Ally Invest versus TD Ameritrade

Ally Invest vs TD Ameritrade


Compare TD Ameritrade versus Ally Invest - which is better in 2019? IRA/Roth accounts, online investing fees, stock broker mutual fund rates, and differences.



Overview


TD Ameritrade has a strong competitor with the arrival of Ally Invest. Both brokers tout low commissions and advanced trading technology. The two firms offer a range of securities. Because both companies also offer forex, they will attract the same client base. This article will compare the two firms against each other, and see which one is the better - Ally Invest or TD Ameritrade.


Pricing


Broker Fees Stock/ETF
Commission
Mutual Fund
Commission
Options
Commission
Maintenance
Fee
Annual IRA
Fee
TD Ameritrade $0 $49.99 $0 + $0.65 per contract $0 $0
Ally Invest $0 $9.95 $0 + $0.50 per contract $0 $0


Services


Broker Review Cost Investment Products Trading Tools Customer Service Research Overall Rating
TD Ameritrade
Ally Invest


Promotions


Ally Invest: Up to $3,500 cash bonus + $0 commission trades for new accounts.

TD Ameritrade: Trade stocks and ETFs for free + get up to $600 bonus.


Customer Support


Both companies offer customer service around the clock over the phone. Ally Invest also has associates who can be reached through an on-line chat function. TD Ameritrade has a robo-chat function called Ted. It is able to answer questions fairly well, but it’s not a human representative.

TD Ameritrade has more than 450 physical locations throughout the United States for clients who want in-person service. Ally Invest has zero.

Both websites do a decent job of providing self-help features, although the TD Ameritrade site seems to have more helpful FAQ’s.

Overall, this category is too close to call.


Mutual and Exchange-traded Funds


TD Ameritrade’s mutual fund screener returns 13,000 products that are available for purchase. Out of this list, 4,200 come with no load and no transaction fee. The screener has many variables to search by. These include Morningstar style box, portfolio turnover rate, cash flow growth, and gross expense ratio. It’s easy to browse through the screener’s results, as all variables are sortable.

A mutual fund at TD Ameritrade that isn’t on the company’s NTF list comes with a rather steep $49.99 fee, and even worse, it’s applied to both purchases and sales. NTF funds that are sold in less than 180 days after purchase also are assessed a $49.99 fee.

The Ally Invest mutual fund screener returns 12,000 securities that are open to new investors. From this group, there are 1,672 funds that have no load. Unfortunately, Ally does not offer any funds that are both no-load, and no-transaction-fee. The screener isn’t as functional as TD Ameritrade’s. Buy and sell buttons on Ally’s screener, for example, produce the broker’s stock trading system, a technical glitch.

No-load mutual funds at Ally Invest come with a $9.95 transaction fee. Load funds are always free to trade. Ally is one of the few brokers not to charge a short-term redemption fee on early sales of mutual funds.

For ETF traders, TD Ameritrade and Ally provide all ETFs commission-free.

Although TD Ameritrade has a few advantages in this category, Ally Invest seems like the overall better choice.


Ally Invest vs Ameritrade


Tech Offerings


TD Ameritrade customers get to use a website that is easy to navigate. The bottom of the browser hosts SnapTicket, a user-friendly trading ticket. It can place orders for stocks, ETF’s, and options; and it can even display a small chart. The broker has advanced trading platform called thinkorswim. This is a desktop program and is quite sophisticated. It includes free streaming of CNBC, a paper trading function, and very advanced charting. Nevertheless, it carries no frequent trader requirement.

Ally Invest LIVE is a simple browser-based trading system that is free for all clients. There is a trade ticket at the bottom of Ally’s investment site, although it’s not as advanced as SnapTicket.

Ally Invest fails here.


Mobile Apps


Ally Invest customers can use the regular Ally mobile app, which now has investment functions. It can be used to place trades for equities and options. Limited market news is available. A charting feature can show price histories of stocks along with technical studies and comparisons. Option chains are on the app as well.

Despite the nice features on Ally’s platform, TD Ameritrade has even more. For instance, TD Ameritrade offers funds transfer, which is not currently possible for Ally Invest customers. Ally just recently acquired TradeKing, and some wrinkles probably have not been ironed out. Nevertheless, longer term, the Ally app probably will not have 400 technical studies, which the thinkorswim app does have. Two of the three apps TD Ameritrade provides also offer live streaming of CNBC at no cost.

