Lester Freeman
TD Ameritrade is a leading online broker that offers innovative technology, extensive product access, personalized education, and award-winning service to help investors stay on top of the market. The company provides brokerage services with a focus on transparent pricing, diversified investment options, and dedicated support. With no minimum deposit, TD Ameritrade caters to a diverse array of investors, from beginners to active traders and long-term investors. The company offers powerful, intuitive platforms filled with innovative tools and features, providing the resources necessary for informed decision-making. Additionally, TD Ameritrade provides free trading platforms, 24/7 customer support, and a wide range of investment choices, including stocks, bonds, mutual funds, ETFs, and more.
| Characteristics | Values |
|---|---|
| Account minimum | $0 |
| Stock trading costs | 5/5 stars |
| Options trading costs | 4/5 stars |
| Account fees | 4.5/5 stars |
| Tradable securities | 4.5/5 stars |
| Crypto availability | 2/5 stars |
| Trading platform | 5/5 stars |
| Mobile app | 5/5 stars |
| Research and data | 5/5 stars |
| Customer support options | 4.5/5 stars |
What You'll Learn
TD Ameritrade's trading platforms
TD Ameritrade offers a range of trading platforms to cater to the needs of different types of traders. Here is an overview of their main trading platforms:
Thinkorswim®
The thinkorswim platform is a suite of professional-level trading platforms for serious and active traders. It is available on desktop, web, and mobile. The platform offers a fully customizable software interface, advanced trading capabilities, a wide range of technical analysis tools and studies, customizable screeners and charting, backtesting capabilities, real-time news, quotes, market heat maps, and more. The thinkorswim mobile app is highly rated by users, scoring 4.7/5 stars in the App Store and 3.8/5 stars on Google Play.
TD Ameritrade Mobile
The TD Ameritrade Mobile app is designed for casual investors and is available on iOS and Android. It offers a customizable dashboard, seamless navigation, watch lists that sync with your account, streaming and customizable charts, price alerts, news, and third-party ratings. The app also includes Level II quotes, which are not available on the web platform. The iOS version of the app has received higher ratings from users compared to the Android version.
Thinkorswim web
The thinkorswim web platform is a streamlined, web-based platform that offers essential trading functionality. It is accessible from almost any browser and does not require any downloads. It provides charting with 30 indicators, multi-legged options ordering capabilities, and advanced functions such as saving orders on the same page as the ticker symbol.
Schwab.com and Schwab Mobile
Following the acquisition of TD Ameritrade by Charles Schwab, TD Ameritrade clients now also have access to the Schwab trading platforms. These include the Schwab.com website, which offers portfolio performance views, investing income tools, fundamental research, thematic investing, and more. The Schwab Mobile app provides a convenient summary view of all accounts, allowing users to access account information, market insights, trading, and account documents on the go.
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Investment options
TD Ameritrade offers a wide range of investment options to cater to a diverse array of investors, from beginners to active traders and long-term investors.
For those looking to be more hands-off, there are mutual funds, while more active traders may opt to day-trade, buy options, or invest in futures. TD Ameritrade also offers retirement accounts, including traditional, Roth, Rollover, and SEP for individuals, and Solo 401(k)s, SIMPLE IRAs, and pension or profit plans for small businesses.
TD Ameritrade provides access to stocks, bonds, mutual funds, ETFs, options, IPOs, futures, forex, margin, and crypto trading. The broker has stood out for its thinkorswim® trading platform, which offers a professional-level suite of tools for serious traders. The fully customizable software lets users execute complex trades and access elite tools for analysis.
In addition, TD Ameritrade offers over 13,000 mutual funds, of which more than 3,600 are no-transaction-fee funds. There are also more than 5,300 low-cost funds with expense ratios of 0.50% or less, making it an ideal broker for beginner mutual fund investors.
For investors interested in fixed-income securities, TD Ameritrade offers corporate, municipal, and Treasury bonds, as well as CDs. The broker also provides access to single and multi-leg option contracts, foreign exchange (including 70 currency pairs), and penny stocks (OTCMKTS).
One notable limitation is that TD Ameritrade does not offer fractional shares, and the mobile app does not support fixed-income purchases. However, investors can access a wide variety of assets on both the web platform and mobile apps, making it a good choice for those seeking a diverse range of investment options.
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Customer support
TD Ameritrade offers 24/7 customer support via phone, text, fax, live chat, email, or social media. It also offers in-person support at over 250 branches.
The company's customer support is second to none in the industry, with quick resolutions and reliable service. The support team is easily accessible through different channels, and the no-balance requirement and relatively low, transparent pricing let beginners feel more comfortable entering the market.
TD Ameritrade's website, however, could be improved in terms of ease of navigation.
The company's mobile app also shines when it comes to customer support. The prominent "trade" button at the top right of the screen allows users to execute a trade in just a few taps. Users are supported with real-time data streams, watchlists, and market news.
