Questrade, Inc. (“Questrade” or the “firm”) believes that the best way we can serve your financial needs is to provide you with valuable financial tools and services. We do this so that we both know what to expect from each other. For this reason, we would like you to have a good understanding of:
- The products and services we offer;
- Your account(s) and how it/they operate(s); and
- Our responsibilities to you.
To promote active client participation for a mutually successful relationship, we encourage you to:
- Keep us up to date
Clients should provide full and accurate information to the firm and the employees acting for the firm. Clients should promptly inform us of any change to information, such as a change to their income, employment, net worth, address or marital status.
- Keep informed
Clients should understand the potential risks and returns on investments. They should carefully review literature provided by the firm. Where appropriate, clients should consult professionals, such as a lawyer or an accountant, for legal or tax advice.
- Ask us questions
Clients should ask questions and request information from us in a timely manner to resolve questions about their account, transactions or investments, or their relationship with us.
- Stay on top of your investments
Clients should pay for securities purchases by the settlement date. They should review all account documentation provided by the firm including trade confirmations and account statements.
This relationship disclosure includes key information that we ask you to acknowledge via the checkbox to confirm that you have received this document and understand its contents.
We will update the relationship disclosure when there are material changes by referring you to our client portal.
If you later have any questions related to the contents of this document, or need to change any of the information we have on file for you, please contact us at firstname.lastname@example.org or 1-888-783-7866.
SECTION 1 — THE PRODUCTS AND SERVICES WE PROVIDE TO YOU
Questrade provides you with order-execution only products and services.
We offer you optional additional services related to the main products and services you use. These include the following:
- Investment education
- Third-party research
We will offer you additional services as they are developed. You can find out about new services by visiting our website, www.questrade.com, or our secure client portal, or through information included in the monthly client notice or in other communications.
For a full list of products and services, and the relevant commissions and fees, please ask us or visit our website at www.questrade.com.
Clients may experience selling restrictions related to Over The Counter (OTC) securities, which typically have less trade liquidity due to low volume. Please refer to the following article regarding OTC:
If you are an existing client, and would like to know if there are any liquidity restrictions for your securities, please contact the trade desk at 1.866.980.9590.
Please be aware of the following product restrictions:
- Questrade does not allow purchases of mutual funds with deferred sales charges (DSC).
- Securities that have been issued a CTO (Cease Trade Order) by a securities commissions are prohibited from trading over a certain period of time.
- Clients that are insiders of a publicly traded corporation are not permitted to purchase CFDs.
SECTION 2 — RISKS TO CONSIDER
Risks of borrowing
Using borrowed money to finance the purchase of securities involves greater risk than using cash resources only. If you borrow money to purchase securities, your responsibility to repay the loan and pay interest as required by its terms remains the same even if the value of the securities purchased declines.
You should be comfortable about where your money is invested. This requires you to think about and understand your own risk tolerance and the risk level of your investments. It is important that you understand that your investment is not guaranteed. Therefore, the greatest risk to you as an investor is that you could lose all or part of your investment. Unlike bank accounts or guaranteed investment certificates, stocks, bonds, money market securities and funds are not covered by the Canada Deposit Insurance Corporation or any other government deposit insurer. Please refer to your account opening documents to assess the risks and benefits of borrowing.
For more information regarding investment products, as well as how they work, their risks and possible returns, you can refer to Investments at a Glance, a booklet prepared by the Canadian Securities Administrators for financial consumers like you.
SECTION 3 — THE ACCOUNT(S) YOU HAVE AND HOW THEY OPERATE
Order-execution Only accounts
We offer our clients Order-Execution Only (“OEO”) accounts, which are often known as discount online brokerage accounts. You will receive no advice and there will be no suitability assessment of the investments you make in an OEO account. You are encouraged to keep abreast of all research and announcements related to your investments.
