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Robinhood vs TD Ameritrade
Robinhood or TD Ameritrade - which is better in 2019? Compare IRA/Roth accounts, online investing fees, stock broker mutual fund rates, and differences.
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TD Ameritrade vs Robin Hood Overview
No two brokers could be more different from each other than TD Ameritrade (TDA) and Robinhood. With very different priorities and offerings, they certainly have different strengths and weaknesses. Let's
see how the two firms compare to each other and which is better - Robinhood or TD Ameritrade?
Research & Educational Tools
Very good educational and research tools can be found on TD Ameritrade's website. Screeners for stocks, ETF's, and mutual funds make searching for securities much easier. Analyst reports for stocks are available to clients at no cost. These come from several sources, including Credit Suisse, TheStreet.com, and MarketEdge. Traders will also find instructional videos on a wide variety of financial topics. Remarkably, Robinhood does not have any security research tools or educational resources.
TD Ameritrade easily wins the first category.
The Cost of Trading
It's hard to beat Robinhood in the area of fees and commissions, because the firm offers the lowest price possible for stock and ETF transactions—an amazing $0. It does, however, charge $5 for paper statements and $2 for hard copy trade confirmations. The broker also passes regulatory and exchange fees onto traders. Using a living, breathing agent to execute a trade over the phone is just $10.
TD Ameritrade is charging an about-average $6.95 for ETF and stock trades. Paper statements are $2 for accounts below $10,000. Confirmations by mail are always free. Clients who place a trade over the phone with a live agent pay $44.99.
Robinhood gets the nod here.
TD Ameritrade: Trade free for 60 days + get up to $600.
Robinhood: Get free stock with $3-$7 value when you open an account.
Trading Funds
ETF's are available at either firm. As already mentioned, ETF's are commission-free at Robinhood. TD Ameritrade does have a list of 296 exchange-traded funds that are free to trade. While Robinhood has zero mutual funds, TD Ameritrade offers more than 11,000 of them. Approximately 2,000 carry no load and no transaction fee.
Overall, TD Ameritrade seems to be the better choice in this category.
Broker's Technology
The Robinhood website is primarily used for account sign up. There is no security research capability, nor are trades placed on it. Instead, the broker provides a mobile app where users can buy and sell ETF's and stocks. The app can be used on Apple and Android devices. There is also a Robinhood platform for Apple Watch. Unfortunately, charting is very elementary, without technical indicators, multiple graph styles, or drawing tools. A chart cannot be displayed horizontally. Since there is no charting on the broker's website, the broker's customers are at a real disadvantage if they need to do anything other than pay for a trade.
TD Ameritrade, on the other hand, boasts a very useful website. A handy trade bar named SnapTicket appears at the bottom of the window. It can display a small chart and submit orders for stocks, ETF's, and options. Investors can also use Trade Architect, a browser-based platform with a lot of useful features, including live streaming of CNBC. A more advanced desktop platform is available with approximately 400 technical studies. Both trading systems are free for all customers.
TD Ameritrade is definitely the winner here.
Cash Management Features
Investors at TD Ameritrade who need bank account features can add a debit card and checks at no cost. Doing so does not create a separate cash account. Rather, they are simply added to an existing brokerage account. Because balances are deposited in up to two FDIC-insured institutions, clients receive twice the standard amount of insurance. TD Ameritrade also rebates ATM charges incurred by its clients. Against all these great features, Robinhood customers have no cash management options.
Robinhood fails in this category, too.
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Customer Service
TD Ameritrade has phone representatives available around the clock, day and night. There are agents during certain hours who speak Mandarin, Cantonese, and Spanish. The broker has over 100 brick-and-mortar locations for clients who want personal service and extra guidance.
Robinhood offers customer service over the phone only during market hours. The company's phone number is not toll-free. It has a Twitter account and an e-mail address. It took two days for the company to respond to a test e-mail.
The victory here goes to TD Ameritrade.
TD Ameritrade: Trade free for 60 days + get up to $600.
Robinhood: Get free stock with $3-$7 value when you open an account.
Other Investments
Both futures and forex trading are available at TD Ameritrade. These products can also be traded on the firm's most advanced desktop platform. Investors who don't have sufficient experience in these products can practice trading them using TD Ameritrade's paper trading feature, available at no cost. Robinhood has no futures or forex trading. In fact, it does not offer bonds or options.
Another victory for TD Ameritrade.
TD Ameritrade vs Robin Hood: Results
Robinhood (read review) triumphed in one category, and TD Ameritrade
(read review) won all others. TD Ameritrade wins by a landslide. Evidently, free trades do not
translate into ideal performance in other areas. It is hard to defend Robinhood except for investors who need only the lowest possible commissions.
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