- Commissions: $6.95 per trade
- Account minimum: $0
- Promotion: $100 to $600 cash bonus, depending on account size
TD Ameritrade is best for:
- Beginner investors.
- Advanced traders.
- Investors who want portfolio-building advice.
TD Ameritrade at a glance
|Stock trading costs||$6.95|
|Options trades||$6.95 + $0.75 per contract
|Account fees (annual, transfer, closing, inactivity)||No annual or inactivity fee; $75 outgoing transfer fee|
|Trading platform||Three robust platform choices (Web Platform, Trade Architect, thinkorswim) accessible to all customers|
|Mobile app||Trade, monitor accounts, create alerts and live-stream news and quotes|
|Mutual funds||Nearly 4,000 no-transaction-fee mutual funds|
|Commission-free ETFs||More than 100 commission-free ETFs
|Research and data||Free and extensive|
|Tradable securities||• Stocks
• Mutual funds
|Customer support/branches||Phone service and support 24/7; email support; more than 100 local branches|
|Promotion||Cash bonuses ranging from $100 (for deposits of $25,000 to $99,999), to $600 (for deposits of $250,000 or more)|
Where TD Ameritrade shines
Account minimum: TD Ameritrade’s $0 account minimum for IRAs and taxable brokerage accounts makes it easy for anyone to start investing — and it’s much lower than the $500 to $2,500 many brokerages require. Customers who want to trade options or trade on margin are required by industry regulations to maintain a $2,000 minimum account balance. But unlike some deep discount brokers, TD doesn’t use its low minimum as an excuse to charge account inactivity fees or limit access to research and tools.
Curated investment selection: TD Ameritrade handily earned all five of its stars in this category with its full selection of investment products, including more than 100 commission-free ETFs and nearly 4,000 no-transaction-fee mutual funds, as well as futures and forex. Choice is good, but TD’s level of curation is even more valuable, particularly for investors who prefer guidance in building a portfolio.
Morningstar, a highly respected — and independent — investment research firm, powers much of the mutual fund selection process. It compiles a quarterly Premier List of top-pick no-transaction-fee mutual funds in 45 fund categories exclusively for TD Ameritrade clients. And TD’s 100-plus commission-free ETFs cover a mix of equity funds, bond funds, international funds and commodity funds, all with reasonable expense ratios.
Free research: If you prefer to roll up your sleeves and dive into the data yourself, TD Ameritrade offers streaming CNBC news; analysis from S&P Capital IQ, Market Edge and Credit Suisse; market heat maps and real-time streaming quotes. And it’s all completely free for customers using any of TD’s trading platforms. The brokerage also has a social community called myTrade and offers access to trading specialists via phone or at one of its branches, making it easy to bat around ideas with other investors and get input from pros.
Trading platforms: TD Ameritrade offers three trading platforms:
Web Platform: This is the on-ramp platform for new investors. It’s also a good choice for those who just want to keep things simple. It lets investors select a skill level — rookie to scholar — and highlights education and fundamental research. Users also receive help assembling a properly balanced portfolio of stocks, ETFs, mutual funds and bonds based on pre-built or customized asset allocation models.
Trade Architect: A step up in sophistication, Trade Architect’s trading tools, research and real-time features — including news, quotes and market heat maps — are designed for active and options investors. The web-based platform offers customized charting, 30 stock and option screeners, and option trading tools such as probability analysis, profit/loss graphs and target zone tools. (See our full review of TD Ameritrade’s Trade Architect.)
Thinkorswim: Thinkorswim is a trading platform for serious stock, ETF, options, futures and forex traders. It has all of Trade Architect’s bells and whistles, as well as advanced trading capabilities, a robust lineup of technical analysis tools and studies, customizable screeners, backtesting capabilities and the ability to test strategies with a mock paper trading account. (See our full review of TD Ameritrade’s thinkorswim.)
Where TD Ameritrade falls short
Trade commissions: Previously our biggest knock against TD Ameritrade was its trading costs. But that changed in March when it lowered its commission rate for stocks and ETFs (and base rate for options) from $9.99 to $6.95. Around the same time Fidelity and Charles Schwab also slashed commissions. They lowered theirs to $4.95, which means TD Ameritrade is still pricier than its peers. Free access to TD’s premium research, data, analysis and multiple trading platforms makes paying a premium, albeit a less steep one than before, worthwhile for many investors.
Broker-assisted trades: Similarly, TD Ameritrade’s $44.99 broker-assisted trades are more expensive than most firms’, which often cost between $25 and $35. Customers can slash $10 off the cost if they forgo human help and place a trade via TD’s interactive voice response phone system.
ETF short-term trading fees: Investors must hold any of TD Ameritrade’s 100-plus commission-free ETFs for at least 30 days. Anything less and the broker will levy a $19.99 short-term trading fee. Many other brokers charge this fee, but TD Ameritrade’s is on the high side. For example, Fidelity charges $7.95 and E-Trade charges $15.99-$19.99, depending on quarterly account activity. And like most brokers, TD Ameritrade charges a short-term redemption fee ($49.99) on almost all mutual funds if traded within 90 days or less.
The bottom line
TD Ameritrade covers all of the bases and does it very well. Investors can receive portfolio-building guidance, a thorough education in investing, access to high-quality research, trading tools, a wide selection of commission-free ETFs and no-transaction-fee mutual funds, and the choice of three platforms all under one roof. That these features are all free — and the broker has a $0 minimum deposit requirement and has lowered its trading commissions — helped TD earn some of the highest marks in our discount broker reviews.
Updated March 3, 2017.