HOW TO BUY STOCKS? QUESTRADE WALKTHROUGH / TUTORIAL


hey guys it’s Adrian here the Canadian
in a T-shirt and today I’ll be breaking down exactly how to buy stocks and I’ll
be doing a step-by-step walkthrough of how to buy stocks and ETFs using Questrade. In this video I just want to focus on the actual process of placing a trade
through an online broker like Questrade to learn more about investing
itself and how to pick good companies to invest in check out my past videos in my
Millennial investing guide especially my video on the stock market my video on
ETFs and my top 3 dividend stocks in Canada so click the pop-up in the top
right to check out those videos first so how do we actually buy stocks in the
stock market when people hear the stock market they probably think of stock
brokers on Wall Street or they believe in the myth that banks have been telling
them for decades that the stock market is too complicated and now you should
leave it to the “experts” that’s just a way to intimidate people into buying
mutual funds and that’s how banks make their money by charge you these ridiculous
management fees for their “expertise” but the truth is anyone can invest in the
stock market and I promise you it is not complicated buying stocks online is
about as easy as buying something on Amazon or checking your bank account
online you do not need a Wall Street
stockbroker or your bank’s financial adviser to buy stocks you can buy stocks
from the comfort of your own home and at a fraction of the price by using an
online broker an online broker also known as a discount broker is a website
which allows you to buy and sell securities like stocks bonds and ETFs
with a click of a button if you want to buy TD stock for example you don’t need
to call an existing TD investor and convince them to sell their stock to you
instead you use an online broker where thousands of people are buying and
selling stocks every single second you see the live price that people are
selling their TD stock for and you can choose to buy it
the online broker handles this transaction there are a lot of online
brokers out there and most of the big banks offer their own versions of online
brokers but they usually come with higher fees some of the most popular
online brokers in Canada are TD Direct Investing Scotia iTrade, Qtrade RBC
Direct Investing and the new wealth simple trade
mobile app most of these brokers have really high fees and the ones that don’t
like Wealthsimple have some severe restrictions I’ll be reviewing some
these brokers very soon but for today I want to focus on my overall favorite
online broker and that’s Questrade Questrade was one of the first online
brokers in Canada and they’ve built a reputation on offering absolute rock
bottom prices for their services I’ve mentioned Questrade a bunch of times
in my past videos and the reason why I love them so much is because of their
super low Commission fees a commission fee is a one-time fee you pay to your
broker whenever you buy or sell a stock or another security think of it as a
transaction fee most of the brokers I mentioned earlier charge you a $10 fee
whenever you buy or sell anything but Questrade only charges you a
$5 fee whenever you buy or sell stocks and even better they charge you
no fee when you buy ETFs this makes a huge difference especially when you’re
investing in smaller amounts less than $1000 $1000 Questrade’s commission
is priced at 1 cent per share with a minimum of $4.95 and a maximum of $9.95 if
you buy 500 shares or less you’ll only pay $5 commission if you buy 1,000
shares or more you’ll pay $10 Commission for most people you’ll only ever be
charged $5 Commission on stocks and that’s because 500 shares of any company
is a lot of money usually in the tens of thousands so basically if you’re
investing between $500 and $5,000 at a time you’ll only be charged $5
Commission when you buy stocks when buying stocks through Questrade I
wouldn’t recommend buying any less than $500 at a time even if you only buy one
single share for $100 let’s say you’ll still be charged that $5 Commission so
right off the bat you’ve already lost 5% of your initial investment but if you
invested $500 you’re charged that same $5 Commission but that’s only 1% of your
investment and you can easily make up for that in a few weeks but the
beautiful thing about Questrade is that they do not charge Commission when
you buy ETFs so even if you only have $20 you can still buy a single share of
ETF and it won’t cost you any fees that’s why I like to buy stocks in bulk
at first and then whatever remaining cash I have I buy ETFs and you’ll see
that and I walk through coming right up if you’d like to get started with Questrade click my referral link in the
description box below and you’ll get $50 $50 in commission free trades when
