The 6 Best Robo-Advisors in Canada

The best robo-advisors in Canada are gaining ground as a top choice for investors, and for good reason. They offer a simple, hands-off approach to portfolio management without the need for direct interaction with a portfolio manager. A robo-advisor is a computer program that takes your financial details, like how much money you have and what your financial goals are, uses smart calculations to figure out the best way to invest your money – and then does the investing for you! This makes investing a breeze and easily accessible for people without deep financial knowledge. Plus, you get to enjoy lower management fees compared to traditional financial advisors, which means more of your money is working for you.

To find out how to choose a robo-advisor, take the time to read about investing in general and robo-advisors in particular. I also encourage you to compare the features of many robo-advisors before making a decision. To help you make your choice, we’ve compiled this list of the best robo-advisors in Canada.

1. Questwealth Portfolios by Questrade – Best robo-advisor for low fees

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Questwealth Portfolios by Questrade have the lowest management fees in the industry, ranging from 0.20% to 0.25%, depending on the amount invested. Questwealth Portfolio ETFs have management expense ratios (MERs) of 0.17% to 0.22%.

If you care about the environment and inclusion, rest assured that you can invest your money into socially responsible investments. Their responsible investment portfolios have management expense ratios of 0.21% to 0.35%.

Questwealth includes actively managed portfolios in its offer. That is, a team of experts monitors the market and adjusts your portfolio if necessary. Usually, this feature comes at an additional cost, but Questwealth provides it for free. Your investments will also be automatically rebalanced. If market conditions change, it will be adjusted accordingly. Lastly, all dividends you receive will be automatically reinvested.

Questwealth Portfolios Pricing

The company offers a rate of 0.25% (plus MERs) for accounts between $1,000 and $99,999. For accounts of $100,000 and over, the fees decrease to 0.20% (plus MER).

You can invest in several types of accounts via this robo-advisor, such as Tax-free savings accounts (TFSAs), First home savings accounts (FHSAs), retirement accounts (RRSPs, RRIFs), Registered education savings plans (RESPs), and others. The minimum deposit required to open an account is $1,000.

2. Justwealth – Best for total return

With Justwealth, you have the option of opening a US currency account or a CAD account, for non-registered accounts, RESPs, FHSAs, TFSAs, and individual or spousal RRSPs. For the third year in a row Justwealth had the highest five-year after-fee annualized total returns for the growth portfolio, according to The Globe and Mail.

There are 70 different portfolios to choose from, but Justwealth will help you choose the right one. Justwealth offers portfolios that have been specially designed to invest for educational purposes. That is, you can enter the date your child is expected to start post-secondary education, and as that date approaches, the portfolio will rebalance automatically. This feature is only available for RESP accounts.

Justwealth Pricing

Justwealth offers 0.50% (plus MER) pricing for balances up to $500,000. If you invest more than $500,000, the fee will decrease to 0.40% (plus MER). The average management expense ratios are around 0.20%.

To open an account, the minimum deposit required is $5,000, except for the RRSP and the FHSA where there is no minimum. There is a minimum management fee of $4.99 per month for all accounts except the RRSP and the FHSA, at $2.50 per month.

3. Wealthsimple Invest – No minimum deposit

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With this robo-advisor, you can invest in a TFSA, RRSP, RRIF, RESP or others. You also get access to financial advice upon request. Wealthsimple Invest, like other robo-advisors, builds your portfolio by choosing an asset allocation based on your risk tolerance. Therefore, a $100 portfolio can enjoy the same diversification as a $100,000 portfolio. Their user-friendly app is also great for everyone. It’s very easy to open an account and follow your investments.

The socially responsible investment (SRI) option enables you to build portfolios which include low carbon companies, clean tech innovators, companies with favourable human rights records and AAA-rated Canadian federal bonds.

Unlike traditional robo-advisors, Wealthsimple also has a host of other offers. For example, Wealthsimple offers Halal Investing, a new investment portfolio to comply with Islamic Law, designed by experts in religion and finance.

Wealthsimple Invest now offers investments in private credit to its clients with a portfolio of 100,000$ or more. By following the advice of their portfolio manager, they can earn a 9% annual yield, with monthly payments.

Wealthsimple Invest pricing

The company offers pricing of 0.5% (plus MER) for balances up to $100,000 and 0.4% (plus MER) for accounts $100,000 and over, and can be as low as 0,20% starting at $500,000. Management expense ratios are around 0.20%. There is no minimum deposit required to open an account.

4. BMO SmartFolio – Best robo-advisor from a well-know institution

BMO SmartFolio has slightly higher fees than most robo-advisors. However, it is attractive for investors looking to reduce their fees and get investment management, while investing through a reputable institution.

BMO‘s robo-advisor asks you to complete a questionnaire that will give you better advice. Your ETF portfolio is chosen from one of the following: capital preservation, income, balanced, long-term growth or growth stocks. These portfolios are diversified through different business sectors and regions. Your portfolio will be monitored and you will be able to oversee your goals. This is to ensure that your investments are aligned with your goals. If you wish to change your financial goals, you can let the robo-advisor know and it will readjust your portfolio.

