One of the frequent questions I hear is in regards to what brokerage firm should a new investor sign up with. Over the next few weeks I will be profiling some of the more popular brokerage options and highlight the important things to consider that should help new investors narrow their search. We kick things off with TD Ameritrade.
TD Ameritrade became one of the first discount brokerage firms in 1975 after the deregulation of the brokerage industry allowed negotiated commissions to individual investors. Later in 1998 Ameritrade became one of the first Internet brokers to allow complex option order placement via the Internet. TD Ameritrade came into existence from the original First Securities of Omaha, Inc. The company has gone through many name changes though acquisitions.
TD Ameritrade provides one of the most comprehensive set of investment options available to individual investors. They offer the basics such as stocks, options, bonds, mutual funds and ETFs. If you need access to less traditional financial instruments you can find support for U.S. Treasury and Agency Issues, mortgage backed issues, CDs and Unit Investment Trusts.
TD Ameritrade also provides a variety of different account types to hold these investments. You can open individual cash or margin accounts, Traditional or Roth IRAs, Coverdell ESAss or 529 plans, joint, foreign and even corporate accounts.
Fees and Commissions:
One of the pricing benefits with TD Ameritrade is the flat-fee structure. They provide stock and ETF trades for a flat $9.99 per online trade regardless of the number of shares. Whether you are trading 10 shares or 10,000 shares the price is the same. This can be helpful for active traders as the costs are easy to calculate. Option contracts are priced at $9.99 per trade plus $0.75 per contract.
Pricing does change outside of online trades as the automated telephone and broker-assisted trades cost $34.99 and $44.99 respectively. Other fees associated with the account are competitive within the industry.
Technology and Trading Features:
TD Ameritrade boasts one of the most complete trading systems available through discount brokers. The highly-customizable Streamer Suite gives traders their own custom look at the market. It comes complete with real time free streaming Level I quotes and charts with the ability to upgrade to Level II quotes and streaming news. Users can even set alerts and place trades directly through the streamer.
Also included is access to many market research tools and reports. You have access to research from some of the best analysts in the business as well as webcasts and powerful stock and fund screening tools.
Not only do you have access to a 24-hour call center to place trades or help manage your account, you also have the ability to meet with someone in person at one of the over 100 branch offices across the U.S. For the past three years TD Ameritrade has been rated by J.D. Power and Associates as a certified call center.
TD Ameritrade has been one of the premier choices for traders for years and it is easy to see why. Affordable and straight-forward pricing combined with an extensive support network make it a suitable option for many traders. The added benefit of qualifying as an Apex client will provide you with many tools and features that would otherwise be very costly. TD Ameritrade is a solid brokerage if you want the flexibility to be able to invest in many different investment vehicles without breaking the bank.
PO Box 2209
Omaha, NE 68103-2209
Author: Jeremy Vohwinkle
My name is Jeremy Vohwinkle, and I’ve spent a number of years working in the finance industry providing financial advice to regular investors and those participating in employer-sponsored retirement plans.