SECTION 4 — ACCOUNT DOCUMENTS WHICH WILL BE PROVIDED TO YOU
As an online broker, you will be provided with access to the following via our website and client portal:
- Account Agreements & Disclosure Documents
- Relationship Disclosure
- IIROC Brochure – An Investor’s Guide to making a Complaint
When you receive your account documents from us, it is important for you to review them carefully to ensure you understand their contents. You may also receive other documents that are relevant to your particular account. If you have any questions related to the contents of these documents, please contact us at email@example.com or 1-888-783-7866.
SECTION 5 — THE FEES YOU WILL BE PAYING AND HOW THEY ARE CALCULATED
We offer you a choice of data packages, trading environments, and commission plans. We can help you choose the one that is appropriate for you based on how you expect to use the account and your personal preferences.
A list of our fees is provided on our website at https://www.questrade.com/pricing/self-directed-commissions-plans-fees.
The fees you will pay for services we provide – and these will vary depending on the data package, trading environment, and commission plan you have chosen – encompass:
- Costs of account operation and maintenance. These can include transfer fees, withdrawal fees, such as wire transfer and cheque fees, etc. Please find a list of administrative fees at https://www.questrade.com/pricing/self-directed-commissions-plans-fees/administrative.
- Exchange and ECN fees. Electronic communications networks (ECNs) and alternative trading systems (ATSs) charge a fee to all market participants who use their networks. Questrade charges fees in order to offset ECN and ATS access costs. A list of our Exchange and ECN fees are available at https://www.questrade.com/pricing/self-directed-commissions-plans-fees/transaction.
- Costs to buy, hold and sell investments. A list of our commissions, interest rates and fees is available at https://www.questrade.com/pricing/self-directed-commissions-plans-fees. If you are opening a Forex & CFDs account, you can find information concerning our fees and commissions at https://forex.questrade.com/forex-cfd-pricing.
- Optional data package fees. Please find a list of our data package fees at https://www.questrade.com/pricing/self-directed-commissions-plans-fees/market-data.
- Compensation paid to us for products or services you may buy through us (from mutual fund managers for example, or insurance-related companies that can provide products that complement the investments or services we provide directly).
- The charges for some of these are not immediately evident. For example, amounts to be paid to us by others such as by mutual fund managers. However, all fees are disclosed as required by regulation. For convenience, cost and historic reasons, mutual fund managers usually deduct from fund performance and pay us trailing fees (deferred sales charges – DSCs) for ongoing services we provide to you. Read about our Mutual Fund Rebates program, a service that reimburses trailer fees directly to our clients at https://www.questrade.com/self-directed-investing/benefits/mutual-fund-rebates.
- Fees charged to your account will negatively impact your performance which will lower your investment return over time.
- For information on Management Expense Ratio (MER), related to your mutual fund or ETF purchase please refer to the fund facts or ETF facts document provided to you.
Notice of price changes
We will provide you with at least 60 days written notice of any new fee or changes in charges.
You also may be subject to other costs relating to services that you use that will not appear on your statements from us as they are not our service offerings. For example, there may be penalties related to the early withdrawal from or encashment of certain instruments. For example, if you own shares of small emerging companies, you may be required to pay for valuations of these holdings to satisfy Canada Revenue Agency requirements. Knowing about and planning for these costs is your responsibility.
SECTION 6 — THE WAYS WE WILL AVOID, MANAGE OR DISCLOSE CONFLICTS OF INTEREST THAT MAY ARISE, AS WE SERVE YOUR AND OTHERS' INTEREST
Conflicts of interest
A conflict of interest is any situation when Questrade, Inc. (‘Questrade’) or any of its employees or related entities has an interest that may conflict with the interests of Questrade’s clients or the ability of Questrade or a Questrade employee to deal with clients in a fair, equitable, transparent manner, consistent with the interest of the client or clients.
