With all of the Gamestop hype earlier this year, there’s been a lot of renewed interest in the stock market, online brokers, and even cryptocurrency. I became interested in directly investing in stocks myself, early in 2020. While I was (and still am) more active in long-term investments (like ETFs and retirement funds), TD Ameritrade became the platform where I began experimenting with more active investing.
Is TD Ameritrade worth the hype? Are there better brokerage platforms out there? I’ll walk you through my experience so you can decide if this web platform is right for you.
The TD Ameritrade platform is an online brokerage firm where individuals can buy, sell, and trade stocks, bonds, mutual funds, ETFs, and other forms of investments. Founded in 1975 in the Midwest as First Omaha Securities, this formerly small investment bank expanded into one of the leaders in investment solutions. Now, TD Ameritrade is one of the most popular online brokerages, used by both beginner and advanced investors.
TD Ameritrade Features and Costs
When you open a TD Ameritrade brokerage account, you’ll gain access to investing services.
Numerous investment options
Purchase stocks, ETFs, options, mutual funds, conditionals, bonds, CDs, futures, and forex investments through TD Ameritrade.
Choice of platforms
TD Ameritrade has an easy-to-use web platform that’s ideal for beginners, but it also has a more advanced trading desktop platform called thinkorswim, which is ideal for those trading multiple times per week. Both the classic trading platform and thinkorswim platform offer TD Ameritrade mobile app downloads for convenient on-the-go access to your account. It is available on Android and Apple, as well.
Planning and retirement options
TD Ameritrade offers robust financial planning resources to members and offers help on investment approaches, planning for retirement, setting goals, and finding financial advisors. It also offers IRA, managed portfolios, and annuities accounts, in addition to retirement, college, and small business savings programs.
Comprehensive educational resources
One of the biggest perks TD Ameritrade offers over competitors is a wide range of educational resources designed to help you make smarter investment decisions.
My Experience Using TD Ameritrade
Overall, TD Ameritrade is simple to use, has an intuitive interface that requires just a small amount of time to become familiar with, and offers more features than I could ever hope to use.
Getting started with TD Ameritrade
Before you can sign up for TD Ameritrade, you’ll need to fill out an online application. This will require personal information (name, address, phone number, etc) and some details about your stock history. Although this application is a little lengthy, it’s easy to complete from anywhere — I applied for my account on my smartphone.
You’ll need to disclose if you or a member of your immediate family are a registered broker or if you’re employed by one. You’ll also need to disclose if you’re a director, 10% shareholder, or policy-making officer for a publicly traded company.
Most likely, your answers to the above questions will be “no.”
From there, you’ll answer a few additional questions about your account setup, review your application, and submit it. You’ll then need to read through a few terms and forms. You may also need to confirm your Social Security number for the IRS.
Once that’s done, you’ll create your online login and then you’re ready to fund your account. You’ll be able to link a banking account right away, though your funds might be held for 24 hours.
The setup process was fairly quick and easy, and within minutes I had funded my account and was ready to start buying stocks.
When you log into your account, you’ll be brought to a home screen that shows your current account balance, positions, whether you’re up or down (in total), as well as listing out your stocks with your gains percentages.
You’ll also see a snapshot of all of your stocks and how they’re performing. In the below screenshot, you’ll see that overall my account changed 2.33% since I last logged in, but overall, the three stocks below have gained since I purchased them. Since I’m not interested in short-term investing, I tend to focus more on this percentage rather than actual dollars or daily changes.
From this screen, you could click on any of the stocks you own to view performance data and trends. You can also easily purchase more shares of stocks and automatically reinvest any money made into purchasing more shares.
TD Ameritrade also lets you add stocks to your watchlist, which is helpful if you’re not ready to invest but want to keep your eye on particular companies.
Searching and buying stocks
Finding stocks is relatively intuitive through the TD Ameritrade interface. You’ll simply navigate to the top right search bar and enter the company name or stock ticker abbreviation. You can hit enter to search or choose from a list of dropdowns.
For instance, if you wanted to look into Tesla stock, you’ll type in “Tesla” or “TSLA” and it will bring you to a real-time stock profile. You can review trends over the past day through three years. From there, if you’d like to buy, select the green “buy” button. The purchase process is extremely simple and will allow you to automatically buy when the price drops to a certain threshold or buy stock right now (if the market is open). You can also schedule purchases of shares.
Portfolio planning resources
If you’re interested in how diversified your portfolio is and where you might want to add additional investments, you can view this information via your portfolio planner. This will allow you to minimize risky investments and develop a more balanced portfolio.
Since I use TD Ameritrade pretty sparingly for active investing (and focus mostly on passive investing through ETFs and fractional shares on Ellevest), I’m not typically concerned with my portfolio profile, but it is a handy tool to have available.
Learning tools and resources
Lastly, TD Ameritrade stands out for me because of its excellent tools and learning resources. For instance, if you’re considering investing in ETFs, TD Ameritrade will not only walk you through the process, it’ll also explain what ETFs are, compare different funds, offer analysis reports and commentary, and then allow you to choose your ETF focus.