BMO SmartFolio Pricing

The company offers tiered pricing. The first $100,000 is 0.70% (plus MER), the next $150,000 is charged 0.60% (plus MER) and the next $250,000 is 0.50% (plus MER). For more than $500,000, it’s 0.40% (plus MER). Management expense ratios vary from 0.20% to 0.35%.

With BMO SmartFolio, you can invest in a TFSA, RRSP, RRIF or RESP. The minimum deposit required to open an account is $1,000.

5. CI Direct Investing – Best for high-end investments

With CI Direct Investing, all clients have access to “high-end” investments. For example, you have access to private investments through their robo-advisor, which can be advantageous in terms of diversification.

Plus, you can enjoy a risk-free trial. If you change your mind, CI Direct Investing does not charge transfer fees. For socially responsible investments (SRI), you can invest in its Impact portfolios. They focus on clean energy innovations and social responsibility.

You also get access to automatic rebalancing, which will readjust your portfolio’s asset allocation if it drifts more than 5% away from the initial allocation. This rebalancing occurs each time a dividend is paid into your account, and each quarter.

CI Direct Investing Pricing

The company offers tiered pricing aa rate of 0.60% (plus MER) for balances up to $150,000, 0.40% (plus MER) on the next $350,000 and 0.35% (plus MER) thereafter. Management expense ratios vary between 0.17% and 2.92% depending on your choice of a traditional portfolio, socially responsible portfolio or private and alternative assets.

With CI Direct Investing, you can invest in a TFSA, RRSP, RESP and more, in ETFs and mutual funds. A minimum deposit of $1,000 is required to open an account.

6. RBC InvestEase – Best robo-advisor for phone support

RBC InvestEase offers over a hundred ETFs including socially responsible investment portfolios. Your portfolio rebalances automatically when it is out of balance. The robo-advisor automatically buys or sells the required ETF units to readjust to the target allocation. RBC InvestEase clients can also access the services of financial advisors over the phone or by email.

Like all robo-advisors, the ETFs recommended for your portfolio depend on your answers to a short online questionnaire. For example, someone who invests for retirement in 20 years will receive a different recommendation than someone who is saving to accumulate a down payment for a purchase in 3 years. To achieve the objectives mentioned in the questionnaire, your investment portfolio will have a combination of different categories of financial assets.

RBC InvestEase Pricing

The company offers a 0.5% (plus MER) pricing. So no matter how much is in the account, the same cost applies to everyone. Management expense ratios vary between 0.11% and 0.23%.

With RBC InvestEase, you can invest in a TFSA, RRSP, FHSA and non registered account. The minimum deposit to open an account is $100. Below $1,500, your funds are invested in a minimum balance portfolio. When your balance exceeds this amount, RBC automatically transfers it to a standard or a responsible investment portfolio (which invests in four to six ETFs).

Why invest with a robo-advisor?

As mentioned previously, a good reason to opt for a robo-advisor is the cost savings. A client of a regular advisor can expect to pay fees of 2% to 3% of their assets each year. With a robo-advisor, fees will typically be less than 1%. But unlike a financial advisor, a robo-advisor does not offer human support or personalized advice.

In terms of portfolio types, most Canadian robo-advisors invest in index ETFs, and sometimes in thematic ETFS. That is, portfolio managers working for robo-advisors are not trying to beat the stock market, but rather to achieve a similar return while minimizing fees. Their portfolios therefore tend to be composed mainly of ETFs, which allow you to invest in a large number of financial products at low cost. However, there are some robo-advisor portfolios that are made up of stocks or mutual funds, for example.

There are several types of fees attached to investments via a robo-advisor. Management fees vary in relation to the money invested. Among the most popular robo-advisors, they are generally around 0.5%. Don’t forget the management expense ratio (MER) of the exchange-traded funds (ETFs) in which the robo-advisor invests. These are not included in the management fees displayed by robo-advisors and generally vary between 0.05% and 0.50%. For example, if you invest $1,000 in an ETF through your robo-advisor, you will pay between $0.50 and $5.00 in management fees during the first year.

Is a robo-advisor right for you?

Now that we’ve toured the gamut of Canadian robo-advisors, all you have to do is choose the one that best suits you with the help of a robo-advisor comparator. If you have money invested in mutual funds or with a brokerage firm and you don’t want to manage your money yourself, you can easily save on fees by using a robo-advisor. You should understand, however, that you won’t get the same service as you would from a live person, so if this is something you value highly, don’t transfer to a robot.

If you usually invest by yourself through an online broker, be aware that robo-advisors’ fees will generally be higher than what you pay. However, you need to have the knowledge and interest in financial markets to match the returns of expertly compiled ETF portfolios. If you don’t, robo-advisors are a better option. You can still replicate robo-advisor portfolios with an online brokerage account.