TD Ameritrade vs Vanguard: Trading Fees and Investments 2012
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- Stocks and ETFs: $9.99
- Stocks and ETFs broker assisted: $49.99
- Stocks and ETFs Interactive Voice Response (IVR) Telephone System: $34.99
- Options: $9.99 plus $0.75 per contract
- No-load mutual funds: $49.99
- Treasuries at auction: $25 flat fee
- All other bonds and CMOs, CDs: on a net yield basis
- Futures: $3.50 per contract (inclusive of exchange fees)
- Investment products: stocks, bonds, mutual funds, options, ETFs, bonds, CDs, UITs, futures and forex
- Minimum to open TD Ameritrade account: $0 for cash account, $2,000 for margin account
- All TD Ameritrade fees
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- Stocks and ETFs: $7 for the first 25 trades, $20 for subsequent trades for account with less than $50,000
- $7 for account with $50,000–$500,000 (Voyager Services®)
- $2 for account with $500,000–$1,000,000 (Voyager Select Services®)
- Free for first 25 trades, $2 for subsequent trades for account with $1 million (Flagship Services™)
- Options: $30 plus $1.50 per contract
- Options for accounts with over $1 million: $8 + $1.50 per contract
- Mutual funds: Vanguard mutual funds - free. All others - Standard: $35; Voyager® and Voyager Select®: $20; Flagship®, $8
- Certificates of deposit (CDs): Purchase: $5 per $1,000, Minimum: $50. Sale: $35 per transaction
- Commercial paper: $50 per transaction; minimum purchase: $100,000
- U.S. Treasury: $0.75 per $1,000 face amount, $40 min–$75 max
- Mortgage-backed securities: $50 per transaction; GNMA minimum purchase: $25,000
- Investment products: stocks, options, mutual funds, bonds, CDs, foreign securities, insurance,
commercial paper, ETFs
- Minimum to open Vanguard account: $3,000
- All Vanguard fees
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- No surcharges on penny stocks, large orders and after-hours trading
- Large and well known company with many local branches
- Two excellent trading platforms (ThinkOrSwim and Trade Architect)
- Practice trading without risking your own money using paperMoney
- See what other traders are doing on myTRADE trader community
- Free IRA accounts
- No maintenance and inactivity fees
- Free streaming quotes, including Level II
- Large selection of independent, third-party research (Standard & Poor's, Morningstar, Jaywalk and TheStreet)
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- Low cost and good performance Vanguard mutual funds
- Free Vanguard ETFs
- Free dollar-cost-averaging transactions for no-fee mutual funds. $3 per transaction, minimum purchase $100, minimum two transactions, for transaction fee mutual funds.
- Free dividend reinvestment
- No ACAT fee
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- $9.99 commission for stocks/ETFs and $49 commission for mutual funds are high
- The website is sometimes very slow or even down on the high volume days
- High margin rates
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- High commissions in many cases
- $20 annual maintenance fee for regular accounts with balance less than $50,000
- $10 monthly Low Balance Fee for accounts with $2,500 or less
- Poor trading and research tools
- $3,000 minimum to open account is somewhat high
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TD Ameritrade vs Vanguard: Comparison Summary
TD Ameritrade (Ameritrade Review)
is less expensive for somewhat active customers than Vanguard (Vanguard Review):
$9.99 per stock and ETF trade versus $20 ($7 for the first 25 trades) at Vanguard. Vanguard also charges a $20 annual fee for
accounts with less than $50,000. If account balance is below $2,500, the firm will deduct a monthly fee of $10.
Vanguard provides limited trading tools and research amenities.
TD Ameritrade's website, on the other hand, suffers from slowness and order execution problems on high-volume days and at after hours
trading. Its Thinkorswim trading platform, on the other hand, is one of the best in the industry in versatility, speed and richness of
features.
TD Ameritrade has no IRA setup and annual IRA fees as well as no low balance fees and we recommend it for a fee-free IRA account.
TD Ameritrade bought one of the best online brokers - ThinkorSwim and it benefits a lot from this acquisition. The firm
provides rich selection of third-party research, free streaming quotes, online community, virtual trading and two excellent trading
platforms. Out of these two online brokers, it would be our recommendation to all investors.
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