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TD Ameritrade rating

TD Ameritrade Cons and Pros


TD Ameritrade pros and cons, benefits and downsides, perks offered for opening an account. Is TD Ameritrade good or bad? TD Ameritrade individual (joint) account advantages and disadvantages for 2020.



TD Ameritrade Pros


Large and Well Established: When you choose to invest with TD Ameritrade, you get a peace of mind of keeping your money at one of the largest and best known brokerage houses in the United States

Local branches: Few brokers offer this very expensive service. TD Ameritrade has the largest network in the industry with 450+ local branches

$0 commissions: All stocks and ETFs are now free to buy or sell

No surcharges: One of the major TD Ameritrade benefits is no surcharges on penny stock trades, large-sized orders as well as on extended hours trading

3 trading platforms: The firm offers trading tools for investors with every experience level. Beginners can quickly learn easy-to-use website investing; intermediate investors have free access to a more advanced mobile app; and experienced traders get to use the best-in-class trading platform

Virtual trading: Users can practice trading and test various trading strategies without risking real money using PaperMoney virtual trading account

Community: TD Ameritrade clients can easily access myTRADE investor community to learn from advanced traders and share information with other members

No account fees: All accounts don't have any maintenance, setup, termination, or inactivity fees

Free level II quotes: Big TD Ameritrade advantage is that all customers get free streaming quotes, including Level II quotes, for which most other brokers charge fees

Best research: The broker offers rich selection of third-party investment research from 12 firms (Standard & Poor's, Morningstar, TheStreet, etc.)

Thousands of mutual funds: The brokerage offers a huge number of mutual funds — over 13,000, with about 4,200 NTF (no commission) funds

Free DRIP: Another TD Ameritrade advantage is free DRIP (dividend reinvestment plans)

No IRA fees: The company doesn't charge annual IRA and IRA setup and termination fees

Great service: TD Ameritrade offers 24 hour, 7 days a week phone and email service. The customer generally gets a response from email within 3 hours. Live chat is available. Client services reps are very knowledgeable, cordial, helpful, and on-hold time is usually just 2-3 minutes.


TD Ameritrade Cons


Higher than average mutual funds commissions: TD Ameritrade has a disadvantage — $49.99 commission on most mutual funds, including many popular funds. This is way more than $9.95 charged by Ally Invest.

High margin rates: Another TD Ameritrade con is that margin interest rates on borrowed cash are also somewhat steep, though inline with all major competitors. On the other hand, M1 Finance has some of the lowest margin rates in the industry. It also has a $0-fee robo-advisor — service for which TD Ameritrade charges a steep annual fee of 0.30% of all client assets.

High options commissions: TD Ameritrade charges 65 cents for each option contract. This is the same rate all the main competitors charge, but it is expensive comparing to Firstrade and Webull both of which charge $0 for option contracts.

OTC stocks commissions: While stocks traded on major exchanges have $0 commissions, over-the-counter (OTC) securities are still charged $6.95 per trade commission.


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TD Ameritrade Trading Tools Review


TD Ameritrade provides three different trading platforms: website-based, Trade Architect and Thinkorswim. The website’s landing page functions as a straightforward, easy to use trading platform. It's perfect for beginner investors who will find professional level trading software too complex.


pros and cons ameritrade


For someone on a more intermediate level of investing experience TD Ameritrade offers trading and investing through its Trade Architect platform. To launch Trade Architect, you log into your TDA brokerage account, and the link to the Trade Architect platform is easily found under the Trading Tools tab at the top of the page. Once selected, this will launch a separate pop out window on your desktop that transforms into your very own virtual trading desk. From there you will have access to a number of features including real time streaming quotes, order entry, and trading ideas just to name a few. The tabs at the top of the page clearly display the options available and are quite easy to navigate.


Ameritrade cons


TD Ameritrade also offers a third option for trading - this one is for advanced users and active traders, and it is called Thinkorswim. It is a professional-level, downloadable trading platform that offers a versatile trading environment with a multitude of features.

One of the most valued features of Thinkorswim is the Paper Money account. This option allows users to use a secondary account to trade virtual money. This is very beneficial because it allows users to see how the software works and to test new ideas and strategies without needing to risk real money. The downside to a Paper Money account is that the orders are executed immediately. This is contrary to the actual live market where contracts are not always executed immediately and may give investors unrealistic expectations of trading dynamics.


benefits of td ameritrade


Mobile Trading


TD Ameritrade also has three mobile applications for its users, which make research and trading very easy, even on the go. First is TD Ameritrade Mobile which is similar to a standard banking mobile app, where you can view account balances, look for specific options, view your own shares and how they are doing, and more. It is simple and easy to navigate for the casual user. Their second mobile application, TD Ameritrade Mobile Trader, has more advanced features, similar to their web platform Trade Architect, and is better suited for those advanced traders who want more control and data. Both apps work very well, and are quick to learn.

The third app is called Thinkorswim, and it is probably the most advanced trading application for smartphone users on the market. It offers a lot of features that day traders use to make a living and therefore has a much steeper learning curve


Customer Service


The customer support is top-notch. In addition to the initial broker call when a client opens an account, and periodic follow-up calls just to check-in, they offer 24/7 support, with very friendly and helpful representatives. They also offer an online chat feature, which is automated, but can identify common questions and instantly link to solutions or request web pages.


TD Ameritrade Cons and Pros Summary


With recent acquisition of one of its largest competitors, Scottrade, as well as ever growing selection of products and services, TD Ameritrade is now well positioned to offer the highest amount of value to its customers and become the dominant player in the online investing industry. In 2020 TD Ameritrade pros far outweigh TD Ameritrade cons.