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How to Trade Options on Questrade

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Written by Timothy Sykes
Updated 4/20/2023 8 min read

If you want to know how to trade options on Questrade, you’re probably Canadian.

Most brokers I cover on my blog are U.S.-based. Some of them only accept U.S. residents for brokerage accounts. What happens if you live in Canada and you want to trade U.S. stocks? You’ll need to find a broker that accepts Canadian traders.

Questrade is a Canadian discount brokerage. It’s easy to sign up and start trading.

One of the most important things when trading is choosing the broker that’s right for YOU. What works for others might not work for you and vice versa. There’s no rule that says you have to marry your broker, and I encourage you to explore your options.

There’s only one rule — you’ve got to understand what your broker offers, which is why you’re here. 

Read on for a deeper dive into Questrade’s features and how this broker can help you on your trading journey!

Trading on Questrade

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The first thing to know about trading on Questrade is that it’s a Canadian broker. This complicates things for U.S. citizens and Canadians living in the U.S.

Don’t blame Questrade, blame the SEC. Questrade allows Canadian traders access to the major U.S. exchanges, as well as Canadian exchanges. The SEC is very protective of the markets it regulates, and it doesn’t want U.S. traders getting too clever with their tax returns.

What do you get by being a Questrade user? Here are some of its best features:

  • Desktop, web, and mobile trading platforms
  • Wide asset variety
  • Access to American and Canadian securities
  • Curated research reports
  • Real-time market scanners
  • Educational videos and webinars
  • Low trading fees

Looking for a U.S. broker? Check out my reviews of Fidelity, E-Trade, and Schwab.

Benefits of Trading Options Using Questrade

Questrade touts itself as an alternative broker to big Canadian banks. Why should you use it instead of larger Canadian brokers? There are several reasons why:

Easy Brokerage Transfer

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It’s easy to get started with Questrade. They even give you a $150 CAD rebate for transfer fees!

Multiple Platform Choices

Casual users have different needs from advanced traders. Like most pro-level brokers, Questrade offers two trading platforms:

  • Questrade Trading: This is the basic web-based trading platform. It offers simplified charting and watchlists for traders who value user experience over power. Questrade’s mobile app is a version of Questrade Trading scaled to fit phone screens.
  • Questrade Edge: This is the broker’s advanced desktop trading platform, with a wide range of advanced market research tools. It’s fairly customizable, though not to the degree you’ll find on StocksToTrade, my favorite trading platform (and the one I helped design).

Give StocksToTrade a try today — a 14-day trial is only $7!

Various Tradable Assets

We’re here for options trading. But finding a broker that offers more is always a good thing. Questrade allows you to trade these assets:

  • Stocks
  • Options
  • Mutual funds
  • Bonds
  • Precious metals

You can also trade foreign currencies on a separate, Questrade-affiliated platform.

Robust Trader Security

You want your broker to take your money seriously. These days, security features are essential. Questrade has two-factor authentication for customer logins, and biometric entry for its mobile app. In addition to regulator-mandated insurance, Questrade protects each account with an additional $10 million in private insurance.

Low Options Trading Fees

The base options trading commission is $9.95 CAD plus a $1 CAD per contract. But this gets cheaper when you subscribe to the Active Trader program.

There are two pricing plans: variable and fixed-rate. Variable has advantages in regular stock trading, but is a worse choice for options trading. Here’s how it breaks down:

  • Variable: $6.95 CAD commission, $0.75 per contract fee
  • Fixed-rate: $4.95 CAD commission, $0.75 per contract fee

Helpful Research Tools

Active Trader subscribers can access Questrade’s Intraday Trader. This is Questrade’s proprietary scanner and alerts software, powered by the algorithmic technical analysis services provider Recognia. Fidelity also uses Recognia.

Free Education Material

Questrade’s YouTube channel offers numerous educational videos. They provide answers to questions and cover common topics like the basics of trading options. The website also has a how-to section that contains answers to common questions.

If you want more in-depth material, Intraday Trader has an educational section as well.

Steps to Start Trading Options on Questrade

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How do you start trading options on Questrade? Here’s a four-step guide:

1. Open a Questrade Account

The first thing to do is sign up for a Questrade account. Check that you fit the residency requirements — Questrade is mainly for Canadian traders, but some other residencies and citizenships also work. You can open multiple account types simultaneously, but make sure you get a self-directed trading account for trading options.

On Questrade, you can apply for options trading on account creation. You just need to click Yes in the ‘trading options’ section on your registration form. Doing this means you’ll have a Level 1 options trading account.

2. Log in to the Questrade App

Once you’re registered, log into your Questrade trading platform. Choose Questrade Trading or Questrade Edge, depending on your preferences. Fund your account.

Questrade accounts can be funded with both Canadian and U.S. dollars. This means you don’t have to convert currencies back and forth when trading.

3. Check Your Options Preferences

You can start trading options instantly if you applied during account creation. But if you didn’t, you can apply for it from the app. Click Account Management to find your options level. Then, click Change. Here, you can choose to upgrade or downgrade your options trading level.

Once you choose the new approval level, complete the provided options trading agreement. Approval usually takes one or two business days.

Option trading levels on Questrade range from 1 to 4 and work like other brokers. Inexperienced traders can only access the most basic options strategies. Experienced traders can use more advanced trading strategies. They can also trade more types of options.

