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For decades penny stock trading has been used for many swing trading and day trading strategies. If penny stock day trading and penny stock swing trading is a viable strategy for you, it’s worth finding the right penny stock trading platform for you.

This guide will look through some of the best penny stock trading apps and discuss the rules and the rules of penny stock day trading for beginners.

Best Penny Stock Trading Platforms Canada List

Finding the right penny stock trading platform for you is important when starting penny stock trading in Canada. If you want to check them out already, here’s a list of some of the best penny stock trading apps available.

  1. Capital.com – Overall Best Penny Stock Trading Trading Platform Canada
  2. Pepperstone – Most Integrated Penny Stock Trading Platform Canada
  3. Avatrade– One of the Best Penny Stock Trading and CFD Platforms Canada
  4. FXCM Well Established Penny Stock Trading Platform Canada
  5. IG – Best Penny Stock Trading Platform with Copy Trading Canada

Best Penny Stock Trading Platforms Canada Reviewed

The trading platform can be the difference between a good and bad experience penny stock trading in Canada. This is why it’s important to understand your penny stock trading app strategies to best match them to your chosen penny stock trading platform.

1. Capital.com – Overall Best Penny Stock Trading Trading Platform Canada

penny stock trading

Overall, Capital.com offers the best online stock trading for penny stocks with its easy-to-use interface, zero commissions trading, and competitive spreads. Most users are looking for a seamless trading experience with simple functions, and Capital.com is the penny stock trading app that provides just that.

All commission-free brokers earn through the spread, usually high depending on the asset and broker. What makes Capital.com one of the better penny stock trading platforms is its low spreads and high option for leverage. Aside from this, the platform is also a multi-asset broker that offers contracts for difference (CFD) forex, indices, and crypto trading.

Capital.com fees

Fee Amount
Stock trading fee Spread. 1.83 pips for Amazon.
Forex trading fee Spread. 0.6 pips for EUR/USD.
Crypto trading fee Spread. 100 pips for Ethereum/USD.
Inactivity fee Free
Withdrawal fee Free

Pros:

  • Access to thousands of share CFDs with 0% tight spreads
  • Integration with MetaTrader 4 trading platform
  • Access to Investmate educational trading app
  • More than 75 technical indicators
  • Access to a demo account
  • Regulated by FCA and Cyprus Securities and Exchange Commission.
  • Broker with NASDAQ exchange as well as NYSE and other global markets
  • Wide range of payment options, including credit cards and debit cards, and bank transfers
  • 24/7 customer support

Cons:

  • Can’t set price alerts on the web platform
  • Only CFD and real stock available

Your money is at risk.

2. Pepperstone - Most Integrated Penny Stock Trading Platform Canada

penny stock trading app

If you're looking for a very flexible penny stock trading platform, perhaps the best penny stock trading platform Canada for you is Pepperstone, an Australian-based all-in-one trading platform that lets users trade forex, indices, and commodities, among others.

Pepperstone also offers CFD trading, but what makes it a great penny stock trading app and great for penny stock day trading is how many sub-platforms it has integrated with. For example, with a Pepperstone account, you can connect to a TradingView, MetaTrader 4 (MT4), MetaTrader 5 (MT5), or cTrader platform.

One thing to highlight about this penny stock trading app is its customer service. They offer 24/7 customer support. There is also no minimum deposit for Pepperstone, further adding to their low cost for account creation.

Pepperstone fees:

Fee Amount
Stock trading fee Variable spread
Forex trading fee EUR/USD spread of 0.13 pips average
Crypto trading fee Variable spread
Inactivity fee Free
Withdrawal fee Free

Pros:

  • Spreads without markups (average EUR/USD spread of 0.13 pips)
  • Integrations with powerful platforms such as MetaTrader 4, MetaTrader 5, and cTrader
  • Tools for advanced traders via Autochartist
  • Fast 25-millisecond average execution speed
  • ECN pricing model

Cons:

  • No Pepperstone proprietary platform
  • ETFs are not available

Cryptoassets are speculative and carry high volatility levels. Always consider the risks involved. 

3. AvaTrade - One of the Best Penny Stock Trading and CFD Platforms Canada

penny stock trading canada

If Pepperstone has a lot of sub-platform integrations, AvaTrade is a penny stock trading app with some of the best trading features out there. With over 1,250 stocks and indices under its belt, the broker is Canada's best penny stock trading platform for trading tools and diversification.

