Published by Blain Reinkensmeyer
On Monday, September 28th, 2015
TD Ameritrade charges more than its competitors, but delivers with a fantastic platform and mobile offering and strong customer service. With these attributes, the company earns its No. 1 overall ranking as best online broker for 2015.
Fantastic platforms thinkorswim and Trade Architect; rich research offering; 24/7 customer service; easy-to-use website; great iPad app.
Short-term trading fee charged if a commission-free ETF is sold within 30 days of purchase; no customizable dashboard for mobile apps; no virtual trading offered for Trade Architect.
In the process of searching for a well-rounded broker, finding the right mix is no easy task. Trade costs, ease-of-use, trade platforms, research, and customer service all are important to investors.
After using a TD Ameritrade account, you can't help but love the overall experience. The broker charges $9.99 per trade, a rate almost twice that of some of the cheaper discount brokers. However, the value and quality delivered is so superior that is easily justifies the higher price tag. Our TD Ameritrade review shows they are the real deal.
Commissions & Fees
While having access to 24/7 customer support, advanced trade platforms, ample research, real-time streaming quotes site-wide and more is great, unfortunately, it is expensive. TD Ameritrade charges a flat rate of $9.99 per trade, with options costing $9.99, plus $.75 per contract (for full commission details, see the Commissions & Fees tab above).
Compared to other full-service brokers, TD Ameritrade is on a par with ETRADE, but is more expensive than the rest, including Charles Schwab, Fidelity, and Scottrade. In fact, considering margin costs, TD Ameritrade is the most expensive broker out of the 15 included in our 2015 Review.
One bright spot is that TD Ameritrade does offer 101 commission-free ETFs (Charles Schwab offers the most, with 182). The only caveat is that, with TD Ameritrade, any commission-free ETF that is sold within 30 days of purchase is subject to a short-term trading fee of $19.99.
If having access to 24/7 customer support by email and phone is important to you, then TD Ameritrade has you covered. During testing, our emails were returned within five hours on average. Furthermore, the phone system is quick to navigate and connects you to a rep almost immediately.
Live chat support is also offered, but only for clients seeking platform support while using thinkorswim, or for potential clients who navigate around the site long enough to trigger a live chat popup. Knowing how the web is evolving, I would like to see TD Ameritrade offer live chat support for all clients and potential clients.
When it comes to support the bottom line is that for a full-service broker, great customer service is expected, and TD Ameritrade delivers, regardless of the communication avenue.
Like its biggest competitors, ETRADE, Charles Schwab, and Fidelity, TD Ameritrade has a substantial research offering. When I pulled up a quote for Apple (AAPL), there were seven different third-party research reports to choose from and read, which is the second most in the industry behind Fidelity’s offering of 13. The featured research report provider is ResearchTeam, which combines five research providers into one.
TD Ameritrade utilizes Thomson Reuters as its third-party data provider for fundamental analysis of individual equities, and offers the full array of Morningstar research for all mutual funds. Morningstar is my favorite third-party research provider for mutual funds, and it is no surprise TD Ameritrade, ETRADE, Charles Schwab, Fidelity, Scottrade, and other big names all agree.
I also enjoyed the on-site charting functionality. With 34 different technical indicators (volume, MACD, RSI, etc.) and easy-to-read, big charts, the experience is as clean as you'll find anywhere.
Making research a seamless experience is just one part of TD Ameritrade’s efforts to make its website easy to use. The site-wide quote bar streams real-time quotes – functionality which neither Charles Schwab, ETRADE, nor Fidelity offers – and includes SnapTicket, a quick trade extension that allows stock and option orders to be placed from any page on the site.
TD Ameritrade also offers a fully customizable sidebar, My Dock, which allows clients to display up to 13 different modules. Modules can be resorted or placed into separate columns, allowing clients with wide-screen monitors to maximize their workflow.
Platforms & Tools
While there are many standout areas for TD Ameritrade, the broker's two platforms really are its bread and butter. The flagship platform, thinkorswim, used to be a standalone broker until TD Ameritrade acquired it in 2009. Thinkorswim is designed for advanced traders who want complete flexibility and depth; however, it can also be used by any client with no minimums or specific trade criteria required for access.
Run as a desktop application, thinkorswim is so advanced it is only rivaled by TradeStation. Having dozens of charts streaming real-time data is as easy as a few clicks, and even the pickiest trader will be satisfied with the over 300 technical studies available for each chart, not to mention that each study can be customized thereafter. The possible combinations are endless.
TD Ameritrade's thinkorswim is also home to a slew of advanced tools and functionality. Whether it be CNBC TV, alerts, heat mapping, earnings calendars, stock scanners, options screeners or back-testing, the rabbit hole goes as far as any trader's imagination will take them. One of the newest innovations is thinkorswim Sharing, which gives clients the ability to share workspaces, charts, studies, trade templates, and more via email or social media.
Extremely well known for its options capabilities, thinkorswim is also home to a slew of other advanced tools and functionalities. Whether it be CNBC TV, alerts, heat mapping, earnings calendars, stock scanners, one-click trading, or back-testing, the rabbit hole goes as far as any trader's imagination will take them. One of the newer innovations launched in early 2014 is thinkorswim Sharing, which gives clients the ability to share workspaces, charts, studies, trade templates, and more via email or social media.
Our only gripe with thinkorswim is that while accessibility for any client is important, the larger user base can be a painful point for active traders who rely on the platform to make a living. On highly volatile and active trading days when there is a large influx of clients using the system, thinkorswim can lag noticeably for lengthy periods of time. For casual investors, this is no big deal, but for professionals, this is a serious issue. While lag spouts are rare, they do occur, and are very annoying.
