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TD Ameritrade fees explained

Jun 2019
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Overview of TD Ameritrade fees and charges

TD Ameritrade logo

When it comes to brokerage fees TD Ameritrade shows a mixed picture: some fees are high but some are low. First you need to figure out your approach or you should use our questionnaire to be able to tell whether TD Ameritrade fees are an advantage for you. Continue reading about TD Ameritrade fees and charges to see if this is the right brokerage for you or a similar broker like Interactive Brokers or Charles Schwab is better for you.

Here's a high level overview of TD Ameritrade's fees

TD Ameritrade Fees snapshot
Assets Fee level Fee terms
US stock fee Average $6.95 per trade, there are also ~300 free ETFs
EURUSD fee High FX commission: $0.10 per 1,000 units and min $1; You can also choose to trade with no commission, but larger spreads
US tech fund fee High $49.99 per transaction, there are also ~4,000 free funds
Inactivity fee Low No inactivity fee

TD Ameritrade fees
TD Ameritrade fees explained

Online brokerages in general charge much lower brokerage fees than traditional brokerages do - this is largely due to the fact that online brokerages' businesses can be much better scaled: From a purely technical standpoint it doesn't make that much of a difference for them if they have 100 or 5000 clients.

This is not to say however that they don't have any fees at all. They make money by charging you at various events for various rates. Usually you need to keep an eye on these 3 types of fees:

  • Trading fees - these are brokerage fees that you pay when you actually do a trade, i.e. buying an Apple stock or an ETF. What you pay is either a commission, a spread or financing rate. Some brokers apply all of these.
    • A commission is either based on the traded volume or it is fixed.
    • A spread is the difference between the buy price and the sell price
    • Financing rate or overnight rate is charged when you hold your leveraged positions for more than one day.
  • Non-trading fees. These occur related to some operations you make in your account, i.e. depositing money to your account, withdrawing money from it or not trading for an extended amount of time.

We compare TD Ameritrade fees with its closest competitors, Interactive Brokers and Charles Schwab.

TD Ameritrade fees
TD Ameritrade trading fees

We see TD Ameritrade's trading fees to be high because they charge more than most of its competitors.

Let's break down the trading fees into the different asset classes available at TD Ameritrade.

Trading fees

TD Ameritrade's trading fees are average.

Stock fees and ETF fees

TD Ameritrade has low stock trading fees.

Stock fees of a $2,000 trade
TD Ameritrade Interactive Brokers Charles Schwab
USA $7.0 $1.0 $5.0
UK - $8.7 -
Germany - $4.6 -

Forex fees

TD Ameritrade's forex fees are high.

Forex fees of a $20,000 30:1 position open, 1-week-hold, and close
TD Ameritrade Interactive Brokers Charles Schwab
EURUSD benchmark fee $44.3 $23.0 -
EURGBP benchmark fee $46.5 $17.0 -

Fund fees

TD Ameritrade fund fees are high.

A $2,000 fund buy fees
TD Ameritrade Interactive Brokers Charles Schwab
USA tech fund buy $50.0 $15.0 $24.8
Europe stock fund buy - $4.6 -

Bond fees

TD Ameritrade has low bond fees.

Bond fees of a $10,000 trade
TD Ameritrade Interactive Brokers Charles Schwab
USA $0.0 $5.0 $0.0
Europe - $10.0 -

Options fees

TD Ameritrade's options fees are high.

Stock index options fees of 10 contracts
TD Ameritrade Interactive Brokers Charles Schwab
USA $14.5 $7.0 $11.5
UK - $24.7 -
Germany - $19.4 -

Futures fees

TD Ameritrade's futures fees are low.

Stock index futures fee of 10 contracts
TD Ameritrade Interactive Brokers Charles Schwab
USA $22.5 $8.5 $15.0
UK - $24.7 -
Germany - $22.8 -

Financing rates

TD Ameritrade financing rates are high.

If you want to trade on margin and prefer to hold your positions long, financing costs can be significant.

TD Ameritrade yearly financing rates
TD Ameritrade Interactive Brokers Charles Schwab
Apple financing rate 10.8% 5.8% 9.8%
Vodafone financing rate - 3.9% -
EURUSD financing rate 10.5% 4.9% -
EURGBP financing rate 10.5% 3.3% -

TD Ameritrade fees
TD Ameritrade non-trading fees

When it comes to looking at all the non-trading fees TD Ameritrade is a cheap broker. This means that they don't charge you a lot for non-trading related activities on your trading account, like withdrawal fee.

Non-trading fees include various brokerage fees and charges at TD Ameritrade that you pay not related to buying and selling assets. Among some others, typical non trading fees are withdrawal fee, deposit fee, inactivity fee and account fee.

A high level overview of how TD Ameritrade stacks up in non-trading fees
TD Ameritrade Interactive Brokers Charles Schwab
Withdrawal fee $0 $0 $0
Deposit fee 0 0 0
Inactivity fee No Yes No
Account fee No No No

TD Ameritrade fees
TD Ameritrade deposit fee

Deposit fees are applied when you send money to your trading account from your bank account. Usually brokers don't charge money for that and TD Ameritrade is not different: you will see the exact same amount on your brokerage account that you sent by any of the deposit methods TD Ameritrade offers.

TD Ameritrade deposit methods
TD Ameritrade Interactive Brokers Charles Schwab
Bank transfer Yes Yes Yes
Credit/Debit card No No No
Electronic wallets No No No
Deposit fee 0 0 0

TD Ameritrade fees
TD Ameritrade withdrawal fee

Unlike the majority of the online brokers we have reviewed TD Ameritrade does not charge a withdrawal fee. This means that you'll see the same amount of money on your bank account that you transferred from your brokerage account.

TD Ameritrade withdrawal fees and options compared
TD Ameritrade Interactive Brokers Charles Schwab
Bank transfer Yes Yes Yes
Credit/Debit card No No No
Electronic wallets No No No
Withdrawal fee with bank transfer $0 $0 $0

TD Ameritrade fees
TD Ameritrade inactivity fee

TD Ameritrade does not apply an inactivity fee which is great because your account will not be charged even if you do not trade for a longer time period (months or years).

AUTHOR

Gergely Korpos
Gergely Korpos
Co-founder, CPO
Gergely's aim is to bring more clarity into personal investing. He has 10 years of experience in financial markets with GE Money, KPMG and MOL. He concluded thousands of trades as a commodity trader and financial portfolio manager
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