Lesson Margin 201

Margin power

Margin Power leverages the assets in your TFSA to enter new positions in your margin account. Once activated, your trading platform will show the buying power of your margin account and the increased buying power available via your TFSA.

Boost your trading with Margin Power

You have the power to increase your buying strength. It’s called Margin Power and it’s an exclusive to Questrade. Margin Power connects the savings in your TFSA with the trading in your margin account. What you get is the opportunity to enter new positions in your margin account.

The benefits of Margin Power

  • Access additional buying power from your TFSA

  • Trade without selling securities or transferring cash

  • Increase potential profitability in your margin account

How does Margin Power work?

Tap into your TFSA to buy more

Margin Power leverages the assets in your TFSA to enter new positions in your margin account. Once activated, your trading platform will show the buying power of your margin account and the increased buying power available via your TFSA.

Your TFSA stays tax-free

With Margin Power, your TFSA stays tax-free and holds the same contribution room. There’s no need to transfer cash or securities between your TFSA and margin accounts. You can trade normally in both.

It’s like overdraft protection

Margin Power functions as a type of overdraft protection: if the value of the positions in a margin account should drop, the untapped marginable assets from your TFSA could protect you from a margin call.

What is a margin account?

Get access to leverage to buy more

With a margin account you team up with Questrade to seize bigger opportunities. Think of it as a loan that gives you the leverage to purchase more investments. When you invest with additional money from us, you potentially increase your gains.

Learn about different margin accounts

What is margin trading?

Use leverage to trade more securities

When opportunity strikes, margin trading lets you buy more. By borrowing from Questrade, you have extra buying power. To trade on margin you need a margin account.

What is a TFSA?

Save tax-free

A tax-free savings account was created as a way to save for retirement. But in truth, the account has so much flexibility it’s also great for short-term goals. Different than an RRSP, with a TFSA there’s no tax on any growth earned, including interest, dividends and capital gains. Every year you’re given $6,000 to fill. You can choose to save a mix of investments, like GICs, stocks, bonds, mutual funds and more. You can withdraw tax-free and with Questrade there’s no annual account fees.

Learn about TFSAs

Trade your money, and forget about paying taxes on your interest, dividends, or capital gains. Every dollar earned in your TFSA is yours, no strings attached.

Frequently asked questions about Margin Power

How do I link my margin account to my TFSA?

You link the two accounts on the account management screen of Questrade.

Can I use margin inside my TFSA?

No, you can't use margin in a TFSA account. Margin Power links the accounts so you can leverage your TFSA assets to use in your margin account.

Is margin trading for beginners?

Trading on margin involves greater risk than just trading with the cash in your account and is generally not recommended for beginners.

Using borrowed money to finance the purchase of securities involves greater risk than using cash resources only. If you borrow money to purchase securities, your responsibility to repay the loan and pay interest as required by its terms remains the same even if the value of the securities purchased declines.

Note: The information in this blog is for information purposes only and should not be used or construed as financial, investment, or tax advice by any individual. Information obtained from third parties is believed to be reliable, but no representations or warranty, expressed or implied is made by Questrade, Inc., its affiliates or any other person to its accuracy.

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