Questrade is a Canadian-based trading platform that allows users to invest their money by creating a diversified portfolio of assets. From typical stocks and bonds to forex and cryptocurrency, the possibilities are almost limitless! If you’re new to Questrade, then you’re probably wondering, “How do I get RICH from my investments?”
So how do you make money on Questrade? The best way to make money on Questrade (or any other investment platform, for that matter) is to create a diversified portfolio containing stocks, forex pairs, ETFs, and even a bit of crypto. As long as you make smart investment choices, there’s no reason why you can’t build a sizeable fortune on Questrade with a few years of hard work.
Some of the world’s richest individuals obtained their wealth through trading on the stock market, and many more make a decent income by day-trading their assets throughout the day. Today, I’m going to show you the best strategy for getting rich on the Questrade trading platform. So get your notebook out and get ready to take some notes!
How To Make Profitable Investments With Questrade
One of the best things about Questrade is that you don’t need a lot of money to get started with. In fact, you’ll be able to invest in the market for as little as $4.95 by purchasing fractional shares. Even though a single stock for Google (GOOGL) is around $2,000 USD, you’ll be able to buy a piece of this stock and benefit from percentage gains.
Along with trading apps like Stash, Questrade’s low minimum investments make it the perfect platform for beginner investors who are looking for a way to start building a retirement fund or just want to diversify their income. Once you become a skilled investor and learn the ins-and-outs of the stock market, you may even be able to “day-trade,” which is where you’ll buy-and-sell stocks in rapid-fire throughout the day.
Creating a profitable investment portfolio all comes down to how much time you’re willing to put into researching and investing your money. Questrade provides a self-directed investing platform that allows you to have full control over your investments (unlike working with a mutual fund).
Creating a Questrade account is completely free. The platform just charges a small percentage of trades as payment for using their platform. If you want more data, you’ll also be able to pay a monthly fee to get access to all of the real-time market data and analytics that you need to know to make even better investments as well!
Now that we’ve got the basics out of the way, it’s time to take an in-depth look at the best way to start making money with your new Questrade account.
Always Research Companies Before You Invest
The first tip I’m going to give you is to always do your research. One of the biggest reasons why so many first-time investors quit and give up on stock trading is that they make poor investment choices and lose all of their money. Nine times out of ten, this wouldn’t have happened if they had only done their research.
It usually goes something like this-
The eager young investor is ready to “get rich quick” and starts asking their friends which stocks they should invest in. Their “friends” (who usually don’t know much about investing, to begin with) quickly rattle off a list of stocks. The investor throws all of their hard-earned money into the stocks while barely knowing anything about them. Two weeks later, when the stocks crash, they go broke.
Knowledge Is Power
Even the best investors lose money and make a bad investment from time to time. You’ll never be able to prevent this from happening fully. However, you can minimize your risk by performing market research.
Before you invest, pick up the Wall Street Journal or go on MarketWatch.com and read all of the latest headlines. What’s going on in the market today? Are you in a “bull market” (high-volatility/quick profits), or are you in a “bear market” (low-volatility/long-term profits). Currently, we’re in a bull market. This means that stocks are a lot more volatile than usual. While it provides more opportunities for a quick return on your money, it also means there’s more risk.
You should also keep in mind that the entire market can shift at the drop of a dime. For example, after President Biden got elected, certain “blue-chip” tech stocks dropped in price due to the President’s stance on heavier regulation. Conversely, an investment could skyrocket after a positive review or recommendation (like when Elon Musk tweeted about Bitcoin).
Once you get a feel for the overall market environment you’re working in; it’s time to research individual companies, securities, or cryptocurrencies that you want to invest in. Warren Buffet’s advice is to try to invest in young companies that have a plan to “change the world.”
Go on the actual company website. Read their blog, look at their mission statement. Ask yourself questions like:
- When was the company founded?
- Who is the CEO, and does he have a good record?
- Is the company creating new technology?
- How will government regulation affect the company?
- What are the company’s long-term goals?
- Are there any other successful executives/creators on the team?
As you start answering these questions, it will become clear which companies are good investments and which companies are poor investment choices.
Diversify Your Portfolio
Once you find a couple of good companies to invest in, it’s easy to get overly excited and pour all of your money into that one stock. While you could benefit from this, you could also be gambling with your money. The age-old adage, “Don’t put all of your eggs in the same basket,” definitely applies to stock trading.
Instead, try to diversify your portfolio as much as possible. Thankfully, Questrade provides a broad platform that allows their investors to diversify as much as possible and track their portfolio’s progress day-by-day.
Here are the main types of investments that you’ll be able to diversify your portfolio with.
Stocks are, by far, the most popular investment. This is because almost everybody has a basic understanding of how they work from high school/college economics classes, YouTube, and popular films like Wall Street: Money Never Sleeps, The Wolf of Wall Street, and others.
A “stock” represents a share in a publicly-traded company. Most companies “go public” in order to get access to a greater pool of investors. While it is a risk for some companies, successful companies like Amazon and Facebook were only able to grow into billion-dollar companies by opening the door to public investors like you and me.
