Etrade vs. TD Ameritrade vs. Schwab: Reviewing the Biggest Online Brokers

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The three largest online brokers – Schwab, TD Ameritrade, and E*TRADE – collectively have over 17 million active brokerage accounts.  While Schwab wins in terms of sheer size, which is the best online broker of the three?  Though all of these major online brokerages receive NerdWallet’s 5-star rating for different reasons, and you can trade a variety of asset classes at each, these brokers differ in terms of their top premium features and who they’ll serve best.

If you’re trying to decide which of the three largest online brokerages is best for you, NerdWallet breaks down your big brand name options and their specialities:

E*TRADE

E*TRADE is home to just over 2.9 million total brokerage accounts as of December 2012, as well as $201.2 billion in customer assets.

Known most widely for its talking baby commercials, E*TRADE should perhaps be known best for something else instead: all around low minimums and fees, coupled with all-included premium features like free research, real time data, and 24/7 service.  E*TRADE offers access to all asset classes you might want to trade, including not just stocks and funds but also options, futures, and forex.  E*TRADE is also offering 60 free days of trading upfront – up to 500 free trade commissions for stock and options if you deposit at least $10,000 upfront – an excellent savings to take advantage of if you want to initially fund the account fully but don’t plan to trade very frequently in years to come.

You should sign up for an E*TRADE account if: you’re an active trader or if you’re looking to ramp up your trading, because E*TRADE’s advanced platform is free if you make at least 10 trades per month and also offers a security token for maximum account security.

Account Details:

  • Commission: $9.99 per trade
  • Account Minimum: $500
  • Account Fees: No annual account fee
  • Promotion: Make initial $10,000 deposit to receive 60 days of free trades & up to $500
  • Sign up here.

The downside?  Although E*TRADE does offer free research reports, its basic account offers no free trading software: this comes at the hefty monthly fee for $99.95 extra to upgrade.

TD Ameritrade

TD Ameritrade has 5.8 million funded accounts and approximately $472.3 billion in client assets.

For the more casual investor, TD Ameritrade offers a full suite of investing options, including over 100 commission-free ETFs to help affordably diversify a portfolio of funds.  TD Ameritrade is consistently rated highly across the board for customer service and support.  TD Ameritrade also acquired thinkorswim back in 2009, a powerful stock and options trading platform that has provided TD many top volatility-trading features.

You should sign up for a TD Ameritrade account if: you’re looking for strong, secure trading technology combined with all the basics in one place: a powerful yet easy to use investing platform and user interface.

Account Details:

  • Commission: $9.99 per trade
  • Account Minimum: $500
  • No annual account fee
  • Promotion: Make an initial $2000 deposit and trade free for 60 days + get up to $600
  • Read the full NerdWallet review here for all the details
  • Sign up here.  (Sign up for thinkorswim here.)

The downside?  Casual investors not in search of the most powerful trading platforms and research tools can find better deals elsewhere.

Charles Schwab

Schwab currently comes in first with the status of the largest online broker, boasting 8.8 million active brokerage accounts and totaling just over $1.95 trillion in client assets.

How well does this status translate into quality offerings?  Schwab is a common household name for a reason; it provides a comprehensive suite of investment products and services for customers looking to diversify and host a variety of accounts.  It also offers customers the convenience of visiting physical locations across the country, as well as merging investing with some of the other advantages of traditional banking, such as the no-ATM-fee Schwab debit card.

You should sign up for a Schwab account if: you’re looking for the best of both worlds to integrate your banking with your investing all at the same institution offering both online and in-person services.

Account details:

  • Commission: $8.95 per trade
  • Account Minimum: $1,000
  • No annual account fee
  • Sign up here.
The downside?  Schwab is not currently offering any introductory perks or promotions to take advantage of, unlike its competitors outlined below.  Schwab does not offer the most sophisticated trading platform in the business.

Caveat to Investors: Pay For Only What You Need

Last, a word of caution: just because these are the largest online brokers does not automatically make them the best for your investing needs, so be sure to shop around for the best trading prices available.

If you merely want to buy and trade stocks or another investment vehicle, and will not be using any of the additional premium features described above, you could likely be trading for less money with a discount brokerage.  In fact, a recent NerdWallet study found that investors with the three largest brokerages are overpaying to the tune of $1.8 billion on unnecessary fees for things they don’t really need.

Not sure yet where you fit into this mix?  By plugging your trading preferences into NerdWallet’s search-and-compare tool, you can find the list of the best brokers for your specific needs.

