TradeStation vs. Thinkorswim

Investing is a complicated process, so the trading platform you use should have the tech to support it and make your life easier. TradeStation and TD Ameritrade’s thinkorswim know that. So these two online brokers deliver dynamic investment tools to their userbase of active traders. However, every investor has different needs. Choosing the right brokerage to fit those requirements will bring out the strengths in your investment strategy. Here’s what you should know if you are considering TradeStation or thinkorswim as your online broker.

Keep in mind: A financial advisor can support your investment practices. They can help you figure out the right approach for your goals.

Overview of TradeStation vs. thinkorswim

TradeStation and thinkorswim prioritize traders who have already built investment experience. Although they are looking for ways to make themselves more user friendly for the average investor, they still have a primary audience.

TradeStation and thinkorswim show this through their desktop platforms. Both online brokerage’s desktop interfaces have multiple data and investing tools that can either help or hurt an investor’s experience. Newcomers may struggle with the learning curve both services pose. However, thinkorswim may be the easier of the two to learn. It offers simulated trading (paper trading) that can help beginners adjust. And although it does not have the same range of investment options as TradeStation, it still offers foreign exchange, which the other doesn’t.

TradeStation vs. thinkorswim: Fees

TradeStation and thinkorswim are like many online brokers these days in terms of their stock ETF costs. Both have dropped the fees that brokerages used to include and now offer them at zero commission. After that, the two have somewhat comparable pricing, with some select fees that apply to one or the other.

TradeStation

TradeStation, which no longer has TS GO as an available commission plan, offers its TS SELECT plan with the same price for desktop, web and mobile. TS Select customers get commission-fee trades for stocks, ETFs, stock options, micro options, futures and micro futures. There is a $0.60 fee per stock option contract, $1.50 for futures contract per side, $0.50 per micro futures contract per side and $1.50 for futures option contract per side. There is no minimum deposit required.

The firm, which charges a $10 monthly inactivity fee, offers more than 2,000 mutual funds, none of which are no-transaction-fee mutual funds. It does not offer foreign currency (forex) trading.

TradeStation margin rates are 12.5% for balances less than $50,000, 11.5% for balances of $50,000 to $499,999 and a negotiated fee on balances of $500,000 or more.

thinkorswim

For its part, thinkorswim offers investors desktop, web and mobile platforms. You can trade stocks, ETFs, options, complex options (three legs or more), futures and forex on any of these three platforms.

Investors can trade stocks and ETFs with zero commissions. Options cost $0.65 per contract, while futures can cost up to $5 per trade. There is no account fee. The firm bases its forex trades on the bid/ask spread between countries, and foreign stock trading comes with a $6.95 trading fee.

Margin rates range from 11.825% to 13.575% . Lower rates are offered after $500,000.

TradeStation vs. thinkorswim: Services & Features

TradeStation lets investors trade in most mainstream financial products, like equities, exchange-traded funds (ETFs), options, futures and mutual funds. In addition to these typical offers, you can also choose to invest in futures, cryptocurrency and initial public offerings (IPOs). Thinkorswim also offers the same standard range of financial products but also foreign exchange. It does not currently support cryptocurrency trading, though.

When it comes to accessing these services, you have the same three options for TradeStation and thinkorswim: desktop, web and mobile. Both platforms are similar in terms of their desktop versions. It is the most complex interface out of the three, with the greatest range of customizations and data options.

TradeStation has multiple platforms, and the one you use depends on the type of trading you do. There is FuturesPlus for options and futures, as well as TSCrypto for trading cryptocurrency. In terms of trading, the desktop version offers tools such as Matrix, which is described as the “Swiss Army Knife” of trading tools. It combines an order-tracking system, a market depth window and an order-entry tool into one.

Similarly, thinkorswim supports sophisticated trading tools. However, it also enables fundamental analysis, which many long-term investors rely on. Fundamental analysis entails widgets for news, analysis and Level 2 data to name some. There is also the crucial difference that thinkorswim offers forex where TradeStation does not.

Although both platforms still have some experiential gap between their interfaces and new investors, thinkorswim supports paper trading, which can help actively bridge the gap, letting users set up a simulated account inside the platform and trading with fake money. It lets investors familiarize themselves with the program and its tool before jumping into the real thing.

Both also offer education opportunities to help mitigate this gap as well.

TradeStation vs. Thinkorswim: Online & Mobile Experience

TradeStation pushes cross-platform use by emphasizing the real-time account sync between its web and mobile trading. The TradeStation Trading App is generally not for the casual investor, although it’s less complex than its desktop counterpart. It still offers a customizable investment experience with technical analysis tools that let you monitor trends and create charts. Both the web and mobile-based platforms offer commission-free trading on stocks and ETFs but only TS SELECT can use the desktop version for free.

By the same token, thinkorswim carries over its core desktop features into its mobile platform and emphasizes market monitoring and trading through it. However, it is limited in its tools to make way for that cleaner investment experience.

Both put data and customization at the center of their desktop clients. So, in comparison to their mobile versions, they can be helpful but dense. Beginning investors might not know how to navigate either system easily. However, the high number of tools for each platform can help an experienced investor reach a higher potential, although they might need to take time to learn every gadget.

Who Should Use TradeStation?

TradeStation is not the lowest-cost trading platform out there. It’s also not the simplest, so beginning investors might struggle to use it. Advanced traders will benefit from its mass of data tools and investment options. Its overall layout is sophisticated but caters to a particular type of trader. Investors with a TS SELECT account may find the desktop version particularly appealing because it is the most comprehensive and lets them build a complex, customized investment experience.

Who Should Use thinkorswim?

Like TradeStation, most of thinkorswim’s clientele knows what it wants. The platform is made to suit advanced traders more than beginning investors who can handle a tool-heavy system. Still, it offers more opportunities that could be valuable to a new trader than TradeStation, although it depends on your experience. The simulated investment program is a great way to familiarize a client with a complex system. Plus, the platform offers some analysis tools that TradeStation does not. Investors interested in active trading and investing in foreign exchange may find this to be the better choice between the two.

Bottom Line

TradeStation and thinkorswim are both complex trading platforms that offer a wealth of tools to any interested investor. Although it may not be the right fit for a more passive or inexperienced trader, the two platforms are working toward opening up to a wider audience. So, they may be worth checking out in the future if they aren’t the right online broker for you now. Active investors can continue to take advantage of the opportunities the two offer that create a customized, active investment experience.

Tips for Investing

A financial advisor can help you see your investment strategy in a new light and help you become a better investor. If you don’t have a financial advisor yet, finding one doesn’t have to be hard. SmartAsset’s free tool matches you with up to three vetted financial advisors who serve your area, and you can have a free introductory call with your advisor matches to decide which one you feel is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
Make sure your investment assets fit your risk profile. SmartAsset’s free, easy-to-use asset allocation calculator will help align your assets with your risk tolerance.
If you’re considering an online investment platform, it’s important to research each one before you choose. You can read our detailed brokerage reviews, like the ones we’ve done on TradeStation and thinkorswim to get you on the right path.