TD Ameritrade Review What You Should Know About This Broker

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Contents

TD Ameritrade Review 2020

Summary

Recommended for investors and traders looking for solid research and a well-equipped desktop trading platform

TD Ameritrade was founded in 1978 and it is one of the biggest US-based stockbrokers . It is regulated by top-tier regulators like the Securities and Exchange Commission (SEC), Financial Industry Regulatory Authority (FINRA) and the Commodity Futures Trading Commission (CFTC).

TD Ameritrade is considered a safe broker since it has a long track record, is listed on a stock exchange, has a banking background, discloses its financials, and is regulated by top-tier regulators.

We selected TD Ameritrade as Best desktop trading platform and Best broker for options for 2020, based on an in-depth analysis of 57 online brokers that included testing their live accounts. Check out the complete list of winners.

TD Ameritrade pros and cons

TD Ameritrade’s trading fees are low and it has one of the best desktop trading platforms, Thinkorswim. The customer support team gives fast and relevant answers.

With a TD Ameritrade account you can trade only in the US markets. The account opening is slow and not fully online. TD doesn’t provide credit/debit cards and electronic wallets for money transfers.

Pros Cons
• Low trading fees (free stock and ETF trading) • You can trade only in the US markets
• Superb desktop trading platform • Slow and not fully digital account opening
• Great customer support • No credit/debit cards and electronic wallets for money transfer
TD Ameritrade main features and highlights
��️ Country of regulation USA
�� Trading fees class Low
�� Inactivity fee charged No
�� Withdrawal fee amount $0
�� Minimum deposit $0
�� Time to open an account 1-3 days
�� Demo account provided Yes
��️ Products offered Stock, ETF, Forex, Fund, Bond, Options, Futures

Gergely Korpos

Author of this review

Everything you find on BrokerChooser is based on reliable data and unbiased information. We combine our 10+ years finance experience with readers feedback. Read more about our methodology

TD Ameritrade review
Fees

TD Ameritrade provides free stock and ETF trading. The forex, bond, and options fees are low as well. On the other hand, they charge high fees for mutual funds.

Pros Cons
• Low trading fees • High fund fees
• Low non-trading fees
• Free stocks and ETFs
TD Ameritrade fees snapshot
Assets Fee level Fee terms
US stock Low Free stock and ETF trading
EURUSD Low The fees are built into spread, 1.0 pips is the average spread cost.
Mutual fund High $49.99 per transaction, there are also

4,000 free funds

Inactivity fee Low No inactivity fee

How we ranked fees

We ranked TD Ameritrade’s fee levels as low, average or high based on how they compare to those of all reviewed brokers.

To get things rolling, let’s go over some lingo related to broker fees. What you need to keep an eye on are trading fees, and non-trading fees.

  • Trading fees occur when you trade. These can be commissions, spreads, financing rates and conversion fees.
  • Non-trading fees include charges not directly related to trading, like withdrawal fees or inactivity fees.

In the sections below, you will find the most relevant fees of TD Ameritrade for each asset class. For example, in the case of stock investing, commissions are the most important fees.

We also compared TD Ameritrade’s fees with those of two similar brokers we selected, Charles Schwab and E-Trade. This selection is based on objective factors such as products offered, client profile, fee structure, etc. See a more detailed rundown of TD Ameritrade alternatives.

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To have a clear overview of TD Ameritrade, let’s start with the trading fees.

TD Ameritrade trading fees

TD Ameritrade trading fees are low. In 2020, many US brokers, including TD Ameritrade, removed the commission of stocks and ETFs.

Stock fees and ETF fees

TD Ameritrade provides free stocks and ETFs.

TD Ameritrade stock and ETF commission of a $2,000 trade

TD Ameritrade Charles Schwab E-Trade
US stock $0.0 $0.0 $0.0

If you prefer stock trading on margin or short sale, you should check TD Ameritrade financing rates.

But what is the financing rate? A financing rate, or margin rate, is charged when you trade on margin or short a stock. This basically means that you borrow money or stocks from your broker to trade. For this borrowed money/stock you have to pay interest. This is the financing rate. It can be a significant proportion of your trading costs.

TD Ameritrade has high margin rates.

TD Ameritrade annual financing rates for stocks, futures and options

TD Ameritrade Charles Schwab E-Trade
USD margin rate 10.3% 9.3% 10.8%

TD Ameritrade’s financing rates are volume-tiered. It applies a base rate plus a premium/discount depending on the borrowed amount. The base rate is set by TD Ameritrade and it can change in time. At the time of our review, the base rate was 9.0%

TD Ameritrade – annual financing rates

Debit balance Rate% Base rate + / –
$250,000 – $999,999 8.25% -0.75%
$100,000 – $249,999 8.50% -0.50%
$50,000 – $99,999 8.75% -0.25%
$25,000 – $49,999 9.75% +0.75%
$10,000 – $24,999 10.00% +1.00%
Under $10,000 10.25% +1.25%

The financing rates above are also applied for options and futures trading, not just stocks.

Forex fees

TD Ameritrade’s forex fees are low. Charles Schwab and E-Trade doesn’t offer forex trading.

To have a clear picture on forex fees we calculated a forex benchmark fee for major currency pairs. This catch-all benchmark includes commissions, spreads and financing costs for all brokers.

Forex benchmark fee of a $20,000 30:1 long position held for one week

TD Ameritrade Charles Schwab E-Trade Interactive Brokers
EURUSD benchmark fee $13.0 $17.9
GBPUSD benchmark fee $9.3 $13.6
AUDUSD benchmark fee $13.3 $12.0
EURCHF benchmark fee $5.3 $7.1
EURGBP benchmark fee $9.7 $13.0

Fund fees

TD Ameritrade charges generally high fees for funds.

TD Ameritrade commission for a $2,000 fund purchase

TD Ameritrade Charles Schwab E-Trade
Mutual fund

4,000 free mutual funds”> $24.8

TD Ameritrade Charles Schwab E-Trade
US Treasury bond $0.0 $0.0 $0.0

There is no commission for the US Treasury bonds. In the case of corporate bonds, TD Ameritrade will charge $1 per bond on secondary transactions (subject to a $10 minimum and a maximum of $500).