It provides the same tools for all investment choices and even more extensive education on taxes, retirement plans, and savings funds.
TD Ameritrade Pros and Cons
Robust educational tools and resources. While many online stock platforms offer types of learning resources for beginning investors, TD Ameritrade’s comprehensive learning resources blow the competition out of the water. They not only offer base-level knowledge on all of the stocks they offer access to, but they also provide tutorials, video sessions, analyses and reporting, and current investing news updates. In addition, there are other tools, like screeners, designed to help you make smarter investment choices.
Intuitive investing process. TD Ameritrade is easy to use, but offers most of the tools individual investors could ever need to buy, sell, and trade online. I love that the investing process feels intuitive on this platform, but as your investing knowledge deepens, you’ll find more value in tools you may have overlooked previously. You can also participate in mobile trading right from your smartphone with is extremely convenient.
Transparent and low fees. I love that TD Ameritrade is affordable, requires no minimum account balance to get started, and offers a transparent fee structure (with no transaction fees). They’re also completely commission-free. They’re one of the most affordable investing brokerage companies out there and I’m a big fan of making investing easier and more affordable for everyone.
No fractional shares options. Purchasing fractional shares (or partial shares in a company) has gained traction recently, and can help you better diversify your portfolio and own a balanced amount of partial shares of well-performing companies. This can help minimize your risk if a single company crashes, and not having this feature is a major drawback.
Overwhelming options. While providing a vast selection of investing options, tools, educational resources, and funds may seem like a perk, I can see how this could be overwhelming to new investors. Until you understand what all of these tools are and how they function, they can seem daunting and may detract from TD Ameritrade’s user experience.
No cryptocurrency trading. As of this time, you cannot add crypto to your portfolio with any of TD Ameritrade's account types.
How TD Ameritrade Stacks Up Against Competitors
This investing platform has two general competitors that are also well-respected in the investing world — Charles Schwab and Fidelity.
Charles Schwab’s online investment platform charges $0 per trade or ETF and has no minimum deposit requirement. It has an assisted broker fee of $25 and options per-contract fee of $0.65. This pricing is on par with TD Ameritrade (though TD Ameritrade does charge a slightly higher fee for assisted brokerage services).
What I prefer about TD Ameritrade over Charles Schwab are the extensive learning and trading tools and resources and the better user experience. Charles Schwab does offer mobile app services, but it's not as intuitive and sleek as the TD Ameritrade interface (in my opinion).
It’s important to note that Charles Schwab recently purchased TD Ameritrade. While the two platforms still exist somewhat independently, they’ll likely be merged in the next few years.
TD Ameritrade’s other top competitor, Fidelity, also offers a similar fee structure, with Fidelity offering slightly less expensive assisted broker services. TD Ameritrade does provide more platform options and offers option rolling and mutual fund trading, which Fidelity does not currently provide. Fidelity also does not currently offer paper trading.
While the pricing is the same for just about the same amount of features, I chose TD Ameritrade because of its extensive research, video education, webcasts, and more diverse investing options.
TD Ameritrade FAQs
Is TD Ameritrade good for beginners?
TD Ameritrade is an excellent investing platform for beginners and new investors, because of its extensive educational content, streamlined user experience, and in-depth research tools. Its fees are on par with competitors and stock trading is free. If you’re looking for expert insights, data analyses, and instructional tools, TD Ameritrade stands out among competitors.
How much do you need to open a TD Ameritrade account?
You can open a TD Ameritrade with $0. Of course, to begin investing and enjoying many of the perks of your account, you’ll want to sync up your bank account and begin transferring money. There’s also no monthly fee. If you’re looking for margin privileges (and other perks), you’ll need to deposit at least $2,000.
Will opening a TD Ameritrade account impact your credit score?
If you sign up for a new account through TD Ameritrade, it will pull a soft check on your credit. This won’t affect your credit score.
How do I add money to my TD Ameritrade account?
To add funds to your TD Ameritrade account, you’ll first log in to your account, then navigate to deposit/withdraw. From there, you’ll be prompted to either set up a bank account link or confirm the amount of funding you wish to add to your account.
How long before my funds will be available through TD Ameritrade?
When you transfer funds to your TD Ameritrade account, you’ll need to wait for them to post before you can begin investing and trading. Typically, domestic funds are available within 1-3 hours and international funds within 1-2 days. Your wait time will increase if you’re adding funds during non-business hours.
The bottom line
TD Ameritrade is one of the top investing platforms for good reason — it’s convenient, easy-to-use, affordable, and powerful. I’ve been able to advance my investing knowledge significantly since opening a TD Ameritrade account and I love knowing I can rely on professional stock projections, reports, and news updates when contemplating new companies to invest in.
While TD Ameritrade is ideal for beginners, it also offers the advanced tools and platforms (thinkorswim) that more advanced investors, active traders, and day traders might prefer. The platform’s low fees are also a huge bonus.
I do wish TD Ameritrade offered fractional shares, but since this investing giant is merging with Charles Schwab, I expect that this option will be available soon.
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