Platform thinkorswim aside, TD Ameritrade also has a web-based platform, Trade Architect, which is designed with more casual investors in mind. The tools and functionality are purposely kept simple, and the design is clean with visual flare. Everything ran smoothly in my Chrome browser, bug-free, and I quickly became a fan of the platform-wide streaming real-time quotes. I could only find one flaw: no virtual trading support.
From testing every broker, the streaming watch list functionality Trade Architect offers is my favorite. It isn't just the cleanness of the layout, but also the flexibility, ease of use, and depth of data available. The layout is completely customizable, and having access to visual data such as quote trends, trade trends, 52-week range, and the strength meter was simply icing on the cake.
When it comes to mobile trading, TD Ameritrade took a different approach by offering not one, but two smartphone apps: TD Ameritrade Mobile and TD Ameritrade Mobile Trader. TD Ameritrade Mobile is designed for new and casual investors, while TD Ameritrade Mobile Trader is designed for the feature hungry active trader.
Having two separate apps has its noticeable pros and cons. On the pros side, the apps can hone in on their individual target users and provide a specific experience. On the cons side, it is easy to confuse the two apps initially and not know which one is right for you. Also, some of the functionality that is built for one could really be beneficial on the other, for example basic price alerts, so it can be tricky at times to find the right home as a client.
Once we dove into both apps, it was clear to see TD Ameritrade took the required steps to ensure a smooth experience. Not only were both apps bug free, but every tap we made was smooth, responsive, and crisp. The apps are beautifully designed.
Looking at specific functionality, TD Ameritrade Mobile Trader is “where the magic happens,” so to speak. Advanced charting, with a staggering 305 different technical studies, is available alongside a full array of order options. An extremely smooth interface for advanced equities trades alongside a seamless experience for complex options trades extremely well thought out and executed, is arguably the best combination in the industry.
When all 43 variables are considered in the Mobile Trading category, TD Ameritrade comes away with 88% of the possible points, placing it second overall behind long time industry leader ETRADE. Several of the key pieces missing from the puzzle to break the 90% barrier include a customizable dashboard, advanced price alerts, and the ability to compare portfolio performance against the overall market averages. Critiques aside, TD Ameritrade Mobile and TD Ameritrade Mobile Trader are top-notch products.
TD Ameritrade is one of those companies that just gets it. They understand their clients, the value of a high-quality user experience, and they know what it takes to stay ahead of the competition.
Any investor, new or seasoned, will find TD Ameritrade a great fit for their needs. The main gripe with the broker is cost, but what you pay for is what you get, and the quality delivered by TD Ameritrade is, without a doubt, worth the extra few dollars per trade. TD Ameritrade is No. 1 in our book.
The content portion of this Review was completed on February 17th, 2015.
Blain has been involved in the markets for over 13 years, heading StockBrokers.com equity broker research and reviews. His personal blog, StockTrader.com, provides to-the-point daily market recaps to over 17,000 subscribers.
TD Ameritrade's commission structure is centered around flat-rate trading. All of TD Ameritrades platforms (thinkorswim, Trade Architect), tools, and services are available for access by clients. No minimums, no trade activity requirements.
Stock Trades - All online stock trades are $9.99 regardless of the order size, price, time of order, or type. Broker assisted trades are $44.99. Lastly, any commission-free ETF that is sold within 30 days of purchase is subject to a short-term trading fee of $19.99.
Option Trades - All online options trades are $9.99 + $.75 per contract.
Option Trades - All no-load mutual fund trades are $49.99 per trade. There is no commission charge for load funds, just the fees charged by the fund itself. Also, there is no commission charge for NTF (No Transaction Fee Funds). Note however, any NTF funds (less ProFunds and Rydex) that are held 180 days or less before being sold will be charged a Short-Term Redemption fee of $49.99.
All pricing data was obtained from a published web site as of 5/01/2015 and is believed to be accurate, but is not guaranteed. The StockBrokers.com staff is constantly working with its online broker representatives to obtain the latest pricing data. If you believe any data listed above is inaccurate, please contact us using the link at the top of this page. For stock trade rates, advertised pricing is for a standard order size of 500 shares of stock priced at $30 per share. For options orders, an options regulatory fee per contract may apply.
Options are not suitable for all investors as the special risks inherent to options trading may expose investors to potentially rapid and substantial losses. Options trading privileges subject to TD Ameritrade review and approval. Please read Characteristics and Risks of Standardized Options before investing in options. Offer valid for one new Individual, Joint or IRA TD Ameritrade account opened by 12/31/2015 and funded within 30 days of account opening with $3,000 or more. To receive $100 bonus, account must be funded with $25,000 or more within 30 days of initial minimum funding. To receive $300 bonus, account must be funded with $100,000 or more within 30 days of initial minimum funding. To receive $600 bonus, account must be funded with $250,000 or more within 30 days of initial minimum funding. Please allow 3-5 business days for any cash deposits to post to account. Offer is not transferable and not valid with internal transfers, accounts using the Amerivest service, TD Ameritrade Institutional accounts, and current TD Ameritrade accounts or with other offers. Qualified commission-free Internet equity, ETF or options orders will be limited to a maximum of 250 and must execute within 90 days of account funding. Contract, exercise, and assignment fees still apply. 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. Taxes related to TD Ameritrade offers are your responsibility. Retail values totaling $600 or more during the calendar year will be included in 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. (Offer Code 264) TD Ameritrade Inc., member FINRA/SIPC.. TD Ameritrade is a trademark jointly owned by TD Ameritrade IP Company, Inc. and The Toronto-Dominion Bank. © 2015 TD Ameritrade IP Company, Inc. All rights reserved. Used with permission.