When it comes to investing in stocks, you’ll have plenty of options including:
- Tech/software companies
- Bio-tech companies
- Car manufacturers
- Artificial Intelligence developers
- Pharmaceutical companies
- …and more!
You’ll want to diversify your stock portfolio as much as possible. Try to create a mix of two or three different industries. For instance, you may want to purchase some “riskier” tech stocks while also purchasing some more stable pharmaceutical stocks to balance out your risk.
Once you’ve purchased your stocks, stay up-to-date with the news on all of your investments so you’ll have a fair warning if the stock suddenly increases or decreases.
An Exchange Traded Fund (ETF) is a group of securities that are traded together. For example, the United States Oil Fund is an ETF that bundles multiple U.S. oil companies together. The main advantage of investing in an ETF is that you profit from the growth of a market as a whole, instead of just a small company.
Often, commodities such as gold, silver, or copper are bundled into these ETFs. By investing in the ETF, you’ll profit as long as that niche market does well and you won’t have to do as much in-depth research into individual companies.
Foreign Currency Exchange (Forex) involved trading “pairs” of currencies. Essentially, you’re taking a bet on another fiat currency’s growth or decline. For instance, let’s say that you select “USD-YEN” as a pair. This means you’ll be investing into the Japanese Yen currency. Providing the YEN increases in value, you’ll be able to convert it back into USD and make a profit.
Typically, currencies move in small, fractional percentages known as “pips.” Unlike stocks or crypto, which can increase by hundreds of percent over a year, forex pairs typically increase/decrease incrementally by less than 1%. If you had $2,000 invested into forex and profited 1% on your investment every day, then you could make $20/day in residual revenue.
Bitcoin And Cryptocurrency
Questrade just recently started allowing their investors to purchase Bitcoin and are discussing whether or not to allow other cryptocurrencies such as Ethereum on their platform as well. This was triggered by other investment platforms such as Cash App and Robinhood, which recently allowed their users to start trading crypto.
While cryptocurrency is considered to be highly volatile, there are definitely profits to be made as long as you keep up with the latest market trends. Personally, I recommend dedicating only a small portion of your portfolio to crypto due to its volatile nature.
Save And Invest A Little Bit Each Week
Now that you know more about your options let’s get back to investment strategy. By now, you should have a list of stocks, ETFs, and perhaps crypto/forex pairs that you want to invest in. If you already have money, go ahead and start diversifying your portfolio!
If you want to get rich on Questrade, though, you’ll need a plan to continue investing more money into the market. The best way is to set aside a small amount every week and purchase more stocks. Maybe you can afford $25/week or perhaps $100/week. The key is to stay consistent. Every time you add more money to your investment fund, find a way to further diversify your portfolio.
Before long, you’ll have a healthy, profitable batch of investments!
Keep Your Money In The Market
If you want to make serious money, then you should keep all of your money in the market. Just because your portfolio profits $2,000 in a day doesn’t mean you should cash it out and go on vacation. Instead, use that profit to double-down and purchase even more stocks!
Long-Term Investments Vs. Short-Term Investments
That brings us to our next point- true wealth is created by long-term investments, not short-term hype investments. Just look at how many people took out loans to buy Gamestop and then lost all of their money when the stock crashed a week later.
Don’t get me wrong; these short-term investments can certainly give you a nice profit if you know when to invest and when to take your money out. However, you should treat these investments as more of a “gamble,” and you should never invest more than you’re willing to lose (because that is a very real possibility).
Instead, try to invest the majority of your time, energy, and money into solid long-term investments like stocks and ETFs that we talked about above. Look at it this way- it’s better to earn $100/week from your portfolio consistently than it is to gamble your money and have a 50/50 chance of making $1,000 one time.
Keep Up With Trends
This goes back to what I was saying about doing your research on a company before investing in its stock. In addition to researching the stock itself, though, you also need to keep up with all of the latest information. A great example of this is what’s been happening with Tesla and General Motors.
In January and early-February, Tesla soared to over $800/share as they produced record sales. A few weeks later, however, GM stole their spotlight by announcing a full line-up of electric vehicles coming in 2021-2025. Suddenly, analysts were writing articles about why investors should swap their Tesla for GM stocks, and many people listened.
If you were able to keep up with the news, you would have known what was happening and could have sold your Tesla shares (or at least some of them) and avoided losing money.
Rinse And Repeat
Understand that investing in the stock market on a platform like Questrade, Stash, or Robinhood is a long-term game. You probably won’t get rich overnight, but as long as you keep making smart investments, re-investing your profits, diversifying your portfolio, and stay informed, you can build a sizeable fund over the course of a few years.
Once you’ve reached your goal, you can start giving yourself a monthly allowance. For example, you agree to take 10% of any monthly profits and deposit it into your personal bank account. This will allow you to live a bit more comfortably while still allowing your investments to continue growing.
Well, that’s all for today, folks! Until next time- happy investing, and don’t forget to make smart choices!