TD Ameritrade Review 2020

TD Ameritrade offers free stock and ETF trading, while forex, bond and options fees are also low. On the other hand, it charges high fees for mutual funds and futures.

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.

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 2019, many US brokers, including TD Ameritrade, scrapped commissions for stocks and ETFs.

Stock fees and ETF fees

TD Ameritrade provides free stocks and ETFs.

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'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 from time to time. At the time of our review, the base rate was 8.25%.

Forex fees

TD Ameritrade's forex fees are low. Its main rivals Charles Schwab and E-Trade don't offer forex trading, so we looked at Interactive Brokers to compare forex trading fees.

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.

Fund fees

TD Ameritrade charges generally high fees for funds. However it does offer a good selection of free funds.

The fee for mutual funds is $49.99 per trade. It is a big plus that TD Ameritrade offers ca. 4,000 mutual funds that are free to trade, out of the total ca. 13,000 offered. However, if you sell these free funds within 180 days after the purchase, a $49.99 fee will be charged for the sale.

Bond fees

Bond fees vary based on the bond type. We calculated the fees for US Treasury bonds, which are free to trade at TD Ameritrade.

While there is no commission for US Treasury bonds and a few other instruments, TD Ameritrade will charge $1 per bond on secondary transactions with corporate bonds (subject to a $10 minimum and a maximum of $500).

Options fees

TD Ameritrade options fees are similarly low to its competitors.

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

Futures fees

TD Ameritrade futures fees are high and are calculated on a volume basis, at $2.25 per contract.

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. Withdrawal via wire transfer, the only option available to non-US clients, costs $25. We tested ACH, so we were charged no withdrawal fee.

TD Ameritrade offers many different account types, and US citizens face no minimum deposit.

Can you open an account?

TD Ameritrade mainly targets US clients. However, we have found that TD Ameritrade is available in a few other countries as well: China, Hong Kong, Malaysia, Singapore, Taiwan and Thailand. Canadian clients can use TD Direct Investing solutions within the TD Group, but not TD Ameritrade.

Please note that services offered may vary from country to country. For example, clients from Hong Kong, Malaysia and Singapore can't trade mutual funds or forex; only stocks, ETFs and options.  

What is the minimum deposit at TD Ameritrade?

The required TD Ameritrade minimum deposit is $0 for US clients if you choose the basic cash account. It is worth noting, though, that the minimum deposit may be higher for other account types or trading preferences.

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

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

Account types

TD Ameritrade offers several account types:

In this review, we tested the Individual brokerage account.

How to open your account

TD Ameritrade has a straightforward and easy account opening process. However, when you complete the online account opening form, you may be required to confirm your identity, by mailing or faxing the generated document and a copy of your ID card of choice to TD Ameritrade. The good news is that the last time we opened an account, the process did not require paper documentation. In the course of separate attempts, it took us 1-3 business days to open the account.

Below, we walk you through the account opening process at TD Ameritrade:

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

Online application took us roughly 20 minutes, and our account was verified within 3 business days.

TD Ameritrade has user-friendly account funding with no deposit fees, but USD is the only available base currency, and wire transfers incur a high fee.

Account base currencies

At TD Ameritrade, you can hold your cash only in USD. 

If you have a personal bank account in a currency other than USD, you will be charged a conversion fee.

A convenient way to save on currency conversion fees is by opening a multi-currency bank account at a digital bank. These usually offer bank accounts in several currencies with great currency exchange rates as well as free or cheap international bank transfers. Opening an account only takes a few minutes on your phone.

Compare digital banks

Deposit fees and options

Let's start with the good news. TD Ameritrade charges no deposit fees. When it comes to deposit options, US clients can use checks, ACH and wire transfers, while clients from Hong Kong, Malaysia, Thailand, China, Taiwan and Singapore can use only wire transfer and checks. 

Unfortunately, credit/debit cards and electronic wallets cannot be used. 

We tested ACH transfer and it took 1 business day. The minimum transfer amount is $50. A wire transfer, on the other hand, can take several business days.

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

Alternatively, the following methods are also available:

• Sending a check for a deposit to TD Ameritrade
• Transferring stocks, options, ETFs or other assets from another broker
• Depositing physical stock certificates

TD Ameritrade withdrawal fees and options

TD Ameritrade charges no withdrawal fees in most cases. The only exception we found was bank/wire transfer, which costs $25.

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.

