TD Ameritrade Review 2023
TD Ameritrade is one of the most popular online stock brokers. But is it worth the hype? Our in-depth review tells you everything you need to know before signing up.
Author - TradeZella Team
Choosing the right platform to trade on is super important, and not something you should do lightly. If you’re reading our TD Ameritrade review 2023, you’re doing your research and wondering if this is the right broker for you.
In our in-depth TD Ameritrade review 2023, we look at the platform’s key features and benefits – as well as a few drawbacks you might want to look out for.
For example, whether it offers the asset types you want to trade, whether it integrates with your journaling software, how much it costs and how easy it is for you to use.
So, let’s get started.
Quick summary: is TD Ameritrade good?
Before we get into the finer details, our top-level analysis is that yes: TD Ameritrade is good. In fact, it’s one of the best online stock brokers in 2023.
The first reason is it appeals to a wide range of investors. So, whether you’re starting out or are already established, their broad asset selection means you can pursue a range of different strategies.
There are no minimum balance requirements, and pricing is transparent, so it’s easy to get started even if you don’t currently have a lot of capital.
The platform’s exceptional educational resources and tools can also help you to make more informed decisions. These are something you can use alongside a trading journal to really supercharge your trading abilities.
Another reason that we rate TD Ameritrade highly is its award-winning thinkorswim® platform. This has pretty much everything advanced traders need – including in-depth research tools, screening capabilities and financial calculators.
Although some key asset types, like fractional shares and cryptocurrency, are currently unavailable with TD Ameritrade, this innovative platform has wide appeal and suits a diverse range of users.
There’s something for everyone on this platform, really.
If you want to know more, read on for an in-depth look at what TD Ameritrade can offer its users in 2023.
First things first: what is TD Ameritrade and how does it work?
Let’s start with some background. TD Ameritrade launched in 1975 as a full-service broker in a discount package.
Over the next four decades, it built up a name for itself thanks to its leadership in client experience, education and trading innovation.
One of these innovations was the launch of its award-winning thinkorswim® platform in 2001. This is widely regarded as one of the best platforms for active traders, thanks to its plethora of technical analysis, charting tools and software features.
As a TD Ameritrade user you can either use thinkorswim® or the TD Ameritrade platform itself. The latter has a simpler interface, so is a great jumping-off point for beginner traders.
TD Ameritrade was acquired by another well-renowned brokerage, Charles Schwab, in 2020.
The merger process is still ongoing, with more integration expected to take place throughout 2023. At the moment, however, TD Ameritrade still operates as a separate entity.
The merger process does add some uncertainty.
For example, what will a combined platform will look like once everything is finalized? It could come with some improvements – for example, Charles Schwab offers fractional shares, which TD Ameritrade doesn’t. This asset type could potentially be introduced to the platform soon.
It’s impossible to say either way until the brokers confirm what’s happening, so for now we’re looking at TD Ameritrade as it currently stands.
What assets does TD Ameritrade offer?
TD Ameritrade offers a wide range of assets across its web, mobile and thinkorswim® platforms. While there are a few shortcomings – for example the lack of fractional shares and the inability to trade crypto directly – there’s still a lot for investors to explore.
At the time of writing our TD Ameritrade review 2023, asset types available include:
- Long stocks
- Short stocks
- Mutual funds
- Foreign exchange
- Bonds (corporate, municipal, treasury, and certificates of deposit)
- Single option contracts
- Multi-leg option contracts
- OTCBB (penny stocks)
- Micro Futures
- Bitcoin futures.
Note that the mobile app doesn’t support fixed-income purchases.
What does TD Ameritrade cost?
It costs nothing to download and use TD Ameritrade, but some fees apply for certain asset trades and account activities.
TD Ameritrade offers commission-free trading for stocks, options and ETFs. There are no annual or inactivity charges, either, so you can hold an account without paying even if you don’t use it very often.
So, is TD Ameritrade free? Kind of… but there are some charges.
There are account fees – for example a $75 transfer-out fee if you’re taking all of your money. Partial transfers are free, however, and more than 3,600 of its 13,000 mutual funds are available commission-free too.
TD Ameritrade Pros: why it is one of the best online brokers
Everyone love a good ‘pros’ and ‘cons’ list, so let’s look at some reasons why TD Ameritrade is a great choice. These elements really stood out while we took the platform for a test drive during our 2023 review.