Questrade is what is referred to as a “broker” investment firm, serving retail clients and representing both sides to a transaction, namely, the buyer and the seller. As of January 1, 2013, Questrade became self-clearing. A self-clearing (or carrying) broker provides custody, clearing, settlement and record-keeping services, such as transaction records, to its clients. We execute, settle and report all your trading activity to you, including your investments on statements sent monthly.
Questrade, Inc. provides an order execution-only service. This means we do not assess your trading activity in light of your financial situation to determine the suitability of your trades and investments. We facilitate the trades you choose to execute. Questrade provides a broad range of products and services. Questrade has adopted policies and procedures to help identify and manage conflicts of interest that may exist between:
- You and us
- You and our other clients, and
- Us and our related and associated companies
You can learn more about our firm at www.questrade.com
Description of role of an Investment Dealer
As an investment dealer, we are a financial intermediary. As is the common practice in the brokerage industry, sometimes we may be the party on the other side of the transaction (referred to as a ‘principal’ trade) where we own the security we sell to you. On other occasions, we simply facilitate a transaction between you as our client and a third party on the other side of the transaction through an ‘agency’ trade where we have no ownership interest in the security traded.
Management of conflicts of interest
In general, we deal with and manage relevant conflicts as follows:
This includes avoiding conflicts that are prohibited by law as well as conflicts that cannot effectively be addressed.
We manage acceptable conflicts through means such as physically separating different business functions and restricting the internal exchange of information.
By providing you with information about conflicts, you are able to independently assess their significance and any actions we take.
Any material conflicts that are reasonably foreseeable, which are not avoided will be addressed in your best interest and will be disclosed in a timely manner, upon identification of the conflict. Any risk that the conflict of interest may pose to you will be disclosed, in accordance with regulatory requirements.
Possible conflicts and how they are managed
The following information is intended to assist you in understanding and assessing material potential and actual conflicts of interest, including how we address them.
CONFLICT OF INTEREST
PRIMARY METHODS WE USE TO MANAGE THE CONFLICT
ONGOING CONFLICT OF INTEREST
|We earn compensation by selling products and services to you for which you pay us.||
|Different products and services have differing levels of fees and commissions.||
|We would like you to use more of our services and buy more of our products as shown in our marketing.||
CONFLICT OF INTEREST MAY OCCUR
|We would like you to use more of our services and buy more of our products and so we partner with individuals, organizations, companies and other third parties.||
|Our compensation, organizationally and individually, may involve commissions based on sales volume.||
|We will receive compensation from securities issuers and other third parties based on their products we sell to you, such as ‘trailer fees’ on mutual funds and payment for order flow.||
|We are compensated in other ways as a result of the business you may do with us, including interest spreads on uninvested cash deposits with us and foreign exchange spreads when you convert currencies, trade currencies, or trade CFDs.||
|We may allow you to trade securities that we own (called principal trades) and may profit by doing so.||
|If you hold an applicable security, we may be paid by issuers, offerors or others to solicit your proxy or vote in their favour in respect of takeover bids, corporate reorganizations, solicitation of proxies and other corporate actions.||
|We engage in trading of securities for our own account (called proprietary trading).||
|Individuals registered with us may also be registered with another registered firm related to Questrade, Inc. and provide services to that firm.||
We may receive compensation by trading destinations, including electronic communication networks, market makers and exchanges in connection with trades on markets we direct to such destinations through affiliates or directly if a client trade removes liquidity from the market. For greater clarity, when you trade and your trade removes liquidity from the market you may be charged an Electronic Communication Network (ECN) fee in addition to your trading commission. When you trade and your trade adds liquidity to the market, there is no ECN fee charged to you. However, Questrade may receive ECN credits/ rebates as a result of your trades that add/ remove liquidity to the market.