More advanced strategies require a margin account and a minimum margin requirement in the account.

4. Start Trading Options

Once you’re approved for the option level you want, it’s time to start trading. Always follow my tips for trading in options:

  • Don’t copy other traders’ options trades. Your goals and risk tolerance will differ from other traders, and so will your timing.
  • Learn options strategies from experienced traders. Join online communities and share trading experiences with other traders. Don’t be afraid to ask even the most basic questions — we all start somewhere.
  • Do your own research and make your own watchlists. You want to understand the thought — and chart — behind every potential trade.
  • Record your trades for future review. Examine what went right and what needs improvement with each trade. That’s how you become a better trader.

Learning from experienced traders is one of the best ways to improve your skills. They’ll help you develop effective options trading strategies faster. Plus, you can learn various aspects of trading in options from them.

If you’re searching for a mentorship program, check out my former student Mark Croock’s Evolved Trader. He’s taken my penny stock strategies and applied them to options trading — making $3.9 million in career earnings in the process!

Here’s a sneak peek of Mark’s curriculum:

Sign up for the Evolved Trader program today and start your journey to becoming a self-sufficient options trader!

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Timothy Sykes

Tim Sykes is a penny stock trader and teacher who became a self-made millionaire by the age of 22 by trading $12,415 of bar mitzvah money. After becoming disenchanted with the hedge fund world, he established the Tim Sykes Trading Challenge to teach aspiring traders how to follow his trading strategies. He’s been featured in a variety of media outlets including CNN, Larry King, Steve Harvey, Forbes, Men’s Journal, and more. He’s also an active philanthropist and environmental activist, a co-founder of Karmagawa, and has donated millions of dollars to charity. Read More

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* Results are not typical and will vary from person to person. Making money trading stocks takes time, dedication, and hard work. There are inherent risks involved with investing in the stock market, including the loss of your investment. Past performance in the market is not indicative of future results. Any investment is at your own risk. See Terms of Service here

The available research on day trading suggests that most active traders lose money. Fees and overtrading are major contributors to these losses.

A 2000 study called “Trading is Hazardous to Your Wealth: The Common Stock Investment Performance of Individual Investors” evaluated 66,465 U.S. households that held stocks from 1991 to 1996. The households that traded most averaged an 11.4% annual return during a period where the overall market gained 17.9%. These lower returns were attributed to overconfidence.

A 2014 paper (revised 2019) titled “Learning Fast or Slow?” analyzed the complete transaction history of the Taiwan Stock Exchange between 1992 and 2006. It looked at the ongoing performance of day traders in this sample, and found that 97% of day traders can expect to lose money from trading, and more than 90% of all day trading volume can be traced to investors who predictably lose money. Additionally, it tied the behavior of gamblers and drivers who get more speeding tickets to overtrading, and cited studies showing that legalized gambling has an inverse effect on trading volume.

A 2019 research study (revised 2020) called “Day Trading for a Living?” observed 19,646 Brazilian futures contract traders who started day trading from 2013 to 2015, and recorded two years of their trading activity. The study authors found that 97% of traders with more than 300 days actively trading lost money, and only 1.1% earned more than the Brazilian minimum wage ($16 USD per day). They hypothesized that the greater returns shown in previous studies did not differentiate between frequent day traders and those who traded rarely, and that more frequent trading activity decreases the chance of profitability.

These studies show the wide variance of the available data on day trading profitability. One thing that seems clear from the research is that most day traders lose money .

Millionaire Media 66 W Flagler St. Ste. 900 Miami, FL 33130 United States (888) 878-3621 This is for information purposes only as Millionaire Media LLC nor Timothy Sykes is registered as a securities broker-dealer or an investment adviser. No information herein is intended as securities brokerage, investment, tax, accounting or legal advice, as an offer or solicitation of an offer to sell or buy, or as an endorsement, recommendation or sponsorship of any company, security or fund. Millionaire Media LLC and Timothy Sykes cannot and does not assess, verify or guarantee the adequacy, accuracy or completeness of any information, the suitability or profitability of any particular investment, or the potential value of any investment or informational source. The reader bears responsibility for his/her own investment research and decisions, should seek the advice of a qualified securities professional before making any investment, and investigate and fully understand any and all risks before investing. Millionaire Media LLC and Timothy Sykes in no way warrants the solvency, financial condition, or investment advisability of any of the securities mentioned in communications or websites. In addition, Millionaire Media LLC and Timothy Sykes accepts no liability whatsoever for any direct or consequential loss arising from any use of this information. This information is not intended to be used as the sole basis of any investment decision, nor should it be construed as advice designed to meet the investment needs of any particular investor. Past performance is not necessarily indicative of future returns.

Citations for Disclaimer

Barber, Brad M. and Odean, Terrance, Trading is Hazardous to Your Wealth: The Common Stock Investment Performance of Individual Investors. Available at SSRN: “Day Trading for a Living?”

Barber, Brad M. and Lee, Yi-Tsung and Liu, Yu-Jane and Odean, Terrance and Zhang, Ke, Learning Fast or Slow? (May 28, 2019). Forthcoming: Review of Asset Pricing Studies, Available at SSRN: “https://ssrn.com/abstract=2535636”

Chague, Fernando and De-Losso, Rodrigo and Giovannetti, Bruno, Day Trading for a Living? (June 11, 2020). Available at SSRN: “https://ssrn.com/abstract=3423101”