Options fees

TD Ameritrade options fees are low.

TD Ameritrade stock index options commission of 10 contracts

TD Ameritrade Charles Schwab E-Trade
US stock index options $6.5 $6.5 $6.5

The options fees are based on the number of traded options contracts.

Futures fees

TD Ameritrade futures fees are average and are calculated on a volume base, $2.25 per contract.

TD Ameritrade stock index futures commission of 10 contracts

TD Ameritrade Charles Schwab E-Trade
US stock index futures $22.5 $15.0 $15.0

Non-trading fees

TD Ameritrade has low non-trading fees. For instance, there is no inactivity fee.

There is no withdrawal fee either if you use ACH transfer. The withdrawals to other banks using wire transfer cost $25. Clients outside the US can only use this wire transfer. We tested ACH, so we had no withdrawal fee.

TD Ameritrade non-trading fees

TD Ameritrade Charles Schwab E-Trade
Account fee No No No
Inactivity fee No No No
Deposit fee $0 $0 $0
Withdrawal fee $0 $0 $0

TD Ameritrade review
Account opening

As a new client, you can change from many different account types at TD Ameritrade and as US citizen you will face no minimum deposit. Unfortunately, the process is not fully digital.

Pros Cons
• No minimum deposit • Not fully digital
• Many account types

Can you open an account?

TD Ameritrade targets U.S. clients. On the other hand, we discovered some countries where TD Ameritrade is available: China, Hong Kong, Malaysia, Singapore. For Canadian clients the TD Direct Investing solutions are available within the TD Group, but not TD Ameritrade.

Watch out! The offered services may vary in different countries. For example, clients from Hong Kong, Malaysia and Singapore can’t trade with mutual funds and forex, only stocks, ETFs, and options are provided.

What is the minimum deposit at TD Ameritrade?

The required TD Ameritrade minimum deposit is $0 for U.S. clients if you choose the basic cash account. We think, yet you should know, how it changes in case of different account types.

TD Ameritrade minimum deposit

Trading preferences Minimum deposit
Trading at basic accounts $0, but electronic funding has a $50 minimum
Margin trading* $2,000
Day trading $25,000
Trading with TD Ameritrade portfolios $5,000 – $250,000

*You trade with money borrowed from the broker, also called trading on leverage

The minimum deposit for non-US clients can be higher. For example, the minimum deposit is $3,500 for Malaysian and Singaporean clients.

Account types

TD Ameritrade offers several account types:

TD Ameritrade account types

Account type Short description
Individual The account is owned by a single individual
Joint accounts Two or more account owners
The account is owned by a legal entity
Retirement accounts (Traditional IRA, Roth IRA, etc.) Individual retirement accounts which are available only for US clients
Pension accounts For self-employed individuals and small businesses which are only available for US clients
College savings, e.g. 529 Plan Accounts for college savings plans which are available only for US clients
Custodial or Guardianship accounts Special accounts which are available only for US clients
Trust The account owner entitled to transfer assets to one or more trustee which is available only for US clients
Accounts for trading with portfolios managed by TD Ameritrade, these accounts are available only for US clients

In this review, we tested the Individual Brokerage Account.

How to open your account

TD Ameritrade has straightforward, but not fully digital account opening process. When you complete the online account opening form, you have to mail or fax the generated document and the copy of the relevant ID card to TD Ameritrade. It took us 3 business days for us to open the account.

In the following steps, we walk you through the account opening at TD Ameritrade:

  1. Choose the account type, state your investment/trading preferences
  2. Add personal information, like Social Security Number, residency, and your employment status
  3. Review your information
  4. Acknowledge the terms and conditions
  5. Print and mail/fax the application

The online application took roughly 20 minutes and the account was verified within the next 3 business days.

TD Ameritrade review
Deposit and withdrawal

TD Ameritrade has user-friendly account funding and charges no deposit fees, but are several drawbacks as well. You can use only bank transfer and a high fee is charged for wire transfer withdrawals.

Pros Cons
• No deposit fee • Credit/Debit card not available
• User-friendly • High withdrawal fee for wire transfers

Deposit fees and options

Let’s start with the good news. TD Ameritrade charges no deposit fees. In terms of deposit options, the selection varies. U.S. clients can use checks, ACH, and wire transfers, while clients from Hong Kong, Malaysia, and Singapore can use only wire transfer and checks to deposit.

Unfortunately, credit/debit cards and electronic wallets are missing.

TD Ameritrade deposit options

TD Ameritrade Charles Schwab E-Trade
Bank transfer Yes Yes Yes
Credit/Debit card No No No
Electronic wallets No No No

We tested ACH transfer and it took 1 business day. The minimum transfer amount is $50. The wire transfer can take several business days.

You can only deposit money from accounts that are in your name.

TD Ameritrade withdrawal fees and options

TD Ameritrade charges no withdrawal fees in most of the cases. The only exception we find is the bank/ wire transfer, which costs $25.

TD Ameritrade withdrawal fees and options

TD Ameritrade Charles Schwab E-Trade
Bank Transfer Yes Yes Yes
Credit/Debit card No No No
Electronic wallets No No No
Withdrawal fee $0 $0 $0

How long does it take to withdraw money from TD Ameritrade? We tested the ACH withdrawal and it took 2 business days.

You can only withdraw money to accounts in your name.

Follow us through the next steps to see how to withdraw money from TD Ameritrade:

  • Log into the account
  • Go to the ‘My account’
  • Select the ‘Deposits and transfers \ Withdrawal’ menu
  • Your TD Ameritrade account is pre-selected as ‘Transfer from’
  • Select the account you want to withdraw the money to as ‘To bank connection’
  • Add the amount you wish to withdraw and set the frequency and date of the withdrawal
  • Initiate the withdrawal

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TD Ameritrade review
Web trading platform

TD Ameritrade offers a good web-based trading platform with a clean design. On the flip side, there is no two-step login and the platform is not customizable.

