These days, average folks are getting into stock market trading for the first time. Rather than throwing their money into 401(k)s and letting the market do the rest, more people than ever before are starting to practice active trading or at least doing research into their investment securities before putting their money into the market.
This is a great thing! But before you can jump into this trend and take your financial future into your own hands, you’ll need to find a quality broker and trading platform to rely on.
TD Ameritrade is one of the most well-known trading broker brands in the industry. Through TD Ameritrade, you can place orders to invest in stocks, options, ETFs, futures, bonds, and much more. But TD Ameritrade is not alone in the industry, and there are lots of other competitors to consider as well.
Not sure whether TD Ameritrade is worth it compared to the other options? Let’s break down TD Ameritrade in detail and see what it offers, how much it costs to maintain an account with TD Ameritrade, and what types of traders or investors it’s most suitable for.
TD Ameritrade’s Key Features
To better understand who TD Ameritrade is for, let’s take a closer look at its key features and what it allows you to do.
What Can You Trade?
One of the biggest elements that will determine whether a trading platform is a good choice for your financial goals is the number and variety of securities you can trade. Luckily, TD Ameritrade offers as much choice as possible when it comes to investment selection. Practically any investment instrument or security you can think of is available, including:
- Stocks
- Bonds
- ETFs
- Options
- Futures
- Mutual funds
- Forex
- Foreign ADRs
- IPOs for any qualified accounts
As you can see, you can plan and enact practically any trading strategy you can imagine using this platform. You can even trade Bitcoin futures if you’re an approved client. TD Ameritrade also provides a good selection of no-transaction-fee mutual funds (over 4000 in total).
All in all, it’s a stellar trading platform for those looking for long-term investments, particularly if you want to put your money into low-cost or low minimum funds. Indeed, over 1300 of TD Ameritrade’s funds have investment minimums of just $100 or less. Thus, it’s an ideal choice for beginner fund investors. To learn about the importance of investing see our article about compound interest!
Educational Resources
Some of the best trading platforms will include plenty of educational materials and resources so you can improve your trading skill and investment strategies over time.
TD Ameritrade is no different. It inundates you in high-quality educational offerings, ranging from videos to slideshows to articles to quizzes and more. Even better, TD Ameritrade offers a variety of ongoing live seminars you can view on your computer. While it’s not exactly a full investing course like you take at an online college, it’s the next best thing. Even better, these educational resources are totally free.
You can simply select a skill level using TD Ameritrade’s dashboard, and the platform will automatically point you toward the educational resources it thinks you would benefit from the most. Also included is a specialized chatbot called “Ted” which can provide directions for newcomers to tutorials, investing tools, and key data you might need before making a big investing decision.
Naturally, TD Ameritrade also offers a variety of customer support channels, including live chat sessions and an email address. Either way, customer support responses are usually quick and thorough.
If you’re in the mood to meet other TD Ameritrade users, you can potentially check out one or more of the 40 live events held each year at local TD Ameritrade retail branches.
Trading Simulations
There are only a few online stock market brokers that give traders the opportunity to practice with trading simulators. Fortunately, TD Ameritrade does this through its “paperMoney” virtual simulator platform. This desktop-based platform is perfect for frequent traders looking to hone their craft.
In a nutshell, it offers $100,000 in fake money and access to a trial margin account. It’s totally free through both the mobile app and the two platforms the broker operates on (more on those below). If you don’t use TD Ameritrade yet, you can register for a free 60-day trial for this feature.
In this way, you can check out TD Ameritrade in full without putting any money down. That’s a great way to see if this broker will be worth your time and it will be a good choice for your overall trading or investment strategy.
Trading Platforms
We also like TD Ameritrade because it offers two primary trading platforms, both of which come with a mobile version. The first of these is called TDAmeritrade.com; it’s a desktop-based platform that provides all the major tools and features you’ll need to successfully trade and invest, especially when it comes to researching and screening stocks or other securities.
There are a lot of excellent features included in this platform, like research from firms such as CRFA, Morningstar, and more, stock screeners, a customizable landing page, and more.
Alternatively, you can use TD Ameritrade’s other desktop trading platform, which is called thinkorswim. This platform is best for serious traders who are primarily invested in stocks, futures, options, ETFs, and forex. Like its counterpart, it has a variety of excellent features, but these are mostly geared toward active traders. As a result, it includes advanced screening tools, technical analysis suites, customizable screeners and charting functions, and more.
Ultimately, TD Ameritrade’s platforms are phenomenal for traders of all levels. No matter where you are in your investment journey, TD Ameritrade will have something perfect for your skill level.
Mobile App
We’d be remiss not to mention TD Ameritrade’s dedicated mobile app. The app is available for both iOS and Android devices and both of the above platforms have their own companion app versions (so you aren’t stuck with one of the other if you like to check your trades while on the go).
The app is high-quality through and through, including much of the major functions and features of the web-based platforms. It also includes tools like custom watchlist creation, educational videos, and customizable alert options you can use to quickly react to changes in your portfolio.
If you become a managed client (i.e. your portfolio is managed by TD Ameritrade’s financial experts), you’ll also gain access to the TD Ameritrade Portfolio app. This dedicated app lets you monitor your investments from afar.
Fees
Certainly one of TD Ameritrade’s biggest benefits is its low fees. For starters, you don’t need an account minimum to start trading on this platform, and it doesn’t cost you anything to start trading stocks. There also aren’t any fees for trading ETFs.
There are fees for trading options, however, at a rate of $.65 per contract. This isn’t uncommon in the trading platform industry but is nonetheless a minor downside to keep in mind.
Fortunately, TD Ameritrade doesn’t charge any annual or inactivity fees. If you want to transfer your account balance from another trading platform, however, you’ll have to pay a $75 fee for a full transfer. Transfer only part of the money from another account and you don’t anything.
All in all, TD Ameritrade is one of the most affordable trading platforms because of this fee setup.
No Fractional Trading
While there are a lot of excellent aspects to TD Ameritrade, we should point out that there’s one major downside.
TD Ameritrade doesn’t offer fractional shares like other major broker companies such as Fidelity or Charles Schwab. With fractional shares, investors can invest their cash by a dollar amount, even owning a part of the share instead of an entire share, which is excellent for new traders with limited capital. Hopefully, TD Ameritrade will add this feature in the near future.
TD Ameritrade Pros
- Has very low fees and commission-free options, ETF, and stock trades
- Lots of free research information
- No account minimum
- Good customer support options and educational resources
- Both trading platforms are high-quality
- Excellent spread of investment choices
- The mobile app is also high quality
TD Ameritrade Cons
- Does not allow you to trade fractional shares
Summary
At its core, TD Ameritrade is a well-rounded, robust stock market broker that should allow most traders of varying skill levels to implement their investment strategies with ease. While it doesn’t let you trade in fractional shares, it allows you to trade practically any other investment vehicle or security you can imagine, including stocks, options, and ETFs.
It’s also a particularly good choice for those looking to invest in mutual funds thanks to its research materials and educational resources. Discovering and carrying out an investment plan is more than possible even if you haven’t taken your market money into your hands before.
In our opinion, there’s no reason not to try TD Ameritrade since you can use a fake portfolio for 60 days before putting any money into your account. Give it a shot and let us know what you think!
