A Modern Guide to Investing in U.S. Stocks from Canada
Want to tap into global giants like Apple, Amazon, or Microsoft while living in Canada? It’s more accessible than ever. However, smart choices around brokerage, currency conversion, and taxes make a big difference in returns and risk management.
⚠️ This article is informational—not financial advice—so consult a professional before making investment decisions.
Can You Invest in U.S. Stocks from Canada?
Yes—technically and practically. Canadian investors routinely hold U.S.-listed equities using online brokerages like Questrade, Wealthsimple Trade, National Bank Direct Brokerage, TD Direct Investing, RBC Direct Investing, Interactive Brokers, and moomoo Canada
Legal & Tax Essentials
- Dividend Withholding Tax: U.S. companies generally withhold 15% on dividends paid to Canadians. To avoid higher default rates (30%), you must file IRS Form W‑8BEN through your brokerage .
- RRSP Advantage: Dividends on U.S. stocks held in an RRSP or RRIF are generally exempt from U.S. withholding tax under the Canada‑U.S. tax treaty .
- TFSA & RESP: Unfortunately, these registered accounts don’t offer that tax exemption, so dividend withholding applies .
- Capital Gains Tax: Only applicable in Canada—50% of gains are taxable—while the U.S. does not tax capital gains for Canadian residents .
- Reporting Foreign Assets: Canadian residents holding more than CAD 100,000 in foreign property (e.g. U.S. stocks in non-registered accounts) must file CRA Form T1135 .
Currency Conversion & Cost Strategies
Buying U.S. stocks requires converting CAD to USD, incurring fees that can range from 1.5% to 2.5% per trade or dividend transfer. Over time, these can seriously erode returns .
Two cost-saving approaches:
- Use a USD cash balance in your brokerage (offered by Questrade, TD Direct Investing, RBC, etc.) to avoid repeat conversions.
- Norbert’s Gambit: Convert CAD to USD by buying and journaling a dual-listed stock (e.g., DLR/DLR.U), then selling—minimizing conversion fees. This method is popular and effective, though it requires a few days to settle and involves trading commission costs .
Additionally, international payment services like Wise offer transparent, low-fee CAD→USD conversion and can directly fund U.S. brokerage accounts .
Top Brokerages for U.S. Stock Investing (Mid 2025)
Here’s how Canada’s major platforms stack up:
Questrade
- Commission: $0 on Canadian and U.S. stocks and ETFs; options trading at $0.99/contract ($0.75 for frequent traders) .
- Accounts: RRSP, TFSA, non-registered; supports USD cash balance.
- FX Fee: ~1.5% unless using USD account.
- Pros: Strong tools, no minimums, registered growth accounts.
- Cons: FX spread if currency not managed.
Wealthsimple Trade
- Commission: $0 on trades.
- FX Fee: 1.5% on USD trades. Fee waivers apply only on Premium or high‑balance accounts.
- Pros: Easy mobile-first interface, fractionals, no minimums.
- Cons: Basic tools, FX fee on every USD trade.
National Bank / Desjardins Direct Brokerage
- Commission: $0 on stocks, ETFs, and equity options (with $1.25/contract for options). Works well with Norbert’s Gambit.
- FX Fee: Minimal; often better than big banks.
- Pros: Free trading across equities and ETFs, competitive FX.
- Cons: Fewer advanced tools compared to Questrade or IBKR.
RBC & TD Direct Investing
- Commission: $9.95 (RBC) to $9.99 (TD) per trade; active traders may qualify for $6–7 fee tiers.
- FX Fee: ~2.5% spreads, though holding USD avoids conversion.
- Pros: Reliable platforms, deep research, cross-products integration.
- Cons: Higher trading fees; limited zero-cost ETF options (RBC now offers ~50 commission-free ETFs)
- Interactive Brokers (IBKR Canada)
- Commission: ≈ $0.0035/share or $1 minimum.
- FX Fee: ~$2 flat + very tight spreads. Avoid Norbert’s Gambit unless needed.
- Pros: Lowest FX costs, global market access.
- Cons: Complex interface, requires brokerage activity.
moomoo Canada
- Commission: ~CAD $0.0149/share (min $1.49) for Canadian stocks; USD $0.0099/share (min $1.99) for U.S.
- FX Fee: Often better than traditional banks.
- Pros: No account minimums, advanced charting, paper trading.
- Cons: Limited account types (cash, margin, TFSA, RRSP) .
How to Get Started: 5 Simple Steps
- Choose your account: For tax-efficient U.S. dividend holdings, an RRSP or RRIF is ideal. TFSA/RESP can still work but lose withholding tax benefits.
- Open account: Submit ID, SIN, address verification (KYC).
- Fund your account: Use CAD, convert to USD or use Wise/Norbert’s Gambit.
- Buy U.S. stocks: Search by ticker, verify USD pricing.
- Manage ongoing FX: Opt to hold USD cash, use low-spread USD transfers, or Norbert’s Gambit to minimize fees.
Final Thoughts
Investing in U.S. stocks from Canada offers diversification and access to high-quality, large-cap companies. Choosing the right brokerage—considering trading fees, FX costs, account types, and tools—is key to maximizing returns.
With proper strategy, whether through USD cash accounts, Norbert’s Gambit, or services like Wise, you can keep currency costs to a minimum and focus on building a resilient portfolio.