Wealthsimple vs TD

Comparing the fees and features of Wealthsimple vs TD

Comparing Exchange Fees

Fees Summary

The biggest difference between TD and Wealthsimple is that Wealthsimple does not charge commission fees for any account types, and does not have restrictions on trades or account minimums. TD, however, offers two primary options for investors: TD Easy Trade, which allows investors to trade stocks, TD ETFs, and American Depository Receipts (ADRs) with no commission fees on their first 50 trades (and then $9.99 per trade); and TD Direct Investing, which allows investors to trade stocks, ETFs, Mutual Funds, Options, Bonds, GICs and ADRs with a flat commission fee of $9.99 per trade, and an additional $1.25 per contract for options trades. The only fees Wealthsimple charges are a 1.5% currency conversion fee for cross-border trades and a 1.95% fee for crypto exchanges. Wealthsimple has no account minimum requirements, withdrawal fees, penalties or commission fees, no matter the number or value of trades made each year. 

TD Fees Explained In-Depth

Canadian and U.S. Stock Trading Fees

TD charges a flat commission fee of $9.99 for all Canadians and U.S. stock trades, and this fee is charged in the currency in which the trade is made. The fee, however, is waived for the first 50 stocks purchased or sold per year for those with a TD Easy Trade account. 

Canadian and U.S. Options Trading Fees

TD charges a flat commission fee of $9.99 plus an additional fee of $1.25 per contract for all Canadian and U.S. options trades, and this fee is similarly charged in the currency in which the trade is made. Options are only available to TD Direct Investing account holders. 

Conversion Fees

Conversion fees are applicable to trades made in a currency that is different from the account in which the trade is made. TD Easy Trade offers customers access to a US-dollar investing account but if there are insufficient funds in that account when a purchase is made the balance will be withdrawn from the Canadian dollar holdings and conversion fees will apply. All commission fees are also charged in the currency in which the trade is made, and exchange rates vary between account types. Those with a TD Easy Trade account and sufficient funds available in each currency, however, are able to make trades in Canada and the U.S. without exchanging currencies. 

Telephone Brokerage Services Commission Fees

Trades placed over the phone with an investment representative are subject to a different fee structure than those placed online, and include a minimum commission fee of $43 per trade. Telephone brokerage services are only open to TD Direct Investing customers, and are not available for those with a TD Easy Trade account.

For Canadian stocks priced under $.24 a commission fee of 2.5% applies. For those valued at $.25 or higher TD charges a $35 commission fee, plus an additional fee per share, which ranges from $.005 for stocks valued between $.25 and $1, to $0.06 per share for trades of stocks that are worth $20.01 or more. 

For American stocks that have a price of $.24 or less a flat 3% commission fee applies. For those valued at $.25 or more TD charges a $39 commission fee, plus an additional fee per share, which ranges from $.02 for stocks priced between $.25 and $1, and $0.08 per share for trades of stocks that are each worth $30.01 or more. Furthermore, a fee of $43 is added to equity transactions with a principal of less than $2,000

Active Trader Fees

TD Direct Investing account holders can upgrade to “Active Trader Pricing” if they make 150 trades or more each quarter. Those that qualify enjoy a reduced commission fee for stocks and trades, with a flat rate of $7.00 per Canadian and U.S. stock trade and a fee of $7.00 per options trade plus an additional $1.25 per contract. In order to qualify, traders must spend a minimum of $1,050.00 per quarter on commission fees alone ($7.00 multiplied by 150 trades).  

Maintenance Fee

TD charges account holders with less than $15,000 in their Direct Investing account a maintenance fee of $25 per quarter. This fee, however, is waived for TD Easy Trade account holders and Direct Investing accounts that qualify for the Household Program. To qualify for the program users must have more than of $15,000 in all TD Direct Investing accounts among members of their household; have a registered disability savings plan within their household; have opened the first TD account within their household within the last six months; register one or more of the accounts in their household in a Systematic Investment Plan (SIP), a pre-authorized deposit, or a pre-authorized contribution of at least $100 a month; or have paid commission fees on three or more trades in the previous quarter within household accounts.   

Wealthsimple Fees Explained In-Depth

Conversion Fees

Wealthsimple Trade charges a flat fee of 1.5% for currency exchanges to Basic users, but clients who subscribe to Wealthsimple Plus have their own USD accounts and pay no fees on USD trades (the fee still applies when moving cash between CAD and USD accounts). Wealthsimple Plus costs $10 per month plus applicable taxes.  

For Basic account holders the fee applies to exchanges from CAD to USD and vice versa, and for both purchases and sales. That means that, using an exchange rate of $1.3 USD for every $1 CAD, for example, users would instead be charged $1.3195 Canadian for each dollar they purchase of an American-based asset (or $1.3 plus an additional 1.5%). On the flip side those selling $1 worth of a US-based asset, with an exchange rate of 1.3, would instead receive $1.2805 per dollar from the sale (or $1.3 minus an additional 1.5%). 

