Best Penny Stock Brokers & Apps in Canada 2024

Thadeus Geodfrey

Thadeus Geodfrey is an experienced and celebrated writer and self-taught trader specialising in cryptocurrencies and forex. Market analysis, identifying fraudulent brokers, and security are his cup of tea. At BrokerRaters Thadeus develops educational materials and user-guides, offer market insights, ensures our content conforms to the best standards. Join Thadeus to succeed in your trading endeavours.

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Article was updated: December 16, 2024

Estimated reading time: 12 minutes

If you have a small budget but would still like to profit from online trading, we highly recommend penny stocks. These are company stocks that often trade for as little as $5 per share. They are usually issued by small, growing brands and traded over the counter.

Penny stock trading is a highly profitable venture. But, to enjoy the best returns from this venture, you must trade with reputable and reliable penny stock brokers. If you are unfamiliar with such service providers, don’t worry. This guide will acquaint you with some of the best penny stock brokers in Canada. Our experts researched and tested different service providers before preparing this piece. 

List of the Best Penny Stock Brokers & Apps

• Interactive Brokers – Overall Best Penny Stock Broker in Canada
• Saxo – Best Penny Stock App for Professional Traders and Investors
• Questrade – Best Broker for Low-Cost Penny Stock Trading in Canada
• Qtrade Direct Investing – Penny Stock Broker with the Best Collection of Research and Educational Tools in CA
• RBC Direct Investing – Best Penny Stock Broker for Integrated Banking and Investment Solutions

Canadian Penny Stock Brokers: Comparison Table

Our search for the best for the best penny stock brokers in Canada was exhaustive and extensive. The BrokerRaters team covered every crucial detail, starting with licensing and regulatory status. We checked if every promising service provider was regulated by a respected Canadian authority like CIRO.

Our gurus also tested and evaluated customer support, trading platforms, payment methods, and other elements highlighted in the comparison tables in this guide. We encourage you, our reader, to follow in our footsteps and use these factors to evaluate every single penny stock broker before opening an account.

Platforms Short Overview

Some penny stock brokers prioritize affordability and pocket-friendliness, while others don’t. Moreover, some platforms for penny stock trading Canada allow users to diversify with other financial instruments, like ETFs and options. To avoid high costs and ensure you have everything you need to succeed at your disposal, check fees and assets while searching for the best penny stock broker in Canada. We have touched on the fees and assets our gurus discovered while researching and evaluating the best penny stock app Canada has to offer.

Fees

Assets

Our Expert Opinion about Penny Stock Brokers in CA

We have dissected every indispensable detail while evaluating the best Canadian penny stock brokers below. Since BrokerRaters is committed to informing our readers, we aim to cover every recommended service provider’s strengths and drawbacks without favouritism. That said, fitting everything in one guide is impossible. After reading this piece in its entirety, please conduct independent research and gather more information before committing to any broker.

1. Interactive Brokers – Overall Best Penny Stock Broker in Canada

Today’s best overall penny stock broker in Canada is Interactive Brokers. We highly recommend it to traders who are working with a shoestring budget as well as high-budget individuals since it has no minimum deposit requirement. You can sign up and top up an IBKR account with anything affordable to you at the moment. Moreover, you can use zero-fee funding options like Online Bill Pay and EFT.

After signing up and funding your IBKR account, you will get ample opportunity to invest in your chosen stocks regardless of price. That is because this service provider supports fractional trading, a solution that allows you to buy a fraction or portion of a specific stock. For instance, you can buy a slice of Netflix, Tesla, or Google shares depending on the capital at your disposal. The best part is that IBKR allows you to invest in a wide variety of fractional shares from Canada, the US, and Europe.

Besides fractional shares, IBKR’s clients can trade and invest in other financial assets. With a funded IBKR account, you get unparalleled access to over a million bonds, low-commission futures, 43,000+ mutual funds, and many other financial instruments. You also get the opportunity to acquire financial education and increase your odds of success courtesy of this broker’s free courses and lessons. Every vital learning material is provided by Interactive Brokers, from beginner to advanced courses and lessons. Plus, this service provider offers webinars, podcasts, and other educational resources.

Finally, IBKR allows its users to leverage the power of robust trading platforms and tools. This broker has different platforms tailored to suit the needs of a diverse variety of trading experiences, from beginner to intermediate and advanced. Its users can also exploit powerful research and analysis tools.

