Choosing between TD Ameritrade (now part of Charles Schwab) and E*TRADE (owned by Morgan Stanley) for mutual fund investing depends on fees, fund selection, and account features. Both platforms offer thousands of mutual funds, but key differences in pricing, research tools, and available funds may sway your decision.
Table of Contents
1. Mutual Fund Fees & Commissions
TD Ameritrade (Schwab Platform) Fees
- No-transaction-fee (NTF) mutual funds: 4,000+ (including Schwab, Vanguard, and Fidelity funds)
- Transaction-fee funds: $49.95 per trade (avoid these unless necessary)
- Expense ratios: As low as 0.02% (Schwab index funds)
E*TRADE Mutual Fund Fees
- No-transaction-fee (NTF) mutual funds: 6,000+ (larger selection than Schwab)
- Transaction-fee funds: $19.99 per trade (cheaper than Schwab’s $49.95)
- Expense ratios: Competitive, with many Vanguard and iShares funds available
Winner: E*TRADE (larger NTF selection and lower transaction fees)
2. No-Transaction-Fee (NTF) Fund Selection
| Feature | TD Ameritrade (Schwab) | E*TRADE |
|---|---|---|
| Number of NTF Funds | ~4,000 | ~6,000 |
| Schwab Funds Available | Yes (SWPPX, SWTSX) | Limited |
| Vanguard Funds | Some (but not all Admiral Shares) | More available |
| Fidelity Funds | Some (e.g., FCNTX) | Some (but not Zero funds) |
| Proprietary Funds | Schwab mutual funds | Morgan Stanley funds |
Key Takeaway:
- E*TRADE offers more NTF funds, including more Vanguard options.
- Schwab’s platform is best if you want Schwab funds (SWPPX, SWTSX).
3. Minimum Investment Requirements
| Fund Type | TD Ameritrade | E*TRADE |
|---|---|---|
| Schwab Index Funds (e.g., SWPPX) | $1 | $1,000 (if available) |
| Vanguard Admiral Shares (e.g., VFIAX) | $3,000 | $3,000 |
| Fidelity Funds (e.g., FCNTX) | $0 (sometimes) | $0 (sometimes) |
| E*TRADE Proprietary Funds | N/A | Some have $0 minimums |
Winner: TD Ameritrade (Schwab) for low-minimum index funds (e.g., SWPPX at $1).
4. Best Mutual Funds Available on Each Platform
Best Funds on TD Ameritrade (Schwab)
- Schwab S&P 500 Index (SWPPX) – 0.02% expense ratio
- Schwab Total Stock Market (SWTSX) – 0.03% expense ratio
- Fidelity Contrafund (FCNTX) – Actively managed growth
Best Funds on E*TRADE
- Vanguard 500 Index (VFIAX) – 0.04% expense ratio
- iShares Core S&P 500 (IVV) – ETF alternative (0.03%)
- JPMorgan Equity Income (OIEJX) – Strong dividend fund
Winner: E*TRADE for Vanguard funds, TD Ameritrade for Schwab funds.
5. Research Tools & Portfolio Analysis
TD Ameritrade (Schwab) Strengths
- Schwab’s Mutual Fund Evaluator (ratings, risk metrics)
- Portfolio Checkup Tool (asset allocation analysis)
- Strong ETF Screener (useful for comparing funds)
E*TRADE Strengths
- Morgan Stanley Research (premium insights)
- Power E*TRADE Platform (advanced charting)
- More third-party analyst reports
Winner: E*TRADE for research depth, Schwab for user-friendly tools.
6. Which Platform is Best for You?
Choose TD Ameritrade (Schwab) If You:
✔ Want ultra-low-cost Schwab index funds (SWPPX, SWTSX)
✔ Prefer $1 minimum investments
✔ Use Schwab’s banking services
Choose E*TRADE If You:
✔ Want more no-fee Vanguard funds
✔ Need better research tools (Morgan Stanley access)
✔ Prefer lower transaction fees ($19.99 vs. $49.95)
Final Verdict: TD Ameritrade vs. E*TRADE for Mutual Funds
| Category | Winner |
|---|---|
| Fees | E*TRADE (lower transaction costs) |
| Fund Selection | E*TRADE (more NTF options) |
| Minimum Investments | TD Ameritrade (Schwab’s $1 funds) |
| Research Tools | E*TRADE (Morgan Stanley edge) |
| Best for Index Investors | TD Ameritrade (Schwab funds) |
| Best for Active Investors | E*TRADE (more fund variety) |
Bottom Line:
- Passive investors → TD Ameritrade (Schwab’s SWPPX, SWTSX)
- Active investors → E*TRADE (more fund choices & research)
Would you like a deeper dive into specific fund comparisons or tax implications? Let me know how I can refine this analysis!
