TD Ameritrade offers self-directed brokerage accounts, automated trading, and more.
TD Ameritrade; Gilbert Espinoza/Business Insider
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Bottom Line: TD Ameritrade Commission-free Trading is great for active traders interested in utilizing multiple trading platforms. However, the brokerage also offers automated and advisor-assisted investing accounts, so it could also be suitable for those looking for managed portfolios.
Overall rating
FeatureInsider rating (out of 5)Fees4.25Investment selection5.00Access4.50Ethics4.88Customer service5.00Overall score4.73
Is TD Ameritrade right for you?
TD Ameritrade investment account is an online brokerage offering self-directed brokerage accounts, professionally managed investment accounts, retirement accounts, education savings accounts, and more.
Though Charles Schwab acquired the brokerage in 2020 (meaning that both platforms will eventually merge product offerings,) TD Ameritrade provides many of the same services, including copious trading platforms and tools, investment research materials, and educational courses and webcasts.
The TD Ameritrade mobile app is available on iOS and Android devices.
TD Ameritrade vs. Merrill Edge
TD Ameritrade
Merrill
Min. Investment
$0 ($5,000 for Schwab Intelligent Portfolios and $25,000 for Schwab Intelligent Portfolios Premium)
Min. Investment
$0
Trading Fees
0% ($300 one-time planning fee and $30/month for Schwab Intelligent Portfolios Premium)
Trading Fees
0% (0.45% to 0.85% for automated/managed portfolios)
Investment choices
Stocks, ETFs, options, mutual funds, futures, forex, IPOs, and bonds
Investment choices
Stocks, ETFs, options, mutual funds, and bonds
TD Ameritrade Commission-free TradingMerrill Edge investment account
Active traders, passive investors, and hands-off investors can all benefit from TD Ameritrade and Merrill Edge’s offerings. But TD Ameritrade is a better choice for those who want to expose their portfolios to assets like forex and IPOs.
However, if you prefer automated investing, you’ll pay less to get started than you would with TD Ameritrade’s equivalent accounts, Schwab Intelligent Portfolios and Schwab Intelligent Portfolios Premium (TD Ameritrade no longer offers its managed accounts to new clients, but you can open managed accounts through its affiliate, Charles Schwab).
Merrill Edge’s managed accounts — Merrill Guided Investing and Merrill Guided Investing with an Advisor — include $1,000 and $20,000 minimums, respectively. But you’ll need at least $5,000 for Schwab Intelligent Portfolios and $25,000 for Schwab Intelligent Portfolios Premium. However, you’ll pay less in advisory fees with the Schwab accounts.
TD Ameritrade vs. Fidelity
TD Ameritrade
Fidelity Investments
Min. Investment
$0 ($5,000 for Schwab Intelligent Portfolios and $25,000 for Schwab Intelligent Portfolios Premium)
Min. Investment
$0
Trading Fees
0% ($300 one-time planning fee and $30/month for Schwab Intelligent Portfolios Premium)
Trading Fees
0% (up to 0.35% for automated investment advice; 0.50% for advisor support)
Investment choices
Stocks, ETFs, options, mutual funds, futures, forex, IPOs, and bonds
Investment choices
Stocks, ETFs, options, mutual funds, bonds, CDs, and IPOs
TD Ameritrade Commission-free TradingFidelity Brokerage
TD Ameritrade and Fidelity both offer investment options for self-directed traders and hands-off investors, but the fees, account features, and investment choices vary for each platform.
Fidelity is a competitive choice for hands-off investors in search of low-cost automated or advisor-assisted accounts. You won’t have to worry about any fees with Fidelity Go if you have an account balance below $10,000. But its advisor assisted account, Fidelity Personalized Planning & Advice, costs more than TD Ameritrade’s equivalent account, Schwab Intelligent Portfolios Premium.
Both Fidelity Personalized Planning & Advice and Schwab Intelligent Portfolios Premium have a $25,000 minimum requirement, but Fidelity’s account will cost you more than Schwab’s advisor-guided automated account.
Ways to invest with TD Ameritrade
Self-directed brokerage accounts
TD Ameritrade’s brokerage accounts require no minimum opening deposit and include commission-free trades on US-listed stocks, ETFs, and options. However, options contracts cost $0.65 per contract.
It also offers trading accounts for individuals, joint tenants with rights of survivorship, tenants in common, community property, and guardianships or conservatorships. Plus, if you’re more of a research-oriented trader, TD Ameritrade additionally provides market analysis from Morningstar Investment Management professionals.
TD Ameritrade’s investment selection consists of stocks, bonds, mutual funds (it offers more than 13,000), ETFs, options, futures, annuities, IPOs, foreign investments (Forex), and other fixed income securities.
You can also utilize several trading platforms — including its classic web platform, next generation web platform, and thinkorswim trading platform — and investment tools.
Managed portfolios
Previously, TD Ameritrade investment account offered three managed portfolios: Essential Portfolios, Selective Portfolios, and Personalized Portfolios. However, due to the Schwab acquisition, TD Ameritrade’s managed and automated investing accounts are no longer available to new clients.
