ETRADE vs. TD Ameritrade vs. Schwab: Reviewing the Biggest Online Brokers - NerdWallet

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

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

Open an account

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.

Read our full ETRADE review

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

Open an account

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

Read our full TD Ameritrade review

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

Open an account

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.

Read our full Charles Schwab review

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.

Compare more brokers

For additional online investing resources, please visit:

 

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  • MotherOfFour

    My husband and I have a number of different accounts with different banks and credit unions. We were hoping to make Genisys our main location for a majority of our money. They seemed great, really helpful, and never any issues for a full year. That all changed this week. Randomly two days ago, our account with them was charged $170 in NSF fees. We have clearly more than enough money to not warrant any overdraft fees. There is no negative balance and there has never been a negative balance. We keep the bare minimum in the savings ($5) as our real savings is held elsewhere. The checking had over $3000 when the fees started getting applied. Even after the 6 NSF fees went thru and a few payment transactions, the account was still more than positive. We called the bank and were told we’d get a call back in 10 minutes. No call, called back. Another 10 minutes. Called back, and another. Finally I called the Customer Service main line out of their home office in Michigan. They told me they cannot do anything. Only the local branch manager can reverse NSF fees. They tell me they got ahold of the manager on the other line and they refuse to reverse the fees. No one at the branch will transfer me to the manager, and the manager refused to speak with me through their main branch line when I called in. Went in to cancel account and withdraw the rest of our $, the manager had already left. How disappointing! Worst customer service ever. Telling all of our friends and family and spreading the word. I would HATE for this to happen to anyone else. AVOID them and SPREAD the word so this happens to no one else. Their immature refusal to speak with me on the matter was the worst mistake they made. Refusing the refund the fees was the 2nd worst. Do not work with them. They are unprofessional and steal your money!

  • MotherOfFour

    My husband and I have a number of different accounts with different banks and credit unions. We were hoping to make Genisys our main location for a majority of our money. They seemed great, really helpful, and never any issues for a full year. That all changed this week. Randomly two days ago, our account with them was charged $170 in NSF fees. We have clearly more than enough money to not warrant any overdraft fees. There is no negative balance and there has never been a negative balance. We keep the bare minimum in the savings ($5) as our real savings is held elsewhere. The checking had over $3000 when the fees started getting applied. Even after the 6 NSF fees went thru and a few payment transactions, the account was still more than positive. We called the bank and were told we’d get a call back in 10 minutes. No call, called back. Another 10 minutes. Called back, and another. Finally I called the Customer Service main line out of their home office in Michigan. They told me they cannot do anything. Only the local branch manager can reverse NSF fees. They tell me they got ahold of the manager on the other line and they refuse to reverse the fees. No one at the branch will transfer me to the manager, and the manager refused to speak with me through their main branch line when I called in. Went in to cancel account and withdraw the rest of our $, the manager had already left. How disappointing! Worst customer service ever. Telling all of our friends and family and spreading the word. I would HATE for this to happen to anyone else. AVOID them and SPREAD the word so this happens to no one else. Their immature refusal to speak with me on the matter was the worst mistake they made. Refusing the refund the fees was the 2nd worst. Do not work with them. They are unprofessional and steal your money!

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  • http://www.tablazines.com Tablazines

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

  • 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.

  • 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?

  • 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.

  • jm

    wow this review is a bit shy on info, who cares how big the company is and the only big take on TD ameritrade is the TOS and thats why Im looking to make a change, TOS is just too complicated for somebody trading under pressure. I have a lot of errors placing trades that have to be re-entered, I get logged out way to often, I ended up using a 3rd party for charts, screening and watch list, I have 2 accounts and cant be logged into both at the same time. Your review does not touch on a single thing I would be interested in as a trader… but in all fairness, I cant find any trading reviews that seem like they are written by somebody that trades

  • Charles

    I have a thinkorswim legacy account (before they got bought out by TDA). Much to my surprise their service has, if anything, gotten even better. ToS reps reply to you within 20 minutes for trading platform questions, and TDA customer service is very good as well. ToS desktop software is best-in-class, and trade executions are fast. Best of all, they’ve kept their commissions at $5 per trade for stocks, half the cost of the regular TDA platform.

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  • DrJay DrJay

    It’s so funny that every commentator here has clearly missed the point of this article. It’s really typical American mentality to speak in absolutes – to say X is the best – when the whole point of the article is that life is about Diff’rent Strokes & what might be right for you might not be right for some…

    The different services are “best” depending on one’s definition of “better”, which will vary based on lifestyle, experience, age, wealth, knowledge, education, parents, geography, preferences, etc.

    For example, a 20yo inexperienced male student who lives life indirectly via his iphone will look for different features & have different means/financial considerations from a 35yo FT-working single mum from a less tech-savvy wealthy senior ex-accountant who prefers face-to-face contact from the same senior but blue-collar & less educated from a middle-aged day-trading trust-funder, etc etc.

    So, the X vs Y question will almost ALWAYS yield the same answer: depends !