|We may permit certain individuals who are registered with us to be employed by, participate in, or accept compensation from other persons or firms, outside the scope of his/her relationship with us.||
|Individuals may serve on a board of directors or take on other activities that could take time or attention away from your account.||
|Questrade will allow clients to purchase exempt market products, who have met the regulatory requirements. In some cases, we will receive compensation from issuers for administering such trades, and/or for providing clearing services to exempt market dealers. We do not engage in a client suitability assessment regarding exempt market products.||
|Community Trust Company is a member of the Questrade Group of Companies. Questrade Group of Companies means Questrade Financial Group and its affiliates that provide deposit, investment, loan, securities, mortgages and other products or services. Community Trust Company GIC products are made available to Questrade clients to purchase. Community Trust Company is also the trustee for certain registered account types.||
|Questrade, Inc. outsources administrative functions to QuestEnterprise Inc. pursuant to an intercompany agreement. QuestEnterprise Inc. is a services entity which provides shared services to all subsidiaries of Questrade Financial Group and is an affiliate to Questrade, Inc. Services provided by QuestEnterprise include technology, client services, human resources, legal, marketing and product development.||
Questrade has established order routing arrangements with certain exchanges, broker-dealers and/ or other market centers (collectively, “Market Centers”), including Market Centers in jurisdictions where Questrade is not a market participant.
Questrade may receive remuneration in the form of cash, rebates and/or credits against fees in return for routing client orders pursuant to these order routing arrangements.
Canada has comprehensive and extensive securities regulatory rules and regulations, many of which are directed at protecting client and investor interests including dealing with conflicts of interest. We suggest that you refer to the websites and publications of the provincial securities commission through the Canadian Securities Administrators (CSA) and Investment Industry Regulatory Organization of Canada (IIROC) for more information on how Canadian securities regulations address conflicts of interest in order to safeguard the investing public.
SECTION 7 — THE REPORTS WE WILL PROVIDE TO HELP YOU MONITOR YOUR FINANCIAL ASSETS AND THEIR PERFORMANCE AS WELL AS THE COMPENSATION YOU PAY US
We provide you access to your confirmations electronically through our client portal the day following a transaction listing the details of every purchase, sale, or other relevant transaction details of the instructions. Please look for and review your trade confirmation as soon as it is available online.
Note: we do our utmost to avoid errors, however, misunderstandings and mistakes can happen. Please let us know within 30 days if you see any transactions that you do not recall or identify any errors.
You will receive account statements in our client portal on a monthly or quarterly basis. Account statements are provided quarterly if no transactions occurred during the quarter. Your account statement details all account activity, including purchases and sales of securities, contributions and withdrawals, dividends, interest earned and paid, transfers and any other transactions that occurred in your account over the previous month. These statements also list your current holdings and the net value of your portfolio as of the date on the statement. These statements also include account percentage return information based on a money-weighted total return calculation.
Note: the value of most securities you hold is calculated generally using the last bid price for that security on the stock exchange on which it trades. In the case of securities that have ceased trading, where the company is bankrupt, in the instance of thinly traded securities and of Canadian Controlled Private Corporations (CCPCs), they may be priced at $0 or N/A because of the lack of availability of a valid price.
Investment performance benchmarks
You can see how your investments are doing by comparing the rate of return on the securities you hold to a performance benchmark. Your rate of return is affected by, among other things, changes in the value of your securities, dividends and the interest you earn, as well as any deposits and withdrawals.
To compare your rate of return to a benchmark, you need to find a benchmark with securities similar to the ones you hold in your account.
Example: the S&P/TSX composite is a benchmark for a broad group of Canadian stocks that trade on the Toronto Stock Exchange (TSX). It’s a good yardstick for assessing the performance of a Canadian equity mutual fund with investments in Canadian corporations. However, it would not be a good benchmark if you hold foreign investments, bonds, shares of smaller companies or shares that are limited to only one part of the economy. Instead, you would have to find a foreign equity, bond, small cap, or industry sector benchmark. If your account includes half stocks and half bonds, compare your rate or return to the average of a stock and the average of a bond index.
- Remember that benchmarks should be used as a guide only..
- Benchmarks do not factor in commissions or other costs to invest, and often don’t include any cash or cash equivalents.
