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Updated on Friday, March 13, 2020
TD Ameritrade is one of the leading U.S. brokerages in today’s market. It offers a comprehensive range of account types, and there is no minimum investment requirement. With over 350 brick-and-mortar branches, and a choice of online and mobile trading platforms, TD Ameritrade bridges the gap between a traditional and online brokerage for investors who may want the option for in-person consultations.
Who should consider a TD Ameritrade brokerage account?
With an extensive range of services and investment products, TD Ameritrade aims to reach investors of all levels, from beginners to experienced traders.
The fact that there’s no account minimum to open a TD Ameritrade brokerage account is attractive for new investors. Beginners and other hands-off investors will also appreciate the opportunity to invest in thousands of commission-free ETFs, which can make building a diversified portfolio easy. Active ETF traders, however, may wish to look elsewhere because TD Ameritrade charges a hefty $13.90 fee on commission-free ETFs held for less than 30 days.
Investors who want face-to-face interaction and customer support will appreciate the fact that there are brick-and-mortar branches of TD Ameritrade throughout the country. Educational seminars offered at local branches will also appear to beginning and experienced investors alike.
More seasoned investors will like TD Ameritrade’s robust resources, including pro-grade trading platform, thinkorswim, plus a comprehensive suite of investment research tools. These tools include Social Signals, which pulls Twitter insights on particular investments into one place as well as a trading simulator that allows you to track investment performance without putting real money at risk.
All investors have the option to set up a free consultation with an independent registered financial advisor through TD Ameritrade’s AdvisorDirect referral program.
TD Ameritrade fees and features
|Stock trading fees|
|Amount minimum to open account|
|Account fees (annual, transfer, inactivity)|
|Mobile app||iOS, Android, Windows phone|
|Customer support||Phone, 24/7 live support, Chat, Email, 364 branch locations|
TD Ameritrade offers numerous features that set it apart from other online brokers, including an extensive library of educational materials as well as investor education seminars held periodically throughout the year.
While its resource materials and trading platforms are a cut above competitors, many of its costs and fees are in-line with industry averages:
- There are no commissions charged for online stock or ETF trades
- There are no commissions, assignment fees, or exercise fees for option trades, and contract fees are just $0.65 per contract
- Online trades of stocks not listed on U.S. stock exchanges incur a $6.95 commission
- A $25 fee is charged for broker-assisted trades
- There is a $5 fee for using the interactive voice response phone system
TD Ameritrade trading fees for certain ETFs and mutual funds
Although TD Ameritrade offers thousands of commission-free ETFs, any funds participating in the ETF Market Center and sold for no commission must be held for at least 30 calendar days. If you sell before this time is up, you’ll be assessed a $13.90 short-term trading fee.
The day the ETF is purchased counts as calendar day zero, so the clock doesn’t start on your 30 days until the next business day following the purchase. Because of this fee, the actual cost of a commission-free ETF could exceed the expenses associated with buying and selling ETFs that aren’t commission-free.
TD Ameritrade lets users trade over 13,000 mutual funds on its platform, including hundreds of funds that carry no transaction fee. However, TD Ameritrade charges a $49.99 trading commission to trade no-load mutual funds. Users looking to minimize costs should carefully review potential trading fees involved in buying and selling many funds.
TD Ameritrade investment options
TD Ameritrade offers investors the opportunity to invest in a wide range of different asset classes including:
- Mutual funds
- Bonds and CDs
It’s possible to buy stocks on U.S. exchanges and on overseas exchanges. Investors also have a choice of more than 2,300 commission-free ETFs as well as more than 13,000 mutual funds total including hundreds of funds with no transaction fees.
Investors benefit from the fact they’ll pay no commissions when trading most stocks, options and ETFs — but should be aware that there are still trading costs associated with some investments.
Trading stocks not listed on U.S. exchanges will result in a charge of $6.95 for buying and selling, while there is a fee of $2.25 per futures contract and a fee of $0.65 per options contract. No load mutual funds also come at a cost of $49.99, although investors can avoid this fee by choosing from one of the many no transaction fee funds.
No commissions also doesn’t mean no trading expenses. Investors who purchase certain commission-free ETFs still have to pay fund management expense ratios, which are charged by the fund itself and entirely separate from trading commissions charged by brokers. However, TD Ameritrade‘s ETF screener can help you to find ETFs with 0% expense ratios, as well as other low-cost exchange-traded funds to keep fees to a minimum.
