Charles Schwab vs Etrade vs Scottrade vs TD Ameritrade: Review
When choosing a brokerage, many investors will look to Scottrade, Schwab, E*Trade, or TD Ameritrade. Let's take an in-depth look at these
largest online brokers and see how they compare to each other.
Commissions and Account Requirements
Buying and selling equities at E*Trade and TD Ameritrade incurs a $9.99 charge, while Schwab clients pay $8.95, and Scottrade is the lowest at $7. Derivative traders at Schwab, E*Trade, and TD Ameritrade pay an additional $0.75 per option contract. Options at Scottrade at $0.70 per contract, but the base charge is only $7.
Using a living, breathing broker at TD Ameritrade to buy or sell is $44.99, while Schwab is cheaper at $33.95. Scottrade charges $32, and E*Trade is the lowest at $25.
A brokerage account with any of the four brokers comes with no maintenance fees or inactivity fees. Schwab clients must deposit at least $1,000 to open a regular brokerage account, although this obligation can be removed by opening a Schwab checking account with the securities account. Scottrade has a $2,500 minimum initial deposit requirement, while E*Trade is at $500, and TD Ameritrade has no minimum.
Mutual Funds and ETF's
Investors at Schwab can trade over 5,000 mutual funds. More than 3,500 of these are OneSource funds, which have neither load nor transaction fee. Mutual funds that have a transaction fee are an expensive $76 to purchase, but there is no charge to sell.
TD Ameritrade customers have access to over 11,000 mutual funds. Almost 2,000 have no load and no transaction fee. A $49.99 commission is charged to trade transaction-fee funds.
E*Trade provides more than 8,000 mutual funds. Roughly 1,300 of these are available with no load and no transaction fee. A $19.99 charge is assigned for transaction-fee funds.
There are more than 14,000 mutual funds at Scottrade. Almost 3,000 have no transaction fee and no load. Transaction fee funds carry a $17 commission.
For ETF investors, Schwab has over 200 exchange-traded products that are free to trade, E*Trade offers 118, and TD Ameritrade has 101. Scottrade fails here and doesn't offer any.
Schwab offers customer service over the telephone 24/7. The broker also has representatives who speak Chinese. Furthermore, the company operates a nationwide network of branches with more than 300 locations currently.
E*Trade operates 30 branch locations. The broker has customer support over the phone 24 hours a day, 7 days a week.
TD Ameritrade also has customer service reps on the phone all hours of the day. The broker has a nationwide network of branches. Presently, there are over 100 locations.
Scottrade has the most branches at more than 500. However, the broker fails at phone service, which is not available around the clock.
E*Trade's web site is nicely designed. Clients can use advanced trading platforms, in either browser or desktop format. However, active trader requirements must be met.
Schwab's web site is not as attractive as E*Trade's, but is user friendly nevertheless. Traders can place orders using the web browser, or with StreetSmartEdge, an advanced trading system. The platform just requires a $1,000 account balance.
TD Ameritrade operates three platforms. The simplest is the web browser. Second in line is Trade Architect, which is Java-based. Last, but certainly not least, is thinkorswim. This is a very advanced platform. TD Ameritrade has no active trader requirements for any product.
Compared to the other three brokers, Scottrade has the least sophisticated website. The firm does offer an advanced trading system, Scottrader Streaming Quotes, which is free of charge. The most advanced platform is ScottradeELITE, available only to frequent traders.
Schwab offers an app that can be used on Kindle Fire, Android, iPad, iPhone, Apple Watch, and mobile web. The mobile platform is easy to learn. Several features are available, such as funds transfer, mobile check deposit, and live streaming of CNBC.
Live streaming of CNBC is also available on TD Ameritrade's app. The broker maintains three different apps. They can be used on Android, iPhone, iPad, and Apple Watch. The most basic app can be used on Windows 10. Users can perform many tasks, such as deposit a check, read market news, or watch business videos from CNBC and Reuters.
E*Trade has mobile applications for Windows phone, Android phone and tablet, iPad, iPhone, Apple Watch, Amazon Fire phone, and Kindle Fire HD. Features include charts, a video library, and mobile check deposit. Unfortunately, only active traders can access streaming of CNBC.
Investors at Scottrade can use Android, Apple, or mobile web to place a trade. Unfortunately, some features that the other brokers offer, such as mobile check deposit, are missing at Scottrade.
E*Trade clients can open a checking account that comes with checks and a debit card free of charge. The firm rebates ATM fees for accounts with balances above $5,000.
TD Ameritrade has a checking account with checks and a debit card. There is no charge for the account, and ATM fees are refunded. The account is insured by the FDIC up to $500,000.
A checking account is also available at Schwab. It comes with checks and a debit card free of charge. ATM fees are reimbursed, and FDIC insurance covers the first $250,000.
Investors at Scottrade can open a checking account that has a debit card and checks. However, they must have at least $500 deposited in a Scottrade securities account to apply.
Thanks to top-notch trading technology, we strongly recommend TD Ameritrade to stock, forex, futures, and penny stock traders.
Scottrade is excellent for long-term and do-it-yourself investors, mutual funds investing, IRA accounts, and clients new to investing.
Charles Schwab and Etrade are very good for retirement accounts and fairly inactive investors. Etrade is also the cheapest among large brokerage houses
for bond investing.
We encourage readers to take a look at the full brokerage reviews, containing promotional offers:
Scottrade (read review),
TD Ameritrade (read review),
Etrade (read review), and
Charles Schwab (read review).
TD Ameritrade: Trade free for 60 days + get up to $600.
Scottrade: Get up to $100 in account transfer fee reimbursed.
Etrade: 60 days of free trades for deposits of $10k or more.
Charles Schwab: None
Updated on 1/14/2017.