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TD Ameritrade
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Insider’s Rating
4.83/5
Perks
TD Ameritrade offers a large range of investment options, including stocks, bonds, ETFs, mutual funds, futures, bitcoin futures, and more.
Account Minimum
$0 ($5,000 or $25,000 for managed accounts through Schwab)
Fees
0% ($300 one-time fee and $30/month for advisor-managed account through Schwab); $49.95 or $74.95 for no-load mutual funds, $2.25 per futures contract, and $0.65 per options contract
Pros
- Free commissions on stock, ETF, and option trades
- No minimum requirement to get started with brokerage account
- Large investment selection
- Research and educational resources available
Cons
- No fractional shares
- Robo-advice and managed portfolios are more expensive
- No cryptocurrencies
Insider’s Take
TD Ameritrade is great for active traders interested in using multiple trading platforms. As one of the best online brokerages, TD Ameritrade offers secure storage for investments and other assets.
Product Details
- Promotion: None at this time.
- App store rating: 4.5 iOS/3.6 Android
- Consider it if: You want multiple apps for different trading experiences and goals
About TD Ameritrade
TD Ameritrade is one of the best onlinebrokerages for beginners, particularly for active traders interested in utilizing the thinkorswim platform.You can invest in low-cost stocks, bonds, ETFs, mutual funds, and bitcoin futures.
A significant portion of TD Ameritrade mutual funds are no-transaction-fee funds, so the brokerage could also be a good choice for traders who want to minimize fees on mutual funds.
TD Ameritrade provides many of the same services as Charles Schwab, including copious trading platforms and tools, third-party research materials, and educational courses and webcasts. Some tools include a stock screener, real-time data streaming, customizable charts, paper trading, and more.
You can also access bond-specific tools, like the Bond Wizard, Bond Calculator, and Bonds Alerts. The Bond Wizard tool allows investors to determine the cost and yield of their bonds.
Is TD Ameritrade Right For You?
Active Investors can benefit from advanced charting and account tools with TD Ameritrade's thinkorswim platform. These features include customizable dashboards, stock screeners, real-time market charts, and bond-specific analysis tools. Beginners can also use the platform's large selection of informational resources and market research.
You can't invest in fractional shares or directly in cryptocurrencies with TD Ameritrade. Although the brokerage offers indirect crypto trading through investments like mutual funds and bitcoin futures, folks wanting to trade crypto actively should look elsewhere.
TD Ameritrade: Overall Rating
| Feature | Insider rating (out of 5) |
| Fees | 4.75 |
| Investment selection | 5.00 |
| Access | 4.58 |
| Ethics | 4.88 |
| Customer service | 5.00 |
| Overall score | 4.83 |
TD Ameritrade Pros and Cons
| Pros | Cons |
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Is TD Ameritrade Trustworthy?
Charles Schwab acquired TD Ameritrade in October 2020. Both companies have received high ratings from the Better Business Bureau.
The BBB rates companies using a grade scale range of A+ to F. Both TD Ameritrade and Charles Schwab have an A+ rating. These grades indicate that TD Ameritrade and Schwab interact fairly well with customers.
June 13, 2022, the SEC charged three Charles Schwab investment advisors $187 million for a lack of transparency with clients regarding the management of their funds. The actual incidents occurred between March 2015 through November 2018.
Ways to Invest with TD Ameritrade
Self-directed Brokerage Accounts
TD Ameritrade offers individual and joint brokerage accounts requiring no minimum deposit. Trade commission-free for US-listed stocks, ETFs, and options. If you're more of a research-oriented trader, TD Ameritrade additionally provides market analysis from Morningstar Investment Management professionals.
Individual and joint brokerage accounts can be funded with cash or trade on margin. You can also choose a cash and options account or a margin and options account. Requires a $2,000 account minimum to unlock margin or options trading.
Furthermore, TD Ameritrade offers several trading platforms — its classic web platform, next-generation web platform, and the famous thinkorswim trading platform. Its thinkorswim mobile, desktop, and web platforms are best for advanced traders searching for perks like real-time market alerts, stock scanners, options statistics, and more.
TD Automated Investing
For investors who prefer a set-it-and-forget-it-approach, TD Ameritrade offers a goal-based Automated Investing account for top-notch robo-advice. After you take a quick online assessment you'll get a personalized portfolio recommendations tailored to your risk tolerance and goals. Invest in a curated blend of ETFs, mutual funds, and cash.
However, TD's $1,000 minimum investment is higher than other low-cost robo-advisors like SoFi Invest or Fidelity Go. Plus, there's a 0.30% annual wrap fee with a $15 minimum for accounts balances under $5,001.
You can also opt-in to get access to a team of TD professional advisors with TD Automated Plus. But a $25,000 investment minimum is required to open a Plus account and a $250 annual fee.