you sign up that basically means that your first 10 stock trades will be
commission free and that saves you $50 plus I’ll get a small referral bonus as
well I’ll do a full review of Questrade very soon but now let’s jump into
a step by step walkthrough of how to buy stocks and ETFs using Questrade so we
start at the Questrade home page we click on the login button we enter our
credentials and it takes us to the landing page where it shows me a summary
of all my accounts you can see here I have a TFSA account and an RRSP account
there are a lot of really cool features you can do on Questrade if you hover
over to the reports tab you can see account activity which is essentially a
history of all your transactions you can also do an investment summary and a
summary of your investment return if you go over to the funding tab you can add
money to do Questrade account through online banking or you can also request
to transfer investments from other banks or other brokerages and Questrade will
reimburse you for those transfer fees I’m gonna save a walkthrough of all
these features for later video for now I just want to show you guys how to buy
stocks and ETFs using Questrade so to do that we’re gonna click on the green
trade button to take us to the trading platform so it took me to the account
page and by default and went to my RRSP account but for this tutorial I want to
work out of my TFSA account at the left here you can see all of my unrealized
gains and this means that if I were to sell all my stocks at this moment I
would have made a profit of $630 but I’m not gonna do that all the stocks
I own are stocks and I want to keep the long run to accumulate those dividends
the most important thing I want to show you here is the cash amount I have
almost $20,000 invested in in this TFSA account through
Questrade but I have $650 $650 sitting there in cash I
never want to have too much cash sitting in my account because cash is not
gaining me anything in fact this cash sitting here is a
losing value every single day because of inflation just yesterday I transferred
$600 from my checking account into Questrade and the other $50 I got
through dividends last week so now I have $650 in cash
ready to buy some stocks with so this is the balances page where it shows you how
much your total investment and how cash you have if you click on orders you
can see all the trades that have happened today last week or the past
three months and then positions is a list of all the Holdings you have so
these are all the stocks and ETFs that I’m holding in this TFSA Questrade
account in my TFSA account I only hold Canadian dividend-paying stocks and
Canadian ETFs I’m gonna make a whole video about asset location which
basically means which kind of stocks and ETFs I put in a TFSA which ones I put in
an RRSP and which ones I put in a taxable account but here’s a quick ten-second
summary: my TFSA is only Canadian dividends and Canadian ETFs for US
dividends and US ETFs I put those in an RRSP and I do that to save on US
withholding taxes so here’s the list of all the stocks I currently own remember
I have $650 to spend so if I want to buy more stocks of an existing
holding I could just click on it like Enbridge for example click on buy and
sell and it will take me to the panel to buy more stocks but today I’m gonna buy
something like don’t own I’m gonna invest in CIBC I know that the CIBC
ticker symbol is CM but when I search CM you see that at the top of the list
I get CIBC but traded through the New York Stock Exchange this is not the one
I want but I’ll click on it anyway just to show you why so this is CIBC the
Canadian Imperial Bank of Commerce but it’s traded under the New York Stock
Exchange NYSE so all the numbers you see on this page are going to be in US
dollars I do not want to buy this CIBC stock in u.s. dollars I’m gonna be
paying a currency conversion fee to convert my Canadian dollars into US
dollars that’s a 2% feed that I lose that’s money down the drain
so instead I’m going to select the CIBC stock through the Toronto Stock Exchange
so I do CM.TO to specify the TSX the toronto stock
exchange so now you click on it and you can see here it’s CIBC the Canadian
Imperial Bank of Commerce in the TSX the Toronto Stock Exchange and you’ll see
that the number here is a little higher on the on the other one it was $88 here
I’m seeing $110 that’s because this is in Canadian
dollars a Canadian dollar is about 76 cents in American I’m not gonna go over
exactly why I’m buying the stock I’ll save that for a later video where I’ll
go over all different metrics and historical trends
I look at before I decide to buy a stock but I’ve already decided by cibc but
real quick the CIBC stock is paying a dividend of 5.3% a year paid out