TD Ameritrade's customer support is available to help with trading and account queries. The company's trading desk is staffed by former professional floor traders and market makers or staff trained by them. Clients can also speak with TD Ameritrade financial advisors.
The company also provides chat support through the thinkorswim mobile app, where clients can chat live with a support associate without leaving the app.
TD Ameritrade's customer support is highly regarded, with one experienced options trader describing it as "excellent".
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Educational resources
TD Ameritrade offers a wide range of educational resources for investors. The broker provides learning material across various channels and formats, including desktop, mobile, and web. The educational content is comprehensive and covers a broad range of topics, making it accessible to investors of all levels of experience.
The Immersive Curriculum, for instance, is a free educational client portal that breaks down trading concepts and investing strategies into individual lessons, allowing users to learn at their own pace. The material is personalized based on users' preferences, account history, and the financial situation, ensuring that it remains relevant and tailored to their needs.
For hands-on learners, TD Ameritrade offers paperMoney®, a demo account tool that allows users to experience the flagship platform, thinkorswim, as an investment simulator. This feature is accessible on multiple devices, providing a convenient learning resource.
Additionally, the broker provides interactive courses and webcasts, as well as a large selection of mutual funds. However, some users have noted that the free research offered may not always be relevant to novice investors, and the platform does not offer fractional shares, which can be a limitation for those with limited capital.
Overall, TD Ameritrade's educational resources are designed to empower investors by providing the knowledge and tools necessary to make informed investment decisions.
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Fees and pricing
TD Ameritrade offers commission-free trading of stocks, options, and ETFs, and there are no inactivity or annual fees. However, there is a $75 fee for transferring your full balance out of your account. Options trades incur a per-contract fee of $0.65, which is a typical fee among brokers.
Some investments, like mutual funds and ETFs, have internal fees called expense ratios, which are charged by the funds themselves, not TD Ameritrade. Mutual funds outside the No Transaction Fee program incur commissions ranging from $49.99 to $74.95. OTCBB trades, which most other brokers have made free, incur a commission of $6.95 per transaction.
Margin interest rates range from 14.50% for a balance of up to $10,000 to 12.50% for a balance of over $499,999. High-net-worth account holders can negotiate lower rates.
Futures transactions cost $2.25 per contract per side, plus exchange fees. Forex currency pairs are traded in increments of 10,000 units with no commission; the cost is reflected in the spread, and TD Ameritrade is compensated by its liquidity provider.
There is no fee for inactivity or for transferring part of your account. Sending a wire costs $25, while sending a paper check is free, though overnight mailing incurs a $15 fee. Paper statements cost $2 for accounts with low balances.
Using a live broker costs $25 per trade across all asset classes.
TD Ameritrade does not charge any fees for online equity or ETF trades. However, they do charge a commission of $6.95 per transaction for OTCBB trades, while most other brokers have made these trades free. There is no per-leg commission on options trades, and the per-contract commission is $0.65. VIP option customers can privately negotiate discounted commissions based on volume.
Mutual fund commissions for funds outside the No Transaction Fee program range from $49.99 to $74.95. Fixed income is sold on a "net yield" basis, which means the price is marked up for a purchase or down for a sale; this fee is not transparent.
Most orders incur exchange fees, typically fractions of a penny per share or contract, which TD Ameritrade absorbs rather than passing them on to customers.
While TD Ameritrade clients do not earn interest on cash held in their accounts by default, they can opt into the cash sweep program to earn interest (currently at a rate of 0.35%).
TD Ameritrade generates revenue by directing trade orders to different parties, known as market makers. They accept around $0.001 per share for equities and $0.37 for non-marketable orders, which is average among brokers that accept payment for order flow.
Post-Merger Fees
Since Charles Schwab acquired TD Ameritrade, the fees for the combined platform are not yet known.
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Frequently asked questions
TD Ameritrade's advantages include its elite trading platform, transparent pricing and fees, real-time quotes, and experienced, licensed support. We also appreciate the thorough investor education materials and well-designed user experience, which helps it stand out above other brokerages.
Although TD Ameritrade is a strong choice for both new and experienced investors, it is missing a couple of features, such as direct crypto trading and fractional shares. If you want to use the cash sweep program, you'll have to take a few extra steps; it's not automatic. Lastly, note that although you can buy a range of fixed-income securities and CDs with TD Ameritrade, there is an additional fee charged per bond or CD.
Yes, TD Ameritrade is a good brokerage for beginners. It offers plenty of education and investing advice, plus it's easy to navigate whether you're using the website or mobile app. Plus, commission-free trades, $0 account minimum, and robust support are perfect for those just getting started in the market.
You can open a TD Ameritrade account with $0, so it's easy to set up and take a look around before funding it. If you want access to more advanced privileges, like trading on margin or options, you'll need to put down a $2,000 deposit.
