TD Ameritrade versus Fidelity Investments - compare IRA, commissions, trading fees, tools, account differences, pros and cons. Which investment firm is best?

Challenge

Fidelity Investments and TD Ameritrade are two of the most well-established names in the brokerage industry. Both companies have been around for decades and have proven themselves as two of the main players in today’s competitive brokerage landscape. This article will compare these two giants head-to-head in various categories to determine who is superior in each category.

Comparison Table

TD Ameritrade Rating Fidelity Investments Review
Rating 4.5-star brokerage firm rating Fidelity Investments rating
Stocks $0 $0
Mutual Funds $49.99 $49.99
Initial Funding Requirement $0 $0
Inactivity Fee $0 $0
IRA Annual Fee $0 $0
Full Account Transfer $0 $0
Partial Account Transfer $0 $0
Account Closing Fee $0 $0
Trading Experience & Technology brokerage ratings brokerage ratings
Mobile brokerage ratings brokerage ratings
Research Amenities brokerage ratings brokerage ratings
Portfolio & Analysis Reports brokerage ratings brokerage ratings
Customer Service and Education brokerage ratings brokerage ratings
Open an account $0 stock/ETF trades + transfer fee refund. Open a Fidelity account and get $0 stock trades.

As you see from the table above, Fidelity Investments and TD Ameritrade are equally priced.


Investment Products & Services Offered

Both brokers offer trading in the most common investment products including stocks, ETFs, options, mutual funds, IPOs, and bonds. One main advantage of TD Ameritrade compared to Fidelity is that TD Ameritrade offers trading in futures, options on futures, and FOREX and Fidelity does not. One main advantage of Fidelity compared to TD Ameritrade is that Fidelity offers a fractional share trading program and TD Ameritrade does not.


TD Ameritrade vs Fidelity


Both brokers offer access to investment advisors either over the phone or in-person at one of their many investment branches. Both brokers offer one on one financial planning and guidance with an investment advisor. Fidelity offers estate planning and trust services, and TD Ameritrade offers neither.

Another advantage of Fidelity compared to TD Ameritrade is that Fidelity has a strong and diverse offering of investment options for investors who want to have their money managed for them and TD Ameritrade doesn’t offer anything in this category. Fidelity offers managed robo-advisor portfolios and TD Ameritrade does not. Fidelity offers a variety of managed accounts and TD Ameritrade does not offer any. Fidelity offers multiple wealth management programs and TD Ameritrade does not offer any.

It is important to note that even though TD Ameritrade doesn’t technically offer any managed accounts or fee-based investment services as Fidelity does, investors can access these accounts and services through TD Ameritrade’s owner and affiliate company Schwab.

Both brokers offer a fully paid lending program and a dividend reinvestment program. Both brokers offer cash management services such as check-writing, debit cards, and bill pay.


Fidelity Products


In the category of investment products and services, the winner depends on your investing needs. Fidelity has a broader range of products and services offered overall, but TD Ameritrade offers key products that Fidelity doesn’t. If you are a wealthy investor looking to hand your money over to a broker who can manage your money for you, then Fidelity certainly would be the better choice. If you are a futures or FOREX trader, then TD Ameritrade is your only choice of the two by default.


Types of Accounts Offered

Both brokers offer the same types of accounts including non-retirement brokerage accounts, IRA’s, custodian accounts, small-business retirement accounts, college savings accounts, business accounts, trust accounts, annuities, and charitable giving accounts.


Commissions, Fees, & Pricing

At the heart of both Fidelity and TD Ameritrade’s price offerings are $0 commissions for online US-listed stock, ETF, and options trades. One key difference between the two brokers is Fidelity’s $0 commissions apply to OTC stocks as well while TD Ameritrade charges $6.95 per OTC stock trade. Both brokers charge the same fee of $0.65 per contract for options trades. However, Fidelity charges no contract fee for buy-to-close orders of $0.65 or less.

Both brokers have an impressive selection of no transaction fee mutual funds with Fidelity having 3,398 and TD Ameritrade having 4,400+. Fidelity and TD Ameritrade both offer $0 commissions for US treasuries bought at auction and $1 commission per bond on online secondary marketplace transactions.

TD Ameritrade’s margin rates start at 11% for margin balances under $10,000 and their margin rates progressively drop down to 9% for balances between $250,000.00 - $499,999.99. Fidelity’s margin rates start at 9.825% for margin balances under $24,999 and their margin rates progressively drop down to 5.525% for margin balances over $1 million. Fidelity has lower published margin rates for every level of margin balance.


Trading Tools

TD Ameritrade has many advanced and technical trading tools that are most useful for day traders, options traders, FOREX traders, and futures traders. TD Ameritrade’s trading tools include powerful scanners for stocks and options, back-testing for options, the capability to write custom scripts, tons of customizable settings for layouts and charts, and multiple one-click order entry tools. TD Ameritrade’s greatest strength in trading tools is its amazing charts across all three of its trading platforms and especially in its desktop trading platform thinkorswim.