every quarter so every three months another thing I want to point out is
that in the past five days there was a huge drop in the CIBC price this is
because last Thursday CIBC released their quarterly earnings
and for this quarter their profits were lower than expected and so a lot of
investors panicked and freaked out and sold their stock and that’s why the
price dropped here but I really don’t care about the quarterly earnings I’m
invested in this company for twenty thirty years I know that CIBC is gonna
bounce back in a couple of weeks so I’m gonna buy CIBC stock at this discounted
price and in fact if I click on the one-year timeline you could see that
every few months CIBC has these regular drops and CIBC
always bounces back up within a few weeks so I’ve decided I’m gonna buy the
CIBC stock but what exactly am I looking for
you can see a lot of numbers on this page the two most important numbers I
want to talk about are the bid price and the asking price remember there is no
inherent value in a stock the value of a stock is only how much someone else is
willing to buy it for the bid price is how much a buyer is willing to pay for
the stock whereas the asking price is how much someone is willing to sell this
stock for usually these two numbers are the same but sometimes the asking price
is a little higher by a few cents so for all of my calculations I’m gonna use the
asking price so I’m gonna click on this green buy and sell button and now this
takes me to this panel here again I can see the bid price and the asking price
the first thing I want to bring your attention to is the order type so
there’s usually there’s two main types here market orders and limit orders I
almost always use market orders and what a market order means is I want to buy
the stock instantaneously right at this second so I’m gonna pay whatever the
price is this very minute and if I do a market order the trade will execute
immediately but you can also do something called a limit order a limit
order means that I will set the maximum price that I am willing to buy the stock
for so you can see that the stock is currently selling for a $109 but what if I think that the stock is gonna keep going down
in value and I don’t want to pay any more than $105 so I set the limit price
as $105 when I’m telling Questrade here is I want to buy
this at $105 so the second that this about the value of this stock drops down
to $105 execute the order and buy the stocks for
me but there’s a risk what if the price never goes down but maybe the price does
go down but it only goes down to $106 Questrade will never execute this
order until the price drops to $105 or below I can set a few options for the
duration if I set the duration to one-day that means that if the price of
the stock never drops to $105 or below by the end of the day I want to cancel the
whole order another option for duration is GTC and that is good till cancel and
that means that I’m telling Questrade to keep trying to execute the order
until I manually cancel it the maximum amount of time that GGC order can be
held is 90 days so if the price of CIBC stock doesn’t drop down to 105 or below
within 90 days the order is automatically cancelled another option
is GTD which is good till date and that’s just like GTC except then you can
specify the date at which the order is automatically cancelled I almost always
recommend market orders versus limit orders because when you do a market
order the trade is executed immediately and there’s no surprises I know exactly
what price I’m gonna be buying the stock at and as soon as I hit the Buy button
the order will be filled but with a limit order sure I may save a few
dollars if the price goes down but there’s no guarantee of when or even if
the order will be filled because the price may never go down and another
important point with stocks you have to buy a whole number of shares you can’t
buy fractions so we have to do a little bit of a calculation to figure out how
many whole number of shares of CIBC I can buy so remember I have about $650
in cash but just just to be confirmed let’s scroll down here and you
can see my balances you can see my buying power or my cash amount so I can
see here I am $649.90 in cash but remember I have to pay a $5 Commission
fee so here’s how the calculation goes I bring up my calculator and I take this
cash amount which is $649.90 and I’m going to subtract
$5 right off the bat because I know I have to pay commission right
upfront so now that means I can buy a maximum amount of $644.90 of CIBC
stock now I’m gonna click this little circle here to refresh the price and I
can see right now at this very second the asking price of CIBC is $109.22
cents but I have $644 $644 so let’s see how many stocks I
