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*Note: Betterment acquired the US side of Wealthsimple’s business in 2021. The remainder operates as a Canadian entity.
Is Wealthsimple Right for You?
money simple is a Canadian investment platform that offers self-directed trading, automated investing, expense allowances, tax filing services and much more. Its investment selection currently includes stocks, ETFs, and cryptocurrency,
Wealthsimple vs Wealthfront
money simple Both Wealthfront and Wealthfront offer automatic investing, but Wealthsimple is a better option for individuals who want to trade on their own. With Wealthsimple, you can practice DIY trading for stocks, ETFs and cryptocurrencies.
to like money simpleWealthfront offers both ETFs and exposure to crypto through its two crypto trusts (Grayscale Bitcoin Trust (GBTC) and Grayscale Ethereum Trust (ETHE). But you will not be able to place your own trades; this is strictly automated. Wealthfront, however, is a better option for investors seeking lower fees.
Wealthsimple vs Vanguard Personal Advisory Services
money simple And Vanguard both serve many different types of investors. But when it comes to Vanguard’s advisor-managed, automated account, Vanguard Personal Advisory ServicesWealthsimple offers a low entry fee.
Vanguard Personal Advisor Services and its other automated investment account, Vanguard Digital Advisor, both have lower minimum requirements — $50,000 and $3,000, respectively — than Wealthsimple’s basic managed portfolio (this option only requires a minimum of $1). .
Ways to Invest with Wealthsimple
Stocks and ETFs
money simple Versatile is a great option for investors as it offers both self-directed trading and automated investing. The hybrid platform currently gives investors a choice between two different plans for stock and ETF trading: the Basic plan (which costs $0 per month) and the Plus plan ($10 per month). It is important to note the differences between the two:
- basic plan: This account allows you access to perks such as fractional stock trading, instant deposit of $1,500, real-time prices, unlimited price alerts, commission-free and account minimum-free investments, tax-free savings accounts (TFSAs), taxable accounts, and registered provides access. Retirement Savings Plan (RRSP). (Note: The TFSA and RRSP only apply to residents of Canada).
- Flattery: These users get access to all the features of the basic plan. The only difference is that Plus clients do not have to worry about foreign exchange rates for US trades, and they can deposit $5,000 instantly.
Unlike the Basic plan, the Plus plan lets you keep USD in your account(s), allowing you to trade US stocks without running into exchange rates. For the Basic plan, there is a 1.5% currency conversion fee when you convert from CAD to USD (or vice versa).
For its investments, Wealthsimple offers thousands of stocks and ETFs that investors can find on both the US and Canadian exchanges.
money simple There are no minimums in crypto, nor does it charge any fees to make deposits or withdrawals. Although it does not offer as many crypto assets as popular exchanges like coinbase And Kraken (both offer 100+ coins), it still has a wide selection of cryptocurrencies to choose from. Its available coins include Bitcoin, Dogecoin, Ethereum, AHD Cardano.
Plus, it lets users take advantage of limit order, which lets you set the price at which you want the sell or buy order to be executed. With a platform like Coinbase, you have to use its more advanced account, coinbase pro, to use limit orders. The fact that you can implement limit orders with Wealthsimple’s most basic crypto services can be attractive to crypto traders looking for order flexibility.
However, you will run into fees for crypto transactions. It has a spread fee which can be up to 2%.
When it comes to custody, Wealthsimple keeps most of its users’ assets in offline storage. It uses several custodial partners—including Gemini Trust Company LLC—for it, each of which offers more than $200 million in insurance. It says it stores the remaining assets in digital crypto wallet And also uses Coincover to protect those coins.
However, Wealthsimple is limited when it comes to transferring crypto to your account. If you wish to deposit coins stored through an external wallet, you can do so for only 23 coins. Those 23 coins limit also applies to users who wish to transfer assets from their account.
Wealthsimple’s automated portfolios are ideal for investors who want to sit back and watch their investments grow without making day-to-day trading decisions for the account. All you have to do is come prepared with an amount to invest, make a list of your short-term and/or long-term goals, set an investment time horizon and risk tolerance, and Wealthsimple takes care of the rest.
Like many robo-advisors and automated accounts, its managed portfolios offer features such as dividend reinvestment, portfolio rebalancing, and automatic deposits. Plus, it offers two unique portfolio options:
- Socially Responsible Portfolio: These portfolios are great for investors who want to positively impact the world on an environmental and social level. As for its asset allocation, it invests in ETFs of both socially responsible companies in developed markets globally and socially responsible companies in North America. Wealthsimple says it also uses bond and gold to hedge against the equity risk associated with ETFs in your portfolio.
- Halal Portfolio: This option can be a great option for those who want to invest in a way that respects Islamic law. Unlike a socially responsible portfolio, its asset mix includes Shariah compliant ETFs, gold and non-interest-bearing liquidity in globally developed markets. It says it uses a third-party committee of Sharia scholars to examine each investment.
Another highlight of Wealthsimple’s socially responsible portfolio is that it removes the top 25% of carbon emitters in the industries selected for the ETF. In addition, it ensures that each company fund has at least three women on its board of directors.
For a fee, it offers three different pricing plans: the Basic plan, the Kali plan, and the Generation plan. The Basic plan — which includes the option to ask questions to portfolio managers — has a $1 minimum and a 0.5% annual fee. With the Black plan, you’ll have to pay a $100,000 minimum and a 0.4% advisor fee, but you’ll get access to things like estate planning and health allowances.
Lastly, the Generation plan has a minimum $500,000 and 0.40% fee, but you’ll be exposed to a number of experts who can tailor your portfolio to your needs. Its management fees are high compared to other automated platforms like Betterment, Wealthfront and Fidelity Go.
Wealthsimple: Is It Reliable?
Better Business Bureau Wealthsimple Financial Inc. Gives an F rating. Ratings typically range from A+ to F, and the BBB’s opinion reflects how well a company interacts with its customers.
However, many other factors can also determine a company’s rating. These include customer complaint history, type of business, time in business, licensing and government actions, and advertising issues. The bureau says its rating for Wealthsimple stemmed from the fact that it received 17 complaints and failed to respond to 12 of them.
Its BBB profile shows that it closed 17 complaints in the last three years and six in the last 12 months.
Wealthsimple — Frequently Asked Questions (FAQs)
Is Wealthsimple good for beginners?
money simple It is a competitive option for both beginners and experienced investors or traders looking for low fees, abundant investment options and a simple user interface. platform too provides a library On all things personal finance, and it offers an income tax calculator to simplify the tax process.
Can I Day Trading on Wealthsimple?
Yes. Wealthsimple does not encourage this type of trading, but it does allow it.
Can I Trust Wealthsimple Cash?
Yes. With a Wealthsimple spending account, you get coverage of up to $100,000 through the Canadian Deposit Insurance Corporation (CDIC), and you can earn 1% back rewards in cash, stocks or crypto. All you have to do is make purchases using your Wealthsimple Visa card.