For additional online investing resources, please visit:

 

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  • http://www.tablazines.com Tablazines

    For someone just starting out investing, which service would you suggest?

    • Joanna Pratt

      TD Ameritrade is one of NerdWallet’s favorites for beginners because they have an easy to use free platform, access to market commentary and research, and a lot of other great features included in their basis $9.99/trade fee. Read our full review here: http://www.nerdwallet.com/blog/investing/2013/td-ameritrade-review/

  • beatstockpromotersdotcom

    Of these 3 etrade is the best however etrade is still nothing in comparison to a direct access broker like speedtrader for trading penny stocks. We trade penny stocks for a living and have done so since 2002 and have used nearly every broker.

  • Gracie Darling

    I have had an Etrade account since about 1996. I am closing the accounts very soon. I am tired of the poor CS, poor trade executions and poor attitude. Don’t know why I have stayed this long. Now they are un-linking my brokerage account from my checking account. I can’t even see the brokerage account online anymore. They said because I lived outside the USA, there was a policy change.

    Now, I can’t trade or even xfer money. I can’t buy or sell. Can’t do anything. So now I have to go back the the USA to trade or open another account with a better company.

    Good luck with etrade.

    • guest

      ok so you stay with this company for about 18 years and now you complain??

    • guest

      you’ll pretty much find the same anywhere you go. these are tightened laws due to money laundry surveillance because you are out of the country.

    • frustrated beyond beyond

      Agreed……my daughter opened an account this Monday and we are already in the process of closing it because of their non-user freindly security random pin app that you must respond to in 30 seconds just to sign on…..are they nuts…..PS what customer service

      • Maxime Rieman

        Etrade’s Mobile Security ID feature (also called “VIP Access”) isn’t required for brokerage accounts, it’s simply offered as an additional service. If you would like this feature removed from your daughter’s account, just call their customer service line at 1-800-387-2331.

        • frustrated beyond beyond

          She did and their customer service couldn’t or wouldn’t……maybe you should send this information to etrade’s customer service if in fact it is fact as the individuals she dealt with didn’t know……she closed the account….we are done…thanks for your effort

  • Hari Iyer

    I use google finance and etrade. New to it but having a nice time of it so far. 24/7 support is a huge help especially with figuring out how/when margin is calculated. Their service has been great so far.

    If you are active trading though margin is essentially mandatory. 3 days for trade settlement was a royal PIA

  • Guest

    Shouldn’t Fidelity be included with these three other online brokers?

    • Guest

      I have been using Fidelity since 2005…$8 a trade

    • joeo74

      fidelity is great EXCEPT for the trading platform – flaky and unreliable. tons of other great tools and research … so if you want great Mutual Fund access and are not looking for a trading platform for active investors then Fidelity is a good option.

  • SS

    I have been using etrade for a couple years and am currently looking for a new online broker. Things I don’t like about etrade:

    1. Yes, real time quotes, but no AJAX. Is this the 90’s?
    2. The app is a disgrace to the modern world.
    – The font is too small, I know how to ‘scroll’ down.
    – I’m so tired of html in the briefs.
    – The barcode thing is so novel, but at the top.
    – It lacks real technicals (meaning if you are trading on the go, you are probably advancanced or a day-trader, like what good is the EMA?),
    – It’s too slow, and overall feels unmaintained,
    – And I don’t like how it stores activity for only a month.

    I will say the app is at least comprehensive.

    3. Pre-market and after-hours isn’t open, I don’t like having to go to google for them.
    4. Watch lists isn’t free on full site. Doesn’t make sense and again I don’t like having to go to google for it. I want everything in the same place.
    5. You can only have 4 technicals at a time.
    6. There’s no way to see the history of technical and keep it’s granularity.
    7. The full site is a little confusing, maybe even daunting to navigate.
    8. I don’t like how it doesn’t have url redirects.

    I do like the customer service, friendly. And the online learning is very nice too. I also like the interactive TREFIS.

    I don’t know if another service offers these, some of them I wouldn’t mind paying for, some not. Just wanted to comment and I hope this comment is helpful for other active traders.

  • chanctob

    What does he mean when he says about etrade…..”The downside? Although E*TRADE does offer free research reports, its
    basic account offers no free trading software: this comes at the hefty
    monthly fee for $99.95 extra to upgrade.” ??

  • CharlieCapp

    OMG, it just took me 14 days for Fidelity to fund an account on money I had moved two weeks ago. When I talked to them (every time you call you get a different rep) they said it would take 4 days. Not sure why an electonic transfer takes four days, let alone 14 days to move into an account. I am now in the process of looking for a new broker.