Robinhood vs. TD Ameritrade

New and Notable

  • On May 17, 2022, Robinhood announced that it is building a brand new non-custodial, web3 wallet. The company will begin inviting waitlist customers to join its Beta program in the late summer and make the product generally available to all Robinhood customers by the end of 2022.

When Robinhood launched about a ten ago, its selling period was commission-free trade, with free stock, ETF, options, and crypto trades. now that most brokers have dropped commissions, Robinhood has lost that boundary. hush, the broker ‘s low costs, zero account minimums, and overall simplicity remain attractive to modern investors .

interim, TD Ameritrade ( TDA ) has been around since 1975 and is backed by decades of dependability and constancy. Compared to Robinhood, TDA offers a across-the-board diverseness of trading products, more educational offerings, and more robust trade software—including the pro-level thinkorswim platform. While Robinhood and TDA have few similarities, we ‘ll compare the two to help you decide which broke might be a better fit for your trading needs.

Investing in cryptocurrencies, Decentralized Finance ( DeFi ), and other Initial Coin Offerings ( ICOs ) is highly bad and inquisitive, and the markets can be extremely volatile. confer with a qualify professional before making any fiscal decisions. This article is not a recommendation by Investopedia or the writer to invest in cryptocurrencies nor can the accuracy or seasonableness of the information be guaranteed .

  • Account Minimum: $0
  • Fees: Free stock, ETF, and per-leg options trading commissions. $0.65 per options contract.

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serviceability

Robinhood makes it easy to open and fund an account on its app or web site, and there ‘s no dollar minimum to open or maintain an account. With TDA, you can besides get start via app or web site, but it ‘s a bit more challenge to pick the appropriate explanation type ascribable to the broke ‘s broader scope of offerings. Like Robinhood, there ‘s no minimum to open an account, but with either agent, you need at least $ 2,000 deposited in your account to use gross profit.  

Robinhood ‘s web site is streamlined and easy to navigate, which may be a function of the broke ‘s limited offerings. Its mobile app and web site are similar enough that it ‘s easy to bounce between the two interfaces. still, there ‘s not much you can do to personalize the experience, which may be frustrating for experienced traders and investors who have come to expect that capability.  

TDA ‘s web site is clean, well-organized, and easy to navigate, and you ‘ll find a well assortment of educational subject, including articles, videos, webinars, and a glossary. While both brokers offer streaming quotes, TDA ‘s are delayed by default, which means you could miss cardinal grocery store moves. however, you can enable real-time quotes in your history visibility.  

overall, we found Robinhood makes a decent starting position for newfangled traders, specially those who have a small bill and want to trade fair a share or two at a time—or those interested in a very minute range of assets. At the same time, TDA is a better fit for investors and traders of all experience levels who want a more full-bodied and customizable deal experience and access to more products.  

Trade experience

Desktop Trade Experience

Robinhood and TDA offer different trade experiences, but that may not be a surprise considering the two brokers ‘ prey customers. Robinhood ‘s trade platform has limited functionality compared to many brokers ( including TDA ). You ca n’t customize anything, stagecoach orders, or trade directly from the chart. furthermore, while there ‘s a bare trade ticket for equities, the orderliness introduction process for options is complicated. More importantly, Robinhood has been the subject of examination ( and litigation ) due to recurring platform outages and trade restrictions .

TDA offers a more robust and reliable trade experience. casual traders will find everything they need on its web-based trading platform. Experienced, tech-savvy traders and investors will gravitate toward thinkorswim ( TOS ), TDA ‘s flagship platform. Thinkorswim is in full customizable, modern-looking, and offers a wax suite of analysis tools. There ‘s besides a trade simulator that lets you create and test studies using the thinkScript scheduling linguistic process. overall, TDA has a hearty moderate in terms of features and functionality.

mobile Trade experience

While Robinhood offers a web-based platform, it ‘s a mobile-first party. The app targets investors who want a simpleton trading feel without any bells or whistles. It’s extremely easily to use, but you wo n’t find many of the lapp tools that larger brokers offer. still, you can trade all available asset classes and access streaming real-time quotes and charts .

