Top features you’ll love
A range of trading platforms
Like most brokers, TD Ameritrade offers a trade ticket so that you can quickly input orders and execute trades. It gets right to the point, and it’s easy for one-off orders, when you want to trade and go. But the broker also offers two high-featured platforms that can do much more.
Web platform: The broker’s classic platform does all the fundamentals – trading stocks, bonds, ETFs, mutual funds and options. It also includes streaming news, third-party research and watchlists.
Thinkorswim platform: This platform ups the ante, with the addition of futures, forex, and futures options on top of the web platform’s tradable securities. You’ll be able to trade some of these securities 24 hours a day, five days a week. With access to more than 400 technical studies, charting tools and advanced analytics, the platform is a professional-grade suite with many of the toys experienced traders are looking for. It comes in web, desktop and mobile versions.
Trading simulator
TD Ameritrade’s simulator – called paperMoney – lets you practice your trading strategies, setting users up with $100,000 in virtual cash, as well as a margin account to increase your buying power. The simulator uses the broker’s robust thinkorswim trading platform, and is free for customers — though it’s also available for a 60-day trial run for non-customers.
You’ll get to customize the platform’s layout, backtest your strategies, and generally do anything else that you’d be able to do on the real-money platform.
Pros: Where TD Ameritrade stands out
Fee-free funds
TD Ameritrade does right by investors here, offering more than 3,700 no-transaction-fee mutual funds. That’s a boon for investors who focus on funds. TD Ameritrade allows you to screen the funds for a variety of characteristics (though the screening function is not as useful as it could be). Each fund has a page dedicated to showing its key statistics, including holdings, performance across various time periods and more.
Investment selection
You can trade almost anything you want at TD Ameritrade – stocks, bonds, options, forex, futures and, of course, funds. And if cryptocurrency is your thing, you can trade that via futures contracts, though you won’t be able to trade it directly as you can at a number of other brokerages.
Commission-free stock and ETF trades
Like most of the online brokerage industry, TD Ameritrade has no commissions on stock and ETF trades, putting it among the leaders in the industry. The broker charges $0.65 per options contract, putting it in line with other major peers such as Charles Schwab and Merrill Edge.
Research and education
TD Ameritrade offers education for beginners on up — with live webcasts, news and analysis on almost any market-related topic. From basic “how to trade stocks” guides to arcane options trading sessions, you’ll find many of the investing education resources you’ll need to help make the most of TD Ameritrade. TD Ameritrade even takes advantage of its physical presence, offering in-house sessions for investors at its more than 175 branch locations.
Those investing in individual stocks will appreciate the broker’s research, including reports from Morningstar, Credit Suisse, CFRA, Thomson Reuters and many others. Each stock page includes access to SEC filings, earnings transcripts, and any related news, so you’re fully up to date.
Mobile apps
TD Ameritrade offers not one, but two apps, corresponding to the broker’s two trading platforms. TD Ameritrade Mobile mimics much of the more straightforward desktop platform, offering practical functionality in an easy-to-use package.
Meanwhile, the thinkorswim Mobile app transforms the thinkorswim platform into your handheld device. It offers more advanced trading, such as futures and multi-legged options, so you can trade virtually anything as long as you’re web-enabled. You can also stream video from CNBC and the TD Ameritrade Network while getting access to Level II quotes.
Wide range of account types
TD Ameritrade is also highly accommodating when it comes to the types of accounts you can open. In addition to standard types such as individual and joint taxable accounts, you’ll also be able to open custodial accounts, 529 accounts, education savings accounts, trusts and partnership accounts. Those looking for retirement accounts won’t receive short shrift either, with the standard traditional and Roth IRA accounts as well as pension and profit sharing accounts and business retirement accounts: SEP IRA, SIMPLE IRA and the solo 401(k).
TD Ameritrade offers a wide range of types, meaning you’re highly likely to find what you need.
Cons: Where TD Ameritrade could improve
Account fees
While TD Ameritrade doesn’t charge an inactivity fee, it does impose a $75 transfer-out fee, though partial transfers are free. And although the broker doesn’t impose a fee for trading some mutual funds, it will dock you a short-term trading fee of $49.99 if you don’t hold the fund for at least 180 days. It does not charge a short-term redemption fee on ETFs, however.
A handful of brokers, including Fidelity and Interactive Brokers, now charge no fees for ACATS transfers.
Mutual fund fees
TD Ameritrade offers more than 13,000 mutual funds, and more than 3,700 of them can be traded without incurring a transaction fee. However, if you don't trade one of these fee-free funds, you'll be stuck with a $49.95 commission for no-load funds when you buy, though some fund families will cost as much as $74.95. TD Ameritrade doesn’t charge when you sell no-load funds, however. For load funds, the broker won't charge you a fee, but you'll likely be hit with an even bigger sales commission.
Fractional shares
The broker allows you to reinvest your dividends into partial shares of stock, but does not permit you to purchase stock as fractional shares. That’s too bad since fractional shares are a great way for newer investors to get all their money invested in those high-priced securities they want.
Meanwhile, key rivals such as Charles Schwab and Fidelity offer both fractional purchases and dividend reinvestment. For TD Ameritrade customers it may be something of a moot point, however, as Charles Schwab begins integrating the broker into its own operations.
Bottom line
With its strengths in research, education, trading platforms and more, TD Ameritrade is still a good pick if you’re looking for a broker. But you’ll probably want to be sure that Charles Schwab is also a good fit too – it does rank tops at Bankrate – as that broker integrates TD Ameritrade. TD Ameritrade still offers a number of reasons to become a customer today:
- TD Ameritrade packs a full-service broker experience into a discount package, with many available types of securities, account types and other services – many at no charge.
- Experienced investors will still find something to love here, with the broker’s multiple trading platforms and other high-quality trading tools.
- If you’re looking for research or education, TD Ameritrade will be able to deliver here, too, and investors of all levels will be able to derive value from the offerings.
If you’re on the hunt for a broker that provides quality research and educational content, Fidelity and Merrill Edge are also good places to look. E-Trade scores well too on both fronts and should be a contender, as well. If you need an even wider selection of securities, including cryptocurrency, check out Interactive Brokers.
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