Questrade Exchange Rate 2024: Lower Your FX Fees for U.S Trades

If you are a Canadian interested in the U.S. stock market, you might have heard about Questrade.

Questrade was the first discount broker in Canada to offer USD-denominated accounts, which helps to save on currency conversion fees.

So what is the current Questrade exchange rate to convert USD and other currencies to Canadian dollars?

There is a fee of 175 basis points, which is equivalent to 1.45% over the past 12 months, according to the Questrade website. The fees are based on the Bank of Canada USD/CAD Daily exchange rate.

This is a pretty good rate and lower than many other trading platforms in Canada, which can be upwards of 2.5%.

Why Invest In The US Stock Market At All?

There are several good reasons to invest in the U.S. as a Canadian investor.

1. The first reason is that the U.S. has two of the most significant stock markets worldwide: the New York Stock Exchange (NYSE) and the National Association of Securities Dealers Automated Quotations (NASDAQ).
2. Second, investing in U.S. stocks and ETFs lets you gain exposure to some of the world’s largest companies like Apple Inc., Microsoft, and Amazon.com.
3. Lastly, investing in U.S.-listed securities also allows you to diversify your portfolio and invest in securities that align with your financial goals.

How to Fund Your USD Account at Questrade

There are several methods to fund your Questrade account in USD. I will discuss using a pre-authorized deposit (PAD) or a wire transfer to achieve this. These are the two most popular methods that self-directed Canadian investors use to fund their Questrade accounts in USD.

Using Pre-Authorized Deposit

Here are the steps you need to follow if you plan on using PAD to fund your Questrade account in USD.

1. Login to your myQuestrade account, click “Funding,” and select “Pre-Authorized Deposit”.
2. Choose the option to “Add New Bank Account” and select the option to set it up manually.
3. Once you set up your account, Questrade will ask you to fill up the different fields for all the required information. You need to fill up several required fields here, including the deposit date, frequency of deposits, and the end date for the deposits.
4. Questrade requires your banking information and a PAD agreement on file when you set up a PAD manually. Thus, you should upload your banking information and PAD agreement before the deposit date if you want to avoid delays while funding your Questrade account in USD.
5. Once you submit a PAD, you can see the status on your myQuestrade account by clicking on “Funding” and selecting “Pre-Authorized Deposits History.”

Another thing you should remember while setting up the PAD manually is that you need to upload a void check or a direct deposit form for your bank account. Go to myQuestrade, select “Account Management,” and then click on “Upload Documents” to upload the void check or direct deposit form.

Using A Wire Transfer

Here is a look at the following information you will need if you are planning to wire transfer USD funds to Questrade through a Canadian financial institution:

Beneficiary Information:

Questrade, Inc.
5700 Yonge Street, G1 – Ground floor
Toronto, ON M2M 4K2
Account: 4006573

Make sure to include your Questrade account number and name.

Questrade has an account with the Royal Bank of Canada (RBC) to process its wire transfer requests. You should send your USD directly to the RBC bank account below to complete wire transfer requests and fund your Questrade account with USD.

Banking Information:

Royal Bank of Canada
Yonge & Hollywood Branch
5001 Yonge Street
Toronto, ON M2N 6P6
Swift Code: ROYCCAT2
Transit Number: 02874

Note that you can also include your Questrade account number and your name in the wire transfer request.

Using Wire Transfer or Pre-Authorized Deposit – Which Is Better?

Wire transfers are usually the quickest method to fund your Questrade account with USD because they arrive sooner, taking only one or two business days. You also don’t need to worry about a minimum or maximum transfer limit you can receive in your Questrade account.

In contrast, PAD effectively lets you fund your Questrade account with USD for free. However, the funds might take two to three business days to arrive for a PAD request lower than $10,000 CAD or USD. If the PAD amount is $10,000 CAD or USD or higher, you can expect it to take up to seven business days to come through.

Some banks offer free wire transfers for a specific amount of cash, depending on the account type you have. You need to check with your bank or financial institution to get more information on wire transfers because they might involve daily maximum limits and fees.

Still, you can choose wire transfers or pre-authorized deposits based on your preferences.

If you don’t mind a slightly longer waiting time, you can choose to go with PAD to fund your Questrade account in USD. On the other hand, if you prefer making the transfer more quickly and don’t mind paying any transfer fee for the wire transfer, you could consider using wire transfers to fund your Questrade account in USD.

Funding USD In A Registered Account or Margin Account

Using Questrade lets you hold both CAD and USD in your account without worrying about exchanging back and forth between the two currencies.

However, while you can hold dual currencies in your account, there is a difference if you want to fund USD in a margin account and a registered account.

The currency settlement for a margin account is the trade currency. It ensures that the currencies stay on their respective sides, depending on the trade.

For a registered account, you can easily check on the currency settlement. Just go to myQuestrade, select “Account Management,” and click on “Currency Settlement.”

Selecting the currency settlement preference allows you to control how the money is deposited into your registered account when you receive cash, sell securities, or transfer funds into your account from another financial institution.

If you set the currency settlement preference to CAD, Questrade will automatically convert all the cash into CAD. It will also convert everything into USD if you set the currency settlement preference to USD.

On the other hand, you can also choose to set it to “Currency of Transaction” if you want to ensure that the currencies stay on their respective sides, like in margin accounts.

If you are funding your registered Questrade account in USD, you should know that the platform still reports your contributions to the Canada Revenue Agency (CRA) in CAD.

You can contact Questrade via phone or chat to confirm the CAD equivalent of your USD contributions. Knowing the amount will help you make a more well-informed decision for your future deposits and let you remain within your contribution limits for the registered accounts.

Conclusion

Getting the best conversion rates is important because every dollar counts when it comes to investing. Questrade exchange rates are some of the best ones for CAD to USD conversion. Questrade is also one of the top trading platforms that you can use as a Canadian investor.

You can learn more about the discount broker in my Questrade review to understand why it is so popular.