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TD Ameritrade (Thinkorswim)

  • #1
  • First Post: Apr 23, 2017 4:08pm Apr 23, 2017 4:08pm
I've searched the forum up and down and it seems like there hasn't been much recent discussion on Thinkorswim forex trading. I've paper traded with their live feed platform for about 2 years and have had a live account for the past 6 months. I am a US resident so the broker choices are very limited. I also mainly trade the EUR/USD and USD/JPY. I do like the fact that Thinkorswim is backed by TD Ameritrade however their forex accounts are not protected by the SIPC. I'll go over some pros and cons of the overall experience so far and any additional feedback from users of the platform is highly appreciated due to the fact that I would like to stay with them for the long haul.

PROS

- Charting is very user friendly and clean.
- Free global news squawk and other news sources streamed live.
- Offers commission-free trading on all pairs. EUR/USD and USD/JPY typical spread for the London and NY session are 1.0 with no commission.
- Also offers commission trading but at $10 per 100k (maybe a CON here)
- Great customer support.
- Backed by TD Ameritrade.
- Fast execution (at my current volume)

CONS

- No volume reference or indicator for forex.
- No advanced pattern charting.
- No automated trading.
- Bid/ask always shows the price x1,000,000 units so who knows what their liquidity access really is.
- Not a dedicated forex broker, therefore not much information about these issues.

So far I've had a good experience and have been profitable in paper trading and starting to be profitable in the live account. My concerns are for the long term. I've seen slight slippage at even a 10,000 order. I don't know much about their liquidity provider or if TD is taking the other end of the trade. If so, surely this will affect me as I grow the account. I'm sure I missed a couple pros and cons but I will edit as I think of them.

Any and all feedback appreciated!
  • #2
  • Apr 23, 2017 5:19pm Apr 23, 2017 5:19pm
They are using Gain Capital for liquidity..
  • #3
  • Apr 24, 2017 4:38pm Apr 24, 2017 4:38pm
Before signing up with Oanda I looked into TD. As Shrike mentioned, I also found out that they are just a white label of Gain Capital Liquidity. My thought was, if I didn't have to trade with a middle man why would I. Also, I am not particularly fond of Gain Capital as a Forex broker., there is just too much bad information out there about them.
  • #4
  • Edited 4:30pm Apr 26, 2017 3:51pm | Edited 4:30pm
Found out some good info on TD/Thinkorswim today from a long chat with a rep. So TD is the counterparty in their forex trading, however since the liquidity and data is all directly from GAIN capital, there is no false data from TD. I have a FOREX.COM demo so I compared data feed and it is identical aside from the spread in which case TD is better. They also guaranteed no liquidity issues for anything less than 100 lots and even said it wouldn't be any issue until 10s of millions of units. Same execution speed and price as if it were a micro lot order. This was a worry of mine being as though they do not show market depth. So they are simply betting that their 90% of traders will lose, just like anyone else would. But it seems that it's pretty fair other than that. Plus they are backed by TD Bank so if you really grew a large account you could withdraw it all with no problem. They also said that there is no dealing desk, and they are the counterparty in 100% of forex trades.
  • #5
  • Apr 27, 2017 10:42am Apr 27, 2017 10:42am
This might be a stupid question, but if they are the counter party wouldn't they have a dealing desk to manage the risk?

Also, I just reviewed TD, Gain, and Oanda. TD is only listed as an FDM (Forex Dealer Merchants) whereas Gain and Oanda are listed as RFEDs (Retail Foreign Exchange Dealers). Does anyone know the difference between these?
  • #6
  • Apr 27, 2017 11:23am Apr 27, 2017 11:23am
So I wondered this as well, referring to the dealer desk. I asked simply if they have a customer who statistically wins more than he loses, would there be any scenario where TD wouldn't take the other side of the trade. They assured me that 100% of their forex trades, they are the counterparty and there is no dealing desk. So when I place an instant trade, TD then takes the other side and the actual liquidity comes from GAIN at the quoted price minus spread.

As far as the terminology of Forex Dealer Merchant and Retail Foreign Exchange Dealers, I can't say I'm aware of the difference. It does seem that TD isn't a typical Dealer Desk broker, maybe because they don't do as much forex trading as OANDA or GAIN.
  • #7
  • Apr 27, 2017 12:02pm Apr 27, 2017 12:02pm
That makes sense about the counter party. Interactive Brokers seemed to be setup the same way from what I could tell before they shut down. They STPed all of their Forex trades, but because you were technically trading with IB the regulators made them tell you they were the counter party.

So, it is possible that TD is STPing all trades to Gain. But because TD holds your money, account, and is technically taking the other side, they must claim they are the Counter Party.
  • #8
  • Apr 27, 2017 12:16pm Apr 27, 2017 12:16pm
Good thought on that. Anyway, I'm very satisfied with them so far. I'm able to turn a profit and can see a long term relationship with them as they guarantee fills up to 100 lots per order without liquidity issues. Also slippage does work both ways, if you get a spike in your favor it will fill at a better price if it's a stop or limit order. There is very minor slippage but it does happen of course, that's just the market.

Another point is that their demo account is 100% the same as the live account. The only difference is that they will not calculate spread for forex on the demo. So if the spread is 1.0 pip, you will fill at the ask -0.5 or bid +0.5. You can simply just review your trades and subtract the current spread though to avoid that. I believe it's this way because they are mostly a stock/options broker so a price filling inbetween the bid and ask is common for stocks where as it doesn't occur in forex.
  • #9
  • Apr 30, 2017 2:01pm Apr 30, 2017 2:01pm
I have a account with Oanda, but want to transfer half the balance to TD. Does TD handle margin differently? Do you need a certain amount? Also, Oanda charges for withdrawals which is one of the reasons to try out a new broker.