If you’re a beginner and prefer a hands-off investment approach, you’ll have to set up a managed account through Charles Schwab. Schwab currently offers two robo-advisors: Schwab Intelligent Portfolios and Schwab Intelligent Portfolios Premium.
Schwab Intelligent Portfolios has a $5,000 minimum, but it doesn’t charge any advisory fees. With this account, the brokerage invests your money into a diversified portfolio of ETFs that align with your risk tolerance and investing goals. The account also includes 24/7 customer support, and it supports brokerage, IRA, trust, and custodial accounts.
Schwab Intelligent Portfolios Premium takes these features a step further by pairing them with unlimited guidance from a CFP. However, you’ll need at least $25,000 to get started. Plus, fees include a one-time $300 planning fee and $30/month advisory fee.
Retirement accounts
TD Ameritrade offers several retirement accounts for individuals and small businesses. The brokerage’s current selection includes traditional IRAs, rollover IRAs, Roth IRAs, SEP IRAs, solo 401(k)s, SIMPLE IRAs, and pension or profit plans.
In addition, each account comes without minimum opening deposits or maintenance fees. Roth and traditional IRAs feature educational resources, retirement tools, and access to investing and market research.
Education savings accounts
You can also save for college and educational expenses with TD Ameritrade investment account 529 college savings plans and Coverdell Education Savings Accounts (ESAs). The Coverdell ESA offers tax-free distributions, with a $0 minimum deposit and $2,000 annual maximum contribution limit.
The 529 plan provides several investment choices, including domestic equity, real estate, international equity, international bond, money market and fixed income investments.
TD Ameritrade also offers custodial accounts that allow minors to own cash or securities.
Specialty accounts
TD Ameritrade offers several other specialty accounts, including the following:
TrustsPartnership accountsLimited partnership accountsInvestment club accountsLimited liability accountsCorporate accountsSole proprietorship accountsNon-incorporated accountsSmall business plans
Is TD Ameritrade trustworthy?
To ask if TD Ameritrade investment account is trustworthy is to also ask if Charles Schwab is trustworthy. Charles Schwab acquired TD Ameritrade on October 6, 2020, so the two companies are currently merging their businesses. Both companies have received high ratings with the Better Business Bureau, though.
The BBB rates companies using a grade scale range of A+ to F. Currently, TD Ameritrade has an A rating, and Charles Schwab has an A+ rating. Both grades indicate that TD Ameritrade and Schwab both interact fairly well with customers.
Earlier in 2021, TD Ameritrade, Robinhood, and several other investment apps faced backlash for restricting trades on Gamestop (GME), AMC Entertainment (AMC), and other stocks that surged due to a Reddit forum called r/WallStreetBets. You can see an updated list of its current trading restrictions here.
The brokerage has also faced other legal troubles over the years. In 2011, the US Securities and Exchange Commission (SEC) forced TD Ameritrade to reimburse $10 million to customers it failed to warn about the dangers of a mutual fund known as the Reserve Yield Plus Fund. In 2020, the investment app was accused of failing to warn customers about the risk in oil investments, but it beat all oil-related customer lawsuits.
If you’re not sure about the brokerage, consider the best investment app alternatives to TD Ameritrade.
TD Ameritrade: Frequently asked questions (FAQ)
Is TD Ameritrade good for beginners?
TD Ameritrade investment account offers options that cater to beginners who want to learn more about the stock market. These include its education center, which provides articles, videos, webcasts, in-person events, and podcasts on all things investing. The brokerage also offers a Market News section that keeps customers updated on the latest happenings.
Plus, if you don’t want to dive right into DIY trading, you can set up an automated investing account (also known as a robo-advisor) with its partner, Charles Schwab.
Does TD Ameritrade have fees?
Yes. While TD Ameritrade offers commission-free stocks, ETFs, and options (options still have a $0.65 contract fee), you’ll pay up to $49.95 or $74.95 for no-load mutual funds. Futures cost $2.25 per contract, and Forex investment prices vary.
TD Ameritrade also charges $25 for broker-assisted trades. See its complete pricing guide here.
Which is better: Robinhood or TD Ameritrade?
This depends on your investing preferences. Robinhood strictly offers stocks, ETFs, options, cryptocurrencies, and American depositary receipts (ADRs). Plus, its options have no contract fees, so this brokerage is a better option for options and crypto traders.
TD Ameritrade investment account, on the other hand, offers a wider range of investment choices and account options. Plus, its vast selection of educational resources make it a better fit for both beginners and investors who simply want more to choose from.
Related terms
Stocks: When private companies go public, you can typically purchase shares of ownership within them on exchanges like the NASDAQ and NYSE. Stocks are usually available through online brokerages, automated advisors, and other investment platforms.ETFs: These funds contain a mix of stocks, bonds, commodities, and other investments. Unlike mutual funds, they don’t have active managers who oversee the investments in the fund. And, compared to stocks, ETFs are generally less risky since you’re purchasing a basket of investments. Options: Options are contracts that give you the power to purchase or sell a security at a certain price within a set amount of time.
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