Trading platforms and tools
TD Ameritrade has a desktop trading app, a mobile app, and a web app, letting you buy and sell assets whenever and wherever you like. Some of the features you can expect from these platforms include:
- Integrated research and data, including third-party research as well as financial news and social insights from Twitter
- Real-time streaming quotes
- Advanced charting tools including the ability to incorporate data from the Federal Reserve including more than 400,000 economic indicators
- Access to current and historical market data
Unfortunately, not all tools are available on all TD Ameritrade platforms. Portfolio Planner, which assists you in building a portfolio that exposes you to an appropriate level of risk depending on your investment goals, is available only on TD Ameritrade‘s online platform.
Beginning investors may also find ThinkorSwim, TD Ameritrade‘s free desktop trading platform, to be too complex to navigate even with in-app support.
Research resources and trading simulator
TD Ameritrade truly sets itself apart from other brokers because of the quality and quantity of research and educational materials the brokerage provides. Some of these tools include:
- Immersive online courses taught by investment coaches that provide education for all levels of investors. Courses include an introduction to retirement planning; lessons on fundamental analysis to help you learn to identify value stocks or technical analysis to help you learn to read the market; introductions to options trading or futures trading; and much more.
- More than 200 instructional videos for investors at all experience levels, including an introduction to trading stocks.
- Access to market news, including from third party sources such as Yahoo Finance as well as briefings on market events prepared by TD Ameritrade strategists.
- Webcasts on a wide range of subjects including long-term investing, active trading, and portfolio management.
TD Ameritrade also offers paperMoney, a virtual stock market simulator so you can test trading strategies and track performance. With paperMoney, you can virtually trade stocks, options, futures and forex. You’ll have access to the same charting data and market indicators available to those trading actual money, but won’t put assets at risk.
Strengths of TD Ameritrade
- No account minimums for TD Ameritrade brokerage accounts and no account value thresholds for site access: The fact that there are no account minimums is a huge draw for beginning investors, who should know that all online tools are available to them regardless of account balance.
- Robust research tools and analysis: TD Ameritrade offers live CNBC streaming and access to third-party research tools to help investors come up with a customized strategy.
- Robust mobile experience: In addition to being able to buy, sell and trade via the app, the app also allows access to more than 20 educational videos as well as research from leading financial analysts.
Drawbacks of TD Ameritrade
- Short-term ETF trading fees: TD Ameritrade offers over 2,300 commission-free ETFs. You must own them for at least 30 days before selling, or you may be charged a $13.90 short-term trading fee — something to be aware of if you’re an investor who regularly trades ETFs and you’re focused on keeping costs as low as possible.
- Higher costs and a higher account minimum for robo-advisory services: While competitors allow you to get started with just $500 — and some don’t even have minimum investment requirements — TD Ameritrade‘s robo-advisor requires a $5,000 minimum
- Some trading platforms are complicated: Beginning investors will likely find thinkorswim to be overwhelming.
Is TD Ameritrade safe?
TD Ameritrade has a history of 40-plus years in investing. The online and mobile platforms have strong security requirements, including two-factor authentication, and shut down account access at the first sign of suspicious activity. TD Ameritrade also offers an asset protection guarantee that promises reimbursement for any securities or cash lost as a result of unauthorized account activity.
TD Ameritrade manages $1 trillion in client assets and has over 11 million funded client accounts. TD Ameritrade is a member of the Securities Investor Protection Corporation (SIPC), and securities in your account are protected up to $500,000. Certificates of deposit (CDs) purchased by TD Ameritrade are issued by banks insured by the Federal Deposit Insurance Corporation (FDIC). Cash in your investment account can be held in an FDIC-insured deposit account, where it is insured by the FDIC up to the legal limit per depositor, per bank.
Final thoughts on TD Ameritrade
Investors who have a range of investment needs may find TD Ameritrade to be a good all-in-one option. The robust online tools, accessible customer service and lack of account minimums make TD Ameritrade appealing to investors of all levels. Those looking for an affordable robo-advisor or who wish to actively trade ETFs, however, may wish to look elsewhere as their costs with TD Ameritrade will likely be higher than with many competitor offerings.
The rates and fees mentioned in this article are accurate as of the date of publishing.