TD Ameritrade vs. Robinhood [2021]: 8 Important Differences to Know

We compare TD Ameritrade vs. Robinhood to discover how they’re the same, what makes them different, and which investing platform may be right for your goals.
Last updated Jan 12, 2021 | By Lee Huffman
TD Ameritrade vs. Robinhood

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TD Ameritrade and Robinhood both offer online brokerage platforms to make investing easier for consumers. One is an established powerhouse with over 45 years of experience and more than $1 trillion in assets. The other is a fintech startup that is trying to make investing accessible to everyone.

In this article, we'll compare TD Ameritrade vs. Robinhood to highlight what they're good at and how they're different so you can determine which one may be right for you.

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TD Ameritrade vs. Robinhood

Before we get into the details, let's look at an overview of TD Ameritrade vs. Robinhood. Knowing some basics will make it easier to choose how you’d like to go about investing money.

TD Ameritrade
Minimum investment $0, except for margin accounts, which require $2,000 $0, except for margin accounts, which require $2,000
Management fees None None
Asset classes
  • Stocks
  • Options
  • ETFs
  • Cryptocurrency
  • Mutual funds
  • Futures
  • Forex
  • Managed portfolios
  • Bonds amd fixed income
  • Annuities
  • Collateral lending
  • Stocks
  • Options
  • ETFs
  • Cryptocurrency
  • ADRs
  • Gold
  • Cash management
Account types available
  • Individual
  • Joint tenants
  • Traditional IRA
  • Roth IRA
  • Solo 401(k)
  • 529 Account
  • Trust Accounts
  • And more...
  • Individual accounts only
  • $0 commissions on online stock, ETF, and option trades
  • Live telephone customer support
  • Over 175 physical branches nationwide
  • Live help via in-app chat
  • Robust research tools
  • Unlimited commission-free trades
  • Crypto and gold available
  • Purchase fractional shares
  • Invest with as little as $1
Distributions Assets held in retirement accounts may be subject to required minimum distributions Brokerage accounts do not have required minimum distributions
Taxes Taxation depends on the type of account you open. Customers receive relevant tax forms based on their trading patterns and the performance of their investments. In general, brokerage accounts may trigger taxes, while certain retirement accounts may grow tax free. The sale of stocks in a brokerage trigger relevant tax forms for profits and losses. Additionally, dividend payments also result in tax forms. Brokerage accounts do not grow tax free like certain retirement accounts do.
Best for... Investors looking for a full-service brokerage with no commissions. Beginning investors and people wanting to purchase fractional shares using small-dollar investments.
Visit TD Ameritrade Visit Robinhood

How does TD Ameritrade work?

As a traditional brokerage, TD Ameritrade offers investors the ability to trade over the phone, in-person, online, or through its mobile app. It offers a full array of investment options for accounts of all types, including taxable brokerage accounts, retirement accounts, and company plans.

TD Ameritrade offers real-time streaming quotes, which provide the most accurate and up-to-date values of stocks, bonds, and exchange-traded funds. Additionally, investors have access to a full suite of free tools to research investments. In addition to researching investments, these tools also provide educational topics ranging from beginner to advanced. These tools are available online, as a desktop application, and through TD Ameritrade’s mobile app.

Investors have access to a wide variety of investment options. TD Ameritrade investors can purchase common investments like stocks, bonds, CDs, annuities, ETFs, and mutual funds. Sophisticated investments like options, futures, margin accounts, managed portfolios, and forex are also available.

TD Ameritrade has no account minimum to get started and has a low-cost fee structure, including $0 commissions on online stock trades, ETF trades, and options trading. Read our TD Ameritrade review for even more details.

TD Ameritrade Benefits

  • Enjoy $0.00 commission trades on stocks and ETFs
  • Open an account in less than 5 minutes
  • Intuitive online trading platform
  • 24/7 customer support

How does Robinhood work?

