Overview
E*Trade and TD Ameritrade are both powerhouses in the active-trading market. But they also offer
investors much more, which means they are definitely worth taking a look at.
Cost Comparison
| Broker Fees |
Stock/ETF
Commission |
Mutual Fund
Commission |
Margin
Rate |
Maintenance
Fee |
Annual IRA
Fee |
|
TD Ameritrade
|
$0
|
$49.99 ($0 to sell)
|
11%
|
$0
|
$0
|
|
Etrade
|
$0
|
$19.95
|
10.45%
|
$0
|
$0
|
Services
| Broker Review |
Cost |
Investment Products |
Trading Tools |
Customer Service |
Research |
Overall Rating |
|
TD Ameritrade
|
|
|
|
|
|
|
|
Etrade
|
|
|
|
|
|
|
Promotions
TD Ameritrade: $0 commissions + transfer fee reimbursement.
E*Trade:
Get zero commission on stock and ETF trades.
Available Investments
E*Trade and TD Ameritrade provide both self-directed and managed accounts. In a self-directed account at TD Ameritrade, it’s possible to buy and sell these instruments:
- Stocks
- Bonds
- Futures
- Forex
- Exchange-traded and closed-end funds
- Mutual funds
- Annuities
In the portfolio management category, TD Ameritrade offers traditional human-advised plans. The brokerage firm recently retired its robo service, so the old-school system is the only option. There are a couple of traditional packages, though. The cheapest starts at 0.75% per year with a $25,000 commitment.
E*Trade offers managed account services in both human and robo varieties. The latter type requires just $500 to get started and costs just 30 basis points per year.
For self-directed trading, E*Trade has everything TD Ameritrade offers except annuities and forex.
In their place, E*Trade offers term life insurance.
Both brokerage houses provide trading in OTC equities. Neither firm offers access to foreign exchanges.
Winner: TD Ameritrade
Margin Accounts
Both brokerage firms in this survey offer margin trading. E*Trade’s rates are on a sliding scale
and range from 6.95% to 10.45%., depending on the amount borrowed. TD Ameritrade is a little more expensive with rates varying from 9% to 11%..
E*Trade’s website has a margin calculator that will display important details on any entered ticker symbol. TD Ameritrade does not offer this helpful service.
Winner: E*Trade
Website Trading
For research and order entry, both firms in this contest have very good websites. During our exploration, we found them easy to use but powerful at the same time.
E*Trade’s site starts with Complete View, which is a dashboard with many functions arranged into tiles. An order ticket offers many advanced trade types, including trailing and stop on quote.
Charts on E*Trade’s website provide many great tools. These include:
- Earnings trend bar (QTR)
- Insider trades
- Technical indicators
- Logarithmic and linear scales
A chart can be expanded the full width of the screen, and settings can be saved.
Among the site’s many other features, there are alerts and a watchlist (multiple lists can be created and edited).
Traders who demand more will find much to like with Power E*Trade. This is the company’s browser platform. Launched from the website, it occupies its own window and offers many advanced order types including hidden and stop limit on quote. The order ticket delivers option spreads with profit-loss diagrams, another great highlight.
TD Ameritrade’s website has some of the same features that E*Trade delivers: alerts and an infinite number of watchlists are examples. Charting is on a similar level as E*Trade’s website (but not Power E*Trade, which is slightly better) with several tools and the ability to detach a graph into its own window.
For order entry, TD Ameritrade’s site has something that E*Trade’s doesn’t: SnapTicket. This is a permanent trade bar that sits at the bottom of the browsing window. Real-time data can be turned on and off for an entered ticker symbol. In expanded mode, the widget can place trades for stocks, ETFs, and closed-end funds.
Orders can also be sent to the exchanges using regular web pages. Here, TD Ameritrade offers more complexity with trade types like order cancels another (OCA) and one triggers two (OTT).
Winner: Pretty close
Desktop Programs
Although both websites are plenty good for the vast majority of trading regimens, E*Trade and TD Ameritrade offer even more.
