Charles Schwab vs. TD Ameritrade

Charles Schwab vs TD Ameritrade Range of Offerings
Asset Charles Schwab TD Ameritrade
Short Sales  Y Y
No-Load, No-Fee Mutual Funds  20,000+ 3,600+
Bonds  Y Y
Futures/Commodities  Y Y
Futures Options  Y Y
Complex Options  Y Y
Robo Advisory Y Y
Cryptocurrency  Only CME Bitcoin futures Only CME Bitcoin futures
International Exchanges 12 non-US markets; investment service consultant can provide access to foreign share trading exchanges across 30 countries Canada; More international exchanges can be traded using broker assistance.
Forex  Y, 8 pairs AUD; CAD; EUR; GBP; HKD; JPY; NOK Y, 73 pairs
Fractional Shares  Y N
OTCBB and Penny Stocks Y, with no commission Y, but with a $6.95 flat fee

rate Types

Both Charles Schwab and TD Ameritrade are able to handle standard limit, stop loss, stop restrict orders, and trailing stops. conditional orders such as one-triggers-other, one-cancels-other, order-triggers-other, and therefore on are available on some platforms. conditional orders are not available on the Schwab web site or the TD Ameritrade web site, but traders would be using desktop applications and/or a mobile solution that supports these orders a well as the other trade tools passive investors are unlikely to need. Given the similarities between Schwab and TD Ameritrade when it comes to regulate types, this category is a draw .

trading technology

Charles Schwab uses proprietary engineering to route ordain, and rates highly for obtaining price improvement on 93.9 % of orders, and an average of $ 0.01719 in savings per parcel. Execution focal ratio is 0.04 seconds. Schwab does receive requital for holy order stream ( PFOF ), and this tax income pour has grown significantly for Schwab and early brokers from increases in trade volume during the pandemic ; Schwab ’ s PFOF gross jumped 78 % from 2019 to 2020, and other brokers saw 100 % increases. Schwab besides provides qualifying customers with portfolio margining, which lowers allowance costs based on the overall risk in the portfolio. Schwab has not, however, been proactive in helping customers maximize their cash balances, and generates significant gross by putting the burden on the customer to be proactive if they want to obtain higher money market rates than Schwab offers. Schwab besides offers bill holders the ability to purchase fractional shares of angstrom short as $ 5, allowing little investors to participate in ownership of eminent priced stocks like Tesla and Amazon, which can trade for more than $ 1,000 per parcel .

TD Ameritrade besides benefits from PFOF. TD Ameritrade allows its customers to route their own equity and options orders to select exchanges. alternatively, its customers can benefit from monetary value improvement through TD Ameritrade ’ s proprietary spread-eagle software. Orders routed through TD Ameritrade ’ s order route system for transactions for between 1 to 1,999 shares, or 90 % of their orders, experience fills in 0.04 seconds, and average price improvement of $ 0.0186 on 98 % of orders. TD Ameritrade besides offers portfolio margining, but not fractional shares. TD Ameritrade, however, is one of merely a few on-line brokers to allow traders to backtest their trading strategies. TD Ameritrade, like Schwab, besides fails to proactively assist its customers with higher rates on cash balances .

This class is a tossup, with Schwab winning it for the majority of investors that benefit from fractional shares. TD Ameritrade, however, wins this class when it comes to traders because of the ability to backtest strategies and route your own orders.


Both Charles Schwab and TD Ameritrade were early adopters of commission spare trade for stocks and ETFs, but TD Ameritrade still charges a compressed tip of $ 6.95 for over the counter ( OTCBB ) issues. Schwab has no fee for OTCBB trades. Both TD Ameritrade and Schwab charge $ 0.65 per option contract, and neither company charges inactiveness or minimal fees. While most futures traders would look elsewhere for even lower perpetration rates, Schwab ’ randomness commission on futures is $ 1.50 per narrow per side plus change fees, while TD Ameritrade charges $ 2.25 .

margin traders will besides do better at Schwab, which has lower margin rates than TD Ameritrade at every breakpoint and by more than a full moon share compass point for balances of $ 25,000 or more. repair income rates are unmanageable to compare because Schwab charges $ 1 per bond, with a $ 10 minimum and $ 250 maximal for on-line transactions, while TD Ameritrade has its fees incorporated into the price for secondary commercialize transactions, so is less guileless. Schwab ’ s fee for wire transfers is $ 15 if done on the Schwab web site, compared to a $ 25 tip at TD Ameritrade. TD Ameritrade does not charge extraneous central transaction fees, while Schwab charges fees for currency substitute. TD Ameritrade charges a $ 49.99 commission for reciprocal investment company trades outside of their no transaction fee course of study, while there is no charge at Schwab if the trades are made on its on-line platform .

While both brokers have no perpetration stock and ETF trades, and charge the same for options trades, Schwab has a clean edge over TD Ameritrade on costs because they have lower gross profit rates and don ’ metric ton charge for trading OTCBB stocks. We besides appreciate Schwab ’ s more crystalline fees for secondary grocery store fixed income purchases.