TD Ameritrade has the edge here.


Ameritrade vs Ally Invest


Fees and Commissions


Stock and ETF trades at Ally Invest cost $0. Option contracts are 50¢. A margin loan under $5,000 costs 9.75%.

TD Ameritrade charges $0 for equity transactions. Derivatives are 65¢ per contract. Margin accounts currently pay 10.00% for debits under $5,000.

Neither broker charges an annual fee for a brokerage or retirement account. There is also no minimum deposit to open a securities account with either firm.

Overall, Ally Invest has the better schedule here.


Futures and Forex


Both brokerage firms offer trading in forex and TD Ameritrade also has futures. It is very rare in the industry for offering both. At Ally, forex can be traded on a dedicated currency platform, and a practice account is available. It is more user-friendly than thinkorswim, which is where forex is traded at TD Ameritrade. The spread at Ally on EUR/USD was recently 5.4, while TD Ameritrade shows 3.0.

At TD Ameritrade, futures are traded on thinkorswim and start at $2.25 for each contract. The broker’s website has a lot of educational information on futures and forex.

Overall, TD Ameritrade wins here.


Promotions


Ally Invest: Up to $3,500 cash bonus + $0 commission trades for new accounts.

TD Ameritrade: Trade stocks and ETFs for free + get up to $600 bonus.


Managed Accounts


Ally Invest and TD Ameritrade both offer managed account options for customers who don’t have the time, confidence, or ability to make trading decisions. Ally charges 0.0% for its Cash-Enhanced Managed Portfolio. The pricing, obviously, cannot get any better. There is a $100 minimum to start the service.

TD Ameritrade has several account management options. One is a robo-advisory service that costs 0.30% and carries a $5,000 minimum. Although these numbers seem less appealing than Ally’s, TD Ameritrade’s questionnaire is much more thorough and detailed. Like Ally’s service, this low-cost management system invests only in ETF’s with small expense ratios.

TD Ameritrade has human advisors who can trade more than low-cost ETF’s. Called Selective Portfolios, this option requires a significantly higher $25,000 deposit and costs anywhere from 0.75% to 0.125% of account balance annually for the first $100,000. A personal financial advisor is available with Selective Portfolios.

Ally Invest has the better selection here.


Research and Education


Learning materials are available on both websites. TD Ameritrade clients have access to a large library of videos and playlists of videos on a wide range of financial topics. These include not just futures and forex, but also retirement, mutual funds, technical analysis, strategies to reduce volatility, and much more. A progress tracker is integrated in the broker’s education section. It keeps track of completed lessons and awards achievement icons. There are self-guided quizzes on various securities, including options and bonds.

TD Ameritrade also provides a 7-day trial membership in its affiliated but separate educational company investools. This group offers in-depth coaching and learning on a host of trading topics.

Ally Invest also has learning materials on its website, but they don’t seem as advanced as TD Ameritrade’s materials. Ally provides mostly articles, and they’re fairly short. It’s hard to find educational videos on the Ally Invest website, although there are some on its blog.

The Ally Invest education center provides an option of choosing materials based on market outlook, such as bullish or bearish. But both choices produce the same list of materials. The link for ‘On-demand videos’ produces a list of articles.

TD Ameritrade easily wins here.


Ally Invest vs TD Ameritrade Results


Ally Invest succeeded in three categories, TD Ameritrade was victorious four times, and there was one tie. TD Ameritrade wins by a small margin. Despite the results, Ally Invest would be a good broker for frequent stock and option traders who want the lowest commissions as well as for managed account.

For readers that are still wondering in which company to open an account, TD Ameritrade will be our recommendation for "buy and hold", long-term investors, ETF investors, and IRA accounts. Ally Invest would work great for all other customers, especially for beginners, and active stock and options traders.

The two online investment companies provide a lot of unique and valuable features. Our suggestion is to open accounts at both firms with $0 down (it will take only about 20 minutes), and take advantage of everything these top online brokers have to offer free of charge. Investors can decide later into which brokerage account they want to deposit most of their money.