One feature that could set AvaTrade as the best penny stock trading site in terms of tools is its sup-platforms for automated trading. It’s not unheard of to use algorithmic trading in online penny stock trading Canada, and through AvaTrade, users can access the auto-trading features of DupliTrade and ZuluTrade.

AvaTrade fees

Fee Amount
Stock trading fee Variable spread
Forex trading fee Spread. 0.9 pips for EUR/USD
Crypto trading fee Commission. 0.25% (over-market) for Bitcoin/USD
Inactivity fee $50 per quarter after three months of inactivity
Withdrawal fee Free

Pros:

  • Over 8,000 tradable financial instruments
  • Penny Stock Trading and CFD trading available
  • 0% commission on most assets
  • Exceptionally low spreads offered at high liquidity
  • Available dedicated streaming channel, XRay
  • 24/5 live chat and available phone support
  • Compatible with MT4
  • FCA-regulated broker

Cons:

  • Commission of US$10 per slide on stocks
  • No support for e-wallets

Your money is at risk.

4. FXCM - Well Established Penny Stock Trading Platform Canada

best penny stock trading platform canada

One of the leading foreign exchange and CFD trading providers is FXCM, a global broker with over 20 years of industry experience. An advantage of CFD trading is earning from upwards and downward price movements. Essentially, FXCM lets you do short penny stock day trading.

FXCM offers higher leverage for a penny stock trading app. For example, with a maximum leverage of 20:1, a US$100 position only needs US$5 to open. Therefore, it can be said that FXCM is the best online stock trading for penny stocks with high leverage.

FXCM Markets fees

Fee Amount
Stock trading fee Varying spread.
Forex trading fee Varying spread.
Crypto trading fee Spread. 40 for BTC/USD
Inactivity fee US$50 per year after one year of inactivity
Withdrawal fee Free for withdrawals through bank cards. US$40 for all Bank Wire requests.

Pros:

  • FCA-regulated broker that strictly adheres to regulatory requirements
  • Forex, stocks, indices, commodities, and cryptocurrencies trading available
  • Demo account available
  • Zero commissions stock trading
  • Trading Station, NinjaTrader, and MT4 integrations
  • Award-winning commission-free broker for 2021
  • Mobile trading available for Android and iOS
  • Dedicated 24/7 support

Cons:

  • Hefty inactivity fee
  • Limited customer support available

72% of retail investor accounts lose money when Penny Stock Trading and/or trading CFDs with this provider. You should consider whether you understand how spread bets and CFDs work and whether you can afford to take the high risk of losing your money.

5. IG - Best Penny Stock Trading Platform with Copy Trading Canada

canadian penny stock trading

The award-winning IG markets online broker is another all-in-one platform for penny stock trading. According to their site, they are the world’s number one CFD provider and offer some penny stock trading Canada. 

There are over 17 thousand markets and instruments to trade from on the IG platform. You might not be able to get a more diverse portfolio than this. Furthermore, the platform has integrations with MT3, L2 dealer, and ProRealTime, all advanced and highly utilized third-party trading software.

IG fees

Fee Amount
Stock trading fee Commission. 0.10% per slide
Forex trading fee Spread. 0.6 pips for EUR/USD.
Crypto trading fee Spread. 38 minimum spread for Bitcoin.
Inactivity fee US$18 a month after 24 months of inactivity
Withdrawal fee Free

Pros:

  • MetaTrader 4 and ProRealTime trading integrations available
  • Offers trading for over 17,000 markets
  • Regulated by FCA and CFTC, NFA (U.S.)
  • Award-winning mobile app available
  • Up-to-the-minute analysis of trading
  • Algorithmic trading offered
  • Has fast execution on a huge range of markets

Cons:

  • High share-CFD fees
  • No copy trading or back testing strategies available

Your money is at risk.

Best Penny Stock Trading Platforms Canada - Fees & Leverage Comparison

After seeing our short reviews on our Penny Stock Trading Canada platforms, we’ve constructed a table to help compare and contrast the different Penny Stock Trading brokers.