can buy so I’m gonna take the amount of cash I have minus the Commission fees divided by
$109.22 and I can see I’ve got 5.9 5.9 I’m so close to buying 6
shares but remember you can’t buy a fraction of a share 5.9
shares is not 6 shares I have to round down to 5 shares so I’m gonna buy
5 shares and whatever money I have left is remains as cash and I could buy
other things with that so I can buy five shares so I entered the quantity here
five and now I’m ready to buy so let’s confirm a few things one I’m buying
CIBC.TO which means it’s it’s a Toronto Stock Exchange I’m good
I’m buying in a market price of $109 22 I’m buying five shares at market price
and I want to confirm which account I want this to be in my TF is a account so
I click Buy and it brings me up to this confirmation page I can see let’s
confirm the details so I’m buying five shares of CIBC at market price in my
TFSA account for five shares that’s gonna that’s gonna cost me $546 plus a commission of $4.97 $4.97 so basically $5 and I’m
gonna have $98.89 $98.89 left over in cash so now I’m ready
so let’s click send order and immediately you can see this pop up at
the bottom right saying that my order was filled and I bought five shares so
to confirm that let’s click on accounts and orders and now this shows me all of the orders
I’ve executed today I bought five stocks of CIBC the order was filled immediately
and I bought for a price of $109.22 per share And now you can see at the bottom
here I now own five shares of CIBC I bought it at a price of $109.22
so it shows me that I’ve made a profit of five cents again this number doesn’t
mean anything I really don’t care about the daily fluctuations of a couple cents
a couple of dollars what I really care about is the long-term growth there’s
two values here the market value represents the real-time value of my
stocks at this moment so if I were to sell all of my CIBC stocks in at this
moment I would get $546.10 the book value represents the price I bought it for since I just bought the stock they’re basically the
same but if I look at a stock that’s grown a lot in value for example my
Enbridge stock I bought the Enbridge stock for $6,500 and the current market
value is $7097 so if I sold my Enbridge stock
today I would make a profit of almost $600 not including
dividends so there you go I’ve now bought five shares of CIBC stock so that’s how
I buy stocks on Questrade but if you remember I still have $98 of
cash what am I gonna do this cash I don’t want this cash just sitting there
collecting dust but at the same time $100 is not enough to buy
stocks with remember if I were to buy a $100 of the stocks I would
have to pay a $5 Commission fee that’s 5% of my investment
down the drain so I only ever buy stocks with at least $500 so
I’m not gonna buy stocks remember one of the best things about Questrade is
that you can buy ETFs commission-free I pay zero dollars in Commission when I
buy an ETF so instead of having this $98 sitting
there in cash let’s spend this $98 on ETFs
so I’ll go in my positions so let’s look at some of the ETF’s I own I have this
ETF XIC.TO this is a Canadian ETF which tracks the TSX composite index so this
ETF tracks the 250 largest Canadian companies
like TD CIBC Royal Bank Enbridge all those I also have this ZAG ETF. ZAG is a
bond ETF so it’s basically a collection of a lot of Canadian bonds so remember I
have $ 98 to buy and XIC currently cost $27 a share so I can buy
3 shares of the XIC ETF and that’s what I’m gonna do with Questrade buying
ETFs and buying stocks are the exact same process so as before I’m gonna
search for the ticker symbol which is XIC.TO XIC.TO and I see the exact same
information I did with stocks I can see a different timeline of how the etf
price changes over weeks months and years I can see the bid price the asking
price it shows me the dividend yield which is in this case is 2.8% the
dividend amount I get every quarter this is what my favorite ETF’s I’m definitely
gonna buy it so I’m gonna click buy as before and I’m gonna do the same things
I can do a limit order a market order but I’m only gonna do a market order in
this case let’s scroll down to see how much cash I have so I have $98.84
so let’s put that in my calculator I’ve got $98.84 I remember when I’m
buying ETF’s I don’t pay any Commission so I don’t have to subtract $5 now I’m
just gonna refresh the price to see how much it’s worth at this very instant XIC
ETF cost $27.06 so let’s divide by that price
divided by 27.06 and you can see I can afford 3.6
ETFs but again with ETFs I can’t buy a fraction of a share so I have to round
down so I could only afford three ETF’s so to confirm I’m going to buy three ETS
of xic at market price in my TFSA account again
clicking buy will bring me into the confirmation page let’s confirm these
