TD Ameritrade Review 2021: Strong All-Around Brokerage But No Robo Advisor

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TD Ameritrade is one of the nation’s largest discount brokerages. The Omaha, Nebraska-based brokerage provides trading and investing services for 11 million client accounts, totaling more than $1 trillion in assets. Plus, it provides custodial services for more than 6,000 independent investment advisors.

For those who are interested in hands-on, self-directed trading, TD Ameritrade provides an array of investing tools, detailed analysis, and market news. However, TD Ameritrade’s robo advisor, or automated investing, Essential Portfolios, is no longer available. Robo advisors provide automatic, hands-off investing for all investors and are much cheaper than traditional, human advisors.

Newer investors might benefit from the free online investing classes available on the website, while active traders would enjoy the investing platforms available on the desktop and mobile app. Managed portfolios are also available for those who want greater guidance and customized advice from an investing professional. NextAdvisor recently named TD Ameritrade as one of the best online brokers of 2021.

Read on to learn more about TD Ameritrade.

TD Ameritrade Review 2021

TD Ameritrade offers zero commission fees for stocks, ETFs and options listed on U.S. exchanges. Currently there are over 2,300 ETFs with zero commission fees for online trades. Account holders can trade on its mobile app and receive around-the-clock customer service by phone. They can also step foot into over 175 TD Ameritrade branches.

TD Ameritrade was founded in 1975. In October 2020, Charles Schwab acquired TD Ameritrade and with that, TD Ameritrade’s robo advisor services, Essential Portfolios, got nixed. According to its website, it will most likely take until 2023 for account holders to experience any changes. Until then, they will operate as two separate brokerages. 

Pros and Cons of TD Ameritrade 

Pros

  • Zero commission fees on stocks, ETFs and options on U.S. exchanges

  • Solid trading tools on platforms such as thinkorswim which is its electronic trading platform

  • Robust educational resources like free online investment classes, personalized learning paths, and paperMoney, a virtual stock stimulator to help beginners understand investing basics before investing with real money.

  • 24/7 customer service

Cons

  • No robo advisor. Would need to open an affiliate account through Charles Schwab.

  • Managed portfolios require $25,000 minimum investment with advisory fees of 0.75% to 0.90% for the first $100,000.

  • Cryptocurrency trading isn’t currently available

  • Fractional shares aren’t currently available

TD Ameritrade at a Glance

  • Self-directed online trading platform or managed portfolios
  • No robo advisors 
  • Retirement accounts include traditional IRA, Roth IRA, and rollover IRA 
  • Investments available include over 13,000 mutual funds, and over 2,300 ETFs.
  • Customer service reps available during the week.  
  • No commission fees for online trades on stocks, ETFs, and options. There is a $0.65 contract fee for options. Other fees apply. 
  • Research tools and in-depth analysis from third parties available through Market Edge, its research platform. 
  • Trade stocks, monitor and track investments, set up price alerts through the TD Ameritrade mobile app. 
  • Through thinkorswim, its trading platform, active traders can have more advanced charting capabilities, real-time market news, and access to personalized educational resources.  

Investments Available on TD Ameritrade

TD Ameritrade Fees

For a full rundown of fees, readers can look at TD Ameritrade’s pricing page and brokerage fees page

FeeAmount
Trading and commission fees $0 commission on U.S. exchange listed ETFs, stocks, and option trades.

Fees for stocks and ETFs: $0 online, $5 for phone trades, $25 for broker-assisted trades.

Mutual funds: $0 commission for online and NTFs, $49.99 for no-load, $0 commission for load.

Options: $0.65 fee per contract, $5.00 + $0.65 for phone trades, $25 + $0.65 for broker-assisted trades.
Account minimum for brokerage and trading services$0 
Account maintenance fee for brokerage and trading services $0 
Account fees No data or inactivity fees. $75 for outbound transfer, $25 for wires (both U.S. and international); other fees may apply. 
Investment management feesSelective portfolios: $25,000 minimum investment, 0.75% – 0.90% for first $100,000

Personalized portfolios: $250,000 minimum investment, 0.60 – .90%

Who Is TD Ameritrade Best For?