The following steps are required to withdraw money from TD Ameritrade:

• Log into your account
• Go to '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'
• Enter the amount you wish to withdraw and set the frequency and date of the withdrawal
• Initiate the withdrawal

Compare to other brokers

TD Ameritrade offers a good web trading platform with a clean design. On the flip side, the platform is not customizable.

Let's highlight our key findings on TD Ameritrade's platform selection first. TD Ameritrade offers both web and desktop trading platforms.

The web platform is suitable for trading execution and research on investment products, like stocks and ETFs.

By contrast, if you are interested in trading complex products, Thinkorswim, the in-house developed desktop platform of TD Ameritrade may be just right for you. This platform offers more products such as forex and futures and has sophisticated technical research tools.

The web trading platform is available in English and Chinese.

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

Look and feel

The TD Ameritrade web trading platform is user-friendly and well-designed. However, it is not customizable and is relatively basic compared with the desktop platform. 

Login and security

TD Ameritrade offers two-step login authentication. You can choose either 2-step login, or being prompted a rotating security question after entering your password. It is also possible to register your device as familiar to bypass these requirements.

When you first log in on a new device, you have to answer one of your security questions. After registration, you can access your account according to your chosen login preference. 

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 an asset's ticker.

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

Placing orders

You can choose from quite a few 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 is also a very good selection of order time limits to choose from:

• 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)

Alerts and notifications

You can set a broad range of alerts and notifications, in the 'Alerts' section under the 'Research & Ideas' menu.

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

Portfolio and fee reports

TD Ameritrade has clear portfolio and fee reports. To view these, go to 'My Accounts', select 'History & statements' and then 'Transactions'.

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

The TD Ameritrade mobile trading platform is great. It is user-friendly and well-designed.

It is great that TD Ameritrade offers two mobile trading platforms, each suited to different levels of trading proficiency and investment goals. We summarized the main differences between the two in the table below. Both apps support iWatch devices, a unique feature among brokers.

In this review, we tested TD Ameritrade Mobile.

The app is available for both iOS and Android; we tested the iOS version. The mobile trading platform is available only in English.

Look and feel

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

Placing orders

Available order types and order time limits are almost the same as on the web platform. You can use the following order types:

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

There are also order time limits you can use:

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

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

Thinkorswim is available in English and Chinese.

Look and feel

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

Login and security

Unlike the web and mobile trading platforms, Thinkorswim offers only one-step login. A two-step login procedure would be safer.

Search functions

The platform's search functions are OK. You can search for an asset by starting to type its name or ticker, as Thinkorswim has an automatic suggestion feature. We were not 100% happy with the relevancy of serach results, though. For example, when you search for Apple, tech giant Apple Inc. appears only in fourth place.

Placing orders

You can use many order types:

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

There is also an excellent selection of 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)

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 many alert types. Notifications are available via email or text message.

Portfolio and fee reports

The TD Ameritrade desktop platform has clear portfolio and fee reports under 'Account information'. You can easily customize the tab and add commission reports, profit/loss balance, margin level, etc.

You can trade many asset classes, from stocks to futures and forex, while nice extras include social trading and robo-advisory. On the other hand, only the US market is covered.

Product availability may vary from country to country. For example, clients from Singapore can only trade stocks, ETFs, options and futures. US clients can trade all the products listed below.

Let's see how TD Ameritrade's product offering stacks up in comparison with its competitors.

Stocks and ETFs

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

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

Forex

At TD Ameritrade, you can trade forex by using its Thinkorswim platform. The possibility to trade forex sets TD Ameritrade apart from its immediate competitors.

Funds

The selection of funds is great, beating both Charles Schwab and E-Trade.

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

Bonds

TD Ameritrade's bond selection is not the biggest on the market, however.

TD Ameritrade's bond offer includes both government and corporate bonds.

Options

As for the number of options markets offered, TD Ameritrade ranks fairly average, especially when compared with brokers like Interactive Brokers that give you access to options markets all over the world.

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

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

Futures

Similarly to options, TD's futures offer is average as well.

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

Social signals

TD Ameritrade supports social trading via Thinkorswim. Under the 'Tools' menu, you can set up a public profile and use it to follow other traders, engage with them in chatrooms, and share your own trading results.

This is a good opportunity for seeking out new ideas and matching other traders' moves that you like: it takes just a few clicks to confirm your copied deal. You can also find unique research materials and charts produced by the community.

TD Ameritrade Managed Portfolios

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

• Essential Portfolios
• Selective Portfolios
• Personalized Portfolios

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

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

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

TD Ameritrade has great research tools, including trading ideas and detailed fundamental data.