- Rates of return for a benchmark are calculated using a specific method. For the best comparison, ensure your account’s rate of return is calculated using the same method.
- Additionally, benchmarks are based on how a sample portfolio performs and other factors, such as tax considerations, will affect your returns
Currently, benchmark information is available publicly through popular websites, such as Yahoo or Google Finance. You can also access certain benchmarks through our trading environment by opening a chart for the index you wish to view. Example: SPX.IN can be used to view the price performance of the S&P 500 index.
Future reporting enhancements
We regularly look at ways to improve the reporting and documentation we provide to you to make it more informative, clear, and useful for you and other clients. We are working on changes pertaining to account holdings, fees that you pay, and performance. As part of our service commitment, we will keep you informed of the timing of changes and how to understand new report formats. For updated information at any time, please ask us or visit our client portal.
SECTION 8 — COMPLAINT HANDLING PROCESS
Questrade processes large volumes of client account transactions each day, and we do our best to ensure that your business is handled in an efficient, courteous and accurate manner. We want to know if we have not met the high level of standards we have set for ourselves, and we have established procedures for clients who want to bring a concern to our attention.
A detailed resolution process can be found in our account agreements and disclosures document which is available in https://my.questrade.com/clients
IIROC’s Investor’s Guide to Making a Complaint is available in https://my.questrade.com/clients . You will also find a link to the brochure during the online account application process.
SECTION 9 — QUESTRADE, INC. RELATED PARTY DISCLOSURE
Questrade Wealth Management Inc. (QWM) and Questrade, Inc. are wholly owned subsidiaries of Questrade Financial Group Inc. Questrade, Inc. is a registered investment dealer, a member of the Investment Industry Regulatory Organization of Canada (IIROC) and a member of the Canadian Investor Protection Fund (CIPF), the benefits of which are limited to the activities undertaken by Questrade, Inc. QWM is not a member of IIROC or the CIPF.
Questrade Wealth Management Inc. is a registered Portfolio Manager, Investment Fund Manager and Exempt Market Dealer.
If you are a Questrade Wealth Management Inc. client, please refer to the QWM relationship disclosure provided to you for additional information.
SECTION 10 — FX AND CFD CLIENTS
Questrade has partnered with Saxo Bank A/S (Saxo) in order to provide you with access to FX and CFD trading. Saxo is the liquidity provider and issuer of the CFDs and Questrade is the broker/dealer providing order execution services.
For more information about FX and CFD trading, including risks, please visit https://www.questrade.com/disclosure/legal-notice-and-disclosures/2018/07/26/leverage-risk.
While information about our FX and CFD platform can be found here: https://www.questrade.com/self-directed-investing/trading-platforms/questrade-global.
SECTION 11 — OTHER DISCLOSURES
You understand that it is important for you to verify carefully and promptly trade confirmations, account statements, and other documentation as requested to make sure that assets and orders you give us are accurately reflected, the correct taxes are withheld (if applicable), and so on. You will notify us if there is any transactions that you do not recall or if you identify any errors within thirty (30) days of receiving your statement.
Privacy and confidentiality
You provide your consent for the disclosure of information to regulators as required by law or regulation.
Getting rid of paper
You understand the benefits of electronic or online receipt of confirmations, statements, tax receipts, etc. in terms of easier storage, retrieval, cost savings and environmental responsibility, and that you consent to the electronic delivery of such.
Unclaimed intangible property
You understand that laws in a number of provinces require Questrade to remit accounts and financial instruments where Questrade has not heard from owners for specified amounts of times. You agree that it is your responsibility to provide Questrade with your address as soon as possible after you change addresses, and to acknowledge the existence of an account(s) if asked to do so to avoid holdings being transferred to government authorities in provinces with such requirements.
Questrade as a Derivatives Dealer
Questrade, Inc. is a registered derivatives dealer. Derivatives offered to clients are authorized by the Autorité des marchés financiers.