Interactive Brokers vs TD Ameritrade 2024 - Online Trading (2024)

Comparison of Interactive Brokers vs TD Ameritrade

Overall, both brokers offer a range of investment options and competitive pricing, with Interactive Brokers offering more advanced trading tools and a wider range of investment options, while TD Ameritrade offers a user-friendly interface and a wider range of educational resources. Ultimately, the choice between the two will depend on your specific needs and preferences.

Assets Offered

Investors looking to trade a wide range of asset types will be pleased with what both TD Ameritrade and Interactive Brokers have to offer. These online brokerage platforms are known for their diverse product offerings, including stocks/ETFs, mutual funds, fixed income securities, futures/commodities options trading, CDs, foreign exchange trading (Forex), and more.

When it comes to no-load mutual fund options specifically, IBKR edges out TDA in terms of the number available. However, both brokers offer access to thousands of mutual funds from well-known providers such as Vanguard and Fidelity Investments.

For traders interested in international exchanges outside the United States market arena though there is a clear winner between these two brokers. IBKR provides access to 95 different international exchanges while TDA only offers one. Additionally IBKR supports traders located in over 200 countries worldwide thereby making it ideal for investors who want global reach.

Speaking about forex trading exclusively however reveals that when it comes down to currency pairs offered by each platform then definitely again we see that Interactive Brokers has an edge over its competitor offering more currency pairs using many more currencies than TDA’s limited selection.

Although both platforms provide excellent products within their respective markets – U.S. Stocks and Options Trading – users can certainly find something interesting suited towards their investment style among these offerings; yet where Interactive Brokers shines above all else is through its breadth of products covering markets around the world which is unrivaled by any other online broker.

Fees and Commissions

When it comes to investing in the stock market, fees and commissions can significantly eat into your returns over time. That’s why it’s crucial to choose a brokerage that offers fair pricing structures without sacrificing quality trade executions.

In this section, we will examine Interactive Brokers’ (IBKR) and TD Ameritrade’s fee schedules, exclusively for U.S. dollar-based trading. While IBKR provides various commission options based on different countries they operate in, we’ll focus solely on their three choices for U.S. customers – IBKR Lite, IBKR Pro Fixed, and IBKR Pro Tiered.

For zero commission trading with no account minimums or fees of any kind, you can opt-in for IBKR Lite. Meanwhile, both fixed ($0.005 per share traded; minimum $1 per order) and tiered pricing options (scaled by monthly volume committed), are available under their Pro plan – offering flexibility depending upon your frequency of trades.

Notably, there is no additional fee when opting into multi-leg option strategies under the Pro plan, only a rate-per-contract (RPC) charged at execution stage which decreases progressively as volumes increase every month. This could be an attractive proposition compared to other brokers who charge a ‘per-leg’ basis cost structure.

On the margin rates side tiers also come into play with varying interest rates on borrowing depending upon how much money one borrows against collateral held in their accounts; while those using Lite pay 5.58% annually regardless of amount borrowed at any given point throughout the year.

Moving onto TD Ameritrade’s price setup now. TD Ameritrade does not have any charges attached to stocks or ETF trading. However, there is a $5 charge per executed order plus $0.65 charged for each contract traded in options trading.

For margin rates, TD Ameritrade splits it up into tiers with interest rates ranging from 12.5% to 10.5%, depending on the amount you borrow and your account balance.

Overall, while TD Ameritrade offers competitive fee pricing for zero commission trades – IBKR comes out ahead when considered holistically as their transparent and scalable “Pro” plan provides attractive benefits in terms of multi-leg option strategies costs, lower overall commissions based on volume traded every month (versus fixed or flat rate structures),and tiered borrowing expense structures that can result in significant savings over time compared to other brokerage firms.

Regulation and Security

When it comes to online investing, security should always be a top priority. The last thing you want is for your personal information or hard-earned money to fall into the wrong hands. That’s why we took a closer look at Interactive Brokers (IBKR) and TD Ameritrade (TDA) regulation and security measures, to see how they stack up.

One important factor to consider is whether these brokers have experienced any data breaches or outages in recent times. Neither broker has had any such incidents over the past year, giving their clients peace of mind when trading online.

Both IBKR and TDA offer strong authentication measures like two-factor authentication and biometric recognition for added protection against unauthorized access. Additionally, both provide Excess SIPC protection which covers losses above $500k per account up to $149 million with TD Ameritrade compared to $30 million with Interactive Brokers.

If there’s ever an opportunity for class action lawsuits involving securities fraud cases where customers may be eligible for compensation, then Interactive Brokers offers Securities Class Action Recovery service which can file claims on behalf of its customers with a contingency fee of 20%.

Overall, both brokers surpass industry standards when it comes to security features thereby ensuring safety while trading investments online regardless of whether one chooses between them based on other factors like pricing scheme, investment attitude etc.

Customer Support

When it comes to investing, customer service can be a deciding factor for many traders. Investors want to know that they have access to fast and reliable support if something goes wrong or they need assistance with their account. In this section, we will take a deep dive into the customer service options offered by TD Ameritrade and Interactive Brokers.

TD Ameritrade offers customers several ways to get in touch with their support team, including email, live chat, phone support, and even direct access to financial advisors who can help answer questions about investments or provide guidance on trading strategies. This range of options makes it easy for investors to choose how they want to communicate with TD Ameritrade’s knowledgeable staff.

On the other hand, IBKR has an AI-powered tool called IBot that helps users find helpful resources within their platform quickly. IBot encourages users to always first try finding answers there before contacting customer support directly – allowing them faster self-service solutions without having someone else do your work for you unnecessarily.

While both companies offer excellent customer service options overall, TDA is faster than IBKR at answering phones which could be key when timing is crucial during market hours like early morning pre-market after-hours trading calls etc., but one area where TD Ameritrade shines is in its registered investment advisor (RIA) program – something not available through Interactive Brokers.

Conclusion

Both TD Ameritrade and Interactive Brokers are elite companies in the online brokerage world. While IBKR is the best for advanced traders and international trading, TD Ameritrade is the best for beginner traders and mobile-usage. Ultimately, it comes down to what you’re looking for in a trading platform and your personal preferences.