TD Ameritrade (https://www.tdameritrade.com/home.page) is a financial services institution that focuses on the brokerage and trading of financial assets such as stocks, exchange-traded funds (ETFs), futures and options contracts, and mutual funds. The company is one of the most prominent and largest US-based stockbrokers.
Reviews about TD Ameritrade are generally positive, citing its fantastic trading platforms, great education platforms for beginners, stellar customer service, and long track record as primary reasons.
Who Is TD Ameritrade?
TD Ameritrade started in 1975 as a relatively small investment banking firm named First Omaha Securities, Inc. Throughout the years, they have expanded their services, facilities, solutions, and tools until the company is what it is now: a multi-billion dollar company with over 120 branches and offices across the nation.
In the 1980s and 90s, TD Ameritrade leveraged technology to pioneer a series of firsts. In 1988, the company was the first to offer touch-tone phone trading. In 1995, after acquiring K. Aufhauser & Co., the firm executed the very first online trade. Following its going public in 1997, the company combined its many brokerage units into one collective, named Ameritrade, Inc.
The next few years were all about Ameritrade improving and growing their online trading user experience for self-directed traders and investors. The company started online entry of options order, email confirmations, extended-hours trading, investor behavior measuring tools, paperless account creation, and many more, all to improve the efficiency and convenience of their trading services.
Today, TD Ameritrade services about 11 million clients totaling about $1 trillion in assets. The firm also provides custodial services for more than 6,000 independent investment advisers. Its total client base places an estimated 500,000 trades per day.
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Where Is The TD Ameritrade Headquarters?
TD Ameritrade is based in Omaha, Nebraska. They have major trading offices in St. Louis, Missouri, and Southlake, Texas.
The firm is regulated by some top-tier authorities such as the Securities and Exchange Commission (SEC), Commodity Futures Trading Commission (CFTC), and Financial Industry Regulatory Authority (FINRA).
What Are The Types Of TD Ameritrade Accounts?
TD Ameritrade offers a bevy of accounts for many of your brokerage needs.
- Standard account – These are the most common and flexible accounts. These include individual, joint, and guardianship arrangements, and can be upgraded for forex trading, options, and futures.
- Retirement accounts – These are designed to meet your lifestyle needs based on your income and will help you prepare for retirement. Different retirement accounts include traditional, rollover, and Roth IRA, Solo 401k for small businesses, and pension or profit plans.
- Education accounts – These accounts are for planning the holder’s education goals. Different account types include the 529 Plans, education savings account, and a custodian-controlled account.
- Specialty Accounts – These accounts are geared towards trusts, small businesses, sole proprietorships, limited partnerships, corporations, and investment club accounts.
- Margin Trading Accounts – A margin trading account allows a trader to borrow money from TD Ameritrade for your trading or personal needs.
- Managed Portfolios – TD Ameritrade offers goal-oriented portfolios crafted from the professional opinions and expertise of analysts from Morningstar Investment Management, LLC.
TD Ameritrade accounts generally require no minimum initial deposit. Trading options on margin requires a $2,000 deposit and managed portfolio accounts require minimum investments of $500 to $250,000, depending on the portfolio type.
Making an account is easy, but is not fully digital, and may take you as long as three days to complete.
TD Ameritrade Highlights
Here are some of the best and most essential features of TD Ameritrade.
- TD Ameritrade requires no minimum investments on many of its accounts, making it an excellent option for beginner traders.
- The firm has a wide assortment of investment classes. They offer just about any asset class you can think of, and numerous mutual funds and fund offerings. They also now offer cryptocurrency trading for those who are into the niche.
- TD Ameritrade’s trading platform, Thinkorswim, has been cited by several reviews and sites as the top trading platform because of its extensive functionality and ease of use. Their mobile trading applications are also more than decent and are for on-the-go trading.
- TD Ameritrade has a trading simulator, named paperMoney, that enables a beginner to practice trading strategies with virtual cash. It is available for free from current clients, but only for a 60-day trial run for non-customers.
- The Ameritrade Network and a unique line-up of trading tools provide users with a substantial research offering and experience to help both veteran and greenhorn alike. Aside from digital services such as live webcasts, analysis, and news, they also have in-house sessions at their branch locations for those interested.
Is There A Fee To Transact With TD Ameritrade?
TD Ameritrade offers zero fees on some of its services, but some of its offerings do require a certain payment. For the most part, however, their costs are in line with many of their competitors.
There are no fees for minimum deposit, inactivity, stock trades, ETF trades, and options base fees. Per- contract commission fees for options are $0.65. Mutual fund trade fees and broker-assisted trades fees amount to $44.99.
- OTCBB (penny stocks) incur a $6.95 commission per transaction. Most other brokers have waived this fee and are now free.
- No per leg commission fees on options trades.
- For options contracts priced at $0.05 or lower, there are no fees. Otherwise, per-contract commission fees amount to $0.65.
- For an order of 50 options contracts, the fee is $32.50. For covered call trades of 500 shares plus five contracts, $3.25
- Futures transactions fees are $2.25 per contract, plus exchange fees.
- Partial transfer of assets is free, while a full transfer costs $75.
Advantages Of Transacting With TD Ameritrade
TD Ameritrade has a wealth of things that make it a top-tier pick for an online broker.
- Low fees, both for trading and non-trading transactions
- Many account types and funds
- No minimum deposits on many account types
- User-friendly deposit and withdrawal, and no deposit fees
- Great reports and sophisticated analysis
- Great interactive research charts and data on asset fundamentals
- Quality customer support with fast response times through either phone or chat
- Excellent education through its demo account service, tutorials, and videos.
- Regulated by credible authorities
- Long history and veteran status assures you safety, stability, and excellence.
However, the company has several disadvantages, as well.
- High fund fees for those not included in the No Commission group
- Not fully digital account opening system
- Limited customizability on its trading platform with regards to the workspace and charts
- No debit/credit cards or electronic wallets for money transfers
Overall, if you want to dip your toes into the online trading niche, then TD Ameritrade is a solid choice. They are an outstanding firm with decades of experience behind them. Beginner traders will appreciate its educational resources and zero fees on trades, while long-time traders will make good use of its outstanding research platforms. TD Ameritrade will help you advance on the path of becoming a successful online trader.
I’m Jon, owner of Trade Wise at https://tradewise.community/ and https://www.youtube.com/channel/UC7VmOx8DbvX4Rbrac2pPcjw
I review forex and crypto trading products and services to find the best of what’s out there for creating a passive income without becoming a full-time trader.