WIKIFX REPORT: TD Ameritrade Brokerage Builds On Broad Strengths And Options Platform To Excel

In the midst of a merger, and deep into the coronavirus pandemic, TD Ameritrade brokerage continues to rely on its broad strengths and options trading platform to gain clients and place highly among the best online brokers.

TD Ameritrade ranked No. 4 overall in Investor's Business Daily's Best Online Brokers survey and placed No. 2 in its Options Trading Platform. It was second only to Tastyworks on Options Trading, which also placed No. 1 overall according to IBD's Best Online Brokers survey. In all, 10 brokers were included in the survey analysis. IBD recognizes the top five brokers overall and in each category as Best Online Brokers.

Among the 15 attributes that matter most to investors, TD Ameritrade also did well in Equity Trading Tools, Research Tools, Investment Research, Educational Resources and Original Programming (podcasts, videos, etc.).

“I'm quite happy with TD Ameritrade,” said Jery Meehan, a longtime client in New York. “I use Investor's Business Daily to do my research using tools like MarketSmith and SwingTrader, but I place all my trades on TD Ameritrade.”

TD Ameritrade Brokerage Gains Clients

TD Ameritrade grew its client base by 11% in 2020.

Charles Schwab (SCHW) acquired TD Ameritrade in October 2020 for $26 billion, lifting it above Fidelity in terms of the number of accounts. But getting that word out to customers may take some time, even though the pending acquisition was announced in November 2019. A number of TD Ameritrade clients reached by IBD said neither TD Ameritrade nor Schwab have reached out to them about the merger. In fact, some of them weren't even aware that TD Ameritrade had been acquired.

The two companies will continue operating separately until the companies are combined, which could take up to three years. “We have a very primary goal and that is to maintain stability in our clients' investing experience,” said JJ Kinahan, chief market strategist at TD Ameritrade. “We are seeing record-setting volumes across the industry. And we are keeping a stable client experience they can consistently count on as job No. 1.”

But Schwab has made it clear that TD Ameritrade's award-winning Thinkorswim trading platform will not go away. Any TD Ameritrade client will be able to keep it. In fact, it is likely to be offered to Schwab customers as well, says Barry Metzger, senior vice president, trading and education at Schwab.

Schwab Acquisition Of TD Ameritrade Will Take Time

“We are now working hard to bring our two great companies together, a process we expect to take 18-36 months,” said Metzger. “Schwab plans to adopt TD Ameritrade's award-winning Thinkorswim and Thinkpipes trading platforms, educational resources and tools as part of the integration.”

That's good news for retired stockbroker Carole Miller of Los Angeles, a longtime TD Ameritrade customer who now has a side business selling online gift baskets. She says she trades stocks every day. “I'm pretty happy with them. There's always someone knowledgeable to answer my questions.”

Miller said she just completed an options class through TD Ameritrade and is looking forward to placing her first options trade.

“Many people had more time in 2020 to learn about the market and their investments,” said Kinahan. “Due to this and due to the market movement throughout the year, we saw a 3x increase in our education usage year-over-year. The biggest shift in investor behavior was participation. After many years of wondering how we were going to attract new people to the market, we saw the events of 2020 spark interest in the individual investor in the markets.”

Ameritrade Brokerage Founders

Many advisors also hire TD Ameritrade and Schwab to hold customer assets. Advisors use both firms' tools to manage accounts, build portfolios and trade stocks on behalf of clients.

Online stock trading pioneer Joe Ricketts founded TD Ameritrade in Omaha, Neb., nearly four decades ago. He took the company public in 1997. TD Ameritrade was a pioneer in lowering brokerage clients' costs and trading commissions in the digital age.

Overall, TD Ameritrade ranks highly in the Educational Resources, Original Programming and Research Tools categories. Its extensive media and news offerings give customers a wealth of information at their fingertips for making trades. The company relies on these elements to raise the quality of service for customers.

Best Online Broker Options And Equities Trading Platforms

In this year's best brokerage accounts survey, broker clients rated TD Ameritrade as the No. 2 broker in Options Trading Platform and Equity Trading Tools. Tastyworks and TD Ameritrade's Thinkorswim platform were founded by the same group of people, namely Tom Sosnoff, Scott Sheridan and Kristi Ross.

Trade Execution Speed/Price, Website Security, Site Performance, Equity Trading Tools, and Customer Service emerged as the top five broker attributes valued by customers in our Best Online Brokers survey. The survey was based on more than 5,000 respondents between September and December 2020.

Based on survey results and survey participants' comments, the TD Ameritrade brokerage platform is geared toward intermediate to advanced-level traders who value customization capabilities and active trading. At the same time, TD Ameritrade offers an abundance of educational resources and investment research tools for beginners.