Account Research Amenities

Schwab and TD Ameritrade both have excellent screeners for stocks, ETF, reciprocal funds. The respective fixed income screeners are both able to look for specific issues and provide ladder build up tools. Both brokers besides offer trading theme generators. TD Ameritrade ’ mho options psychoanalysis and screen tools are good in class, and superior to Schwab ’ second offerings. On the other side, Schwab ’ s screeners for ETFs and common funds let users screen for securities that meet socially responsible invest ( SRI ) and environment, social, administration ( ESG ) criteria, while TD Ameritrade does not offer SRI/ESG filtering on their screeners .

Both companies provide free research, news, and fundamental information for individual stocks. They besides both put up daily market reports and provide access to third party research. TD Ameritrade ’ s thinkorswim platform allows paper trade and backtesting of strategies, which is not available at Schwab. While charting is besides available on both platforms, we found TD Ameritrade ’ s charting intelligibly better, in summation to their market and incriminate and actual excitability data going back further than the data available at Schwab .

overall, we give the edge to TD Ameritrade when it comes to account and research amenities.

portfolio analysis

Both TD Ameritrade and Schwab allow collection of outside accounts to provide a full moon fiscal picture for clients. similarly, they both provide excellent tools and calculators for portfolio analysis, including tools for allowance, portfolio mix, retirement and income steering, tax efficiency, biography events, and options price and probabilities. Rebalancing, benchmarking, inner rate of reappearance, and tax affect psychoanalysis and other tax accountancy tools are besides available. We gave a flimsy edge to Schwab ’ s offer of tools, calculators, and portfolio analysis even though both companies have firm offerings in this area.

department of education

Schwab and TD Ameritrade both have excellent offerings to help educate investors and traders, but TD Ameritrade is our option as having the best educational offerings of all on-line brokers. TD Ameritrade provides hands-on learning through wallpaper trading, and investing education that uses technology to deliver innovative educational content in a personalized way.

Customer Service

Both TD Ameritrade and Schwab provide solid customer service, and unlike most on-line brokers, they besides have a wide-eyed outgrowth network with offices throughout the United States. Both brokers have 24/7 earphone and live chat avail options, arsenic well as making fiscal advisors available to assist customers with scheme and trade ideas. Schwab ’ mho average wait time on customer service calls is 102 seconds, compared with TD Ameritrade ’ s 43 seconds. While both wait times are fair for such large companies with indeed many accounts, we give the slender border in customer service to TD Ameritrade because their wait times are less than half of Schwab ’ south .


security on Schwab and TD Ameritrade is largely comparable, but there is an exception. Both brokers offer dual-factor identification, biometric fingerprint and facial recognition, and extra protection beyond Securities Investor Protection Corporation ( SIPC ) through insurance policies in London. While neither broker has reported any holocene data breaches, TD Ameritrade, along with several brokerage firms, experienced intermittent downtime on January 27, 2021, that prevented users from logging on, checking portfolios, or making trades. TD Ameritrade besides encountered login issues in 2020 as a solution of unprecedented natural process volume. A clean record on login issues for Schwab tilts the scale to them on security .

Our verdict

Both Schwab and TD Ameritrade have fantastic technology for their web site, background, and mobile apps, so there are no very losers in this competition. That said, TD Ameritrade has a small edge over Schwab because its trading technology is more coherent between network, desktop, and their corresponding mobile apps. Further, TD Ameritrade ’ south graph, options analysis, and investor education offerings are all better than at Schwab. More sophisticate traders would likely choose TD Ameritrade because of how good thinkorswim is, and for the ability to control how their orders are routed. TD Ameritrade besides gives users the ability to paper trade and backtest deal strategies .

There are, however, some offerings and cost differences that can tilt the scale in Schwab ’ s favor. Regarding offerings, Schwab has fractional plowshare trade and TD Ameritrade does not. You can besides screen for SRI/ERG criteria for Schwab for common funds and ETFs. On cost, examples include margin rates more than a full moon point lower at Schwab ; OTCBB trades that are detached at Schwab and not at TD Ameritrade ; fixed income fees are unmanageable to understand at TD Ameritrade because commission is included in the monetary value of the attachment ; and common funds outside of the no-fee offerings cost $ 49.99 at TD Ameritrade, but nothing at Schwab if the order is placed on-line. While futures commissions are besides lower at Schwab, we did not weigh this heavily because active futures traders would not be probable to use either of these platforms for futures .

again, both Schwab and TD Ameritrade are excellent brokers and investors won ’ thymine be ailing served choosing either one. That said, if you are in it for trading technology, chart, and education, TD Ameritrade is the better fit. If you are after lower costs, ESG tools, and fractional shares, however, Schwab is the obvious option.

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Investopedia is dedicated to providing investors with indifferent, comprehensive reviews and ratings of on-line brokers. Our reviews are the consequence of months of evaluating all aspects of an on-line agent ’ randomness platform, including the drug user feel, the quality of craft executions, the products available on its platforms, costs and fees, security, the mobile have and customer service. We established a rat scale based on our criteria, collecting thousands of data points that we weighed into our star-scoring organization.

Read our full methodology .

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Category : Finance

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