TD Ameritrade versus Fidelity Investments - compare IRA, commissions, investing fees, trading tools, account pros and cons. Which online broker is better?


Overview of Fidelity and TD Ameritrade

Two of the largest and most popular brokerage firms in the United States are Fidelity Investments and TD Ameritrade. Depending on your own trading habits, one of these firms may be the better choice. This article will look at the two companies in detail, and then make some suggestions.


Broker Fees

Broker Fees Stock/ETF
Commission
Mutual Fund
Commission
Options
Commission
Maintenance
Fee
Annual IRA
Fee
TD Ameritrade $6.95 $49.95 $6.95 + $0.75 per contract $0 $0
Fidelity $4.95 $49.95 $4.95 + $0.65 per contract $0 $0


Services

Broker Review Cost Investment Products Trading Tools Customer Service Research Overall Rating
TD Ameritrade
Fidelity


Range of Investments

The usual range of investments in the online brokerage world (stocks, bonds, options, mutual funds, and ETF’s) is available at both firms. Extended-hours trading is available at each broker, but only TD Ameritrade offers overnight trading.

Both companies also offer brokered CD’s and annuities. TD Ameritrade offers futures and forex, but Fidelity does not.

Besides the assets that can be traded, both broker-dealers also offer their clients assistance in important areas. Fidelity, for example, sells life insurance (in partnership with MassMutual). And both brokerage firms offer college savings plans.


Banking Features

Fidelity and TD Ameritrade offer very good cash management tools, although there are some differences between them. The primary similarity is that they both offer checks and a Visa debit card free of charge with unlimited ATM fee refunds.

At TD Ameritrade, free cash balances are swept to FDIC-insured banks, which results in $500,000 worth of insurance. This is twice the standard protection of $250,000. Fidelity, by contrast, uses up to five program banks, and this produces a much higher $1.25 million in FDIC protection.

At Fidelity, checks and a debit card can either be attached to an existing brokerage account, or customers can open a separate Cash Management Account. The CMA is a hybrid investment-deposit account. TD Ameritrade only offers the first option.

Besides cash, both brokerage houses also offer Visa Signature credit cards. Fidelity’s offers 2% cash back, while TD Ameritrade’s card offers 1.5% cash back plus a 10% bonus when awards are deposited into a TD Ameritrade account.


Technology

Ahhh...software. Yea, you probably want to know about this one if you plan on actually buying and selling anything. If you’re opening a self-directed account, you might want to learn how to place a trade.

And Fidelity has you covered in that department. You can download its desktop software Active Trader Pro and try it out with a virtual currency. You don’t even need to have a Fidelity account to do this.


Active Trader Pro


When we trialed it, we found Level II quotes, advanced charting, option chains (including multi-leg strategies), alerts, direct-access routing (to a few market makers), and streaming Bloomberg TV.

If you don’t need the complexity of the desktop system, you can trade with Fidelity’s simpler website. It still offers a lot of great features, including charting with all sorts of tools, and a pop-up order ticket that includes an extended-hours feature.

If you want to trade futures or currencies, you’ll need to download and install TD Ameritrade’s desktop platform thinkorswim. Like Active Trader Pro, it offers a demo mode so you can practice it before you commit real money. This is a good idea as the program is at a professional level.


TD Ameritrade Thinkorswim


Besides futures and forex, thinkorswim offers the ability to trade securities with direct-access routing (more venues than Fidelity offers) and complex order types. During our testing, we particularly liked the program’s advanced charting with hundreds of technical studies. Instead of Bloomberg, thinkorswim offers CNBC and a TD Ameritrade broadcast.

TD Ameritrade’s website, although lower in sophistication than thinkorswim, has a lot of great trading tools in its own right. A trade bar called SnapTicket is available at the bottom of the screen. It is able to place orders for options and equities. This should be enough for the needs of most traders. And charting on the website is also decent with multiple tools.

Both companies have skills for Amazon Echo and Echo Show. TD Ameritrade’s skill can place trades.


Mobile Apps

The Fidelity mobile app has some really great features. The first one we noticed was Touch ID when we logged in. Next, we saw all the great articles on financial news, courtesy of Bloomberg, Reuters, and other agencies. And we definitely liked streaming Bloomberg video news in HD. A chart can be rotated horizontally. There are 8 technical indicators and 5 graph styles.


Ameritrade vs Fidelity


The order ticket offers multiple order types and time-in-force options, but no direct-access routing or complex orders. The app offers a simpler order ticket with fewer choices.

TD Ameritrade clients can use three apps. One of these is a thinkorswim platform that offers very advanced charting with more than 100 studies and 6 graph styles. CNBC (in standard definition) streams instead of Bloomberg. thinkorswim’s order ticket is very advanced, with direct-access routing and complex order types.


Fidelity vs Ameritrade


Customer Support

Both brokerage firms offer customer service over the phone all hours of the day and night, 365 days a year. They also both offer AI chat service. We posed the same question to each robot, and TD Ameritrade’s did a better job of answering the question. Human chat is available some hours of the day at each firm.

TD Ameritrade has more than 360 brick-and-mortar locations throughout the United States, while Fidelity manages fewer than that amount. TD Ameritrade offers Chinese language service, but Fidelity does not.

As for the websites, self-help sections are available on both sites. We thought it was easier to find information and resources on TD Ameritrade’s.


Trading in Funds

Mutual and exchange-traded funds are available at each broker. One important difference between the two in this category is that Fidelity manages its own funds, while TD Ameritrade does not. There are 288 Fidelity mutual funds currently open to new investors. The company also has 12 ETF’s. Both the mutual funds and ETF’s have no transaction fees, and Fidelity recently eliminated minimum investments for its own mutual funds (ETF’s have a minimum of 1 share).

The total number of mutual funds at Fidelity stands at 10,538, and the brokerage firm offers about 1,800 with no load and no transaction fee. Our major gripe is that Fidelity’s screener is able to look for NTF funds, but not no-load funds.

TD Ameritrade’s mutual fund screener is able to look for no-load funds (we found 6,976 of them). Adding NTF status, we got 3,988. In total, there are 11,208 funds.

NTF mutual funds at TD Ameritrade that are sold in less than 6 months incur a short-term redemption fee of $49.99. At Fidelity, the timeframe is just 2 months, and the fee is $49.95.

As for ETF’s, they are available at each company. Fidelity offers 265 with no commissions (these are iShares and Fidelity funds). TD Ameritrade clients have access to over 300 ETF’s (from several fund families) with no trading fees.


Promotions

TD Ameritrade: Trade free for 60 days + get up to $600.

Fidelity: Get 500 free trades with $100,000+ deposit.



Investment Education

A great deal of financial research is available at either broker. Inside our TD Ameritrade test account, we found an education section with videos, courses, workshops, webcasts, articles, and links to in-person events. These resources cover a very wide range of topics, including how to trade options to the basics of fixed-income securities.

Fidelity offers a similar range of materials. We found webinars, videos, infographics, articles, and courses on a wide range of topics. These include technical analysis, charitable giving, and how to use the company’s software.

For stocks, a great deal of information is available at either firm. We did a search for equity reports on Facebook, and found 15 at Fidelity and 8 at TD Ameritrade.


Fidelity vs TD Ameritrade Summary

Fidelity outperforms its rival in cash management tools and pricing, while TD Ameritrade shines in software, range of investments and new customer promotion that essentially allows investors to create their portfolio for free.


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Open TD Ameritrade Account

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Open Fidelity Account


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