TD Ameritrade Thinkorswim: Commission Structure
AAA
  1. TD Ameritrade Thinkorswim: Introduction
  2. TD Ameritrade Thinkorswim: Account Types And Minimum Deposits
  3. TD Ameritrade Thinkorswim: Services Offered
  4. TD Ameritrade Thinkorswim: Commission Structure
  5. TD Ameritrade Thinkorswim: Customer Support
  6. TD Ameritrade Thinkorswim: Analysis Tools
  7. TD Ameritrade Thinkorswim: Conclusion

TD Ameritrade Thinkorswim: Commission Structure

By Cory Mitchell

When using the thinkorswim trading platform, fees fall under the "Internet" category and are cheaper than the fees charged by TD Ameritrade if making a trade by phone or with a broker's assistance. While many products can be traded on thinkorswim, the commission and fee structure is fairly straightforward. When trading online the cost of a trade is a $9.99 flat fee, when trading stocks and ETFs (commission free ETFs are available and will be discussed shortly). Figure 3 shows stock related fees.

Figure 3: TD Ameritrade Stock Trading Commissions (Feb. 2, 2012)


Options can be traded for $9.99 plus 75 cents per contract, and futures can be traded for $3.50 per contract.

TD Ameritrade offers "commission free" ETF trading in a specific list of eligible funds. There is no fee for buying the ETF as long as the trade is held for at least 30 days. If the ETF is liquidated before the 30-day period a "short-term trading fee" is applied.

For fixed-income products, the commission is largely determined on a "net yield basis." This means that the quoted price on bonds or CDs is marked up, thus the price seen includes the fee charged by TD Ameritrade. Forex trades work in a similar fashion. The price at which traders can transact will include a markup. Therefore, there is no commission, but rather TD Ameritrade makes money by including their markup in the quoted price or by being compensated by the liquidity providing forex dealer. When trading forex in 10,000 unit increments, there are no commissions charged in addition to the forex spread markup. When trading in 1,000 unit increments there is a 10 cents commission per unit, with the minimum commission being $1.

Treasuries purchased at an auction have a $25 flat fee.

Trading accounts often include margin, which is when a trader is only required to put up a portion of the cost of the transaction. This essentially means the broker is extending credit to the trader, and interest is charged.

Figure 4: Margin rates as of Feb. 3, 2012


Market data, which includes real-time charting and live quotes, is free for non-professional clients (retail traders). Miscellaneous fees may be charged though for withdrawals, transfers, stock certificate delivery, etc. Therefore, it is important to read the current fee structure before trading. TD Ameritrade Thinkorswim: Customer Support

  1. TD Ameritrade Thinkorswim: Introduction
  2. TD Ameritrade Thinkorswim: Account Types And Minimum Deposits
  3. TD Ameritrade Thinkorswim: Services Offered
  4. TD Ameritrade Thinkorswim: Commission Structure
  5. TD Ameritrade Thinkorswim: Customer Support
  6. TD Ameritrade Thinkorswim: Analysis Tools
  7. TD Ameritrade Thinkorswim: Conclusion
RELATED TERMS
  1. Exchange-Traded Fund (ETF)

    A security that tracks an index, a commodity or a basket of assets ...
  2. Compound Annual Growth Rate - CAGR

    The Compound Annual Growth Rate (CAGR) is the mean annual growth ...
  3. Return On Investment - ROI

    A performance measure used to evaluate the efficiency of an investment ...
  4. Systematic Manager

    A manager who adjusts a portfolio’s long and short-term positions ...
  5. Unconstrained Investing

    An investment style that does not require a fund or portfolio ...
  6. Sharpe Ratio

    A ratio developed by Nobel laureate William F. Sharpe to measure ...
RELATED FAQS
  1. What does a high turnover ratio signify for an investment fund?

    If an investment fund has a high turnover ratio, it indicates it replaces most or all of its holdings over a one-year period. ... Read Full Answer >>
  2. What is the difference between passive and active asset management?

    Asset management utilizes two main investment strategies that can be used to generate returns: active asset management and ... Read Full Answer >>
  3. What percentage of a diversified portfolio should large cap stocks comprise?

    The percentage of a diversified investment portfolio that should consist of large-cap stocks depends on an individual investor's ... Read Full Answer >>
  4. Why should an investor include an allocation to the telecommunications sector in ...

    An investor should include an allocation to the telecommunications sector in his portfolio, because telecom offers an investor ... Read Full Answer >>
  5. What are some mutual funds that do not have 12b-1 fees?

    Some of the most popular and best-performing mutual funds that do not include any 12b-1 fees in the expenses charged to fund ... Read Full Answer >>
  6. Are there mutual funds that take advantage of merger arbitrage?

    A few select mutual funds focus investing on merger arbitrage. Among these are the Merger Fund, the Arbitrage Fund and the ... Read Full Answer >>

You May Also Like

Trading Center
×

You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!