Pros Cons
• User-friendly • No two-step (safer) login
• Clear fee report • Limited customizability (for charts, workspace)
• Good variety of order types
TD Ameritrade platforms to choose from
Trading platform Score Available
Web 3.8 / 5 stars Yes
Mobile 4.4 / 5 stars Yes
Desktop 4.8 / 5 stars Yes

Let’s point out our key findings on the platform selection first. TD Ameritrade offers both web and desktop trading platforms. The first, web is suitable for trading execution and research on investment products, like stocks and ETFs. You are interested in trading with complex products? No worries, then Thinkorswim is just right for you. Thinkorswim is the inhouse developed desktop platform of TD Ameritrade. This offers more products as forex and futures and has sophisticated technical research tools.

The web trading platform is available in English, Chinese .

The following table summarizes the main features of the web trading platform and the Thinkorswim desktop trading platform.

TD Ameritrade – web and desktop platform compare and contrast

Web trading platform Thinkorswim
Stocks, ETFs, options Yes Yes
Mutual funds Yes Quotes only
Fixed incomes Yes No
Futures, options on futures, forex No Yes
Charting Yes Yes, more advanced
Research & third-party analysis Yes Yes, but limited
Demo account No Yes
Newsfeed Yes Yes

Look and feel

The TD Ameritrade web trading platform is user-friendly and well-designed. However, it is not customizable.

Login and security

TD Ameritrade provides only a one-step login authentication. A two-step login would be more secure.

When you first log in on a new device, you have to give an answer to your security question. After the registration, you can access your account using your regular ID and password combo.

Search functions

The search functions are OK. We were happy to see that automatic suggestion works on the platform. You can search by typing both a company’s name or asset’s ticker.

On the flip side, the relevancy could be further improved. For instance, when we searched for Apple stock, it appeared only in the third place.

Placing orders

You can use the following order types:

  • Market,
  • Limit,
  • Stop-Market,
  • Stop-limit,
  • Trailing stop %,
  • Trailing stop $

If you are not familiar with the basic order types, read this overview.

There are also order time limits you can use:

  • Good ’til canceled (GTC),
  • Good ’til canceled extended hours,
  • Day,
  • Day + extended hours,
  • Extended hours am/pm,
  • Immediate or Cancel (IOC),
  • Fill or Kill (FOK),
  • All or Nothing (AON)

Alerts and notifications

You can set a broad range of alerts and notifications. If you want to set them, go to ‘Research & Ideas’ and select ‘Alerts’ section.

You can set up alerts on 2 email addresses and 2 phones to stay tuned.

Portfolio and fee reports

TD Ameritrade has clear portfolio and fee reports. Go to ‘My Accounts’, select ‘History & statements’ and finally select the ‘Transactions‘ section.

You can download the reports, but only in CSV format.

TD Ameritrade review
Mobile trading platform

The TD Ameritrade Mobile trading platform is great. It is user-friendly and well-designed. However, it lacks the two-step login.

Pros Cons
• User-friendly • No two-step (safer) login
• Good search function
• Price alerts

It is great that TD Ameritrade offers two mobile trading platforms. Based on the level of your proficiency and goals, you can select which one you want to use. To show you a clear picture, we summarized the main differences between the two.

TD Ameritrade mobile trading platforms

TD Ameritrade Mobile TD Ameritrade Mobile Trader
Stocks, ETFs, options Yes Yes
Futures, forex No Yes
Mutual funds Only quotes Only quotes
Conditional trading, virtual trading, chart drawing No Yes

In this review, we tested TD Ameritrade Mobile.

The app is available both for iOS and Android, but our test was done on iOS. The mobile trading platform is available in English .

Look and feel

Similarly to the web trading platform, TD Ameritrade mobile platform is user-friendly, has only a one-step login, provides an OK search function, and you can easily set alerts.

Placing orders

The order types and order time limits are limited compared to the web platform. You can use the following order types:

There are also order time limits you can use:

  • Fill or Kill (FOK),
  • All or Nothing (AON)

TD Ameritrade review
Desktop trading platform

The Thinkorswim desktop platform is one of the best on the market, we really liked it. The only feature we missed was the two-step authentication.

Pros Cons
• User-friendly • No two-step (safer) login
• Clear fee report
• Good customizability (for charts, workspace)
• Trading support functions
• Great learning materials

Thinkorswim is available in English and Chinese .

Look and feel

Thinkorwsim has a great design and it is easy to use. It is also highly customizable, you can easily set your own layouts.

Login and security

Security, similarly to web and mobile trading platforms, provides only a one-step login. A two-step login would be safer.

Search functions

The search functions are OK. You can search for an asset by typing its name or ticker as Thinkorswim has an automatic suggestion feature. We were not 100% delighted with the relevancy. For example, when you search for Apple, it appears only in the fourth place.

Placing orders

You can use several order types:

  • Market,
  • Market on close,
  • Limit, Limit on Close,
  • Stop-Market,
  • Stop-limit,
  • Trailing stop %,
  • Trailing stop $

There are also order time limits you can use:

  • Good ’til canceled (GTC),
  • Good ’til canceled extended hours,
  • Day, Day + extended hours,
  • Extended hours am/pm,
  • Fill or Kill (FOK),
  • All or Nothing (AON)

Alerts and notifications

You can set alerts and notifications on the Thinkorswim desktop trading platform by using the MarketWatch function.

From price to news alerts, you can find a lot of alert types. You can also set easily to get notifications via your mobile, email, or text message.

Portfolio and fee reports

TD Ameritrade has clear portfolio and fee reports. Go to ‘Account information’, if you want to check them. You can easily customize the tab and add commission reports, profit/loss balance, margin level, etc.

TD Ameritrade review
Markets and products

At TD Ameritrade you can trade with a lot of asset classes, from stocks to futures and forex. We also liked the additional features like social trading and the robo-advisory service. On the other hand, the offered products cover only the U.S. market.