1. Easy-to-use web and mobile platforms
The biggest draw of TD Ameritrade is its excellent user experience. The broker’s customer-facing side is split into two parts.
For casual traders, there’s the standard TD Ameritrade experience: available both on web and mobile.
For more advanced traders, there’s the wonderfully complex thinkorswim® platform – which is also available for web or mobile.
All four of these interfaces offer a smooth and consistent experience, working well as you move between desktop and on-the-go.
2. Commission-free funds
If funds are a big part of your portfolio or strategy, you’ll be more than pleased with TD Ameritrade’s offering.
At the time of writing our TD Ameritrade 2023 review, the platform had more than 3,600 no-transaction-fee mutual funds available to trade.
It’s possible to screen these based on characteristics, and each fund page has comprehensive information – for example, key statistics, performance across different time periods and holdings.
3. Excellent educational material
TD Ameritrade offers a wide range of materials to help you to develop your skills as a trader. As well as informative articles and up-to-the-minute analysis, they also provide live webcasts and the latest market news.
Whether you’re a beginner or more advanced, these high-quality resources can help to increase your knowledge of markets as you hone your expertise.
There’s even some nice basic stuff in there for beginner traders who want to learn the ropes.
4. Wide selection of assets to invest in
Aside from a few key exceptions (fractional shares and cryptocurrency, for example) TD Ameritrade offers a really comprehensive array of assets to invest in.
You can dabble in stocks, bonds, options, forex, futures and funds.
And, while you can’t trade crypto directly, there are ways around it – for example through Bitcoin futures contracts.
5. An array of tools and resources
TD Ameritrade has a lot of cool tools to make trading easier.
These include idea generators, research insights and options screeners to help you to make the best decisions.
Using these tools can help traders of all levels to smoothly follow their preferred trading strategy, and sometimes even to develop new ones.
6. Amazing customer support
Quick solutions and reliable service make TD Ameritrade’s client support among the best in the business.
Account service and support is available 24/7, and phone lines are staffed from 8:30 am to 5:30 pm ET, Monday to Friday.
This access to real people means TD Ameritrade stands head and shoulders above other online trading platforms – some of which don’t have the option to speak to a human.
7. Test drive your strategies with a robust simulator
If you’re not keen on testing out your shiny new strategy with real money, you can test it first using TD Ameritrade’s excellent simulator paperMoney®.
This is free for customers to use, with a 60-day free trial for non-customers.
The simulator gives you $100K in virtual cash to play with, along with free run of the thinkorswim® trading platform.
It’s a great way to play around and do some testing before jumping in.
8. Lots of account types
This may be quite niche, but we think it’s worth mentioning.
As well as standard account types, like individual and joint taxable, it’s also possible to set up more complex accounts. For example, custodial, education savings, trusts, partnership and 529 accounts.
Investing for retirement? TD Ameritrade offers standard, traditional and Roth IRA accounts, as well as pension and profit-sharing accounts and a whole host of business retirement accounts.
TD Ameritrade Cons: where it could do better
Nothing is perfect, and that is also true of TD Ameritrade. During our review of the platform, these are some of the areas we thought could use some improvement.
1. You can’t trade crypto directly
If cryptocurrency makes up a large part of your portfolio – or if you want it to – TD Ameritrade is not the platform for you. While you can trade it through funds, over-the-counter (OTC) trusts and Bitcoin futures, there’s no way to actually trade directly.
2. There are some fees to be aware of
While TD Ameritrade offers a lot of assets for free, there are a few fees to be wary of. For example, if you’re trading mutual funds, you’ll need to be aware of the short-term trading fee of $49.99 which applies to funds you hold for less than 180 days (roughly six months).
TD Ameritrade has more than 13,000 mutual funds available, and just over 3,600 are fee-free. For the rest of them, you’ll need to pay commission. These range from around $49.95 to $74.95, so just pay close attention.
And, while it’s free to make partial transfers with TD Ameritrade, a transfer-out fee of $75 applies if you withdraw all of your money from your account.
3. It takes extra effort to enrol in the cash sweep program
One of TD Ameritrade’s cooler features is its cash sweep program, which holds cash in an FDIC-protected account while it’s sitting idle.
And, don’t get us wrong: it’s awesome that this option exists in the first place. However, enrolment isn’t automatic so you need to dig around the platform a little to opt-in.
If you’re not aware of it, you could easily be leaving money from interest on the table. Some competitors do this automatically.