Robinhood is a fintech platform that works exclusively through its online portal and mobile app. As an online broker, it does not offer in-branch services, live support online, or telephone customer service like full-service brokerage firms. Robinhood is considered one of the best investment apps because it offers commission-free investing and the ability to purchase fractional shares.

Currently, Robinhood only offers individual brokerage accounts. You cannot open a retirement account for yourself or your business, a joint account, or a 529 for your child.

Investing options are focused on U.S.-based stocks, options, and ETFs, as well as American depositary receipts of select international stocks. Additionally, Robinhood investors may purchase cryptocurrency and gold. There is also the possibility of margin trading with a Robinhood Gold account. Read our Robinhood review for more information.

Robinhood offers an education portal for investors to learn topics ranging from the basics to advanced strategies. Customers may also subscribe to its Snacks newsletter, which distills the financial news into a quick read to start your day. For people on the go, Robinhood also publishes a daily podcast that breaks down three of the day's top stories in 15 minutes.

Robinhood Benefits

  • When you sign up, a surprise stock appears in your account
  • Commission-free trading with no account minimums
  • Trade stocks, options, and cryptocurrencies

What both investment platforms excel at

Both TD Ameritrade and Robinhood make it simple for investors to get started with only a small amount of money. Each company's technology platforms give investors the tools they need to help them make informed investing decisions.

TD Ameritrade offers $0 commissions, no platform or data fees, and no trade minimums. Investors can purchase stocks, ETFs, mutual funds, and options online without paying a commission. Robinhood also provides commission-free investing to its clients. Customers can purchase stocks, ETFs, options, and cryptocurrency without paying a commission.

The web platforms and mobile apps for TD Ameritrade and Robinhood provide in-depth tools for customers to make investing decisions. TD Ameritrade's tools are more robust and are available as online, desktop, and mobile applications. One of its options, the thinkorswim platform, offers elite-level trading tools in a fully customizable format. However, Robinhood was built from the ground up as a fintech company so it is not burdened by legacy systems that might be outdated.

8 important differences between TD Ameritrade and Robinhood

Although TD Ameritrade and Robinhood have some similarities, there are important differences to consider when comparing these trading apps:

  1. Years in business: When comparing TD Ameritrade vs. Robinhood, you're comparing an established veteran vs. a startup. TD Ameritrade has been in business for more than 45 years, while Robinhood was founded in 2013.
  2. Size of Assets Under Management (AUM): TD Ameritrade has $1 trillion of AUM and was recently acquired by Charles Schwab. Robinhood does not release its financials, but industry sources estimate it manages $40 billion of customer money.
  3. Account types: TD Ameritrade is a full-service brokerage and offers numerous account types to meet its customers' needs. With Robinhood, you can currently only open an individual brokerage account.
  4. Variety of investment options: Customers can invest in a wide variety of products with TD Ameritrade, including stocks, options, ETFs, mutual funds, and forex. Robinhood has fewer products to choose from, but they can satisfy the needs of beginner investors. Options include stock trading, ETF trading, options trading, cryptocurrency, and gold.
  5. Fractional shares: Only Robinhood allows customers to purchase fractional shares of stocks. These shares enable people to purchase a fractional interest in a stock even if they don't have enough to buy a whole share. With TD Ameritrade, investors must purchase whole shares of stock unless you are participating in a dividend reinvestment program (DRIP).
  6. Research tools: TD Ameritrade offers a robust selection of tools for online, desktop, and mobile devices at no extra charge. These tools include real-time streaming quotes, live help via in-app chat, and access to Federal Reserve data. Robinhood's research reports and tools focus on a more limited set of five indicators to enable customers to make investing decisions.
  7. Stability of its trading platform: Robinhood has a checkered past when it comes to outages. For example, its service was down at least twice in March 2020 while the stock market was collapsing due to coronavirus fears. This meant any investors who were interested in selling were unable to do so before their portfolios declined. In contrast, TD Ameritrade has received accolades from several industry leaders, such as Investor’s Business Daily and, for its customer service, platform and tools, and investor education.
  8. Customer service: With TD Ameritrade, customers can speak to a live person over the phone, via chat in the app, or in a physical branch. This access can provide a quick resolution to issues that arise. Robinhood does not have live customer service, and you can only speak with its support team via a website contact form and in-app messaging.