TD Ameritrade is best for investors who want to do their own trading on an online platform. 

Newer investors would enjoy the array of educational resources, such as free online investment classes, a practice account to help newbies get their head about investing fundamentals, and custom learning paths.

Active traders can also enjoy sophisticated platforms such as thinkorswim, and enjoy the zero commission fees on U.S. exchange-listed stocks, ETFs, and options. However, if someone is looking for a robo advisor, TD Ameritrade currently doesn’t offer one. Those looking for automated investing options will need to look elsewhere. 

How to Open an Account with TD Ameritrade 

1. Hone in on what you want from a brokerage. Start by figuring out what your investment needs and goals are. Pinpointing the types of tools and information you’d like access to, along with the level of guidance, can help you narrow down your choices and determine if TD Ameritrade is a good contender for your investing needs.

2. Do your research. Spend time looking up fees and costs, investments, tools, and resources available. What is their customer service like, and do they have an investing app? It’s also crucial to know what types of investments are available. 

3. Open an account online. You can open a TD Ameritrade brokerage account online. Before you get started, be sure you have your Social Security number or ITIN handy. If you’re not a U.S. citizen, you’ll need a passport, visa, or foreign ID. Last, make sure you have your employer’s address and phone number.

If you need to transfer funds from another brokerage, you can do so online. Once your account is open and funded, you can trade that same day. TD Ameritrade has over 175 physical locations across the U.S. Should you have any questions, around-the-clock help is available via chat or phone. 

TD Ameritrade Compared to Others

TD Ameritrade*Charles Schwab Vanguard
Types of investing accounts Brokerage and trading, IRAs and other retirement accounts, managed accounts Brokerage and trading, IRAs and other retirement accounts, managed accounts, college and education savings plans  Brokerage and trading, IRAs and other retirement accounts, college and education savings plans  
Fees $0 trading commission fees on online trades for stocks, ETF, and option trades; other fees vary  $0 trading commission fees for online trades for stocks and ETFs; other fees vary  $0 trading commission fees on online trades for stocks, ETFs, and Vanguard mutual funds; other fees vary  
Account fees No annual fee No annual, inactivity, maintenance fees $20 annual fee on most accounts with less than $10,000 
Index funds Over 2,300 ETFsThird largest provider of index funds, over 2,000  More than 100 Vanguard index funds 
Mobile app Investing app available Investing app available Investing app available 
Customer service Account support available 24/7 via phone 24/7 via phone and chat, brick and mortar locations  Reps available via phone 8 a.m. to 8 p.m. EST. weekdays 

FAQs

How much money do you need to open a TD Ameritrade account?

There is no minimum to open an account with TD Ameritrade. However, to be considered for certain options privileges and for margin, which is when you borrow money from a broker to buy securities, such as stocks, bonds options, and index funds, you’ll need a minimum of $2,000 in your account.

Can you lose money with a TD Ameritrade?

TD Ameritrade is a member of the Securities Investor Protection Company (SIPC). What this means is that, as an account holder, your securities are protected up to $500,000, which includes $250,000 cash claims.

However, one’s securities aren’t protected against fraud nor ups and downs in the market. And regardless of which brokerage you use, there is a level of risk when you invest. Your securities could lose value, and in turn, you could lose money.

How much does it cost to use TD Ameritrade?

There are no commission fees for online trades of stocks, bonds, and ETFs that are listed on a U.S. exchange. For options trades, there is a $0.65 fee per contract. For over-the-counter (OTC) stocks, including stocks not listed on a U.S. exchange, there’s a $6.95 commission fee.

Is there a fee to deposit money into TD Ameritrade?

When you open an account, you can deposit money via an electronic bank deposit, wire transfer, check, or by transferring funds from another fund. There is no fee to deposit money into your TD Ameritrade account.

Can I start trading with $100?

As there is no minimum to open an account, you can begin investing with $100.