amounts I’m buying three shares of X I see at market price it’s gonna cost me
eighty one dollars and since I’m buying an ETF I’ll quest trade I don’t pay any
Commission and now I’ll have seventeen dollars and sixty-five cents remaining
so now I’m gonna click send order and as before I’m gonna see a pop-up
here showing that my order was filled I bought three shares of X I see and now
let’s confirm click on account and click on orders and now you can see here these
are all the trades I’ve executed today I bought 5 shares of CIBC and I bought
three shares on the X I see ETF and now if I go here I can see my number of
shares have gone up by 3 before I only had 25 shares of X I see now I have 28
and now clicking on balances let’s see how much cash I have left so now I have
17 dollars and sixty-five cents left that’s not a lot of money but still I
don’t want to keep this money sitting here collecting dust so let’s see if I
can buy an ETF with it luckily I can afford to buy one share of
zeg right now the price of zeg which is my bond
ETF is 1592 so that’s enough to buy one share so let’s search zeg so I can
either search zeg tio or I could even just click it directly right here I can
click it and click buy and sell let’s refresh the price and let’s do the same
steps so I’m going to confirm the cash I have I have 1765 17.65 and I’m going to
divide by the price fifteen point nine three that’s easy math I know like it
only Ford to buy one so I’m gonna make quantity of one market price in my TV
say account click buy and now it’s confirm the details before I send the
order so I want to buy one share of the say ETF ad market price that’s gonna
cost me 15 ninety three and that means I’ll have a dollar 71 in cash left so
click send order boom I get the pop up the order was filled
I bought one share of the zeg ETF and now let’s confirm again let’s click on
account and orders and here I can see all of the orders I executed today I
bought five shares of CIBC three shares of the xic ETF and one share of the Zagg
ETF both of the ETF’s didn’t cost me anything in Commission and the CIBC only
costed me five dollars in Commission now let’s go back to my balances and I can
see I only have a dollar 70 cents left in cash I can’t do anything this money
so I’m gonna have this money sit there until my next paycheck where I’ll put
more money in quest rate and buy some more stocks or the next time I get a
dividend and then I can dividend money to buy more stocks so
there you have it that’s how you buy stocks and ETFs using quests trade
different brokers will have a very similar process but I definitely
recommend quest trade because of their super low commission fees those fees
really do add up over time I’ll be releasing more videos highlighting the
other features you could do on quests trade plus I’ll also be doing reviews of
other brokers and again if you’d like to get started with less trade click my
referral link below and you’ll get $50 of commission free trades when you sign
up plus I’ll get a small referral bonus thanks for watching guys and be sure to
LIKE comment and subscribe if you found this video helpful
every thumbs up and comment really helped me build this channel and be sure
to hit that Bell icon to be notified of my new videos every Thursday and let me
know in the comments below do you use quests trade and if not what
broker do you like be sure to tune into my next video where I’ll be starting a
new series on tax strategies in Canada in my next video
I’ll be breaking down exactly how taxes work in Canada for income businesses and
investing and I’ll go over a few tax saving strategies like TFSA and RSP
thanks everyone and I’ll see you guys on the next episode of The Canadian in a
t-shirt bye guys you

9 thoughts on “HOW TO BUY STOCKS? QUESTRADE WALKTHROUGH / TUTORIAL

  1. Another informative video.. πŸ‘
    Quick question for you… I was looking to buy similar stocks and ETF’s for my TFSA (XIC, TD, ENB) and use the DRIP option.
    But I’ve been reading great reviews about the All-In-One Index Balanced funds, like VBAL. But it has some exposure to the US market, which may be subject to withholding taxes, even in a TFSA. Do you know if this is the case?
    If so, I’ll stay with the 100% Cdn content.
    Thanks again!

  2. Thank you for the informative video! I have learnt a lot from your channel. However, the concept of DRIPs still baffles me. On one end, they seem like an irresistible offer promoting discipled investesting while on the other I feel the independence of choosing where the dividends go will be beneficial. Could you perhaps shed some light on the concepts of DRIPs w.r.t their calculations and long time benefits? Thank you once again!

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