4. You can’t trade fractional shares
Factional shares are great for those starting out, people don’t have a lot of capital to invest and anyone who wants to add high-value stocks to their portfolio. This type of trading allows you to buy shares by dollar amount rather than as a whole share.
Unfortunately, TD Ameritrade doesn’t currently offer this option, which can make things difficult. Especially if your strategies involve investing in portions of high-priced securities.
This is one to watch, however, as Charles Schwab – which TD Ameritrade is in the process of merging with – does offer fractional shares. This asset type could potentially be added to the platform down the line, but so far there’s no confirmation.
5. It’s not clear how things will look once the Charles Schwab merger completes
Throughout 2023, TD Ameritrade will start transitioning to Charles Schwab. This is likely to include moving towards a combined platform. As this isn’t live yet, there’s no way to test it and say which existing features will stay and which will be lost.
The web trading experience
During our 2023 review of TD Ameritrade, we found the user experience to be smooth and intuitive across all of the website and mobile apps.
To enter, execute or monitor trades on the web, you just need to enter the ticker symbol into the search tool. From there, you can place orders directly on the site. Easy.
Both the web platform and mobile app provide a wide range of asset classes (aside from fixed-income products). There are also lots of useful screening tools. With these, you can filter stocks, ETFs, mutual funds etc. based on your specific interests or strategy.
Also using these tools, you can apply filters such as industry, market capitalization and sector. Or you can create your own custom screens.
From a beginner lens, these tools are great if you’re looking for a bit of guidance on choosing potential investments. But, as experienced traders, we enjoyed using it to find some fresh ideas and inspiration.
So, whatever your level, you’re bound to find these useful.
We’ve already mentioned thinkorswim®, TD Ameritrade’s proprietary platform, earlier in this review. It really takes things to the next level and is especially good for advanced traders.
Using this enhanced experience, traders can utilize indicators, draw trendlines and conduct technical analysis on a deeper level than they can with the classic TD Ameritrade platform.
We also found thinkorswim®’s analysis tools for sophisticated investment types, like derivatives and options chains, useful.
Another useful feature is the ability to download the platform and personalize it further to align with your own individual preferences.
Another nice thinkorswim® feature is the trading simulator which allows users to build their own analysis tools using the thinkScript® programming language. With this, you can build useful studies, strategies, watchlist columns, alerts, conditional orders and scan queries.
Because you control what data to analyze, and the methods, it’s easier to track the data that you actually need while developing and implementing a strategy.
If you’re an advanced trader, it’s very likely that the thinkorswim® experience is more likely to suit you than the standard versions of TD Ameritrade.
For newbies, this extensive range of features and functionalities could be a bit overwhelming – but it’s still intuitive enough for those near the start of their trading journey.
How well does TD Ameritrade work on mobile?
TD Ameritrade excels in providing a top-end mobile trading experience, with Investopedia naming it the ‘best broker for mobile’ in 2023.
Let’s start with the trading experience. It’s seriously smooth, matching the seamless feel of the web platform. This isn’t something you see enough in the industry, and is testament to TD Ameritrade's innovative approach to mobile investing and commitment to user experience.
Once you’ve got the app open, trading is as easy as a few taps. Start by hitting the eye-catching green "trade" button in the top right corner of the screen. From there you can enter a symbol and start your trade.
As for data and information, the app offers real-time data streams, watchlists, and market news to help its users to make the most advantageous trading decisions.
There are some limitations: for example, you can’t draw on charts using the mobile version. But you can still initiate your trades straight from these screens, so it’s easy to do what you need to.
If you need chart customization and other advanced features, download the thinkorswim® mobile app instead. This has a more extensive selection of features that more experienced traders need.
It’s also worth noting that the thinkorswim® app allows users to trade more complicated assets: including multi-leg options. Again, this is a seamless web-to-mobile experience with a heap of similarities to the thinkorswim® computer platform.
What order types are available?
TD Ameritrade provides a wide range of order types across all of its platforms: such as standard market, limit, stop-limit, and trailing stop orders.
If you’re using the more advanced thinkorswim® platform, you can also use conditional orders including order-triggers-other (OTO), order-triggers-two (OTT) and one-cancels-the-other (OCO).
This support for more advanced order type is why we rate thinkorswim® so highly.
Setting them up lets users manage risk, move quickly on entry and exit and secure their gains – without keeping too close an eye on trades. This means more time for planning and analysis, which can ultimately help you to become a more profitable trader.
