TD Ameritrade® Review 2019

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Bottom line in a sentence

If you're a novice investor but serious about getting more involved with the market, TD Ameritrade will hold your hand every step of the way.

TD Ameritrade at a glance

Star Rating

  • Affordablity: 3 of 5
  • Usability: 5 of 5
  • Tools & Research: 4 of 5
  • Mobile: 4 of 5
  • Scalability: 5 of 5
  • Minimum Balance:
  • Cost per stock trade:
  • Cost per options trade:
    $6.95 + $0.75 per contract
  • Commission-free mutual funds or ETFs:
    More than 300 commission free ETFs, though only a few hundred no-cost mutual funds
  • Customer service:
    24-hour phone support; in-person support offered at over 300 branches nationwide.
  • Inactivity fee:
    TD Ameritrade does not charge inactivity fees.
  • Mobile app:
    Yes, TD Ameritrade offers two mobile trading apps: TD Ameritrade Mobile and TD Ameritrade Mobile Trader. Both are available on the Apple App Store and Google Play.
  • Annual fees:
    There are no annual fees.
  • How long to withdraw:
    Funds are available to withdraw by check four days after the settlement date and by wire transfer immediately after settlement. Note, wire transfers incur a $25 fee.
  • SIPC insured:
    Yes, the SIPC protects securities customers of its members up to $500,000 (including up to $250,000 for claims for cash).
  • Best for:
    Investors who may be a bit green, but want to get serious about investing

What TD Ameritrade is

TD Ameritrade has been in the discount brokerage space for long time. It launched its internet-based trading platform in 1995 – and before internet trading was common, it developed a touch-tone order entry system in the 1980s.

It's no surprise, then, that TD continues to be one of the leaders in democratizing all asset classes for the "little guy." Its pricing structure may not be best in the market, but a massive array of commission-free ETFs makes up for some of that shortfall.

Furthermore, robust educational resources and a user-friendly interface provide powerful potential without making the platform inaccessible to newcomers.

If you want depth to your broker but don't want to just get tossed into the ocean without a life vest, TD has you covered.

What TD Ameritrade costs

Admittedly, $6.95 per trade is at the high end of the marketplace for online brokers. And with only hundreds of no-cost mutual fund offerings (some providers offer several thousand options), there are certainly places where TD can improve on costs.

But at present, it's hard to find any other broker that offers more commission-free ETF options than TD. This includes popular broad market funds from major firms like Vanguard as well as niche funds from smaller providers if you want a tactical bet on something much more narrow – like the First Trust Global Wind Energy ETF (FAN).

With TD's suite of exchange-traded funds, you don't need access to thousands of additional mutual funds that don't really provide any new strategic opportunities. TD knows that the world is moving away from mutual funds and toward ETFs, so it has made the decision to discount what people are increasingly interested in.

Be careful, however, because trading quickly in and out of a theoretically commission-free ETF can still lead to charges. The fine print reveals that typically you have to hold an exchange-traded fund at least 30 days to be truly free of any charges.

In other words, if you're trading actively and at volume – either in short-term ETF positions, individual stocks or options – the fees may make TD cost prohibitive versus platforms that offer a much better pricing structure.

What TD Ameritrade offers

This cost structure has its flaws but shouldn't scare you. Because in many ways, the broker is designed to take relatively inexperienced investors and hold their hands until they are ready for more sophisticated strategies.

In short, it's all about service and usability.

Quick comparison of Brokerage options:
Brokerage Overall Rating Avg. Cost Per Trade Usability Rating
td-ameritrade logo
$6.95 5 of 5
interactive-brokers logo Read Our Review
$1 3 of 5
wellstrade logo Read Our Review
$5.95 3 of 5
charles-schwab logo Read Our Review
$4.95 5 of 5

Here are some features that illustrate this:

  • Ask Ted Anything: An interesting feature that shows how TD Ameritrade views the world is the prominent integration of a "virtual investment consultant" named Ted. He's clearly a bot that runs on artificial intelligence and isn't quite as witty as digital assistants like Siri or Alexa. But for investing-related questions, he's a great resource that makes it incredibly easy to navigate the platform, learn more about an investing concept or reach the full potential of the tools.
  • Best-in-class investor education: Unlike some brokers that simply let you click around and learn things based on personal taste, Ameritrade puts education front and center. The broker starts you at "Rookie," then recommends items such as a video on basic portfolio management so you can increase your standing. A point-based system awards you for self-discovery, too, and turns it into a kind of game that makes you truly feel like you're making progress. That education isn't just limited to strategies and concepts, either, and includes tutorials on how to use TD Ameritrade tools to their fullest potential. It's clear that TD isn't just offering an in-depth education experience but wants to push you to experience the resources – and ultimately, to grow as an investor.
  • Goldilocks quote pages: Brokers seem to take one of two approaches to their quote pages: Either they give you the basics in a plain format, or they go all out to impress you with how much they can do. TD does neither too much nor too little. Its quote pages are robust but also easy to use thanks to a tabbed approach that keeps veterans focused on a key element of their research and prevents novices from experiencing information overload. Key statistics are shown in easy-to-understand graphics – and if you don't know what you're seeing, just put your cursor over a specific factor to learn more. Sure, it may take a few more clicks for some. But the format is intuitive and accessible, and leaves nothing on the table when it comes to the depth of research.
  • Big research universe: Beyond simply screening tools and financial metrics, TD also offers plenty of third-party takes on what all those numbers actually mean according to other investors – from investment banks like Credit Suisse to financial media giants like Dow Jones to independent research firms like Zacks. This shows that TD wants investors to get involved and not just rely on high-level metrics that are spoon-fed to them in a flashy chart.
  • Thinkorswim: Back in 2009, TD Ameritrade bought this sophisticated research platform and now offers the tool for free to all account holders who want a high-powered investment experience above and beyond the offerings native to TD. So if and when you're ever ready to trade like a pro, this additional resource is waiting.

What TD Ameritrade lacks

The biggest drawback for TD Ameritrade is the cost structure. At $6.95 a trade, it's hard for active investors to justify this brokerage platform even considering all the depth it offers.

Of course, it's because of this slightly higher cost structure that the broker can afford such a robust suite of tools and training – so don't mistake its commissions for a reflection that TD doesn't care about its customers. You're getting a lot for your money – and more features are constantly coming online, including a live daily broadcast during market hours that launched last year as the TD Ameritrade Network.

The philosophy is clearly about helping investors grow and thrive. If you're a rookie investor, this much care and attention is great. You're not placing that many trades, so you get great value in return for the extra few dollars you're paying for each transaction.

That said, if you trade at any volume and are already very comfortable with the markets, it's hard to justify the expense.

TD Ameritrade is best for...

Disinterested investors who want to simply buy and hold mutual funds forever may not find the best structure on TD. Nor will veterans who trade frequently, and thus are more sensitive to costs.

But if you're an investor who wants to get serious and learn more, with the flexibility to access more sophisticated tools when you're ready, TD Ameritrade shines. The entire platform seems designed to make all markets and asset classes accessible, and to build the confidence of its users over time.

This is a compelling proposition because most investors fall into this category. It's irresponsible to be a lazy investor, and many folks who consider themselves Wall Street pros still have much to learn.

There's something to be said for paying a small premium in exchange for better customer service and a higher-quality product. This is particularly true with something like investing, where even minor decisions can be stressful and the intangible costs of your emotions cannot be discounted.