TDA supports two mobile apps : the beginner-friendly TD Ameritrade Mobile App and the active trader-focused thinkorswim Mobile. Both are robust and offer a big deal of functionality, including chart and watchlists. Streaming real-time data is included, and you can trade the same asset classes on mobile as on the other platforms .

On the App Store, Robinhood has importantly more reviews, but TDA has a slenderly better rat. Robinhood has a 4.2-star rate from some 3.9 million reviews, while TDA has 4.5 stars from about 105,000 reviews. overall, we found that Robinhood ‘s app is more straightforward and fun to use, while TDA ‘s app is superior in features and functionality.

scope of Offerings

Robinhood supports a minute crop of asset classes. You can trade stocks ( no shorts ), ETFs, options, and cryptocurrencies, including Bitcoin ( BTC ), Bitcoin Cash ( BCH ), Bitcoin SV ( BSV ), Dogecoin ( DOGE ), Ethereum ( ETH ), Ethereum Classic ( ETC ), and Litecoin ( LTC ). TD Ameritrade offers more products, including reciprocal funds, bonds, futures, forex, and a Robo-advisory service. Unless you’re looking for crypto, TDA takes the win here .

Robinhood vs TD Ameritrade Range of Offerings
Asset Robinhood TDA
Short Sales  No Yes
No-Load, No-Fee Mutual Funds  0 Nearly 4,000
Bonds  No Yes
Futures/Commodities  No Yes (futures only)
Futures Options  No Yes
Complex Options  4 legs 4 legs
Robo Advisory No Yes
Cryptocurrency  Yes Bitcoin futures only
International Exchanges 0 1 (Canada)
Forex No Yes
Fractional Shares  Yes No
OTCBB and Penny Stocks No Yes

order Types

With Robinhood, you can place market, limit, stop limit, trailing arrest, and stop orders on the web site and mobile platforms. It does n’t support conditional orders on either platform. The nonpayment monetary value basis is first-in-first-out ( FIFO ), but you can request to change that .

TD Ameritrade offers a bigger selection of ordain types, including all the common suspects, plus trailing stops and conditional orders like one-cancels-the-other ( OCO ). There are no restrictions on order types on the mobile platform, and you can stage orders for subsequently entry on all platforms. It’s possible to select a tax distribute before you place an order on any platform .

trade technology

Robinhood does n’t publish its trade statistics, so it ‘s intemperate to rank its payment for order flow ( PFOF ) numbers. While the diligence criterion is to report PFOF on a per-share basis, Robinhood uses a per-dollar basis. The company does n’t disclose its price improvement statistics either. however, its target customers tend to trade small quantities, therefore price improvement may not be a big refer .

TD Ameritrade ‘s decree routing algorithm aims for flying execution and price improvement. It publishes price improvement statistics that show most marketable orders get good over 2 cents per parcel ( $ 0.0219 ) in price improvement, on median. TD Ameritrade receives some PFOF but claims its ordering execution engine does n’t prioritize it .

Costs

Robinhood ‘s trade fees are elementary : you can trade stocks, ETFs, options, and cryptocurrencies for absolve. At TDA, online equity, options, and ETF trades are $ 0 ( there ‘s a $ 0.65 per sign choice fee ), and futures are $ 2.25 per compress. There are no platform or data fees, and broker-assisted trades run $ 25 ; interactional voice reaction ( IVR ) call system trades are $ 5.

overall, Robinhood may be cheaper if you trade a lot of options. otherwise, the costs are the lapp if you chiefly trade stocks and ETFs, making this category besides close to call.

inquiry Amenities

predictably, Robinhood ‘s inquiry offerings are limited. There are no screeners, investing-related tools, or calculators, and the chart is basic. That being said, market news is available from several reputable outlets, and you can access Morningstar research if you’re a Robinhood Gold node ( $ 5/month subscription ) .

