed, split-second decisions. Its competitive pricing structure with low commissions can significantly benefit day traders, helping them maximize profits by minimizing trading costs.
Kraken is often considered one of Canada’s best cryptocurrency exchanges for day trading due to its robust features, security measures, and wide range of supported cryptocurrencies. Kraken Pro, also known as Kraken Advanced, is the advanced trading interface offered by Kraken, and it’s particularly suitable for experienced day traders.
Yes, you can do day trading in a TFSA (Tax-Free Savings Account) in Canada. However, it’s important to note that day trading may be considered an activity that constitutes carrying on a business in your registered account. In such cases, the day trading profits will be taxable as business income rather than capital gains.
Yes, day trading in an RRSP is permitted. However, it could risk your RRSP’s tax-free status if the Canada Revenue Agency (CRA) considers it a business activity rather than an investment, leading to potential income tax on profits.
Day trading in a TFSA isn’t precisely quantified by the number of trades but revolves around the nature and frequency of your trading activity. The CRA may classify it as day trading if you often buy and sell securities quickly, aiming to profit from short-term price changes. In such cases, gains might become taxable, potentially forfeiting TFSA’s tax benefits.
The permissibility of day trading in Islam varies based on individual interpretations of Islamic finance principles. Some view it as haram (forbidden) due to concerns about excessive speculation, uncertainty (gharar), and gambling-like behaviour. However, others consider it acceptable under specific conditions, like trading in halal assets, avoiding interest (riba), and preventing addiction or gambling behaviour.
Yes, day trading is legal in Canada. Canadians can engage in day trading activities in various financial markets, including stocks, forex, and commodities.