Interactive Brokers

✔$0 minimum deposit requirement
✔No account inactivity fees

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57,499 User Reviews

2. Saxo – Best Penny Stock App for Professional Traders and Investors

We urge professionals searching for the best penny stock app Canada has to offer to check out Saxo. Why? This broker provides a sophisticated app that users can access via Android and IOS devices. Known as SaxoTraderGo, the app comes with a friendly interface and an impressive range of tools and features. They include robust fundamental analysis tools, technical analysis tools, and news and research tools.

Courtesy of the available tools and functionalities, you can effortlessly search for the right instruments, use expert insights to make informed decisions, and take your experience to the next level with automated trade signals. You can also take advantage of advanced charting features and trade directly from the app’s integrated charts.

Furthermore, the app makes trading, investing, and managing your assets easier through diverse features. These include a portfolio summary feature, which allows you to keep track of your net holdings’ current and past reports, and a returns breakdown feature, which allows you to use time-weighted percentages to analyze the development of your trades.

Sign up with Saxo today and get the opportunity to trade penny stocks over the counter. The service provider will also give you uncapped access to other financial instruments. For starters, you can use the app to trade leveraged products like forex pairs, commodities, and diverse CFDs. You can also invest in stocks, ETFs, mutual funds, and bonds.

3. Questrade – Best Broker for Low-Cost Penny Stock Trading in Canada

If you are a little short on cash or would like to enjoy reduced costs, trade penny stocks with Questrade. You can open a self-directed Questrade investment account, deposit as little as $250, and start trading and investing without any hassles. The best part is that, before making a financial commitment, you can use a practice account to test this provider’s services.

We tested Questrade and have nothing but praises for its clutter-free, user-friendly platforms. Anyone can sign up and dive in with relative ease, from newbies to seasoned active traders. What’s more, Questrade’s all-in-one trading platforms offer every indispensable element that you need to trade and invest seamlessly, from a built-in Learning Mode to robust research and trading tools. The icing on the cake is mobile users can enjoy the same perks their counterparts get while trading with QuestMobile, this company’s dedicated mobile app.

If you’re fretting over fees, rest easy. As a Questrade user, you can enjoy commissions as low as 0 while trading different securities, including ETFs, options, and stocks. You can also trade forex pairs and CFDs with Questrade and magnify potential returns with tight spreads starting from 0.08 pips.

4. Qtrade Direct Investing – Penny Stock Broker with the Best Collection of Research and Educational Tools in CA

As seasoned pros, we urge every professional trader and investor to consider switching to the Qtrade Direct Investing platform. The company started operating in 2001 and boasts thousands of clients. It’s backed by Aviso, one of the most prominent wealth management firms in the Land of Maple Syrup. We have yet to find a single reason to doubt this service provider.

Open an account with Qtrade today and get access to a wealth of tools. The platform’s stock screener lets you filter and identify the best penny stocks based on price, performance, market cap, and other criteria. This company also offers its users the opportunity to use detailed company reports and real-time data to make profit-generating, informed decisions.

We understand that ongoing education is a professional investor’s most potent weapon. Without education, a pro like yourself can decrease their odds of success courtesy of issues like using outdated strategies and the inability to keep up with market changes. That said, with Qtrade, you can upgrade your knowledge at no extra cost.

Qtrade has countless educational articles and guides tailored for both new and experienced investors. As a pro, you just have to click on the “Experienced Investors” option on the educational website and devour everything you can.

5. RBC Direct Investing – Best Canadian Penny Stock Broker for Integrated Banking and Investment Solutions

Affiliate with the infamous Royal Bank of Canada, RBC Direct Investing is a robust trading and investment platform that caters to thousands of people. We love it because it’s designed to facilitate seamless integration between clients’ investment and banking accounts. In other words, as an RBC Direct Investing user, you can manage your trading/investment portfolio and manage your day-to-day banking activities from a single platform.

Open an RBC Direct Investing today and avoid unnecessary headaches. You’ll have the chance to manage different accounts, from personal to RESP, while seamlessly trading penny stocks. Speaking of stocks, RBC has an impressive collection of products. You can trade penny stocks on the platform and, to reduce risk exposure, invest in diverse exchange-listed US and Canadian stocks.