The availability of products may vary in different countries. For example, clients from Singapore can only trade with stock, ETF, options, and futures. US clients can trade with all the products listed below.

TD Ameritrade Charles Schwab E-Trade
Stock Yes Yes Yes
ETF Yes Yes Yes
Forex Yes No No
Fund Yes Yes Yes
Bond Yes Yes Yes
Options Yes Yes Yes
Futures Yes Yes Yes
CFD No No No
Crypto No No No

In the following lines, we share a clear overview of TD Ameritrade’s product offering in comparison with its competitors.

Stocks and ETFs

During our TD Ameritrade review, we discovered that it covers products only from the U.S. market. It offers roughly the same number of stock exchanges and ETFs as Charles Schwab or E-Trade.

TD Ameritrade Charles Schwab E-Trade
Stock markets (#) 5 4 5
ETFs (#) 2,300 2,300 2,300

You can trade on the following stock exchanges: NYSE, NASDAQ, AMEX, OTCBB, other OTCs.

Forex

TD Ameritrade Charles Schwab E-Trade
Currency pairs (#) 77

Funds

The selection of funds is great, it beats Charles Schwab and E-Trade.

TD Ameritrade Charles Schwab E-Trade
Fund providers (#) 740 600 530

You can find funds from the biggest fund providers like BlackRock or Vanguard and from smaller ones too.

Bonds

TD Ameritrade has a smaller bond selection compared to Charles Schwab and E-Trade.

TD Ameritrade Charles Schwab E-Trade
Bonds (#) 40,000 60,000 88,000

TD Ameritrade’s bond offer covers both government and corporate bonds.

Options

At options offer, TD Ameritrade is average if you compare with brokers, like Interactive Brokers that gives access to options markets all over the world.

In comparison with its closest competitors, like Charles Schwab or E-Trade, the available number of options markets is great.

TD Ameritrade Charles Schwab E-Trade
Options markets (#) 8 8 1

We found the following exchanges available: CBOE, AMEX, PHLX, ISE, BOX, NASDAQ, NYSE BATS, and C2.

Futures

Similarly to options, the futures offer is average as well.

TD Ameritrade Charles Schwab E-Trade
Futures markets (#) 5 8 3

You can trade with futures on these exchanges: CFE, CME, ICE, ICE EU, LIFFE.

Social signals

TD Ameritrade supports social trading via Thinkorswim. Under the “Tools” menu you can set up a public profile, and with the help of this, you can follow fellow traders and share your own results.

This is a good opportunity for searching for new ideas or if you like one, easy to follow: just a few clicks and you can confirm your copied deal. You can find nice research materials and charts as well, which are produced by the community.

TD Ameritrade Managed Portfolios

TD Ameritrade offers three managed portfolios which are great if you need help to manage your investments.

  • Essential Portfolios
  • Selective Portfolios
  • Personalized Portfolios

The Essential Portfolios is a robo-advisory service. First, you have to answer questions about your investment goal, risk tolerance, and time horizon. Based on your answers, you can choose from five ETF portfolios. These portfolios will be automatically rebalanced when needed. $5,000 is the minimum to start a TD Ameritrade Essential Portfolio.

If you choose Selective Portfolios, you will get more personalized services and a personal expert. The minimum to start this premium account is $25,000.

From $250,000 TD Ameritrade offers a professionally managed Personalized Portfolio.

TD Ameritrade review
Research

TD Ameritrade has great research tools. You can use many tools, including trading ideas and detailed fundamental data.

Pros Cons
• Good interactive chart None
• Trading ideas
• Data on asset fundamentals

Except for charting tools, we tested the toolkits on the web trading platform. We tested the charting tool on Thinkorswim desktop platform as it seemed better than other platforms’ charting tools.

Similarly to the trading platforms, the research tools are available in English and Chinese.

Trading ideas

Are you a beginner or in the phase of testing your trading strategy? We have good news for you.TD Ameritrade provides trading and investment ideas for stocks and ETFs, mutual funds, and fixed incomes.

To have a clear view, worth to note the ideas come from third-party providers, such as analyst outlooks from TD Group, CFRA, Thomas Reuters, etc. The overviews and ideas are separated by timing or equities.

  • The stocks are assessed by several third-party analysis. For example, we found 8 third-party analysis at Apple, usually giving recommendations as well.
  • ETF‘s rating is supported by CFRA, and TheStreet, however, plenty of market reports are also available.
  • You can also find Morningstar ratings for mutual funds.

Fundamental data

TD Ameritrade offers fundamental data, mainly on stocks. Go to ‘Fundamentals‘ and look for ‘Financial statements for 5years’ or ‘Basic performance and rating metrics’. At the same line under ‘Earnings‘, ‘Valuation‘, and ‘Peer Comparison‘ we found a huge amount of information. Yet, our favorite part was the benchmarking under the Valuation menu.

Charting

TD Ameritrade has good charting tools. You can use 400 technical indicators and the charts are easily editable. By the way, the number of indicators TD Ameritrade offers is one of the most extensive on the market.

Newsfeed

The newsfeed is OK. It was easy to read for us, but we missed visual elements, like charts or pictures. It is provided by thirdparties, like Benzinga, CNBC, MarketWatch, etc.

Other research tools you will enjoy

You can use well-equipped screeners. If you want to try them, go to ‘Research & Ideas‘ and select ‘Screeners. From the basic company information to technical indicators, you can use a wide range of filters.

TD Ameritrade review
Customer service

TD Ameritrade has great customer service. They are available 24/7 and give relevant answers.

Pros Cons
• Phone support None
• Live chat
• Fast response time

In our test, we tried all three channels of customer support:

The customer support line is available in English, Chinese and Spanish languages.

The live chat is great. The answers are fast and relevant.

The phone support is also good. The customer support team was very kind and gave relevant answers. The response time was OK as an agent was connected within a few minutes.

The email was also quick and relevant, we got our answers within 1 day.

It is also a big plus that TD Ameritrade support team is available 24/7.

