TD Ameritrade Short Selling Fees

TD Ameritrade Shorting Fees, Hard To Borrow, & Short Locates. How to Short Sell Stocks on Thinkorswim in 2022


Can You Sell Short at TD Ameritrade?


If you’ve been thinking about shorting stocks (or other investments), TD Ameritrade has good resources for you at reasonable prices. This article will show you how to get started.


TD Ameritrade Short Selling Fees & Interest Rate


Shorting a stock or ETF carries the same fee as a purchase: $0 per trade.


TD Ameritrade Hard To Borrow Interest Rate


Margin interest could be charged in some cases. Currently, TD Ameritrade’s margin schedule ranges from 11% to 8.25%. A brokerage account comes with zero fees.

Surprisingly, TD Ameritrade does not charge hard-to-borrow fees for equities that are difficult to borrow.


Open TD Ameritrade Account



Open TD Ameritrade Account


TD Ameritrade Short Locates


Federal regulators require a brokerage firm to actually locate shares to borrow. Shorting a stock without actually borrowing shares is known as naked shorting, and the government doesn’t like this. So TD Ameritrade has to go look for shares that traders can borrow before actually selling them short.

Unfortunately, TD Ameritrade does not have a short locate service that clients can use, either on its website or desktop platform. Instead, it takes short orders and then tries to find the shares to actually short. There is no method at TD Ameritrade for customers to find out beforehand if a stock or ETF can actually be shorted. This is obviously a major drawback.


Bearish Bets with Options, Forex, and Futures


Besides stocks and exchange-traded funds, TD Ameritrade also offers option contracts, futures, and currencies; and all of these assets can be shorted. For options, you can buy a put or sell a call. Either choice creates a short position on the underlying stock. TD Ameritrade charges 65 cents per contract for option trades.

Futures cost $2.25 per side. The mini-contract on the S&P 500 (/ES) is available. And for currencies, you simply sell the base currency in a currency pair. For example, if you want to short the dollar against the yen, you would sell USD/JPY. In this case, the dollar is the base currency.


Shorting on thinkorswim


TD Ameritrade’s desktop platform can be used to establish short positions on any of the products discussed above. During our testing, we found the simplest method to establish a short position was to right-click on a chart and select sell from the drop-down menu. This creates a pop-up order ticket, which can be integrated into the platform by editing it. With any order, be sure to specify the trade as “sell to open.”

One weakness thinkorswim has is that it doesn’t display margin requirements for stocks. TD Ameritrade does have a page that displays these numbers, however.


Thinkorswim Day Trading


TD Ameritrade Short Selling Judgment


TD Ameritrade does a great job of providing shorting services. Its greatest strength lies in the range of products that are actually shortable.


Open TD Ameritrade Account



Open TD Ameritrade Account


About the Author
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.