Vanguard vs. TD Ameritrade 2019

Both TD Ameritrade and Vanguard are among the largest brokerage firms, but the resemblance ends there. Vanguard is a reluctant participant in the online brokerage space, preferring to house its customer's assets in its proprietary mutual funds and exchange-traded funds (ETFs) rather than place frequent -- or even occasional -- trades.

TD Ameritrade, one of the largest online brokers, has several platforms to choose from, ranging from their basic website to thinkorswim (it’s not capitalized on purpose), which is designed for very active traders. TD Ameritrade offers copious education content, helping new investors to become more confident, and to trade additional asset classes as their skills grow. TD Ameritrade allows its customers to trade a wide variety of asset classes, including futures and complex options strategies.

In our 2019 Best Online Brokers Awards, Vanguard received an award for Best for ETFs.

TD Ameritrade received awards for Best Overall Online Brokers, Best for Beginners, Best Stock Trading Apps, Best for ETFs, Best for Options Trading, Best for Roth IRAs, Best for IRAs, Best for Day Trading and, Best Web Trading Platforms.

Vanguard focuses its considerable energy on helping its high wealth clients plan for retirement and other long-term goals. As such, its trading technology is lacking. Fulfilling their long-term focus, there is little of interest to active traders or derivatives traders.  There are no streaming quotes; you have to manually refresh the screen to get updates. You cannot trade complex options strategies on Vanguard.

TD Ameritrade customers can choose from several platforms, from their standard "green site" on the web to their platform for frequent options traders, called thinkorswim. The downloadable thinkorswim platform is extremely customizable, allowing the client to define color schemes, layouts, and trading defaults. Over the last year or so, the standard website has added numerous customization options, including the Dock tool, which is a customizable dashboard. Trade tickets are ubiquitous on all platforms, so you can enter an order no matter where you are. TD Ameritrade’s order routing algorithms seek out price improvement, which can offset the cost of placing a trade. You’ll find streaming real-time data on all platforms. 

Vanguard

• No streaming quotes
• No complex options
• Very simple trading experience with few creature comforts

TD Ameritrade

• Streaming real-time data on all platforms
• Customization options abound on thinkorswim, and the dock on the standard website can also be customized
• The smart order router seeks out price improvement.

Vanguard offers mobile apps for iOS, Android and Kindle Fire devices. The layout is actually much nicer and easier to use than the website. They added mobile check deposit in the last year. Quotes, however, are delayed. There is no online chat capability for contacting customer service.

TD Ameritrade has two mobile apps. The TD Ameritrade Mobile App is simple and mirrors most of the capabilities of the website. TD Ameritrade Mobile Trader is the mobile companion to the thinkorswim platform, letting you sync your watchlists, charts, and market scans between your desktop and your smartphone. Mobile Trader also gives you the tools to analyze and place complex options orders. You can watch streaming video produced by the TD Ameritrade Network on your mobile device as well. There are ways to connect with TD Ameritrade on Facebook Messenger, Twitter and WeChat.

Vanguard

• Very simple app, most useful for checking balances
• Data is delayed
• Mobile check deposit available

TD Ameritrade

• Streaming data on all mobile apps and websites
• Connect with TD Ameritrade's services on Facebook Messenger, Twitter, and WeChat
• Analyze and trade complex options strategies on TD Ameritrade Mobile Trader

Vanguard offers a stock screener, and a separate ETF screener. The mutual fund screener is very basic, and focuses on finding Vanguard funds even though they carry funds from many more fund families. Options research is limited to looking at options chains, which are significantly less informative than chains on other broker sites. Charting is extremely basic and includes no customization or technical studies.  There are plenty of calculators and planning tools for the long-term investor.

TD Ameritrade's thinkorswim platform lets you scan for trading opportunities using real-time data for equities and options. The TD Ameritrade website has multiple screeners, including an excellent bond screener and bond ladder builder. The news feeds can be filtered according to your portfolios and watchlists or by sector.

Vanguard

• Stock, ETF and mutual fund screeners available
• Planning tools for long-term investing are plentiful
• Extremely basic charting that lacks customization or technical analysis

TD Ameritrade

• Customizable charting on thinkorswim platform using real-time data
• Multiple screeners available on the website for stocks, ETFs, mutual funds, and fixed income
• News feeds and video content can be filtered by sector or by the contents of your watchlists

Vanguard's education offerings are fairly basic, and are aimed at very long-term investing. They host occasional webinars that focus on the longer term. The website is encrypted according to industry standards, and you'll face a security challenge when logging in from an unrecognized device.

TD Ameritrade has made education a major focus, bringing it onto their trading platform and expanding the amount and depth of their content. They have produced hundreds of 2-minute videos that can be found all over the Internet. Logging in from an unfamiliar device will prompt challenge questions and additional authentication.

Vanguard

• Education is basic, aimed at long-term investing and goal setting
• Webinars offered occasionally for long-term planning
• Security features include a challenge when logging in from an unrecognized device

TD Ameritrade

• The TD Ameritrade Network streams original video content throughout the trading day
• Hundreds of short videos on a wide array of investing topics
• Logging in from an unfamiliar device generates challenge questions

Vanguard's standard commission schedule is very high, at $7 per equity trade, and $7 plus $1 per contract for options. Margin rates are on the high side.  There are 1,800 ETFs you can trade without paying a commission, though, and clients with very high account balances are treated to much lower commissions.

TD Ameritrade's standard pricing is on the high side in the current marketplace, at $6.95 for a stock or ETF trade, and $6.95 per leg plus $0.75 for options. These prices include all exchange fees, though, so there won’t be any additional charges tacked on to surprise you, plus there are over 300 ETFs you can trade that are commission-free. Margin rates are also high. Frequent traders or those with high account balances can negotiate their own rates, but our review is based on the published rate schedule. 

Vanguard

• Stocks/ETF trade fees: $7
• Options fees: $7 per leg plus $1 per contract
• Futures fees: Futures trading not enabled

TD Ameritrade

• Stocks/ETF trade fees: $6.95
• Options: $6.95 per leg plus $0.75 per contract
• Futures fees: $2.25 per contract