TD Ameritrade review
Education

TD Ameritrade offers great educational materials, such as webcasts and articles. The top league Thinkorswim platform has a demo account with a virtual balance for head-starting without any risk.

Pros Cons
• Demo account None
• Trading platform tutorial
• Educational videos

Beyond the demo account, TD Ameritrade offers many other ways to improve your knowledge:

  • Demo account
  • Platform tutorial videos
  • General educational videos
  • Webinars
  • Quality educational articles

We really liked the papermoney demo account/trading simulation and the webcast videos. The papermoney account is powered by Thinkorswim offering the full range of professional trading and charting tools while testing your skills cost even not a penny. The account gives access to the complex markets (options, futures, etc) with a dedicated amount of virtual money (in the case of stocks & ETFs it is virtual $100,000).

Worth to mention that the Thinkorswim platform has a separate learning center, where we found useful articles and education materials (besides the platform’s FAQ). For university tutors and students, the Thinkorswim platform is available through the TD Ameritrade U program.

The webinars (called webcast) are focusing on various subjects and different levels (from beginners to advanced) and scheduled basically all day long (10-11 times/business day, except Friday). Don’ worry if you cannot catch any real-time occasion. It’s available later as well.

TD Ameritrade review
Safety

TD Ameritrade is regulated by top-tier US regulators, like the SEC and the FINRA. You are also protected by a high investor protection amount, $500,000 for securities and $250,000 for cash. On the negative side, negative balance protection is not provided.

Pros Cons
• Majority of clients belong to a top-tier financial authority • No negative balance protection
• High level of investor protection
• Banking background

Is TD Ameritrade regulated?

Yes, it is regulated by the Securities and Exchange Commission (SEC), Financial Industry Regulatory Authority (FINRA), Commodity Futures Trading Commission (CFTC), Hong Kong Securities and Futures Commission, Monetary Authority of Singapore (MAS) .

TD Ameritrade is based in USA and was founded in 1978.

Is TD Ameritrade safe?

To be certain, we highly advise to check two facts:

  • how you are protected if something goes wrong
  • and what the background of the broker is.

TD Ameritrade operates several legal entities, but all customers are covered by the U.S. investor protection scheme, called SIPC. This is because the US legal entity, TD Ameritrade Clearing, Inc. provides clearing and custodial services, holds the assets on behalf of other legal entities.

The SIPC investor protection scheme protects against the loss of cash and securities in case the broker goes bust. The limit of SIPC protection is $500,000, which includes a $250,000 limit for cash. This amount is substantially higher than the amount most national investor protection schemes provide. Plus, the TD Ameritrade has an additional insurance policy, which results in a total coverage up to $152 million ($2 million cash limit) per client and $500 million aggregated limit.

Not all investments are protected by SIPC. In general, SIPC covers notes, stocks, bonds, mutual funds and other investment company shares, and other registered securities. It does not cover instruments such as unregistered investment contracts, unregistered limited partnerships, fixed annuity contracts, currency, and interests in gold, silver, or other commodity futures contracts or commodity options.

For summarizing the different regulators, legal entities, investor protection amounts, we compiled this handy table:

TD Ameritrade legal entities

SIPC: $500,000 ($250,000 cash limit) plus additional insurance

Securities and Exchange Commission (SEC)

Financial Industry Regulatory Authority (FINRA)

Country of clients/Product Protection amount Regulator Legal entity
TD Ameritrade, Inc.
Hong Kong SIPC: $500,000 ($250,000 cash limit) plus additional insurance Hong Kong Securities and Futures Commission TD Ameritrade Hong Kong Ltd.
Malaysia, Singapore SIPC: $500,000 ($250,000 cash limit) plus additional insurance Monetary Authority of Singapore (MAS) TD Ameritrade Singapore Pte. Ltd.
Futures & Forex No protection Commodity Futures Trading Commission (CFTC) TD Ameritrade Futures & Forex LLC.

TD Ameritrade does not provide negative balance protection.

Background

TD Ameritrade was established in 1978. The longer track record a broker has, the more proof we have that it has successfully survived previous financial crises.

A good chunk of TD Ameritrade’s common stocks is owned by the Toronto-Dominion Bank (TD), therefore TD Ameritrade has a banking background, and as such, it is subject to tougher regulation than brokers.

TD Ameritrade is listed on the stock exchange, NASDAQ, which is a big plus for safety as TD Ameritrade releases financial statements regularly and transparently.

Having a banking license, being listed on a stock exchange, providing financial statements, and regulated by a top-tier regulator are all great signs for TD Ameritrade’s safety.

TD Ameritrade review
Bottom line

TD Ameritrade is one of the biggest US online brokers. Reflecting the wave of introducing commission-free trading at the end of 2020, TD Ameritrade now charges no commission of stock and ETF trades.

Research and education are outstanding and covers a lot of tools. The Thinkorswim desktop trading platform is one of the best on the market. The customer service is great, you will get relevant answers within a short time.

It has some drawbacks though. It charges high financing (margin) rates and it doesn’t provide credit/debit cards and electronic wallets for money transfers. Furthermore, the product portfolio covers products only from U.S. markets.

As there are great education tools including a demo account, feel free to try it.

You’re in the right
place to become an
even smarter investor

Our knowledgeable experts and industry leading
tools are united to do one thing: make you
a smarter, more confident investor.

When the market swings, learn how to swing back

Get expert insights to help navigate the ups and downs of the market with confidence.

Why would you trade anywhere else?

Stay on top of the market with our award-winning trader experience.

Take on the market with our powerful platforms

Trade without trade-offs. Our desktop, web, and mobile platforms are designed for performance and built for all levels of investors.

Personalized education just for you

There’s no ROI on TMI. That’s why we created a learning experience that customizes to give you exactly the information you need, and none of the information you don’t.

Why Choose TD Ameritrade?