TD Automated Investing accounts can be opened as individual brokerage accounts, joint tenants with Rights of Survivorship taxable accounts, traditional IRAs, and Roth IRAs. Traditional and Roth IRAs are unavailable for rollovers from TD Retirement Plan accounts.
Retirement Plan Accounts
TD Ameritrade offers several of the best retirement plans for individuals and small businesses. The brokerage's current selection includes:
- Traditional IRAs
- Roth IRAs:
- Rollover IRAs
- SEP IRAs
- Solo 401(k)s
- SIMPLE IRAs
- Money pension or profit-sharing plans
In addition, each account comes without minimum opening deposits or maintenance fees. Roth and traditional IRAs feature educational resources, retirement tools, and investing and market research access.
Education Savings Accounts
Save for college and educational expenses with TD Ameritrade 529 college savings plans and Coverdell Education Savings Accounts (ESAs). The Coverdell ESA offers tax-free distributions, with a $0 minimum deposit and a $2,000 annual maximum contribution limit.
The best 529 plan provides several investment choices, including domestic equity, real estate, international equity, international bond, money market, and fixed-income investments. Minimums and fees vary by state.
TD Ameritrade also offers non-tax-deferred custodial accounts, which are types of custodial accounts to which a parent or guardian can contribute funds until the beneficiary meets the state's age requirement. Funds contributed to these accounts are considered irrevocable gifts under the Uniform Gift to Minors Act/Uniform Transfer to Minors Act (UGMA/UTMA).
Trust Accounts
A TD Ameritrade trust account allows investors to transfer assets to one or more trustees. Trustees can manage the account's assets for the account owner's benefit. TD Ameritrade offers trusts for taxable living, revocable, testamentary, and irrevocable trusts.
Partnership Accounts
A partnership account is an account shared by two or more people with an established agreement. Taxes are reported on the individual partners as personal income tax. These accounts can be opened as cash accounts, cash and margin accounts, cash and options accounts, and margin and options accounts.
TD Ameritrade also offers a limited partnership account, which is like a regular partnership account but at least one partner has unlimited liability. Common reasons to open an LP include a real estate investment partnership and hedge funds. Limited partners have very little to no responsibility for how assets are managed. Also, limited partners don't pay self-employment taxes.
Corporate Accounts
Whether for a profit or non-profit corporation, you can open a corporate account for your business to pay bills, pay taxes under the corporation's name, hold assets, and invest funds. Corporate accounts offer additional protection benefits, such as liability protection and account flexibility.
Investment Club Account
An investment club account is an account owned by a group of people, usually a partnership, that contributes a pool of funds to be invested in securities. Dividends, capital gains, and losses are reported on the individual member's taxes.
Limited Liability Account
TD Ameritrade offers this type of account for legally established LLCs. A limited liability account has the same tax status benefit as a partnership account and the limited liability benefit of corporate accounts.
Non-Incorporated Account
Non-profit organizations not charted as corporations can open a non-incorporated cash account, cash and margin account, cash and options account, or cash, margin, and options account.
Similarly, a non-incorporated, single-owner small business can open a sole proprietorship account to receive a tax advantage.
Investment Options
TD Ameritrade's investment selection consists of stocks, bonds, and more than 13,000 mutual funds including bond and crypto funds), ETFs, options, futures, annuities, IPOs, foreign investments (Forex), and other fixed-income securities. In addition, nearly 3,700 of its mutual funds are no-transaction-fee funds.
The brokerage doesn't offer direct crypto trading, but traders can invest indirectly in cryptocurrencies through over-the-counter (OTC) trust, mutual funds, ETFs, and bitcoin futures and micro bitcoin futures.
TD Ameritrade Fees
Most TD Ameritrade accounts don't have an account minimum, but to access margin and options trading, there's a $2,000 account minimum. Automated investing accounts have a $1,000 minimum with a 0.30% annual fee.
Stocks, ETFs, and options are commission-free with TD Ameritrade . However, options contracts still cost $0.65 per contract. You'll pay up to $49.95 or $74.95 for no-load mutual funds. Futures cost $2.25 per contract, and Forex investment prices vary. TD Ameritrade also charges $25 for broker-assisted trades.
TD Ameritrade doesn't charge data fees or trade minimums. You'll be subject to a quarterly $12.50 account maintenance fee if you have less than $500 of equity in your account. OTC trades may incur additional fees.
TD Ameritrade Frequently Asked Questions (FAQs)
What is TD Ameritrade, and what services does it offer?
TD Ameritrade is a leading brokerage firm empowering all types of investors with various account types, including retirement plans, education savings accounts, and trusts. You cantrade stocks, ETFs, and options commission-free. As TD Ameritrade is merging with Charles Schwab, investors can access a robust collection of resources and educational resources like third-party research materials and in-depth charting features.
How does TD Ameritrade stand out among other brokerage firms?
TD Ameritrade is a top-rated investment platform offering beginner-friendly content, market charting tools, and a collection of investable securities with little to no fees. TD equips investors with a robust library of materials and commission-free trades for stocks, ETFs, and options. The brokerage is currently integrating with Charles Schwab, another top brokerage with a notable reputation and strong client history.
