Have you decided to give Questrade a try and are now wondering how to buy stocks through the discount brokerage? Questrade has a very user-friendly interface that makes purchasing stocks a breeze.
Four steps to buying stocks on Questrade:
1. Look for the stock that you would like to buy
2. Input your order
3. Review the specifics of your trade and submit your trade
4. Check your order status
I will elaborate on these steps below and outline exactly how to buy stocks on Questrade.
Steps to Take before you can buy Stocks on Questrade
Before you are able to buy stocks on Questrade, you will need to make sure you have completed the following steps:
- You have opened an account with Questrade (make sure to use this link to get $50 in free trades)
- Your account is funded
- You have researched the stocks that you will buy or trade
- You are logged on to Questrade
How to buy Stocks on Questrade
Step 1: Search for the Stock that you want to buy
Once you have completed your research and have a good sense of the stock(s) that you would like to purchase, the first step is to search for each stock’s ticker through Questrade.
You can find a specific stock by typing in its ticker at the top of the trading screen.
Make sure to type in the correct stock ticker as well as the correct exchange that you would like to buy it on. In some cases, stocks are listed in both the US and Canada, giving you the option to buy them in US dollars or Canadian dollars. A good example is CIBC stock:
- CM – shares of CIBC that trade on the New York Stock Exchange in US dollars
- CM.TO – shares of CIBC that are trading in Canadian dollars on the Toronto Stock Exchange
Once you have found your stock, you can review its historical performance as well as other statistics such as:
- Market cap
Step 2: Place your Order
Once you have reviewed the specifics of your stock, the next step is to place the order. The account in which you will be buying the stock should be selected from the top of the screen.
Questrade allows you to place several types of orders. I will outline the two types of orders that are absolutely critical to know: limit orders and market orders.
Limit Orders – Typically the Best Type of Order
The most important order type to understand as an investor or trader is the limit order. Limit orders allow you to buy or sell a stock or security at an exact price if the market price reaches your desired price.
The key benefit of limit orders is that you can set the sell or buy price to be as high or as low as you want. Investors can also choose how long a limit order stays open by specifying a date. This allows you to wait until a security approaches the price that you have chosen (hopefully it does).
Limit orders will fill you at either the price that you have inputted or a better one. When buying a stock, this means buying shares at the inputted price or at a lower price. When selling a stock, this means selling shares at the inputted price or at a higher one.
Using a limit order will allow you to invest a precise amount of money into a security (if your order is entirely filled). If the price of the security that you are trading fluctuates and your limit order is filled at an even better price than you have inputted, you will even have some leftover cash.
Limit orders are best for investors that are not in an extreme rush to trade.
Market Orders – Best for Immediate Trading
Unless you are trading very liquid stocks or securities, market orders are generally not recommended. A market order is immediately executed, allowing you to instantly invest in a security or stock.
The critical weakness of market orders is the lack of control over the price at which you are filled. In the case of illiquid stocks or securities (a wide bid-ask spread), it is possible that you will end up trading the investment at very poor prices.
It is very important to use market orders only when you are in an extreme rush to trade or if a security is extremely liquid (and has a tight bid-ask spread).
Step 3: Review your Trade and Submit the Order
Once you have clicked on the buy button, the next step is to confirm that the order is correct.
You will want to double-check several things:
- The name of the stock
- The exchange of the stock
- The number of shares
- The type of order
- The desired price (if applicable)
- The account
- The estimated cost
Once you click on the send order button, your trade will be submitted to the system (and may potentially be filled instantly).
Step 4: Check the Status of your Order
For market orders in particular, Questrade will send you an instant pop-up after sending the order with the trade confirmation and the average fill price.
You can check the status of your trade by clicking on the account menu, followed by orders.
Limit orders may or may not be instantly filled. This depends on how close the price that you have selected is to the current market price. It is possible for limit orders to be partially filled in some cases.
If your limit order price is far from the current market price, it may take some time until it is filled. You can review trades through this menu and monitor unfilled trades that are still open.
Once the trade has settled, and you have reviewed any relevant information, you have successfully bought a stock on Questrade.
Alternative to Buying Stocks Directly: The Use of a Robo-Advisor
Another option instead of buying stocks directly through Questrade is to use a Robo-advisor to invest in stocks. Robo-advisors are offered through brokerages and are designed to replace human advisors.
The software collects information such as goals and objectives and then provides clients with investment recommendations and automatically-generated portfolios.
If you decide to use a Robo-advisor, you will no longer need to research and trade your own stocks. Robo-advisors typically charge a very low annual advisory fee for their services. This fee is much lower than what is generally charged by an investment advisor.
Questrade offers a Robo-advisory platform called Questwealth – check out my Questwealth review.
If you sign up for Questwealth with this link, your first $10,000 will be managed by the platform for free for one year.
If you are busy in your day-to-day life and don’t have time to research or trade stocks, using a Robo-advisor is an excellent, low-cost option to consider.
Alternative to Buying Stocks Directly: Working with an Investment Advisor
Another option is to consider working with an investment advisor to manage your investments (including stocks). Investment advisors usually offer professional advice regarding investment management, financial planning, and more.
Investment advisors come with diverse backgrounds and skill sets. Some advisors may be more hands-on when it comes to choosing investments, while others may only use funds and ETFs.
Make sure to thoroughly research your advisor before deciding to partner with them for the long term.
As most investment advisors charge very high advisory fees, I do not recommend partnering with one to grow your wealth. A lot of the guidance and insights that a professional advisor can provide can be found online.
ETFs and resources provided by discount brokerages make it easier than ever to take care of your financial affairs.
Questrade’s fees and trade commissions are on the lower end of the spectrum here in Canada.
|Trading Costs||1 cent per share, minimum $4.95 to max. $9.95||Buy for free, sell for 1 cent per unit, minimum $4.95 to max. $9.95||Trade for $9.95 plus $1 per options contract||Trade for $9.95|
Purchasing an advanced data package allows clients to access active trader pricing. Active trader pricing is offered in two options: fixed and variable.
Fixed pricing rates include:
- $4.95 per stock trade
- $4.95 plus $0.75 per options contract for options
- Buying ETFs for free and selling for $4.95 per trade
Variable pricing includes:
- 1 cent per share for stock trades, with a minimum of $0.01 and a maximum of $6.95
- $6.95 plus $0.75 per options contract for option trades
- Buying ETFs for free, selling for 1 cent per unit, with a minimum of $0.01 and a maximum of $6.95
Questrade does come with a $1,000 account opening minimum. Knowing the specific strengths and weaknesses of a discount brokerage is critical to helping you decide on which one to use.
I cover Questrade in a lot of detail in the video above and also in my thorough Questrade review.
Buying stocks (and other investments) through Questrade is very simple and intuitive.
If you are looking for alternatives to managing your own investments, other options include robo-advising or partnering with an investment advisor.
I don’t recommend partnering with an investment advisor since they usually charge very high fees that eat away at your investment returns.
Take a look at my ultimate list of the best stocks in Canada if need some ideas regarding which stocks to invest in.