Commission Fees

Wealthsimple does not charge commission fees for any asset class other than cryptocurrencies. That means users can buy or sell any other asset class in Canada or the United States without any additional fees. There are also no fees for opening or closing an account, making deposits or withdrawals, electronic statements, or inactive account fees. 

Crypto Exchange Fees

Wealthsimple charges a flat fee of 1.95% for all Crypto exchanges. 

Wealthsimple Plus Fees

Those who want access to a range of premium features have the option to upgrade from a “Basic” to a “Plus” account. The upgraded accounts are available for $10 per month, plus applicable taxes. 

Plus accounts are cost efficient for those who are making frequent and/or large trades across the Canada-U.S. border. That is because Plus users can access USD-trade accounts, which allows them to make cross border trades without foreign exchange fees (a 1.5% FX fee still applies to cash transfers between CAD and USD accounts). The upgraded service also includes real-time quotes, and an instant deposit limit of $5,000. By comparison, Basic users will experience a 15 minute delay when receiving price quotes, and have an instant deposit limit of $1,500.

TD vs Wealthsimple’s Managed Investing

Wealthsimple charges a flat fee of 0.5% for managed portfolios with less than $100,000 under management, and 0.4% for managed portfolios with $100,000 or more under management. TD’s fees for managed portfolios, however, depend on the specific mutual fund. There are more than 100 mutual funds actively managed by TD Asset Management Inc., each with a management fee that ranges from .25% to 1.9%, plus an administration fee of either .2 or .25%.

TD offers 20 different actively managed portfolios under its Managed Assets Program, each with its own minimum investment requirements and fees. These portfolios are divided into three categories: TD FundSmart Managed Portfolios, TD Managed Index Portfolios, and TD Managed Portfolios. TD Direct Investing account holders can also invest in non-TD ETFs, however TD Easy Trade customers are limited to TD EFTs only. Easy Trade customers, however, are not subject to ETF Minimum investment requirements.

Wealthsimple vs TD Managed Investing Fees Table

Wealthsimple’s Managed Investing Portfolio Performance

Wealthsimple offers three managed investment portfolio types: Conservative, Balanced and Growth. Over the last five years the Conservative portfolio has appreciated at an average rate of 1.59% per year; Balanced has grown at an average annual rate of 2.58%, while Growth has seen annualized growth of 5.09%. Returns, however, vary significantly across different time horizons. Furthermore, it’s important to note that portfolios offering higher returns are also associated with higher risk profiles, and past performance isn’t necessarily an indicator of future potential.

TD’s Managed Investing Portfolio Performance

TD offers investors a wide range of actively managed portfolio options, each with different free structures, account minimum requirements and performance results.

For example, over the last first years the TD Managed Index Aggressive Growth Portfolio has grown an average of 5.84% annually; the TD Managed Income Portfolio has increased by an average rate of 1.96% annually; the TD Managed Income & Moderate Growth Portfolio has seen 2.74% annual growth on average; the TD Managed Index Maximum Equity Growth Portfolio has grown 7.18% annually on average, and the TD Managed Maximum Equity Growth Portfolio has increased at an average of 5.58% per year. 

Returns can vary significantly across different time horizons, and portfolios showing higher returns are also associated with higher risk profiles. It’s also important to keep in mind that past performance isn’t necessarily an indicator of future potential. 

TD Easy Trade vs. Wealthsimple: App Features

Wealthsimple and TD both offer apps that are free to download and provide access to real time trade data, a trading platform and other useful resources. Both also offer two distinct account types that provide access to different resources, and have different fee structures. 

Wealthsimple offers a Basic account for more casual investors and a Plus account for those making larger and more frequent trades. For example, Basic account holders will experience a 15 minute delay on quotes, which is typically sufficient for those who are not buying and selling the same asset in a short period of time. Those who want to make more frequent trades, however, might need real-time price data, which is included in the Plus account. Furthermore, Basic users can use instant deposit to immediately access up to $1,500, and Plus users have an instant deposit limit of $5,000. 

TD similarly offers two investment account types, one for more casual investors called TD Easy Trade and one for more advanced traders called TD Direct Investing. Both include goal planning, education and research tools, however Direct Investing account holders have access to advanced trade options and resources.

Some of the biggest differences between the two products come down to what investment products are available for purchase. As a major Canadian bank, TD offers its more advanced traders a broader range of investment products that includes mutual funds, GICs, fixed income investments, options trading and more. Unlike Wealthsimple, however, TD does not offer access to cryptocurrency exchanges or fractional shares in any account type. Fractional shares allow users to buy a part of a stock, or a specific dollar amount’s worth of one, rather than exact multiples of the stock price. That means that traders can buy the exact dollar amount they want to purchase, rather than adjusting each trade to correspond with an exact number of shares.