Capital.com Pepperstone AvaTrade FXCM IG
Penny Stock Trading Fees Spread. 1.83 pips for Amazon. Variable spread Variable spread Variable spread Commission. 0.10% per slide
Inactivity Fee Free Free $50 per quarter after three months of inactivity US$50 per year after one year of inactivity US$18 a month after 24 months of inactivity
Withdrawal Fee Free Free Free Free for withdrawals through bank cards. US$40 for all Bank Wire requests. Free

Penny Stocks Explained

To truly benefit from penny stock trading in Canada, a few general things need to be understood. In particular, a few concepts like understanding penny stock trading, finding the best penny stock for day trading, and learning how to start penny stock trading comes to mind.

What are Penny Stocks?

So what is penny stock trading? To answer this, we must first understand what a penny stock is. Although different organizations classify different shares as penny stocks, true penny stocks are low-cap shares worth less than one USD.

The United States Securities and Exchange Commission (SEC) defines a penny stock as having a market cap of under US$300 million and trading under US$5. The important concepts to understand for penny stock companies are that they are small, often don’t release important investor information to the public, and trade at dollars to penny prices.

Regulation

You might be asking, is penny stock trading illegal in Canada? For regulations, penny stock trading in Canada is legal. More specifically, earnings from penny stock trading should be treated as earnings from any other capital equity. This means that any form of penny stock trading in Canada (penny stock day trading or trading penny stock) will be subject to the Canadian Capital Gains Tax.

The capital gains tax requires Canadian citizens to have just 50 percent of their earnings from stock trading and other income sources subject to tax. Luckily, you can offset your penny stock trading Canada losses to lower your taxes and even deduct broker costs from your earnings.

Pros and Cons

penny stock swing trading

Before you search for the best penny stock trading platform in Canada, it’s important to weigh some of the pros and cons of penny stock trading in Canada. 

The benefits of penny stock trading are:

  • Cheap (generally less than US$5) – Practically everyone will be able to afford penny stocks because of their price. This makes it very attractive and allows users to purchase many units of shares.
  • Great for short-term trading– Because the prices of penny stocks are cheap and their prices can swing quickly, this makes penny stock day trading very popular. Many traders have been successful in penny stock swing trading and day trading - two short-term trading strategies for penny stocks.
  • Larger movements than higher-cap stocks – Blue-chip stocks, usually established companies with consistent growth rates, normally move slowly in the short term. On the other hand, Penny stocks have much quicker and larger movements in a shorter period.

Some risks and disadvantages of penny stock trading include:

  • Lack of company information available to the public - Even with Canada's best penny stock trading platform, penny stocks usually don’t give important investor information such as financial statements. 
  • Easily manipulated through pump and dumps - Penny stock companies in the past have been notorious for pump and dump schemes. Although not so blatant and common now, penny stocks are usually more easily manipulated by insiders and other parties.
  • Low liquidity - Most often, penny stocks aren’t traded in high volumes, so it’s hard for sellers to find a good price. Unfortunately, this means that the market price of penny stocks often doesn’t reflect the actual value.
  • Overall higher risk - Overall, penny stock day trading and investing, in general, is higher risk than more expensive stocks for the above reasons.

67% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money.

Penny Stocks Assets

Although certain penny stock trading platforms like Capital.com let you purchase stocks and hold the underlying asset, there are other forms of trading penny stocks. For example, many penny stock trading apps use CFDs to trade these assets. This allows traders to speculate upwards and downwards price movements of penny stocks.

Platform & Usability

As we mentioned earlier, it’s very important to find the best penny stock trading app and best penny stock trading platform for you. Overall, you’ll want a platform that suits your trading strategies, is easy to use for you, and has the best payment options concerning your methods.

Trading Tools & Features

Just like how day traders look at both technical and fundamental analysis to trade the price action of their stocks, the same tools and indicators used for this can be implemented for penny stock trading in Canada. Although liquidity and other factors might come into play, you’ll generally use the same indicators like support and resistances, trading volume, and relative strength index.

67% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money.

Education, Research & Analysis

best penny stock trading app

If you want to practice penny stock trading, getting into virtual penny stock trading might be worth it, which requires a penny stock trading app with a demo account feature like Capital.com. With demo trading penny stocks, you can practice different strategies, get used to the interface, and better understand short-term price movements.

