Broker review

TD Ameritrade

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TD Ameritrade is a big US brokerage firm based in Omaha, Nebraska, that has been in the business for 40 years. The TD comes from the largest shareholder, Toronto-Dominion bank. The firm regulated by the SEC offers retail and institutional clients services to invest online. The firm has approximately 11 million customer accounts averaging more than 500 000 trades daily.  TD Ameritrade is one of the pioneers in online investing. The entire product offering is very technology focused and offers the investor great possibilities!

TD Ameritrade doesn’t require a minimum deposit, there are no trade requirements to access advanced features and there are no hidden fees. They charge a flat fixed fee of 6,95 USD per stock trade and 6.95 USD plus 0.75 USD per contract for options trades. This is lower than they used to charge but is still rather expensive compared to some discount brokers, but the trading platform provided is outstanding and will keep the most advanced traders happy.


General

Positive

  • Flagship product, Thinkorswim, is a great trading platform built with strong focus on technology
  • Good access to products
  • Many clever widgets for trading and analyzing
  • Offers incredible customizing possibilities
  • Relatively user friendly and great “feel”  
  • Great Mobile Trader App

Negative

  • Thinkorswim is too advanced for novice traders at start
  • High commissions
  • At times too many choices that risk confusing the trader
  • Web based platform not sufficient as stand alone

Products

  • US Equities (and Adrs)
  • ETFs
  • Forex
  • Funds
  • Bonds
  • Options
  • Futures

Fee structure

Positive

  • Clear and easy to understand fees

Negative

  • Rather expensive commissions

The Account and Regulation

Positive

  • No minimum account requirements
  • SEC regulated

Negative

  • High commissions

Trading Platforms

Thinkorswim (advanced traders)

Positive

  • Great platform for the demanding pro trader
  • Multiple order types
  • Good charting experience with almost 400 indicators
  • Nice alerts
  • Social trading tool
  • Good analyzing tools
  • Trader TV

Negative

  • Novice traders will find it confusing for starters
  • At times a bit too many details and possibilities

Web based platform

Positive

  • Simple and clean
  • Social screening
  • Good education section

Negative

  • Doesn’t serve as a trading platform. I would only use it as a backup system when travelling.

Mobile Trading

Positive

  • User friendly and intuitive
  • Quick trading
  • Great charts for mobile
  • Good research possibilities
  • Social trading
  • Trader TV

Negative

  • If too much is negative, this would be it

Research

Positive

  • Various fundamental ratios available
  • Probability analysis
  • Backtesting
  • Great information on Economic Data

Negative

  • Weak research for the pro user

Thinkorswim

At times I must admit the trading platform gets a bit too complicated, especially for the novice trader, but Thinkorswim is an excellent platform if you give it some time. I have during my years as head of trading been involved in designing several professional trading platforms, so I know a bit on technology and user friendliness. TD Ameritrade’s flagship product Thinkorswim is great but at times I think they give the user too many possibilities and therefore the trader at times risks information overload and can at times miss quick opportunities.

To use this product I would recommend having at least four large monitors. Personally I run my trading on 8-10 screens, but that involves Bloomberg and other systems as well. Thinkorswim is both a trading platform, as well as an information system. One example is the Trader TV feature integrated in the platform.

The client gets access to an advanced system, very good educational material and videos, very attentive customer support, highly sophisticated research products, option analysing tools, extensive charting section with close to 400 indicators etc, but the commissions fee is rather pricey.

Thinkorswim is designed for the advanced trader looking for a robust system that also offers flexibility. There are many possibilities to customize pretty much whatever you want to customize. You can create your own indicators via the proprietary code language thinkscript. Access to the system doesn’t require any minimum deposits which is a great plus.

The trader basically has a few tabs as main choices from where you can dive into depth in all possible areas of trading:

  • Monitor – shows you the account statement, activity of orders/trades, fx etc.
  • Trade – all things related to trading. One feature I like very much and is suited for quick click trading is the active trader tab. Very neat for the fast trader.
  • Analyze – analyze probability, risk, fundamental, economic data, well analyze anything you want pretty much.
  • Scan – scan according to your set of rules.
  • Market watch – heatmap and great tables of what’s moving.
  • Charts – Almost 400 indicators! Create your own indicators if needed and much more.
  • Tools – interact with other traders and other features.

The main menu of Thinkorswim.

Below is the start screen of Thinkorswim. It is totally customisable where you can create your own lay out. Note the embedded Trader TV as one feature. It doesn’t match CNBC and Bloomberg TV but is still rather impressive.

This example shows the trade tab with order depth of four names at the top, some additional info like news as well as the TV function at the left part and implied volatility of Apple in the charts below the order depth boxes.

The monitor tab showing the account statement is good but can get a bit too detailed for a quick view of the most important according to me.


The Forex trader as a subgroup of the trade tab gives the classical FX trade feel. I like it, simple and fast. Note the charts linked to each trading window. Perfect feature for day trading.

Below is the Active trader feature. This is a function I like a lot! You can see the charts at intervals you wish to the left and to the right you have the prices of the asset, in this case the S&P future. You see the histogram showing volume size at a specific price. The best is how easy it is to click and trade. It is a very intuitive way to trade quickly. Not all systems have this feature. Well done TD Ameritrade for this!

Pairs trading made simple. Just type what names you want to trade, how to trade  and voila you are ready to go. Below is a chart showing: left side S&P versus Tesla and right side; Apple versus Tesla. The charts below shows 30 minute 10 day chart of the spread and the red line is the correlation between the assets.

