Wealthsimple Launches Gold Trading Tool for Just $1 Amid Surge

UPDATE: In a groundbreaking move for investors, Wealthsimple has just announced a new tool allowing clients to trade real gold starting at $1. This innovative offering is expected to reshape the investment landscape as demand for gold skyrockets amid economic uncertainties.

On October 4, 2023, the Toronto-based brokerage revealed that clients can now buy and sell gold 24/7 for a transaction fee of just 1%, with no additional commission costs. This initiative aims to diversify Wealthsimple’s investment options while making gold trading accessible to a broader audience.

“We want to allow all Canadians access to these things that people use to build wealth,” stated Paul Teshima, Wealthsimple’s Chief Commercial Officer. The company is also partnering with custodians to securely store physical gold for clients at no cost, with the option of home delivery available.

Clients can redeem their gold once they acquire one-tenth of an ounce, currently valued at approximately $560. Teshima emphasized the potential for investors, saying, “If you put a dollar a day, or five, ten dollars a week, over time you could accumulate enough that you could then redeem a one-tenth ounce gold coin.”

This initiative comes as gold prices have surged to record highs, surpassing $6,000 per ounce on October 2, 2023, marking an increase of over 60% in just one year. Investors are increasingly turning to gold to hedge against inflation and economic downturns, particularly amidst concerns around recent political developments, including the ongoing U.S. government shutdown and potential interference with the Federal Reserve.

Wealthsimple continues to carve out its niche in the Canadian banking industry, competing with the Big Six banks. The fintech firm recently announced it has achieved a milestone of $100 billion in total assets under administration, ahead of its target for December 2028. This is a significant increase from approximately $50 billion just a year ago.

In addition to the gold trading tool, Wealthsimple also unveiled its new “retirement accelerator” loan designed for clients seeking to maximize their Registered Retirement Savings Plan (RRSP) contributions. This product allows borrowers to top up their RRSP contributions without the need for a traditional credit check, as Wealthsimple evaluates applicants based on their assets instead.

“We believe there are lots of Canadians today who are high earners but maybe haven’t developed lots of credit yet,” Teshima explained. “If you have $20,000 or $30,000 in a Tax-Free Savings Account, we’re going to let you borrow some money to top up your RRSP against those assets at a much lower rate.”

However, financial planners caution that borrowing to contribute to an RRSP is not suitable for everyone. Teshima stated that clients will work closely with advisors to assess whether this financial strategy is appropriate for their individual situations. “There are going to be some Canadians this does not make sense for because they literally are living paycheck to paycheck,” he added.

Wealthsimple’s latest offerings are sparking excitement among investors looking to take advantage of the current economic climate. With these new tools, the firm aims to empower more Canadians to participate in wealth-building opportunities, reflecting a significant shift in how investment products are accessed.

Stay tuned for further developments as Wealthsimple continues to innovate in the financial services sector. This is a crucial moment for investors eager to capitalize on the booming gold market and maximize their retirement savings.