Additionally, research and analysis on penny stocks will be very important as traders usually want to trade these low-cap stocks on unusually high days of volatility and trading volume. 

Mobile App and Device Compatibility

If you plan on trading on the go, then finding the best penny stock trading site with a good penny stock trading app would be necessary. However, most penny stock trading platforms have integrated mobile apps, so this might not be a huge issue for you.

 If your mobile device runs on iOS or Android, you’re already pretty much set. However, if you have another operating system for your device, you might want to look into other options.

Payments

When funding your penny stock trading platform accounts, you'll need to consider the payment methods. For example, Capital.com offers payments through bank cards, wire transfers, and other third-party e-payment methods.

You’ll also want to look into a penny stock trading platform with low to no fees for payments and withdrawing—overall, lowering your costs when penny stock trading will benefit your earnings, especially in the long run.

67% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money.

Penny Stocks Strategy

Because penny stock trading in Canada involves more risk, formulating a good penny stock trading strategy will require deeper and maybe even stricter measures. On the other hand, other stock strategies like investing are more long-term and have a higher success rate.

So generally, penny stock strategies will be geared to short-term trades and require some due diligence regarding the technical and fundamental analysis. For example, some US penny stocks are pharmaceutical companies with products awaiting FDA approval. Once their approval nears or clears a stage, many traders flock to trade the stock as upward price pressure ensues.

How to Get Started with A Penny Stocks Trading Platform

Now that you understand penny stock trading, we can show you how to get started.  We’re using the best overall best penny stock trading platform in Canada, Capital.com, for this step-by-step tutorial.

Step 1: Open a Trading Account and Verify Your Identity

penny stock trading platform

67% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money.

First, head to the Capital.com website and press the Trade Now button. Next, fill in your email and password or register with an existing Facebook, Google, or Apple account. Afterward, you’ll need to upload a valid ID such as a passport or driver’s license, then wait for your account to finish being verified.

Step 2: Deposit Funds

With your account now fully verified, you can now fund your account. First, you’ll need to identify what payment option to use for the deposit. Choose from methods such as bank cards, Apple Pay, PayPal, and more to be able to fund your account.

Step 3: Practice Options Trading on a Demo Account

penny stock trading app canada

Before starting with a live account, it's important to test your penny stock trading strategies with the Captial.com demo account. Here, you can try different strategies to see which one you are most comfortable trading with.

Step 4: Start Trading with Penny Stocks

penny stock trading platform canada

Now that you have funded your account and tested your strategies, you can proceed to start Penny Stock Trading trading on Capital.com. First, identify which asset you want to trade, how much leverage you want to use, and what type of position you want to open.

67% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money.

Conclusion

Most users would benefit from a penny stock trading app that is easy to use, has great payment options, low fees, and excellent customer support. Though many different penny stock trading apps might have different and unique features, what’s important is that you choose the ones that best fit your trading style.

If you want to start penny stock trading with zero commissions, try the Capital.com platform. Click on the link below to sign up and start trading our best and overall recommendation for Penny Stock Trading trading!

trading penny stock

75.26% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money.

FAQs

Are penny stocks trading risky?

Because penny stocks trading involves the shares of smaller companies and businesses, they can be considered much riskier than the usual mid to high cap stocks.

Are penny stocks legal in Canada?

Yes, penny stocks trading is legal in Canada and is a popular way to look for short term gains.

How do Canadian penny stocks platforms make money?

Penny stock platforms in Canada make money either by charging a commission per trade or through a spread. Either way, the commission and spread are established by the broker, and that’s how they earn per position made.

What is the best penny stock trading platform Canada?

The overall best Penny Stock Trading platform in Canada is Capital.com as it offers a great user interface and value for most use-cases.

Are penny stocks trading taxable in Canada?

Penny stocks trading just like trading any other capital shares are subject to the Canadian capital gains tax. This means that 50% of your earnings from trading penny stocks will be subject to the tax according to your tax bracket.

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About Jose Rafael Aquino
About Jose Rafael Aquino

Jose Rafael Aquino is a Filipino writer and entrepreneur that specializes in finance, technology, cryptocurrency, and sports. Versed in the startup tech space, he has written for websites such as The GUIDON, StockApps, and BuyShares.