Wide selection of investment choices

Interactive courses and webcasts

Free, powerful trading platforms

Commission-free online trading †

Objective, third-party research

#1 Overall Broker Stockbrokers.com

Dependable, professional service

Get up to $600 when you fund your account*

A definitive agreement has been reached for Charles Schwab to acquire TD Ameritrade. Read more

Check the background of TD Ameritrade on FINRA’s BrokerCheck

Where Smart Investors Get Smarter SM

Call Us 800-454-9272

#1 Overall Broker

Carefully consider the investment objectives, risks, charges and expenses of any investment company before investing. A prospectus contains this and other important information. Contact us at 800-669-3900 for a copy. Read carefully before investing.

Reviewed against 14 other online brokers, TD Ameritrade was named #1 Overall Broker in the StockBrokers.com 2020 Online Broker Review (2 years in a row). We rated #1 in several categories, including “Customer Service” (4 years in a row), “Platforms & Tools” (9 years in a row), “Education” (8 years in a row), and “Beginners” (8 years in a row). We also received several industry awards, “Trader App” (TD Ameritrade Mobile Trader, 4 years in a row), “Trader Community” (5 years in a row) and “Desktop Platform” (thinkorswim®) (8 years in a row). We were also rated Best in Class (within the top 5) for “Offering of Investments” (6 years in a row), “Research” (9 years in a row), “Mobile Trading” (8 years in a row), “Ease of Use” (4 years in a row), “Active Trading” (10 years in a row), and “Options Trading” (10 years in a row). Read the full article.

ETFs can entail risks similar to direct stock ownership, including market, sector, or industry risks. Some ETFs may involve international risk, currency risk, commodity risk, and interest rate risk. Trading prices may not reflect the net asset value of the underlying securities. Commission fees typically apply.

Market volatility, volume, and system availability may delay account access and trade executions.

† Applies to U.S. exchange-listed stocks, ETFs, and options. A $0.65 per contract fee applies for options trades, with no exercise or assignment fees.

A rollover is not your only alternative when dealing with old retirement plans. Learn more about rollover alternatives.

*Offer valid for one new Individual, Joint, or IRA TD Ameritrade account opened by 04/30/2020 and funded within 60 calendar days of account opening. To receive $100 bonus, account must be funded with $25,000- $99,999. To receive $300 bonus, account must be funded with $100,000-$249,999. To receive $600 bonus, account must be funded with $250,000 or more. Offer is not valid on tax-exempt trusts, 401(k) accounts, Keogh plans, profit sharing plans, money purchase plans, accounts managed by TD Ameritrade Investment Management, LLC, TD Ameritrade Institutional accounts, or current TD Ameritrade accounts. Offer is not transferable, is not valid with internal transfers, and is not valid in conjunction with certain other offers.

Limit one offer per client. Account value of the qualifying account must remain equal to, or greater than, the value after the net deposit was made (minus any losses due to trading or market volatility or margin debit balances) for 12 months, or TD Ameritrade may charge the account for the cost of the offer at its sole discretion. TD Ameritrade reserves the right to restrict or revoke this offer at any time. This is not an offer or solicitation in any jurisdiction where we are not authorized to do business. Please allow 3-5 business days for any cash deposits to post to account. (Offer Code: MKT600)

Taxes related to TD Ameritrade offers are your responsibility. All Promotional items and cash received during the calendar year will be included on your consolidated Form 1099. Please consult a legal or tax advisor for the most recent changes to the U.S. tax code and for rollover eligibility rules.

This is not an offer or solicitation in any jurisdiction where we are not authorized to do business or where such offer or solicitation would be contrary to the local laws and regulations of that jurisdiction, including, but not limited to persons residing in Australia, Canada, Hong Kong, Japan, Saudi Arabia, Singapore, UK, and the countries of the European Union.

Brokerage services provided by TD Ameritrade, Inc., member FINRA/ SIPC. TD Ameritrade is a trademark jointly owned by TD Ameritrade IP Company, Inc. and The Toronto-Dominion Bank. © 2020 TD Ameritrade.

TD Ameritrade Review – Everything You Need to Know

See what we have to say about the top online broker for long-term investing

TD Ameritrade is an Omaha-based brokerage firm and an affiliate of TD Bank. The company offers online stock trading and investing, as well as retirement planning products and services.

Who Is TD Ameritrade Best For?

TD Ameritrade may be most appealing to customers who are comfortable trading and investing online. It may be suited to people who want to:

  • Open a brokerage or retirement account
  • Have access to a wide range of investment options
  • Build a portfolio with low trading fees
  • Invest for the long-term
  • Take a DIY approach to portfolio-building
  • Get professional portfolio management

No platform or data fees

Flat $6.95 fee per online equity trade

$0 minimum opening deposit

Lots of options: Standard brokerage accounts, retirement planning, education accounts, managed portfolios and specialty accounts

Slightly higher fees compared to some competitors

Managed portfolio options can be expensive

Multiple trading platforms (mobile, Web) can be confusing

Types of Accounts

  • Standard Accounts
  • Retirement Accounts
  • Education Accounts
  • Specialty Accounts
  • Managed Portfolios

Learn more about each type of account TD Ameritrade offers below.

TD Ameritrade is currently offering commission-free trading for 60 days and up to $600 in cash for new account openings.

Standard Brokerage Accounts

Standard accounts are TD Ameritrade’s most common and most flexible accounts. This is a taxable investing account, which means you’ll pay capital gains tax when you sell investments at a profit.

The kinds of securities you can invest in with a standard account include:

  • Stocks
  • Options
  • Mutual funds
  • Exchange-traded funds (ETFs)
  • Futures
  • Forex
  • Bonds
  • Certificates of deposit (CDs)

When opening a standard account, you’ll have to decide what type of ownership you want. The options are:

  • Individual
  • Joint Tenants With Rights of Survivorship
  • Tenants in Common
  • Community Property
  • Tenants by the Entireties
  • Guardianship or Conservatorship

Each account has different rules regarding what happens to the account balance if one of the account owners passes away.

Individual Accounts

An individual account is a standard account with just one owner. There’s no minimum amount to open an account, but there are some special rules:

  • The electronic funding minimum is $50
  • To trade on margin or have options privileges, you’ll need at least a $2,000 balance

As the account owner, you can assign a beneficiary to receive all the assets in the account when you pass away.