This is not the first function a novice trader starts using, but it is a great tool when you start trading spreads and want it traded automatically. Easy and straightforward to use.

Thinkorswim offers many possibilities of scanning your stocks. Volume, percentage change, fundamental or other filters are no problem for this platform. Personally I like to crunch complex scans on a different computer as it generally slows down the trading system.

The heat map gives a quick overview but is a feature I never really found important on any trading platform.

Thinkorswim gives you great visualizing option for market movers. You can filter these on many different criterias. As you scroll over the various names you will get additional information about the asset to the right.

Note one neat function, the put call ratio that at times provides interesting information that can be an input to your trading.

Below is a snapshot of ETFs seen on the visualized market watch page.

Charting in Thinkorswim is very good. You have access to almost 400 indicators predesigned in the system. Beside that you can code your own proprietary signals with thinkscript and even create your own candles. Personally I continue using Bloomberg for all my charting which is probably a habit and the fact I like the layout, but Thinkorswim offers traders a great charting platform.

If there is a negative I would say it has too many possibilities. More possibilities itself is good, but the problem is that just trying to find the indicator you want to apply can take time as the drop down menu is filled with so many choices. You have to ask yourself how many indicators do you really need?

Below is chart of Apple with volume subchart as well as the 200 day moving average. It looks rather clean and nice.

Technical Analysis in Thinkorswim is advanced and one of many features is that you can have the system look for chart patterns.

Below is a chart of Apple with wedges and triangles automatically charted by the system. You can have the system look for patterns, individual candles, candlestick patterns etc. I must say this is impressive, especially given the fact TD Ameritrade doesn’t require minimum deposits to open an account.

Thumbs up for Thinkorswim charting!

When charting you have possibilities of adding various subcharts that you choose from the menu on the far right. Indicators etc you choose as normal in the top part, but Thinkorswim has neatly designed additional fields you can add to your charts.

The Apple chart from above has in the following chart been redesigned to also include news about Apple as well as quick trading possibilities in the bottom right corner. You can add other features from the various tabs and it truly gives it a nice feel to integrating charting with trading.  

Thinkorswim has managed adding nice little widgets like the one mentioned and they have managed integrating it smoothly.

Thinkorswim has some fundamental analyzing possibilities. As a general rule research provided by brokers not specializing in research is not overly useful, but Thinkorswim has some interesting features where you can look at information on a specific stock or analyze economic statistics. You can dig out simple information on stocks, see income statements, balance sheets etc.

Below is a quick look at Apple and some research reports you can access.

By clicking one of the report links you will get redirected to the research report itself.

You can get a quick snapshot of what is driving Apple earnings etc. It can be useful for a quick glance but using it as a fundamental platform is not sufficient. For proper fundamental research you need a robust system such as Bloomberg, but that system comes with a high price tag.

A neat function in the fundamental research section is the vast information on Economic data. You have access to a lot of interesting statistics and they are all nicely presented in charts.

You can easily pull out a chart on Federal Debt: Total Public Debt as percentage of GDP.

Thinkorswim has its own social trading section. It doesn’t match systems like www.tradingview.com but the application provides an opportunity to interact with other traders as well as you can follow other traders and their ideas. Each trade is specified and you can see attached charts or other information the trader might provide.


Mobile Trader Applications

TD Ameritrade Mobile Trader app is a great mobile trading platform for the trading geek. This is basically Thinkorswim in the mobile. There is a lighter more casual version called TD Ameritrade Mobile which is well suited for the lighter user, but I would always chose the pro version, ie the TD Ameritrade Mobile Trader.

The layout of the Mobile Trader is very clean and neat. The charting function is amazingly well designed. You can easily pull up quotes and you will see various information as well as the order depth. Very nice!

Pulling up an order is easy. Switching from buy to sell is done in a second. Truly great to use and a very intuitive platform.

As you prepare an order you will clearly see the cost of it. Changing limit or volume is quickly performed. Applying conditions of the order is also very clear and easily performed. All relevant info is displayed extremely well.

The order function comes with various tabs to be applied. The below is showing the order window to trade Tesla accompanied with a great chart. Change the time interval of the chart in a second and voila the TD Ameritrade Mobile Trader quickly becomes a favourite trading app.

 

The Mobile Trader app is robust and powerful. It is easy to understand and you will enjoy it well. Should you need help, you can chat live in the app with customer support, truly unique. If you are sceptical to trading on the mobile, this application will change your mind.

If there is a negative about the app is the fact it is so good, you will probably spend a lot of time on it.


Conclusion:

TD Ameritrade is a great broker offering an impressive product. The flagship platform Thinkorswim will have almost every trader covered when it comes to needs. The experience from a trading point of view is that they are very competent and the platforms have a good feel to it. You have access to many products and there is no minimum requirement for turnover or deposits. Thinkorswim and the Mobile Trader app are both impressive platforms.

Commissions are rather expensive, but on the other hand TD AMeritrade delivers a great product. As I have stated before, Thinkorswim is a great platform, but for the novice trader it can get a bit too complicated.

Another big plus is the extensive education material TD Ameritrade offers.


Commissions:

TD Ameritrade doesn’t have any minimum commissions in order to open the account. You can get access to great platforms and tools with no minimum requirements.

The only negative is the relatively high commissions they charge.

 

 

 

 

 

 

 

 

 

 

 

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