How to Buy Your First Canadian Stocks: Step-by-Step Guide

If you are new to Canada and want to begin investing, this guide outlines the main steps and options. It covers account types, common investments, where to open accounts, and practical requirements so you can make informed choices and start building your financial future.

Types of investing accounts

In Canada, investment accounts are broadly classified as registered or non-registered. Registered accounts are reported to the Canada Revenue Agency (CRA) and provide tax advantages such as tax-free growth, tax-deferred growth, or tax deductions for contributions depending on the account type. Because of those benefits, registered accounts have contribution limits. Non-registered accounts have no contribution caps or withdrawal rules, but do not offer the same tax incentives.

Types of registered accounts in Canada

	Tax-free savings account (TFSA)	Registered retirement savings plan (RRSP)	Registered education savings plan (RESP)	First home savings account (FHSA)	Registered disability savings plan (RDSP)
Purpose	General savings and investing	Retirement savings	Post-secondary education savings for a child	Savings for a first home purchase	Long-term savings for a person with disabilities
Tax advantages	Investment growth and withdrawals are tax-free; contributions are not tax-deductible	Contributions are tax-deductible and grow tax-deferred; withdrawals are taxed as income	Growth is tax-deferred; earnings are taxed in the student’s hands when withdrawn	Contributions are tax-deductible; growth and qualifying withdrawals for a first home are tax-free	Contributions are not tax-deductible; investment income is taxed in the beneficiary’s hands
Contribution limit	Varies by year; 2024 annual limit is $7,000	18% of earned income up to a yearly maximum; $31,780 limit in 2024; unused room can be carried forward	No annual limit; lifetime maximum $50,000 per beneficiary	Annual limit $8,000; lifetime limit $40,000; contribution room can be carried forward one year	No annual limit; lifetime maximum $200,000 per beneficiary
Other key details	Newcomers receive TFSA contribution room beginning the year they arrive if they are 18 or older and have a Social Insurance Number (SIN)	RRSP room is based on prior-year earned income, not age; minors may be able to open accounts if eligible	Federal education grant available: 20% on the first $2,500 contributed each year, up to $500 annually and $7,200 lifetime; some provinces add incentives	Eligibility: age 18–71 in the year you open the account; must not have owned a “qualifying home” in the year of opening or in the previous four calendar years	Government grants and bonds may be available based on family income, with grants up to $2,000 per year and bonds up to $1,000 per year in some cases

Types of non-registered accounts

Cash account: A standard non-registered investing account used to buy securities like stocks, ETFs and mutual funds. Note that a cash investing account is distinct from a bank deposit account.
Margin account: A margin account lets you borrow from your brokerage to trade on leverage. While this can amplify gains, it also increases losses and is better suited to experienced investors who understand the risks and margin requirements.

Types of investments in Canada

Both registered and non-registered accounts can hold a broad mix of investments across the risk spectrum. Common options include:

Stocks: Shares represent ownership in a company. Investors can earn returns through dividends (periodic profit distributions) and capital gains (selling shares for more than the purchase price). Stocks of Canadian and U.S. publicly traded companies are accessible through brokerages.
Mutual funds: Mutual funds pool investors’ money and are managed by a professional portfolio manager. They offer diversification and active management in exchange for fees and are suitable for investors who prefer a managed approach.
Exchange-traded funds (ETFs): ETFs are diversified portfolios similar to mutual funds but trade on stock exchanges like individual stocks. They often have lower fees and are commonly used to build diversified portfolios.
Bonds: Bonds are loans to governments or corporations that pay fixed interest over a set term and return the principal at maturity. Investors may also buy and sell bonds on secondary markets, which can result in capital gains or losses.
Guaranteed Investment Certificates (GICs): GICs offer a guaranteed return of principal and typically a fixed interest rate for a defined term. Market-linked GICs tie returns to market performance but still protect the initial investment.

How to start investing

Here are answers to common newcomer questions about getting started with investing in Canada.

Do I need to be a permanent resident to invest?

No. You don’t need permanent resident status to invest. Many newcomers—including temporary workers and international students—can open investment accounts and begin investing.

What do I need to open an investment account?

Most brokerages require a Social Insurance Number (SIN), a government-issued photo ID (for example, a driver’s licence or passport), and a linked bank account for funding and withdrawals.

Can I invest in U.S. stocks and ETFs from Canada?

Yes. With a brokerage account you can access Canadian markets and major U.S. exchanges to buy stocks and ETFs listed in both countries. Be mindful of currency conversion, tax reporting and any cross-border tax considerations.

Where can I open an investing account?

You have several options, and many providers let you hold registered accounts such as a TFSA, RRSP or FHSA within their brokerage platform so you can manage investments directly or with professional help.

Where to open an investment account

Common places to open an investment account include:

Banks: Major banks offer investment services, including GICs, mutual funds and discount brokerages that provide access to stocks and ETFs. Check whether the bank’s brokerage supports the types of investments you want.
Brokers and online brokers: Full-service brokerages and discount online brokers allow you to trade stocks, ETFs, bonds and mutual funds. Discount brokers are often the most cost-effective option for self-directed investors.
Financial advisors and planners: Licensed advisors can recommend investment strategies tailored to your goals, and can help with tax planning, retirement planning and insurance. Fee structures vary—some charge by the hour, others by assets under management or commissions.
Wealth management firms: These firms provide comprehensive financial services and personalized advice, often combining investment management, tax planning and estate advice in one place.
Robo-advisors: Robo-advisors use automated algorithms to build and manage diversified portfolios—typically using ETFs—based on a questionnaire about your risk tolerance and goals. They offer a low-cost, hands-off approach for those who prefer not to manage investments directly.

When choosing a provider, confirm credentials, compare fees and review customer support options and platform features. Good planning and an appropriate account type can help newcomers take advantage of Canada’s tax-advantaged accounts and investment options to work toward long-term financial goals.

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