Joint Tenants With Rights of Survivorship

This type of account has two or more owners, who share an equal interest in the account’s assets. Again, there’s no minimum to fund your account but the electronic funding minimum and margin or options trading minimums are $50 and $2,000 respectively.

If one account owner dies, the other maintains a right to the entire account. This type of account might be appropriate for married couples or if you’re investing with a parent or child.

Tenants In Common

A Tenants in Common account also has two owners but they don’t necessarily share it equally. Instead, each person owns a specific percentage of the account.

  • Open an account with no minimum
  • $50 minimum for electronic funding
  • Options and margin trading allowed with a minimum $2,000 balance

When one account owner dies, their percentage of the account goes to their estate, not the other owner. You can’t open this type of account if you’re a non-resident alien.

Community Property

Community Property accounts can be owned by married couples and they follow community property laws. Essentially, the rule is that each spouse has an equal interest in the account as long as the assets in the account were acquired during the marriage.

Community Property accounts are allowed in:

  • Arizona
  • California
  • Idaho
  • Louisiana
  • New Mexico
  • Nevada
  • Texas
  • Washington
  • Wisconsin

You can also open one of these accounts if you live in Puerto Rico but again, non-resident aliens are ineligible. If the couple gets divorced or one spouse dies, the account is divvied up equally between their estates.

Tenants by the Entireties

Tenants by the Entireties accounts can be owned by two married people living in these states:

  • Arkansas
  • Arizona
  • Delaware
  • Florida
  • District of Columbia
  • Hawaii
  • Kentucky
  • Maryland
  • Massachusetts
  • Michigan
  • Mississippi
  • Missouri
  • New Jersey
  • Oklahoma
  • Pennsylvania
  • Rhode Island
  • Tennessee
  • Vermont
  • Virginia
  • Wyoming

The difference with these accounts is that if one account owner dies, the entire account becomes the property of the other owner.

Guardianship or Conservatorship

Guardianship and conservatorship accounts allow the account owner to hold assets on behalf of someone else, such as a minor child or a disabled adult. The guardian or conservator has the authority to manage the account and make investment decisions. Margin and options trading aren’t available with this type of account.

Retirement Accounts

TD Ameritrade offers multiple retirement accounts to help you pursue your investment goals in a tax-advantaged way. Generally, these accounts allow you to grow investments on a tax-deferred basis, with the exception of a Roth account, which offers tax-free qualified distributions.

Traditional IRAs

Traditional IRAs offer tax-deductible contributions of up to $6,000 beginning in 2020, along with an additional catch-up contribution of $1,000 if you’re 50 or older. You can begin taking taxable distributions from your account without a penalty at age 59 ½. Starting at age 70 ½, you must begin taking required minimum distributions from your account or face a tax penalty.

To open a traditional IRA you must:

  • Be under age 70 ½ at the end of the calendar year
  • Have earned income for the year

There’s no minimum deposit to open a traditional IRA.

Roth IRAs

Roth IRAs have the same contribution limits as traditional IRAs. The difference is contributions aren’t tax deductible and qualified withdrawals beginning at age 59 ½ are tax-free. There are also no required minimum distributions with these accounts.

To open a Roth IRA you must:

  • Have earned income for the year
  • Be within the IRS income limits for contributions

Like traditional IRAs, there’s no minimum required to open a Roth IRA.

SEP IRAs

A SEP IRA or Simplified Employee Pension Plan is designed for small business owners and self-employed retirement savers. You can set a SEP account up for yourself or your employees. For the 2020 tax year, the contribution limit is 25 percent of employee compensation or $56,000, whichever is less.

Contributions are tax-deductible. SEP IRAs follow traditional IRA rules for withdrawals, which means distributions are taxed at your regular income tax rate and a 10 percent early withdrawal penalty applies before age 59 ½.

SIMPLE IRAs

A SIMPLE IRA (Savings Incentive Match Plan for Employees) is another type of small business retirement account. These have lower contribution limits compared to a SEP IRA — $13,000 for 2020, plus a $3,000 catch-up contribution — and they follow the same withdrawal and tax rules as traditional IRAs.

To open a SIMPLE IRA, your business must have 100 or fewer eligible employees. Employee contributions are optional but you’re required to chip in something as their employer.

Solo 401(k) Plans

A solo 401(k) plan is just like a regular 401(k), except it’s designed for sole proprietors who have no employees or only employ their spouses. These accounts offered tax deductible contributions of up to $56,000 for 2020, along with a catch-up contribution of $6,000 if you’re 50 or older.

Rollover IRAs

If you have an old 401(k), 403(b) plan or another employer-sponsored retirement account, you can roll that over into an IRA with TD Ameritrade. There are no setup or maintenance fees and no minimum deposit you’ll need to roll over.

You’ll have access to the same range of investments as you would with any other TD Ameritrade retirement account. Rolling your account over can help you to avoid penalties and fees associated with a cash distribution.

Pension or Profit Plans

Pension and profit plans are tax-exempt trusts you can set up on behalf of your company or as a self-employed individual to save for retirement. These plans can be set up as either defined benefit plans, which means they pay the account beneficiary a set amount of money in retirement, or as defined contribution plans which specify how much they can contribute.

TD Ameritrade charges no maintenance fees for retirement accounts, but commission, service and exception fees may apply. As you compare accounts, you’ll also want to consider the annual contribution limits for each one and the tax rules for making withdrawals.

Education Accounts

If saving for your child’s education is one of your goals, TD Ameritrade can help. There are three different account types to choose from for education savings, each with different tax implications.

529 Plans

529 plans are a tax-advantaged way to save for college. All 50 states offer at least one 529 plan and you can contribute to any of them, regardless of which state you live in. There’s minimum amount required to open a 529 plan and no maximum annual contribution, although you may trigger the gift tax for contributions that exceed the annual exclusion limit.