Are there any fees associated with using TD Ameritrade?
TD Ameritrade offers competitive fees for options and futures traders. All TD Ameritrade brokerage accounts can trade stocks, ETFs, and options commission-free. Although a $0.65 per contract fee still applies to options trades, this aligns with industry standards. The brokerage does not charge inactivity fees, but you may be subject to a $12.50 quarterly maintenance fees if you don't have at least $500 in equity in your TD account.
Is TD Ameritrade suitable for beginner investors?
TD Ameritrade for beginner investors offers automated and advisor-assisted account options. It caters to beginners who want to learn more about the stock market with the online education center. Educational resources offered by TD Ameritrade include articles, videos, webcasts, in-person events, and podcasts on investing. TD Ameritrade also offers a Market News section that keeps customers updated on the latest happenings.
How does TD Ameritrade support advanced traders?
Advanced trading tools at TD Ameritrade include a suite of sophisticated analysis tools and charts on TD Ameritrade's thinkorswim platform. Thinkorswim is a powerful trading tool for hands-on investors to utilize in-depth analysis tools, paper trading, customizable dashboards, and real-time market scanning. The platform also supports complex order types and extensive options analytics.
How TD Ameritrade Compares
TD Ameritrade vs. Merrill Edge
Active traders, passive investors, and hands-off investors can all benefit from TD Ameritrade and Merrill Edge's offerings. But TD Ameritrade is better for those who want to expose their portfolios to assets like forex and IPOs.
Merrill's robo-advisor option requires the same $1,000 minimum as TD Ameritrade with a slightly higher annual program fee (0.45% per year). But if you're looking for advisor-assisted automated trading, Merrill's Guided Investing only requires a $20,000 initial deposit to unlock one-on-one assistance.
Existing Bank of American customers may also prefer the simplicity of trading on Merrill Edge's investment platform.
Merrill Edge review
TD Ameritrade vs. Fidelity
TD Ameritrade and Fidelity Investments offer investment options for self-directed traders and hands-off investors. However, each platform's fees, account features, and investment choices vary.
Fidelity Go, the platform's robo-advisor, is a competitive choice for hands-off investors searching for low-cost automated or advisor-assisted accounts. You won't have to worry about fees with Fidelity Go if you have an account balance below $25,000. Automated portfolios invest in a combination of Fidelity Flex mutual funds comprising domestic and foreign stocks, bonds, and other short-term investments.
Non-profit organizations and investors looking to open limited liability or partnership accounts prefer TD Ameritrade.
Fidelity review
Methodology: How We Reviewed TD Ameritrade
TD Ameritrade was examined using Personal Finance Insider's rating methodology for investing platforms to examine account types, pricing, investment options, and overall customer experience. Brokerage accounts receive a rating between 0 and 5.
Online brokerage accounts offer tools, educational resources, various assets, low fees, and more. TD Ameritrade was evaluated with a focus on how it performs in each category compared to similar platforms.
Junior Investing Reporter
Tessa Campbell is a Junior Investing Reporter for Personal Finance Insider. She reports on investing-related topics like cryptocurrency, the stock market, and retirement savings accounts. She originally joined the PFI team as a Personal Finance Reviews Fellow in 2022.Her love of books, research, crochet, and coffee enriches her day-to-day life.
Senior Wealth-Building Reporter
Rickie Houston was a senior wealth-building reporter for Business Insider, tasked with covering brokerage products, investment apps, online advisor services, cryptocurrency exchanges, and other wealth-building financial products. Before Insider, Rickie worked as a personal finance writer at SmartAsset, focusing on retirement, investing, taxes, and banking topics. He's contributed to stories published in the Boston Globe, and his work has also been featured in Yahoo News. He graduated from Boston University, where he contributed as a staff writer and sports editor for Boston University News Service.
Jr Compliance Associate
Elias Shaya is a junior compliance associate on the Personal Finance Insider team based in New York City. Personal Finance Insider is Insider's personal finance section that incorporates affiliate and commerce partnerships into the news, insights, and advice about money that readers already know and love. The compliance team's mission is to provide readers with stories that are fact-checked and current, so they can make informed financial decisions. The team also works to minimize risk for partners by making sure language is clear, precise, and fully compliant with regulatory and partner marketing guidelines that align with the editorial team. Elias is the point person for the loans sub-vertical and works with the editorial team to ensure that all rates and information for personal and student loans are up to date and accurate. He joined Insider in February 2022 as a fellow on the compliance team. Elias has a Bachelor of Science in International Business from the CUNY College of Staten Island. Prior to joining Insider, he volunteered at the New York Presbyterian Hospital, where he worked with the biomedical engineering department. In his spare time, Elias enjoys exploring new restaurants, traveling to visit his family in Lebanon, and spending time with friends.
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