Charles Schwab completed its acquisition of TD Ameritrade in October 2020 and expects to conclude the business combination in 2024. New TD Ameritrade accounts can no longer be opened. Read more about Charles Schwab and what this broker has to offer.
TD Ameritrade is one of the most well-known brokers in the US, and now it’s in the process of integrating with Charles Schwab following the completion of the business combination. Current TD Ameritrade customers can expect their accounts to convert to Charles Schwab sometime in 2022, with full integration of accounts by late 2023. If you’re not sure you want to stick around following the merger or whether you should sign up for an account ahead of the integration, here are five alternative trading platforms you should consider.
SoFi Invest shines for its features targeted to cost-conscious, beginner investors. These include:
Fractional share trading
No-fee automated investing
Crypto trading
Like other discount brokers, SoFi lets you trade stocks and ETFs commission-free, and there are no account minimums to get started. SoFi also offers an automated investing account, or robo-advisor, with no annual management fee and just a $1 minimum investment. As we mentioned earlier, investors who stick with TD Ameritrade through the integration will need to pay $5,000 to use Charles Schwab's robo-advisory service.
While SoFi falls short when it comes to investment options compared to TD Ameritrade — SoFi doesn't offer options trading, futures, forex or mutual funds — it does offer exposure to cryptocurrency, something TD does not. SoFi investors can buy and sell Bitcoin, Ethereum and over 20 other coins with just $10.
The pioneer of commission-free trading, Robinhood is known for its:
Commission-free stocks, ETFs, options and crypto
User-friendly interface
Fractional-share trading
While commission-free trading is commonplace, there's a reason investors have stuck around with Robinhood: it's easy. Instant deposits give investors immediate cash to invest and fractional shares let investors buy stocks and crypto with as little as $1. To compare, an impressive 22.8 million people used Robinhood as of spring 2022, compared to TD Ameritrade's 11 million.
Those looking for margin investing, more in-depth research and Level II market data can subscribe to Robinhood Gold for $5 per month. But active traders won't find the most sophisticated research tools, like advanced stock screeners and charting. And investors won't have access to securities like mutual funds, forex and precious metals.
One of the largest brokers in the US, Fidelity Investments stands out for its:
Fractional share trading
Robust research tools
No minimum and expense-ratio-free index funds
While TD Ameritrade offers numerous low-cost funds, Fidelity Investments takes it a step further by offering several no expense ratio and no minimum mutual index funds. Fidelity also offers fractional share trading — something TD Ameritrade customers won't get until their account moves to Charles Schwab. However, like TD Ameritrade, Fidelity doesn't offer direct access to cryptocurrency.
Fidelity clients can invest on their own or open an account with Fidelity Go, the firm's robo-advisor. TD Ameritrade clients will have access to Schwab's robo-advisor after the merger, but it requires a $5,000 minimum deposit. Fidelity Go lets you get started with $10, and the management fee is waived for accounts holding less than $10,000.
Those used to TD Ameritrade's excellent research capabilities should be pleased with Fidelity's library of research tools, including stock screeners with more than 140 criteria and access to more than a dozen third-party research providers, including Recognia, Refinitiv and McLean Capital Management.
Like TD Ameritrade, Interactive Brokers (IB) is great for:
Advanced traders
Investors who want access to global markets
Investors who want access to a wide variety of securities
IB offers a variety of advanced research tools and investment options, making it a solid choice for advanced traders and investors looking to expand their portfolios. You can also place more than 100 different order types and access complex trading algorithms.
CSFB Crossfinder+, for example, identifies liquidity among independent and broker-owned dark pools while offering continuous crossing capabilities. According to its website, CrossFinder+ will spread your order over multiple destinations and fill at the midpoint or better.
IB should give the experienced, active investor much to tinker with, which should feel familiar to TD Ameritrade customers or customers coming from other advanced trading platforms. But depending on your skill level, some features may be overwhelming. IB's fee structure for its Pro level can also be complex. Beginners may be interested in the broker's IB Lite platform, which offers commission-free trading on US-listed stocks and ETFs.
One of the biggest names in investing, Vanguard is known for:
Its large selection of quality ETFs and mutual funds
Its long-term investment options
Its low-fee index funds
As a leader in low-cost investing, Vanguard is an ideal choice for the buy-and-hold investor. But active traders can also benefit from commission-free stock trading.
Those saving for retirement will find a selection of more than 160 no-transaction-fee mutual funds from Vanguard and other companies and thousands of commission-free ETFs. The most passive investors can use Vanguard's digital advisor when their account reaches $3,000. Long-term investors with an eligible 401(k) retirement account can enroll with as little as $5. Vanguard charges 0.20% in advisory fees for its robo-advisory services.
But active investors may want more out of Vanguard, which lacks the research tools offered by TD Ameritrade and other competitors.
Account types
Brokerage, IRA, Education (529), Custodial, Trust
Annual fee
0.3%
Available asset types
Stocks, Options, Mutual funds, ETFs
Annual fee
0.3%
Pros and cons of TD Ameritrade
Pros
Commission-free online stock, ETF and options trades
$0 minimum investment
A leading trading platform with advanced research and charting tools
Extensive investment options
Cons
No fractional shares until integrated with Charles Schwab
No cryptocurrency trading
No robo-advisor until integrated with Charles Schwab, then a $5,000 minimum investment
How to transfer your brokerage account
If you’ve decided to switch brokers, your new broker should outline how to make the switch. TD Ameritrade uses the Automated Customer Account Transfer Service (ACATS) system and charges $75 to transfer all funds and close the account. Your new broker may reimburse you for this outgoing charge since you’re bringing them your business. Your new broker is typically the one that initiates the transfer. Follow these steps to transfer your account to another broker:
Get a statement from your old broker that includes information like your account number and current assets.
Log in to your new brokerage account and navigate to that broker’s account transfer services section.
Request to transfer your assets from your old broker into your new account. Your new broker will validate your request and initiate the transfer, which shouldn’t take more than six days to complete.
Each broker determines which types of assets are transferable. If an asset cannot be transferred, you should be given the option to liquidate your position ahead of the transfer.
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Finder is not an adviser or brokerage service. Information on this page is for educational purposes only and not a recommendation to invest with any one company, trade specific stocks or fund specific investments. All editorial opinions are our own.
Javier Simon is a freelance finance writer at Finder and a certified educator in personal finance (CEPF).
He’s featured on NerdWallet, Bankrate, Yahoo Finance and Fox Business, where he’s shared his expertise on personal finance topics, such as investing, retirement planning, taxes, budgeting and savings.
He has also covered breaking news, such as student loan forgiveness initiatives, the housing market and inflation’s impact on consumers’ wallets.
His passion is turning complex financial concepts into actionable content that can help people improve their financial lives.
Javier holds a bachelor’s degree in multimedia journalism from SUNY Plattsburgh.
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