Charles Schwab vs thinkorswim 2023
thinkorswim vs. Charles Schwab Introduction
Investors at Charles Schwab have an excellent lineup of trading software with the company’s StreetSmart
platforms. Similarly, TD Ameritrade customers get to use thinkorswim tools. To find out which broker is
the outperformer here, keep reading.
TOS vs Schwab: Fees
| Broker Fees |
Stock/ETF
Commission |
Mutual Fund
Commission |
Options
Commission |
Maintenance
Fee |
Annual IRA
Fee |
|
Thinkorswim
|
$0
|
$49.99 ($0 to sell)
|
na
|
$0
|
$0
|
|
Charles Schwab
|
$0
|
$49.95 ($0 to sell)
|
$0 + $0.65 per contract
|
$0
|
$0
|
Services
Visit Websites
TD Ameritrade/Thinkorswim: Get $0 commissions and ACAT fee reimbursement.
Charles Schwab: Get commission-free online stock trades.
Overview of Trading Software
Schwab offers trading software called StreetSmart. It is available in three modes: Mobile, Central, and Edge. Mobile is self-explanatory. Central is a browser-based platform, and Edge is a desktop program.
TD Ameritrade does the same with thinkorswim, although there are no discrete names for the different platforms. Although both Schwab and Ameritrade have other trading platforms, such as websites, this article will focus just on the thinkorswim and StreetSmart platforms.
Tradable Assets
StreetSmart Mobile and Central can submit orders for stocks, OTC stocks, foreign stocks, ETFs, closed-end funds, and futures contracts. For whatever reason, Edge doesn’t have the ability to trade futures.
thinkorswim in all three versions can trade the above products minus foreign stocks plus forex. Neither brokerage firm offers trading in cryptocurrencies.
Winner: thinkorswim
Mobile Apps
The StreetSmart Mobile app has a trade ticket with some advanced order types like contingent on price and OTO (one triggers the other). It’s easy to switch between equities and futures on the trade ticket. On an asset’s profile, there is limited information, such as 52-week range and average volume. A small chart begins the charting experience. Double tapping it produces an interactive chart that can be rotated horizontally.
The thinkorswim app has even barer profiles. Charting, however, is on a much higher level with hundreds of technical studies and several drawing tools. Level II quotes are available as well (they are missing in action on the StreetSmart app).
During our testing of the thinkorswim platform, we did not find any display problems. We did find a few glitches on the StreetSmart app using an iPhone 6 (bid and ask prices overlapping on the trade ticket, for example).
Winner: thinkorswim
Browser Platforms
StreetSmart improves drastically in Central form. This will be found on Schwab’s website (look for it under the Trading Hub link in the upper-right corner). During our test drive of the software, we found an All-In-One trade ticket that can trade futures, stocks, and more. There are many advanced order types, including contingent and market on close.
Charts on Central have 12 plot styles, roughly 40 drawing tools, and well over a hundred technical studies. Although right-click trading is unavailable, there is a trade button in the upper-right corner of a graph.
thinkorswim in web-browser format loses a lot of technical studies. We counted less than 30 of them. There is only one graph style (candlestick), and there are no drawing tools of any kind.
Despite the obvious weakness here, thinkorswim does have a very good trade ticket with several advanced order types. It also has paperMoney, which is a practice mode.
Winner: Schwab
Desktop Software
StreetSmart and thinkorswim find their highest forms in desktop mode. StreetSmart Edge has some really powerful tools that won’t be found on other versions of StreetSmart. These include profit-loss diagrams, Recognia analysis, Level II quotes, and live streaming of CNBC at no cost.
The trade ticket on Edge has a discrete sell short button, a feature that won’t be found on any thinkorswim platform. Charts once again have lots of tools, and this time there is a right-click menu.
thinkorswim users will find a lot of the same resources. These include very good charting with tons of tools. In fact, thinkorswim outperforms here with the return of nearly 400 technical studies, much more than Edge’s 50, which is less than Central has.
thinkorswim also has a very good order ticket with several advanced trade types, including blast all and contingent. Profit-loss diagrams are strangely absent from the ticket, which do appear on Edge’s ticket.
thinkorswim has a large library of learning resources. This treasure trove of materials will be found, conveniently enough, under the Education tab on the platform.
Winner: thinkorswim
Margin
Margin trading is possible on both the StreetSmart and thinkorswim platforms. It’s possible to upgrade an account to margin status on either broker’s website.
As for cost, Schwab usually has slightly lower rates. Right now, it charges 10,125%to 12,825% for debits. A debit above $250k is required to get to the cheapest tier.
At TD Ameritrade, the range is 12% to 14%. At both firms, margin loans above $500k receive negotiated interest rates.
Unfortunately, neither thinkorswim nor StreetSmart displays margin details on specific assets.
Winner: Schwab
Day Trading
Routing Fees and Rebates: Maker-taker fees are not available at either brokerage firm in this survey.
Shorting: Both firms do permit short positions. As already mentioned, StreetSmart Edge has a discrete sell short button (the software also displays short details on an entered ticker symbol, such as % of outstanding shares currently shorted).
Level II Quotes: All three versions of thinkorswim have Level II data. Only one version of StreetSmart (Edge) has the quotes.
Extended Hours: Pre-market and after-hours trading are both possible on both platforms. thinkorswim beats Schwab by a few minutes in total trading time. Plus, TD Ameritrade offers a select list of ETFs for overnight trading on thinkorswim.
Direct-access Routing: Both Edge and thinkorswim offer direct access to ECNs and market venues.
Winner: thinkorswim
Other Services
DRIP Service: Available at both firms.
Individual Retirement Accounts: thinkorswim and StreetSmart can place trades for IRAs.
Fractional-Share Trading: Although Schwab does offer trading in the 500 stocks of the S&P Index, these trades cannot be submitted on the StreetSmart platforms.
Initial Public Offerings: Both brokers offer access to upcoming IPOs.
Winner: Draw
Visit Websites
TD Ameritrade/Thinkorswim: Get $0 commissions and ACAT fee reimbursement.
Charles Schwab: Get commission-free online stock trades.
Recommendations
Beginners: The thinkorswim desktop system has a steep learning curve, although it does offer simulated trading. The browser version is easy to use. The opposite situation exists with StreetSmart, and only the desktop version has practice trading. Either broker can be defended.
Stock & ETF Trading: Either.
Small Accounts: Neither firm has any fees or minimums.
thinkorswim vs Schwab: Recap
Both firms and their trading platforms have performed well here. Either one will be a good choice. Forex traders should definitely go with thinkorswim, while short equity traders will want to use Edge.