With 529 plans, withdrawals of earnings are generally tax-free when used for qualified education expenses. Non-education withdrawals trigger a tax penalty.

In terms of investment choices for 529 plans, TD Ameritrade offers age-based investment plans, static investment plans and 17 individual investment options, including:

  • Domestic equity mutual funds
  • International equity mutual funds
  • Real estate investment trusts (REITs)
  • Bond mutual funds
  • Money market funds

Currently, you can’t trade stocks in a TD Ameritrade 529 account.

Coverdell Education Savings Accounts (ESAs)

A Coverdell ESA is another tax-advantaged college savings option. This account limits you to $2,000 in contributions per student annually and you can’t make new contributions once your child turns 18. And, once your student reaches age 30, any remaining money in the account has to be withdrawn; otherwise, you’ll pay a 50 percent tax penalty.

Custodial Savings Accounts

Custodial Uniform Gift to Minors Act (UGMA)/Uniform Transfer to Minors Act (UTMA) allow parents to save and invest on behalf of minor children. Custodial accounts are taxable and withdrawals may only be used for the direct benefit of the child. For example, you could use a custodial account to pay for college or private school expenses, but not to plan a vacation or pay for home repairs.

Specialty Accounts

Some investors may have unique needs or objectives and that’s where TD Ameritrade’s specialty accounts come in. These are investment accounts you can open as a business entity, such as a partnership or corporation, or as part of a trust. Trust accounts are generally used for estate planning, as a way to pass on investments to heirs in a tax-efficient way.

There are also specialty trading accounts for non-profit organizations and small business, including profit sharing accounts. Again, there’s no minimum deposit required to open any of these accounts.

Managed Accounts

TD Ameritrade managed portfolios are designed for investors who prefer professional guidance on their investment choices. You tell TD Ameritrade about your investment goals and risk tolerance; they make a portfolio recommendation from one of three options.

Essential Portfolios

These portfolios offer access to five goal-oriented portfolios of index ETFs, with a $5,000 minimum investment and a 0.30 percent advisory fee. The ETF portfolios offered all include socially responsible investments, which is good if you’re looking for a way to give back while growing wealth. This is the simplest, lowest cost managed portfolio option TD Ameritrade offers.

Selective Portfolios

Selective Portfolios open you up to a broader range of goal-oriented portfolios composed of mutual funds or ETFs, with a $25,000 minimum and advisory fees that vary by portfolio and investment amount. Tax loss harvesting is included with Selected Portfolios. This feature helps to ensure that your investment portfolio is as tax-efficient as possible.

Personalized Portfolios

If you’re looking for tailored investment advice from a dedicated financial consultant, you can get that with Personalized Portfolios. There’s a caveat, however. These accounts have the highest minimum investment, at $250,000. Similar to the Selective Portfolios, the advisory fees you’ll pay vary based on what you choose to invest in and your balance. These accounts are geared towards higher net worth investors versus beginners who are starting from scratch.

While other TD Ameritrade accounts can be opened online in just a few minutes, you’ll need to call 800-870-9668 to speak with a Financial Consultant who can help you get started with a managed portfolio account.

Managing Your TD Ameritrade Account

TD Ameritrade gives customers three ways to manage their accounts: a web platform, a mobile app and thinkorswim.

Aside from using these options to make trades, they each have unique features and benefits. This table offers a quick comparison:

Managing Your TD Ameritrade Account
Web Platform thinkorswim Mobile App
Access the Education Center to enhance your investing knowledge; build customizable modules to track investment performance; use Social Signals to monitor investment news and trends from Twitter; get quotes instantly with SnapTicket; track capital gains and losses with GainsKeeper Elite-leve trading tools for more advanced investors, including virtual margin and IRA accounts, in-depth market analysis and a build-your-own alogithm tool; assess market entry and exit points with Options Statistics; track price movements and create covered call strategies; live-stream market updates in real time View real-time quotes and set up price alerts; access market views and third-party research; integrate the app with Facebook Messenger, Twitter, Amazon Alexa and Apple devices to amange your portfolio from platforms you use regularly; live text and screen sharing with help from a trading specialist when you need it

About TD Ameritrade

TD Ameritrade was founded in 1971 and has grown to be one of the nation’s leading online trading platforms, with $5.45 billion in revenue reported for the fiscal year 2020. Toronto-Dominion Bank is TD Ameritrade’s largest shareholder and the brokerage firm is currently headquartered in Omaha, Nebraska. In September 2020, TD Ameritrade acquired another online trading platform, Scottrade in St. Louis, Missouri.

While TD Ameritrade takes customer security seriously, the company does have a history of security issues. In 2007, a breach occurred which compromised the personal information of an estimated six million customers. Losses resulting from the breach were later settled in a 2020 lawsuit.

The platform has garnered stellar marks for its customer service, ease of use and range of investment options. TD Ameritrade was named the No 1. Overall Broker by Kiplinger in 2020. The platform has also earned awards for the best online broker from Investor’s Business Daily, the best online platform for long-term trading from Barron’s and a five-star rating from StockBrokers.com.

The Bottom Line

BENEFITS

TD Ameritrade is a solid choice for investors who want to begin investing online, with no minimum investment and no lengthy hassles to open an account. The wide variety of account types and investment options makes it easy to pursue multiple investing and savings goals, while building one or more diversified portfolios. Managed portfolios offer a professional touch for the investor who’s not completely comfortable with the DIY approach to building wealth. And with multiple ways to manage your account, it’s easy to stay connected to your investments and keep a finger on the pulse of the market 24/7.

DRAWBACKS

The biggest drawback associated with TD Ameritrade investing may be the cost. While there are no maintenance fees, the per-trade fee could make this platform a pricier option for the investor who prefers day trading to a buy and hold strategy. And, while managed portfolios offer access to personalized investment advice, the account minimums and advisory fees may put those out of reach for some investors. The thinkorswim trading platform may present a bit of a learning curve to investors using it for the first time. And finally, TD Ameritrade doesn’t include tax loss harvesting or automatic rebalancing with standard, retirement, education or specialty accounts.

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