Many other aspects make trading penny stocks and investing with RBC a smart move. For starters, this company’s users can use real-time streaming quotes to track the performance of different financial products and make profitable trades. Furthermore, first-time users can request guest access and use virtual funds to try out the RBC Direct Investing platform before registering and risking capital.

Penny Stock Trading in Canada

Canadians aged 18 and above can trade penny stocks and reap high potential returns. However, despite presenting profitable opportunities, this activity has its fair share of challenges. For starters, most brokers popular in the Great White North don’t support it. Additionally, penny stock investors sometimes suffer significant losses caused by issues like pump-and-dumb schemes. We encourage you to stay vigilant and learn the risks associated with trading penny stocks before risking any money. Furthermore, note that any profits you get from this venture are subject to taxation.

What is Penny Stock Trading?

Penny stock trading refers to trading company stocks that cost less than $5 per share. Most penny stock brokers allow their clients to trade penny stocks over the counter. These stocks are ideal for individuals with limited budgets.

How Does Penny Stock Trading Work?

Trading penny stocks requires you to do the following:

1. Find a good penny stock broker: Look for a broker that offers penny stocks and matches your expectations. A good broker should have the right attributes, including valid licenses and an untainted reputation.
2. Choose penny stocks: Assess the list of available penny stocks and pick one or more assets. Before putting your money on the line, conduct extensive research. Check every company’s financial statements, history, management team, and track record. Avoid penny stocks associated with brands with red flags like unproven business plans.
3. Buy and sell penny stocks: Buy and sell your chosen penny stocks. Use the best risk management tools and strategies to mitigate losses. Also, diversify your portfolio with multiple financial instruments instead of a single asset.

How to Choose the Best Penny Stock Broker or App in Canada

Here’s one aspect that makes penny stock trading risky. Some of the brokers that support this activity have issues like high fees, subpar features, and poor support. Since your success hinges on your chosen service provider, among other factors, we urge you to be cautious while picking the best penny stock trading app or platform. Use the following factors to gauge every provider’s reliability and trustworthiness:

Risks to Trade Penny Stocks for Canadian Traders

Here are a few risks of trading penny stocks you should know of before signing up with one of the best brokers and risking your funds:

1. High volatility: Generally, penny stocks are more volatile than traditional stocks. While trading these securities, you can incur significant financial losses catalyzed by rapid and extreme price changes.
2. Low liquidity: Most penny stocks are traded OTC, which often leads to low liquidity. In other words, while dealing with these assets, you will have trouble executing trades at your desired price range at some point.
3. Fraud and manipulation: Penny stock traders are highly exposed to fraud and manipulation. That is because these assets go hand in hand with OTC trading and pink sheets, two elements that experts often associate with less stringent listing standards.
4. Dilution of shares: A penny stock company facing issues like low cash flow can try to raise capital by issuing new shares. This move can affect the value of existing stocks and undermine shareholders’ investments.

Pros & Cons of Penny Stocks Trading

Let’s close with a brief overview of the pros and cons of penny stocks trading:

Pros:

• High volatility and drastic price changes give penny stock traders the opportunity to earn high returns.
• Penny stocks have low initial investment requirements since most are priced below $5 per share.
• Some penny stocks are backed by new or small brands with a high growth potential.
• There are many penny stocks from a wide variety of industries and sectors, from communication services and tech to biotechnology and pharmaceuticals.

Cons:

• New share issuances common with penny stock companies can negatively impact the value of shares.
• High volatility can cause unpredicted price swings and hefty losses.

For further insights, explore our article on Options Trading Platforms in Canada.

Conclusion

Canadians report tens of thousands of fraud-related issues every year. Don’t be a statistic; carefully vet every penny stock broker using the hacks we’ve introduced you to before handing over your private information and hard-earned cash. We also strongly recommend trading with one of the companies reviewed in this guide. 

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Thadeus Geodfrey

Thadeus Geodfrey is an experienced and celebrated writer and self-taught trader specialising in cryptocurrencies and forex. Market analysis, identifying fraudulent brokers, and security are his cup of tea. At BrokerRaters Thadeus develops educational materials and user-guides, offer market insights, ensures our content conforms to the best standards. Join Thadeus to succeed in your trading endeavours.

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