One nifty feature we like is the ability to choose tax lots while placing your orders, which makes things easier when tax season rolls around.
What is TD Ameritrade’s tech like?
TD Ameritrade had its own proprietary routing technology and, on average, executes orders within 0.04 seconds. Not too shabby.
So, why is this important? As an active trader, one of the most important things to consider when choosing a trading platform is speed. Fast – and accurate – execution is important for everyone, but if you’re making a lot of trades it takes on even more importance.
Markets move quickly, so your chosen platform has to have tech in place that can keep up. If the order routing process isn’t streamlined and precise, you can’t execute as quickly or as often as you need to as an active trader.
It’s all about the tech behind the broker’s routing method – if it’s good, it’s more likely you’ll get the best price at the time you place your order.
As well as being fast, TD Ameritrade uses technology with built-in price improvement – which uses data to execute trades at a better price than the best quoted market price.
TD Ameritrade’s execution quality data works on order sizes up to 1,999 shares. On average, 98% of trades benefit from price improvement. In 2023, the average net improvement per share is $0.0116.
There’s also the flexibility for users to directly route orders to specific exchanges, for those who would prefer to have more control.
Another cool piece of tech is the ability to back-test your trades. This isn’t offered by every broker, but it’s a useful little analysis tool. You can use it to test your strategies against old data, allowing you to fine-tune your ideas based on a deeper knowledge of the market and how it’s likely to behave.
Basically, it gives you the chance to get some hands-on experience on previous market patterns without having been there yourself.
How are the research and analysis tools?
One of the best things about TD Ameritrade is its epic range of research features and analysis tools. Along with its speed and usability, these are one of the main reasons it’s one of the best online brokers for 2023.
We particularly love its innovative Social Sentiment tool, which looks at social media trends to gauge feelings about particular stocks. As well as this, you’ll find a wide selection of other screeners, charts, calculators and analysis tools.
Let’s do a deeper dive.
TD Ameritrade tools and calculators
We don’t have space to list all of the financial tools and calculators available on TD Ameritrade. Suffice to say, it’s a lot. Some of the key ones include Portfolio Planner, Retirement Calculator, Income Estimator and the IRA selection tool. Basically, there’s plenty in there to help you plan, build and implement your trading strategies.
TD Ameritrade charting capabilities
Another area TD Ameritrade does well in is charting. This is especially true if you start using the more advanced thinkorswim® platform. Charts are comprehensive and customizable – even down to very basic things like color and size. You can also save and share your charts, which is useful when discussing the best strategies with your friends.
TD Ameritrade trading idea generators
We all need a bit of inspiration sometimes, and TD Ameritrade ensures its users have access to all of the information they need to discover exciting new investments. There’s access to analyst reports from the likes of Dow Jones, as well as market news and information. If you want to go deeper, the platform has a massive research library packed with insights on industries and funds. If that doesn’t inspire you, we’re not sure what will.
TD Ameritrade stock screeners
At the time of writing, TD Ameritrade offers 25 pre-defined stock screeners. If that’s not enough, users can create their own custom screens based on technical indicators, valuation, performance, sector and fundamental metrics.
If you want more, switch onto the thinkorswim® desktop platform. The screeners here are more robust and designed for more experienced traders.
TD Ameritrade ETF and mutual fund screeners
Similar to stock screeners, TD Ameritrade's ETF and mutual fund screeners also give users a wide range of options to choose from. One feature we like is that trades can save their last five customized screens for future use. These can also be turned into personalized watchlists, so you don’t have to constantly repeat the same searches.
TD Ameritrade options screeners
The option-specific screener and strategy builder is also robust. It pulls in real-time data streams to cover important parameters like probability of profit, spread price, time to expiration and volatility. There are also some cool options-specific tools, like Spread Hacker and Options Hacker. These can be used for simple and complex screens, as well as monitoring key strategies.
TD Ameritrade fixed income screeners
Choose from pre-selected bond ladders or use the Bond Wizard tool to create your own. This fixed income screener also lets you filter based on individual bonds and certificates of deposit (CDs).
TD Ameritrade news
Real-time market information is easily accessible within the TD Ameritrade platform. It pulls in data from Dow Jones, Benzinga, CNBC Video, Econoday calendar, Wall Street Horizons and more. It also has its own proprietary TD Ameritrade Network, and integration with Yahoo Finance.
