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Investing in stocks in Canada is one of the best ways to build long-term wealth — but the sheer number of options, accounts, and platforms can feel overwhelming when you're just starting out. This guide walks you through everything you need to know: which account to use, which platform to choose, and whether to buy individual stocks or ETFs.
Keeping money in a savings account in 2026 typically earns you 3–4% annually — barely keeping pace with inflation. The Canadian stock market (TSX) has historically returned around 7–9% per year including dividends, while a globally diversified portfolio of index funds has returned similar figures over the long run. That difference compounds dramatically over decades.
Consider this: $100 invested at 7% annual return becomes approximately $76,000 in 30 years, compared to just $30,000 in a 4% HISA. The earlier you start, the more time compounding has to work in your favour.
Before you pick a stock or ETF, you need to choose where to hold your investments. In Canada, the two most important registered accounts for retail investors are the TFSA and the RRSP.
The TFSA is arguably the most powerful investment account available to Canadians. Any investment growth — capital gains, dividends, interest — is 100% tax-free, forever. You can withdraw at any time without paying tax, and the contribution room is restored the following calendar year.
The RRSP gives you a tax deduction today in exchange for paying tax when you withdraw in retirement. If you're in a high tax bracket now and expect to be in a lower bracket in retirement, this is a smart trade.
Once you've maxed your TFSA and RRSP, a taxable brokerage account lets you invest unlimited amounts. Capital gains are taxed at 50% inclusion rate, and dividends from Canadian corporations receive the dividend tax credit — making them more tax-efficient than interest income.
Wealthsimple Trade is the go-to platform for Canadian beginner investors. It offers commission-free trading for Canadian and US stocks and ETFs. The interface is clean and mobile-friendly. The free tier charges a 1.5% currency conversion fee on USD trades; the Premium plan ($10/month) reduces this to 0.5%.
Questrade is the best discount broker for more active investors. ETF purchases are free; selling ETFs costs $4.95–$9.95. You can hold USD in your account to avoid FX conversion on every trade, which saves money on US ETFs.
The big bank brokerages (TD Direct Investing, RBC Direct Investing, Scotia iTRADE) are reliable but charge $9.99 per trade. CIBC Investor's Edge charges $6.95. These are fine if you're consolidating accounts or already bank with them, but Questrade and Wealthsimple generally win on fees.
For most Canadians — especially beginners — index ETFs beat individual stock picking. Here's why:
| Factor | Individual Stocks | Index ETFs |
|---|---|---|
| Diversification | Low (10–20 companies) | High (hundreds to thousands) |
| Time required | High (research each company) | Very low (buy and hold) |
| MER cost | $0 (no ongoing fee) | 0.06%–0.25% annually |
| Risk | High (single company can go to $0) | Low (market-level risk) |
| Average returns vs. market | 80%+ of investors underperform | Matches market minus MER |
That said, individual stocks can be rewarding for learning and for overweighting sectors you understand well. The key is to keep individual stock picks to a small portion (10–20%) of your portfolio and hold the core in diversified ETFs.
A simple, proven approach for Canadian investors is the "all-in-one ETF" strategy. You buy one ETF that holds thousands of stocks from around the world at a very low fee. Popular choices include:
These single-ticket solutions are ideal for most investors. You contribute regularly, reinvest dividends, and never need to rebalance manually.
Fees can erode your returns significantly over time. A 1% annual fee on a $100,000 portfolio costs $1,000 per year — money that could be compounding for you. Here's how the platforms compare for a typical ETF investor buying $500/month:
| Platform | ETF Purchase Fee | Annual Account Fee | USD FX Fee |
|---|---|---|---|
| Wealthsimple Trade | $0 | $0 | 1.5% |
| Questrade | $0 | $0 | 1.5–2% |
| TD Direct Investing | $9.99 | $0 (if >$15k) | 1.5% |
| RBC Direct Investing | $9.95 | $0 (if >$15k) | 1.5% |
| CIBC Investor's Edge | $6.95 | $100/yr (waived) | 1.5% |
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Get KOHO Free →Last updated: March 2026. This content is for informational purposes only and does not constitute financial advice. Always consult a qualified financial advisor before making investment decisions.