TDA offers customizable screeners for stocks, ETFs, options, fixed income, and common funds. The progress chart tools should be more than adequate for most retail investors and traders, and you ‘ll besides find backtesting capabilities. TDA offers real-time streaming news from a boastfully survival of in-house and third-party sources, along with more than 130 hours of live broadcast trader-focused content each day. If you are looking for a versatile batting order of account and research amenities, TDA is by far the better choice.

portfolio analysis

Robinhood ‘s portfolio analysis tools are slightly limited, but you can view your unfulfilled gains and losses, sum portfolio respect, buying ability, margin data, dividend history, and tax reports. TDA clients have access to real-time buy power and allowance data, internal pace of return, and unfulfilled and realize gains. monthly tax reports are accessible directly from the web site, and you can combine holdings from outside your account to get an overall horizon. Overall, TDA has the edge over Robinhood in the portfolio psychoanalysis department .

education

Robinhood ‘s educational articles are easy to understand ( and even entertaining ) but do n’t expect any deep dives. It can be arduous to find what you’re looking for because the content is posted in chronological order ( and not organized by topic ). There are n’t any videos or webinars, but the day by day Robinhood Snacks newsletter and 15-minute podcast offer useful and lively information .

TD Ameritrade provides a full-bodied library of educational content, including articles, glossaries, videos, and webinars. It averages several hundred webinars a month and hosts live events each year. Overall, TDA comes out ahead ascribable to its width of topics and multiple delivery format.

Customer Service

Robinhood handles its customer service through the app and web site, and you ca n’t call for avail since there ‘s no inbound phone number. meanwhile, TDA has 24/7 accompaniment, live chat capabilities for stream customers, and chatbots on Twitter, Facebook Messenger, Apple Business Chat, and WeChat ( in Asia ). overall, we found TDA ‘s customer military service offers better flexibility and dependability .

security

TD Ameritrade ‘s security is up to industry standards. You can log into the app with biometric ( grimace or fingerprint ) recognition, and you’re protected against account losses due to unauthorized or deceitful activity. TD Ameritrade carries excess Securities Investor Protection Corporation ( SIPC ) indemnity provided by London insurers, giving each customer $ 149.5 million deserving of securities protective covering and $ 2 million of protection for cash .

Robinhood ‘s technical security is up to standards, but it lacks the excess SIPC indemnity. however, your cash and securities are distillery protected by standard SIPC indemnity for up to $ 500,000 ( including $ 250,000 for cash claims ). In November 2021, Robinhood had one reported data gap affecting 7 million people. TDA did not have any significant data breaches reported by the Identity Theft Research Center at the fourth dimension of writing .

While not a security write out, it ‘s worth noting that Robinhood derives most ( 77 % for the year 2021 ) of its gross from requital for order flow. The SEC recently announced it is considering a full ban on payment for arrange stream practices because it creates “ an built-in battle of matter to, ” according to SEC Chairman Gary Gensler. Bans are already in effect in Australia, Canada, and the U.K. Additionally, Robinhood faces dozens of class-action lawsuits over trade halts and platform crashes that reportedly led to fiscal losses for millions of Robinhood users .

Our verdict

With a childlike app and web site, Robinhood offers a no-frills trading experience. If you’re new to investing and trading with a belittled poise, Robinhood could be a good place to gain experience before switching to a more versatile broker. Of naturally, if you are concerned about Robinhood ‘s outages and trade restrictions—or its payment for decree stream practices—other zero-fee brokers may provide a more predictable and reliable trade have. overall, we have n’t been fans of Robinhood ‘s efforts to gamify endow, and some of those concerns come out in these comparisons .

TD Ameritrade may not be as “ fun ” as Robinhood, but casual traders and investors will appreciate its intuitive trading platforms, comprehensive educational offerings, and full-bodied resources. The thinkorswim chopine besides makes TD Ameritrade a good choice for more have and patronize users matter to in taking an active approach to their investments. overall, TD Ameritrade is the better choice whether you’re a founder who wants a broader crop of trading products or an active trader looking for a more robust deal experience.

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Methodology

Investopedia is dedicated to providing investors with indifferent, comprehensive reviews and ratings of online brokers. Our reviews are the result of months of evaluating all aspects of an online broker ’ mho chopine, including the exploiter feel, the choice of deal executions, the products available on its platforms, costs and fees, security, the mobile experience and customer service. We established a rat plate based on our criteria, collecting thousands of data points that we weighed into our star-scoring system.
Click here to read our full methodology .

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