Quoting Embry1
Good thought on that. Anyway, I'm very satisfied with them so far. I'm able to turn a profit and can see a long term relationship with them as they guarantee fills up to 100 lots per order without liquidity issues. Also slippage does work both ways, if you get a spike in your favor it will fill at a better price if it's a stop or limit order. There is very minor slippage but it does happen of course, that's just the market. Another point is that their demo account is 100% the same as the live account. The only difference is that they will not calculate...
  • #10
  • Apr 30, 2017 4:41pm Apr 30, 2017 4:41pm
So far it's worked just like a second bank account. I have deposited and withdrawn 6 figures with no problem. TD is 1:50 on most pairs, and I believe all you need to trade is $500. No fees for withdrawals, and no maximums. Takes about 1-2 business days for it to transfer to your regular bank account.
  • #11
  • May 1, 2017 5:56am May 1, 2017 5:56am
TDA is very good for options trading and very good for long term investment in stock market as they not charging data fees or inactivity fee.
Their FX trading is very expensive for small accounts. $1 minimum commision. So if somebody trades 0.01 lot with them - its the same as 11 pips spread. ($1 fixed fee + spread). You need at least 0.1 lot position to justify forex trading with them.
  • #12
  • May 1, 2017 8:15am May 1, 2017 8:15am
Quoting johnnycash
TDA is very good for options trading and very good for long term investment in stock market as they not charging data fees or inactivity fee. Their FX trading is very expensive for small accounts. $1 minimum commision. So if somebody trades 0.01 lot with them - its the same as 11 pips spread. ($1 fixed fee + spread). You need at least 0.1 lot position to justify forex trading with them.
That's only if your trading 1000 units, or a micro lot. If you trade a mini lot (10,000) through their commission based trading, yes it's $1 per 10k units. Or you can use their commission free trading with a minimum of 10,000 units for a very low spread. During the London and NY session their EUR/USD and USD/JPY spread is a fixed 1.0 and other pairs like GBP/USD or EUR/JPY are typically 1.5 with no commission.

If you're trying to trade with 1 micro lot, use a different broker or a demo account.
  • #13
  • May 1, 2017 9:29am May 1, 2017 9:29am
I will be trading 10K unit mostly on the GBP/USD pair. What is cheaper, the commission or spread?

Quoting Embry1
{quote} That's only if your trading 1000 units, or a micro lot. If you trade a mini lot (10,000) through their commission based trading, yes it's $1 per 10k units. Or you can use their commission free trading with a minimum of 10,000 units for a very low spread. During the London and NY session their EUR/USD and USD/JPY spread is a fixed 1.0 and other pairs like GBP/USD or EUR/JPY are typically 1.5 with no commission. If you're trying to trade with 1 micro lot, use a different broker or a demo account.
  • #14
  • May 1, 2017 9:55am May 1, 2017 9:55am
Can anyone with a live TD account confirm what the margin amount for a 10,000 unit on the GBP/USD is?
  • #15
  • May 1, 2017 10:05am May 1, 2017 10:05am
The spread is typically cheaper. With commission you'll get a better spread but usually not 1 pip better. Only time I would recommend paying commission is on non EUR/USD or USD/JPY pairs during Sydney and Tokyo session. Being that the commission is $10 per standard lot, that's equivalent to 1 pip so 90% of the time the spread is better during the proper session. GBP/USD is 1:50 so you need $200 to trade a mini lot.
  • #16
  • May 1, 2017 10:12am May 1, 2017 10:12am
Thanks.. Oanda is requiring $640 margin per 10k mini.

Quoting Embry1
The spread is typically cheaper. With commission you'll get a better spread but usually not 1 pip better. Only time I would recommend paying commission is on non EUR/USD or USD/JPY pairs during Sydney and Tokyo session. Being that the commission is $10 per standard lot, that's equivalent to 1 pip so 90% of the time the spread is better during the proper session. GBP/USD is 1:50 so you need $200 to trade a mini lot.
  • #17
  • May 1, 2017 12:10pm May 1, 2017 12:10pm
$645

Quoting sinclap
Can anyone with a live TD account confirm what the margin amount for a 10,000 unit on the GBP/USD is?
SPC * Swollen PocketZ Crew!
  • #18
  • May 2, 2017 12:30am May 2, 2017 12:30am
Once you initiate a trade without a stop loss and take profit, how do you modify afterwards to add?
  • #19
  • May 2, 2017 7:50am May 2, 2017 7:50am
The way I do it is to use the Active Trader column on your chart. It's the column with the order templates and prices. After you place your trade, just find your stop and target prices on the active trader column and click the red button next to the price you want for a sell stop or green for a buy stop. It will create automatically assign the stop order this way as a STOP loss and the target profit as a limit order. For example. If you buy the EUR/USD at 1.0900 and click the red button by 1.0880, it will set that as a STOP order. If you click the red button by 1.0920 it will place a limit order. Also, if you want to change your order after that, I just simply drag the order on the chart to the appropriate price. If you don't want to be bothered with having to review each order when you do all this, make sure Auto Send is checked.
  • #20
  • May 8, 2017 3:11pm May 8, 2017 3:11pm
Quoting Embry1
The way I do it is to use the Active Trader column on your chart...

Thanks for that info!
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