Wealthsimple is a Canadian financial company with two main investing platforms: Wealthsimple Invest and Wealthsimple Trade. Both platforms have their pros and cons and make it easy and affordable for Canadians to start investing with little money.
But which one is right for you? And what’s the difference between them?
In this blog post, we will compare and contrast Wealthsimple Invest vs Wealthsimple Trade to help you decide which platform is right for you!
Wealthsimple Invest Vs Wealthsimple Trade: Summary
|Wealthsimple Invest||Wealthsimple Trade|
|Account Types||RRSP, RRIF, LIRA, RESP, TFSA, Personal etc||RRSP, TFSA, Personal|
|Asset Type||ETF Portfolios||Stock, ETF & Crypto|
|Fees/Commission||0.40-0.50% Mgt Fees||Commission-free trading; 1.5% FX Fee, $10 for Trade Plus|
|SRI & Halal||Yes||No|
What is Wealthsimple Invest?
Wealthsimple Invest is a managed investing service or robo-advisor as they are popularly known. That means that instead of picking and choosing which stocks or funds to buy yourself, you leave it to a team of professional portfolio managers.
They create and manage a diversified investment portfolio for you, using the best available technology and strategies, so you don’t have to worry about it.
And they charge a low management fee of 0.40-0.50% of your portfolio value per annum, which is just a fraction of what you would pay most human financial advisors or mutual funds.
Here are some of the best features of Wealthsimple Invest:
- Low management fees: 0.40-0.50% per annum, which is much lower than most human financial advisors or mutual funds.
- No minimum investment: You can start investing with as little as $0.
- Automatic rebalancing: Your portfolio is automatically rebalanced as needed to keep it on track.
- Roundup: Simply connect your debit or credit card and your purchases will be rounded up and invested on your behalf.
- Tax-loss harvesting: Wealthsimple Invest uses tax-loss harvesting to help you minimize your taxes when you invest through a non-registered taxable account.
- Socially responsible investing: You can choose to invest in a socially responsible portfolio that aligns with your values.
- Registered accounts: Wealthsimple Invest supports a large selection of registered accounts like RESP, RRSP, TFSA and more.
Wealthsimple Invest is best for:
- Investors who want a hands-off approach and don’t mind paying management fees
- Beginner investors with little to no investing experience
- New investors who don’t have a lot of money to start with ($0 minimum investment)
Learn more about the robo-advisor in this Wealthsimple Invest Review.
What is Wealthsimple Trade?
Wealthsimple Trade is a self-directed investing app that allows you to buy and sell stocks and ETFs with zero commission. It’s designed for do-it-yourself investors who want to take control of their own portfolios.
It was the first investing app to offer commission-free trading in Canada and has since been followed by other investment apps and brokerages.
Wealthsimple Trade currently supports trading in Canadian and U.S. markets, with the option to hold and trade in US dollars with a premium subscription that costs $10 per month.
Here are some of the best features of Wealthsimple Trade:
- No commission fees: Buy and sell thousands of stocks and ETFs for free. You only need to pay the currency conversion fee of 1.5% if you buy/sell stocks or ETFs that trade in USD.
- Easy to use interface: The Wealthsimple Trade mobile app is designed for simplicity and ease of use.
- No minimum deposit: Start investing with as little as $1. Don’t have thousands of dollars to invest? No problem! Start with the little cash you have.
- Plus subscription: that offers USD account, instant deposit of $5,000, and live price quotes, among other features.
- Registered accounts support: RRSP and TFSA are supported on the Trade app
A key drawback of Wealthsimple Trade is that it offers limited asset types. For now, it only supports Stocks and ETFs. Also, you can only open a TFSA or RRSP, the other tax-advantaged or registered accounts are not available.
Wealthsimple Trade is best for:
- DIY investors who want to take control of their own portfolios
- Investors who want to trade stocks and ETFs without paying any commissions
It is also suitable for new investors that want to learn more about investing and are willing to put in the time to research their investment choices.
Learn more about the investing app in this Wealthsimple Trade Review.
Wealthsimple Invest Vs Wealthsimple Trade
Next, we’ll take a look at how both investment platforms compare under different features.
Wealthsimple Invest supports all the major registered account types such as RRSP, RESP, TFSA, RRIF and LIRA, and non-registered personal accounts. You can also open a joint or business account.
On the other hand, your choices are limited on the self-directed investing side of things on Wealthsimple Trade. It only supports RRSP, TFSA and personal cash accounts.
To manage your own investments in an RRIF or LIRA, you may have to go with Questrade or other investment platforms.
Wealthsimple Invest also supports Halal Investing and Socially responsible Investing (SRI).
Both Wealthsimple Investment and Wealthsimple Trade are available on the web and mobile. Whichever platform you choose, you’ll experience a clean, intuitive and modern interface that Wealthsimple has become synonymous with.
Fees & Commission
The management fees for Wealthsimple Invest is 0.50% for deposits up to $100,000, and 0.40% for higher amounts. In addition, you’ll also pay the MER (usually less than 0.20%) for the underlying ETFs the portfolios invest in.
With Wealthsimple Trade, you can trade stocks and ETFs in Canadian dollars completely free. However, to hold USD balances and trade US Dollar denominated stocks directly, you’ll need to upgrade to Wealthsimple Trade Plus that costs $10 per month.
Wealthsimple Invest portfolios are built using low-cost ETFs. That is how robo-advisors are able to keep their costs low and pass some of those savings to you.
But you can trade ETFs and stocks on Wealthsimple Trade. Crypto investing is also available through Wealthsimple Crypto that is offered within the same app.
Unfortunately, bonds, options and other types of investments are currently not supported on any of the Wealthsimple investing platforms.
Wealthsimple rewards you with welcome bonuses for trying all its products.
With Invest, you get a $25 cash bonus when you deposit a minimum of $300. You also get a $25 bonus after trading at least $150 on Wealthsimple Trade.
To qualify, simply sign-up using the referral link for the service you want:
|Invest||$25||Deposit at least $500|
|Trade||$25||Trade a minimum of $150|
|Crypto||$25||Trade a minimum of $150|
|Tax||$15||File your taxes|
|Cash||$1||Download and sign-up|
Learn more about Wealthsimple Promotions here.
Wealthsimple makes it easy for Canadians, irrespective of their budgets, to start investing with little money. That means, there is no minimum investment amount for both Wealthsimple Invest and Wealthsimple Trade.
You can start investing with either platform with just $1 and gradually grow your portfolio.
So, which of the Wealthsimple platforms is right for you?
If you’re a busy person that would rather have someone else manage your investments for you, or you have little investment knowledge or experience, Wealthsimple Invest is a great choice.
However, if you’re an experienced investor who wants more control over your investments and you’re comfortable doing your own research, Wealthsimple Trade is a better option.
Both platforms have their own unique advantages, so it’s ultimately up to you to decide which one is right for you and your investment goals. Whichever platform you choose, Wealthsimple makes it easy and affordable for Canadians to start investing.