E*Trade Pro is available to customers with at least $1,000 in account equity. The software delivers many advanced features, some of which aren’t on Power. These include live streaming of Bloomberg News in high definition, more advanced option tools, time & sales data, a higher level of charting, and futures chains.
thinkorswim is TD Ameritrade’s desktop platform. The broker maintains no account minimum for this very advanced program. Unlike Pro, thinkorswim has a simulated mode, which is a good thing because the software is difficult to learn. During our test drive of the platform, we really liked the futures/forex dealing boxes and live streaming of TD Ameritrade Network. Charting is perhaps the program’s crown jewel, with hundreds of technical studies.
thinkorswim’s greatest weakness is the lack of profit-loss diagrams, something that Pro does have.
Winner: TD Ameritrade
Mobile Apps
Of course both broker-dealers have mobile apps. In fact, they both have two versions: a regular app and a more advanced trading app.
TD Ameritrade’s trading app is aptly titled thinkorswim. Like its desktop cousin, this app has a very sophisticated order ticket with several trade types. Charting is quite advanced with many tools.
On the E*Trade side, Power is the advanced trading app. It comes with some useful tools, such as depth view, time & sales data, Bloomberg TV, and futures ladders. Charting is very good in horizontal mode, although the maximum timeframe is just 5 years. Surprisingly, option chains are only available for calls and puts (the thinkorswim app has spreads).
The regular apps of both companies are where Level II data will be found. Somewhat oddly, these real-time quotes aren’t available on the more powerful trading apps. E*Trade requires a $1,000 account balance to get the data. TD Ameritrade does not.
Both E*Trade and TD Ameritrade have apps for Apple Watch.
Winner: TD Ameritrade
Extra Services
DRIP: Both broker-dealers have free DRIP services, and their websites make enrolling and un-enrolling easy.
Fractional Shares: Somewhat surprisingly, neither brokerage firm in this competition offers whole-dollar investing (at least not on the sell side; fractional shares from a DRIP can always be sold).
Individual Retirement Accounts: Both firms have IRAs. E*Trade has more IRA fees.
Cash Management Features: Debit cards and checks can be had at both E*Trade and TD Ameritrade.
Extended Hours: TD Ameritrade and E*Trade both have after-hours and pre-market trading.
Moreover, they both provide 24/5 trading in a select list of exchange-traded funds.
Periodic Mutual Fund Investing: It’s possible to enroll in automatic mutual fund investments at either firm.
Initial Public Offerings: IPOs are available at both E*Trade and TD Ameritrade.
Winner: Slight advantage to TD Ameritrade for its zero-fee IRAs
Recommendations
Mutual Fund Trading: E*Trade has 7,000 funds available to new investors, with 4,181 coming
with no load and no transaction fee. TD Ameritrade’s numbers are 13,000 and 4,188. We would go
with TD Ameritrade.
ETF & Stock Trading: Both firms are pretty close in this category. It really comes down to a personal preference of software, whether you want to trade with a trade bar or browser platform, and whether you prefer thinkorswim or Pro.
Small Accounts: TD Ameritrade.
Beginners: There are ample educational materials at both brokerage firms that new traders
will benefit from. thinkorswim is difficult to learn because it is a professional-level program,
but it does have a practice mode. E*Trade Pro might be a little better for newbies because it is
more user-friendly but it doesn’t have a demo mode.
Long-Term Investors and Retirement Savers: Once again, both firms do a good job of providing many services. We give a slight edge to TD Ameritrade for its offering of annuities, which E*Trade doesn’t have.
Promotions
TD Ameritrade: $0 commissions + transfer fee reimbursement.
E*Trade:
Get zero commission on stock and ETF trades.
E*Trade vs TD Ameritrade Results
E*Trade and TD Ameritrade are very close in most categories. With this article, you can pick the
right one for your investment goals.
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Chad Morris is a financial writer with more than 20 years experience
as both an English teacher and an avid trader. When he isn’t writing
expert content for Brokerage-Review.com, Chad can usually be found
managing his portfolio or building a new home computer.
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