Which investment platform should you choose?

When it comes to investing money, choosing between TD Ameritrade and Robinhood should be based on your needs. Consider the type of account that you need, what investments you want to purchase, and how much money you have. Both investing platforms offer no-commission trading and robust digital trading interfaces. However, there are several differences that may help you decide which account is right for you.

TD Ameritrade has a broader appeal because of its full-service business model. Its accounts could be a smarter choice for these types of customers:

  • Investors who need multiple account types (e.g., individual brokerage, IRA, and 529) can open all these accounts with one company.
  • Customers who are unsure how to invest on their own and need questions answered by live customer service (phone, in-person, and chat).
  • People who are looking for specific investments, such as mutual funds, forex, and futures trading.
  • Those who want the backing of a large financial institution.

Robinhood's unique value proposition is that investors can purchase fractional shares of stocks. This means you could buy into companies like Apple, Tesla, and others with as little as $1. Investors that could be a good fit for Robinhood include:

  • Beginners who cannot meet minimum investment amounts at other companies.
  • Investors that want to use a dollar-cost averaging strategy to invest a set amount each month into fractional shares of one or more stocks.
  • Index-fund investors who want to learn how to buy individual stocks with small amounts of money.


Can I use Robinhood and TD Ameritrade?

Yes, you could have accounts with both Robinhood and TD Ameritrade at the same time. When comparing TD Ameritrade vs. Robinhood, each company offers features and benefits that the other does not. TD Ameritrade has a wider variety of account types and offers a full-service brokerage. Whereas Robinhood enables investors to purchase fractional shares of stocks, commission-free ETFs, and other investments without a large financial commitment.

Is Ameritrade good for beginners?

TD Ameritrade is a trading platform that could grow with you. Investors can open an account with no money and invest in stocks, bonds, ETFs, and other investments with $0 commissions. As you get more comfortable with investing, you could open additional types of accounts, like an IRA account, 529 account, or Solo 401(k), to address all your financial goals.

Is it smart to use Robinhood?

Robinhood could be a good place to open your first brokerage account, especially for investors interested in fractional share investing and commission-free trading. You could also use the platform's educational resources and your investing experience to learn how to become a smarter investor. If your balance grows, you might choose to stay with Robinhood or move your money to a full-service brokerage.

Can you actually make money on Robinhood or TD Ameritrade?

Yes, you might be able to make money with either of these investing platforms. These companies provide investors the ability to buy and sell investments with a low-cost structure. Keep in mind that there are no guarantees in investing. It is possible that your investments may lose value, and past performance is not an indicator of future results. We are not financial advisors and this is not investing advice.

Bottom line

TD Ameritrade and Robinhood are two of the best brokerage accounts because they each offer robust technology without all the trading fees. But each company provides unique features that makes it more suitable for a specific style of investor. TD Ameritrade is a full-service brokerage with live customer service, a variety of account types, and a wider range of investment options. Robinhood is a fintech startup that enables investors to start investing in fractional shares with as little as $1.

When comparing TD Ameritrade vs. Robinhood, don't just think about pricing. Think about what's most important to you as an investor. Are you interested in working up to day trading or are you a long-term investor? Do you have specific account types you need to open or are you just looking to get into the stock exchange?

As you build your investment portfolio and your investing knowledge, you could migrate from one to the other or open accounts at both to take advantage of the feature that suits your needs.

Robinhood Benefits

  • When you sign up, a surprise stock appears in your account
  • Commission-free trading with no account minimums
  • Trade stocks, options, and cryptocurrencies