There’s a Fortress Canada feeling in choosing a digital broker for trading stocks and exchange-traded funds.
As global as investing has become lately, all the players in this country’s digital investing business were until recently Canadian. That’s our financial industry - dominated by the Big Six banks and some domestic independents. True innovation has been rare.
Two new challengers to keep your eye on are Moomoo and Webull, both of which target investors who consider themselves traders more than buy-and-hold types. Moomoo is part of Hong Kong-based Futu Holdings, while Webull’s ownership is based in the Cayman Islands.
The most prominent foreign player to compete in Canada’s DIY investing sector was Charles Schwab, a U.S. discount brokerage pioneer that never found its footing here and sold its Canadian operation to Bank of Nova Scotia in 2002. Moomoo and Webull are more formidable competition because they’re not running an all-things-to-all-investors operation and have achieved foreign success already with this strategy.
Moomoo has 24 million clients in the United States, Japan, Australia, Singapore and Malaysia, while Webull has about 20 million global users. The trading apps they bring to Canada are polished, proven and different in a way that will appeal particularly to a millennial and Gen Z audience that trades actively and is okay with paying a small commission.
Wealthsimple’s digital brokerage business set a zero-commission standard for battling the established brokerocracy in Canada. A couple of established brokers have also eliminated commissions for trading stocks and ETFs – National Bank Direct Brokerage and Desjardins Online Brokerage. Moomoo charges a minimum $1.49 for Canadian stocks and US$1.99 for U.S. stocks, while Webull charges $2.99 a trade in Canadian or U.S. dollars, depending on whether the stocks are Canadian- or U.S.-listed.
Both Moomoo and Webull are available online, but they really shine as mobile apps. Canada’s incumbent brokers have focused on apps as a way to trade and monitor your account. Moomoo offers much more of a full trading screen on your phone and is quite sophisticated in the information provided. There’s a social-media aspect to Webull that gives it the feel of an investing community.
Neither is a fit for buy and hold investors who value simplicity over flash, as well as extras like equity and ETF reports and portfolio management and risk assessment tools. Fortress Canada continues to rule in this category of DIY investing.
But if you’re open to something new and interesting, try downloading the Moomoo or Webull app. These new arrivals in the Canadian market have a lot of global experience behind their offerings.