TD Ameritrade third-party research
As you can see, there’s lots of information and data freely available on TD Ameritrade. If you want even more, you can subscribe to the premium tiers of Market Edge. This gives you access to real-time reports and commentary, as well as unfettered access to research, screeners and tools.
TD Ameritrade SRI/ESG research amenities
One place TD Ameritrade falls short is with regards to environmental, social, and governance (ESG) criteria and socially responsible investment (SRI). While there are lots of robust screeners on the platform, these don’t specifically look at ethical investments. For the environmentally conscious, this could be a drawback.
What are the educational resources like?
There’s a reason TD Ameritrade was named ‘best broker for education’ by Investopedia. This platform has a really comprehensive educational resource, with learning materials accessible though all of its desktop, mobile and web channels.
Let’s start with a look at its education center. In here you’ll find a vast and searchable content library filled with tutorials, podcasts, videos and webinars.
There’s something for every learning style and its easy to find what you need – whether you’re looking for information based on your areas of interest, investment goals or tailored to your knowledge level.
Next up is the Immersive Curriculum. This educational client portal is free, and offers comprehensive coverage. This is absolutely ideal for beginner investors as it breaks down trading concepts and investing strategies into individual lessons that you can work through at your own pace.
We really like the way that TD Ameritrade implements innovative technology to continuously enhance your learning experience. As it gets to know your preferences – and as you build up an account history – it’s able to offer personalized education recommendations.
Some of this is also based on the profiles of other users in a similar financial situation to you.
And finally, another indispensable educational tool is paperMoney®. This investment simulator tool gives you the opportunity to play around in its flagship platform, thinkorswim®, and get some hands-on experience before you start investing your own cash.
Basically, as your understanding and experience grows, TD Ameritrade can adjust its recommendations on educational material to ensure you’re always growing and developing.
How does TD Ameritrade make money?
An increase in innovative trading platforms and the surge in commission-free trading has meant that brokers need to reduce prices in order to stay competitive. However, TD Ameritrade is clearly a very advanced program, and must be making money somewhere.
If you know your way around the platform, you can even increase the amount of capital you gain. For example:
Payment for order flow
One way TD Ameritrade generates revenue is by directing its trade orders to market makers. They accept around $0.001 per share for equities and $0.37 for non-marketable orders. This is well in line with the industry average, however. Although some brokers, like Vanguard and Fidelity, don’t accept this type of payment.
Stock loan programs
As a TD Ameritrade user you can participate in a stock loan program – but you get no say in which stocks, so there may be some risk here. This type of program generates revenue for brokers, as they can offer the stocks to brokers and hedge funds for short selling.
Interest on cash
Users can enroll in TD Ameritrade’s cash sweep program to earn interest (of roughly 0.35%) on your idle cash. This doesn’t happen by default, and you have to opt in. Some competitors do enroll you automatically in their programs, so the minor inconvenience of opting in could be seen as a ‘con’.
While TD Ameritrade reports an average net price improvement of $0.0116 per share for orders sized between 1 and 1,999 shares, the broker doesn’t disclose its net price improvement for options orders.
How secure and reliable is the platform?
The final, and arguably, most important thing we looked at during our review was security. And again, TD Ameritrade comes up on top here.
Two-factor authentication is available across platforms, as are biometrics (facial recognition and fingerprint scanners). The platform is super secure, and hasn’t reported any major data breaches in the lst four years.
And, if something does go wrong, TD Ameritrade has safety nets in place.
Any losses due to unauthorized activity on your account will be reimbursed. Every client is protected to the tune of up to $149.5 million for securities. An additional $2 million of protection for ash is also available.
While the platform tends to be reliable, it did face some login issues due to high traffic volume in 2020. It was also impacted by intermittent downtime in January 2021, due to the surge in Gamestop stock ($GME).
Track your TD Ameritrade transactions with TradeZella
Another benefit of using TD Ameritrade is that it integrates seamlessly with TradeZella. This means that all of your trades are instantly pulled into our platform, so you don’t need to enter them manually.
But why use TradeZella to track trades? We’re glad you asked. Firstly, journaling helps you to supercharge your trading game.
And, while it’s possible to track trades using spreadsheets or paper journals, our journaling software has lots of amazing features to make it quicker, easier and more productive.
An intuitive dashboard with everything in one place – including an analytics dashboard, advanced filtering and profitability charts. Our algorithm spots patterns for you, and helps you to see which plans are working best.
Sign up for TradeZella today, and level up your abilities with powerful journaling software.