Investment choices: definitions and advantages

Aug 26, 2021

Qtrade Direct Investing™ makes it easy to build a well-diversified portfolio, with access to a wide array of investment choices.

Here is a quick overview of the securities you can choose for your Qtrade account, and the advantages of each.

Investment type Details Advantages
Stocks

Stocks (also called shares or equities) represent an ownership position in a publicly traded corporation

  • Canadian stocks that trade on the Toronto Stock Exchange (TSX), TSX Venture Exchange (TSXV) and Canadian Stock Exchange (CSE)
  • U.S. and foreign stocks that trade on the New York Stock Exchange (NYSE) and Nasdaq
  • Over the counter (OTC) stocks
  • New issues — including IPOs (initial public offerings) as well as secondary or treasury offerings
  • Rights and Warrants
  • Allows diversification across industry sectors and geography
  • Accommodates strategies based on growth, or value, or on generating income from dividends
  • You can borrow (trade on margin) to buy stocks trading for $3 or more on major stock exchanges
ETFs: exchange-traded funds

Investment funds that trade on stock exchanges. ETFs that track the performance of various benchmark indexes are popular. Variations include actively managed and speciality ETFs.

 

  • 100 commission-free ETFs
  • Passive ETFs that track benchmark indexes
  • Actively managed ETFs with mandates to outperform benchmarks
  • Specialty ETFs for various sectors, commodities and other niches
  • Easy to achieve diversification
  • Liquid: easily bought and sold throughout the trading day at current market prices
  • Low management fees
  • ETFs trading for $3 or more can be purchased on margin
Mutual funds

Portfolios of stocks, bonds and other investable assets which are professionally managed on behalf of many investors.

 

 

  • Thousands of funds to choose from
  • Low-expense ‘Series D’ funds available
  • Benefit from expertise of professional portfolio managers
  • Easy to achieve diversification
  • Liquid: easy to buy and sell
  • No commission to buy, so well suited to monthly contribution plans
Bonds

Debt instruments issued by governments and corporations, usually for a specific length of time. They have a par (or face) value, which is repaid to the holder upon maturity of the bond. They also pay interest, which is the buyer’s return (or yield) on the bond.

  • Huge inventory of Canadian and U.S. government and corporate bonds
  • Related products such as commercial paper, strip coupons, and treasury bills
  • Predictable income stream
  • Can play a key role in a well-balanced portfolio
GICs: Guaranteed Investment Certificates

Secure investments that offer a guaranteed rate of return over a fixed duration. Issued by financial institutions.

 

  • Large inventory available
  • Flexible options with rates and maturities to suit your needs
  • Safe — principal is guaranteed up to $100,000
Options

Contracts giving the owner the right, but not the obligation, to buy (“call”) or sell (“put”) an underlying stock at a specified price (strike or exercise price) for a limited time, usually a few months.

 

  • Long calls and puts
  • Spreads
  • Covered writing
  • Uncovered writing
  • Hedge against risk, generate income, and speculate on market moves
  • Use leverage to capitalize on changes to a stock’s price without needing to buy the stock

Find out how Qtrade can help you reach your financial goals.

Online brokerage services are offered through Qtrade Direct Investing, a division of Credential Qtrade Securities Inc. Qtrade, Qtrade Direct Investing and Write your own future are trade names and/or trademarks of Aviso Wealth.

Recent Posts

Aviso Weekly Market Pulse: April 1st – April 5th

Market developments Equities: U.S. stocks climbed on Friday after a stronger-than-expected March jobs report, but the S&P 500 is still headed for its biggest weekly decline since the first week of the year amid rising geopolitical concerns and hawkish signals from...

Aviso Weekly Market Pulse: March 25th – March 28th

Market developments Equities: The S&P 500 Index saw modest weekly gains, propelling equities to their most impressive first-quarter performance since 2019, bolstered by the latest U.S. GDP figures. These numbers fueled speculation that the Federal Reserve might...

Why, when and how to rebalance your portfolio

Your investment portfolio needs a plan to help you reach your financial goals. Asset allocation is a relatively straightforward investment strategy that can help you to balance investing risks and rewards. An asset allocation strategy establishes the relative...

NEI Monthly Market Insights: February 2024

Markets leap forward in February The market rally continued into February in equities, with resilient economic data and relatively strong earnings reports fueling the S&P 500 Index to new record highs in February, gaining 6.9% for the month. Both the Nasdaq and...

Aviso Weekly Market Pulse: March 18th – March 22nd

Market developments Equities: Stocks experienced a slight decline on Friday, halting the week's rally triggered by the Federal Reserve's commitment to potential interest rate cuts this year. Despite the day's decline, the S&P 500 is poised for its most significant...

Aviso Weekly Market Pulse: March 11th – March 15th

Market developments Equities: The S&P 500 ended the week slightly down, as tech stocks sold off, coinciding with a significant Friday options expiration with approximately $5.3 trillion in options set to expire, adding to the market's volatility. With earnings...