Is TD Ameritrade better than Fidelity


Fidelity has many great trading tools that are user-friendly for beginners and most useful for swing traders. Fidelity’s trading tools include a customizable and personalized dashboard, an options trade builder tool, detailed watchlists, and powerful screeners for stocks, ETFs, and mutual funds. Fidelity’s greatest strength in trading tools is the user-friendliness of its tools for beginners to experts.


Fidelity or TD Ameritrade


One of the main trading tools that TD Ameritrade offers that Fidelity doesn’t is paper trading. One of the main tools that Fidelity offers that TD Ameritrade doesn’t is its “Real-time Analytics” tool which allows you to get popup alerts when your selected price signals or technical patterns happen in real-time. Fidelity wins in the category of trading tools for beginners and non-technical investors. TD Ameritrade wins in the category of trading tools for advanced traders and technical investors.


Research Tools

Fidelity has great research tools for stocks, ETFs, options, bonds, and mutual funds. A few of Fidelity’s main research tools are research reports for stocks and ETFs, an “Equity Summary Score” which gives an overall rating to stocks, and a sectors and industries overview of the overall market. TD Ameritrade won Nerdwallet’s 2022 Best Online Broker for Stock Trading Platform and Research award. A few of TD Ameritrade’s main research tools are its “Investor Movement Index” which estimates the sentiment of retail investors, a huge database of economic data, and an all-inclusive company profile for many stocks.

Both Fidelity and TD Ameritrade have amazing research tools across the board, so both are winners in the category of research tools.


Education Resources

Fidelity has an entire section of its website dedicated to educational resources called the “Learning Center.” Fidelity’s Learning Center has educational materials such as getting started guides for different types of investing, advanced trading strategies, and how to analyze stocks. TD Ameritrade also has an entire section of its website dedicated to educational resources called the “Education Center.” TD Ameritrade’s Education Center holds educational content about topics such as personal finance, demonstrations of their trading tools, and advanced options trading strategies.

Both brokers have a tremendous amount of high-quality educational material, so they tie each other in the category of education resources.


Customer Service

Fidelity’s customer service is available 24/7, 365 through online chat and over the phone. Fidelity’s customer service representatives are knowledgeable, friendly, and will do whatever they can to try and make customers happy. TD Ameritrade’s customer service is also available 24/7 through online chat and over the phone. TD Ameritrade’s customer service is easy and relatively quick to get through to and their representatives are outstanding as well.

In the category of customer service, it’s a tie between Fidelity and TD Ameritrade because both have excellent customer service.


Website Comparison

Fidelity’s website allows trading for all of its products including fractional shares. Fidelity’s website provides a user-friendly trading experience for both new and experienced traders with features included for both. One of the highlights of Fidelity’s website, specifically for new traders, is the helpful tips and guides included in every step of the trading process.


Fidelity vs TD Ameritrade


TD Ameritrade’s website allows trading for all of its products except for futures and FOREX. TD Ameritrade’s website provides a user-friendly trading experience for new and experienced traders similar to Fidelity. TD Ameritrade’s website is quite easy to navigate and to find exactly what you are looking for when trading.


TD Ameritrade or Fidelity


Both websites have similar features and content including research tools, education materials, planning tools, account overviews, and the ability to perform various account transactions. Fidelity’s website has a more modern, sleeker user interface than TD Ameritrade’s website. The website comparison is a toss-up between the two that comes down to personal preference. If a winner has to be chosen, Fidelity’s website comes out ahead attributable to the better interface and more features overall.


Mobile App Comparison

Fidelity’s mobile app could be described as a bit archaic in looks but great in functionality. Fidelity’s mobile app allows you to trade on the go, create watch lists, perform cash management transactions, and research individual securities and the markets. One of the biggest downfalls of Fidelity’s mobile app is the poor charting features.


Fidelity Investments vs TD Ameritrade


TD Ameritrade’s mobile app has won awards including Investopedia’s 2022 award for best mobile app. TD Ameritrade’s mobile app has powerful features built for serious traders on the go and an excellent user interface to go along with it. TD Ameritrade’s mobile app has some of the best charting features in the industry as well as one of the best options trading interfaces in the industry.


TD Ameritrade vs Fidelity Investments


TD Ameritrade easily prevails as the winner in the mobile app category.


Promotions

TD Ameritrade: $0 stock/ETF trades + transfer fee refund.

Fidelity: Open a Fidelity account and get $0 stock trades.



Recommendations

Fidelity is the best choice overall for beginner and small balance investors because of its educational material, ease of use across all its platforms, and fractional share trading program. TD Ameritrade is the best choice overall for day traders and options traders because of its powerful trading platforms, options features, and advanced charting features. Both brokers are suitable for swing traders and long-term investors because of their excellent research tools.


Fidelity vs TD Ameritrade Summary

Both Fidelity and TD Ameritrade have many great strengths and not very many weaknesses overall. When comparing categories apples to apples, each broker has its share of clear victories over the other. However, the comparison of Fidelity vs. TD Ameritrade ultimately comes down to what type of investor you are and what your specific needs are. Overall, you can’t go wrong with either broker and you should absolutely try out both brokers to decide for yourself.


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Open TD Ameritrade Account

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Updated on 6/2/2022.



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