We tested the toolkits on the web trading platform, except for charting tools, which we tested on the Thinkorswim desktop platform.

Similarly to the trading platforms themselves, 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, ETFs, mutual funds, and fixed income instruments. 

It's important to note that trading ideas come from third-party providers, including analyst outlooks from TD Group, CFRA, Thomas Reuters, etc. These overviews and ideas are grouped by assets and by investment time horizon.

• Stocks are assessed by several third-party analysts. For example, we found 8 third-party analysis pieces on Apple, with most of these also giving recommendations.  
• ETF ratings are offered by CFRA and TheStreet, but 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. Pick a stock, click the 'Fundamentals' tab and check out 'Financial statements for 5 years' or 'Basic performance and rating metrics'. The 'Earnings', 'Valuation' and 'Peer Comparison' tabs also contain a huge amount of information. Yet, our favorite part was the benchmarking tool under the 'Valuation' menu.

Charting

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

Newsfeed

The newsfeed is OK. The articles are easily digestable, but we missed visual elements such as charts or pictures. News is provided by third parties such as Benzinga, CNBC or MarketWatch.

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 basic company information to technical indicators, you can use a wide range of filters.

Compare research pros and cons

TD Ameritrade has great customer service: available 24/7 and offering relevant answers.

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

• live chat
• telephone
• email

Customer support is available in English, Chinese and Spanish.

The live chat service is great. The answers are quick and relevant. There is also a Virtual agent called 'AskTed' that directs you to relevant FAQ pages. Although chatting with the live agent was more helpful, we appreciated the option to use this tool as well.

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

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

TD Ameritrade offers great educational materials such as webcasts and articles, and its excellent Thinkorswim desktop platform has a demo account.

TD Ameritrade offers many 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. Unfortunately, when we tried to re-test this service after our initial review, the URLs that would lead us to account creation were not working.

The 'paperMoney' account is powered by the Thinkorswim desktop platform, offering a full range of professional trading and charting tools, and allowing you to test your skills without risking even a cent. The account gives access to complex markets (options, futures, etc) with a dedicated amount of virtual money (in the case of stocks and ETFs it is a virtual $100,000).

It is worth mentioning that the Thinkorswim platform has a separate learning center, where we found useful articles and education materials, in addition to the platform's FAQ. For university tutors and students, the Thinkorswim platform is no longer available through the TD Ameritrade U program. Spring 2019 was the last semester when this service was working in full swing.

TD's webinars (called webcasts) focus on various subjects and target all knowledge levels from beginner to advanced. They are scheduled throughout the day, with 10-11 webcasts per business day except Fridays. They are available for later viewing in case you can't catch them real time.

TD Ameritrade is overseen by top-tier US regulators like the SEC and FINRA. You are covered by a high investor protection amount, but negative balance protection is not provided.

Is TD Ameritrade regulated?

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

TD Ameritrade is based in the US and was founded in 1975.

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 US investor protection scheme, called SIPC. This is because it is the US legal entity, TD Ameritrade Clearing, Inc that provides clearing and custodial services and holds client assets on behalf of the 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, TD Ameritrade has an additional insurance policy for assets not covered by SIPC, which involves a total coverage of up to $152 million (including $2 million cash) per client; though it is capped at a total $500 million for all clients.

Not all investments are protected by SIPC, though. 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.

To summarize the different regulators, legal entities, investor protection amounts, we compiled this handy table:

TD Ameritrade does not provide negative balance protection.

Background

TD Ameritrade was established in 1975. 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 stock is owned by the Toronto-Dominion Bank (TD) of Canada, therefore TD Ameritrade has a banking background, and as such, it is subject to tougher regulation than brokers.

TD Ameritrade is listed on the NASDAQ stock exchange, 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 being regulated by top-tier authorities are all great signs for TD Ameritrade's safety.

Find your safe broker

TD Ameritrade is one of the biggest US online brokers. Joining the hot trend of introducing commission-free trading at the end of 2019, TD Ameritrade now charges no commission on stock and ETF trades.

Research and education are outstanding at TD Ameritrade, offering you many useful tools. The Thinkorswim desktop trading platform is one of the best on the market. Customer service is great, you will get relevant answers within a short time.

TD Ameritrade has some drawbacks though. It charges high financing (margin) rates and it doesn't accept credit/debit cards and electronic wallets for money transfers. Furthermore, the product portfolio covers only the US market.

As TD Ameritrade offers great education tools including a demo account, we encourage you to try it.