E*TRADE vs. thinkorswim: A Thorough Platform Comparison
It is essential to select the correct trading platform as an active trader, and E*TRADE and thinkorswim are two different options with specific features for various kinds of traders. E*TRADE, which was founded in 1982, suits long-term investors and active traders both with its friendly interface and in-depth trading features. On the other hand, thinkorswim, now owned by Schwab and originally developed by Tom Sosnoff, targets highly active traders with its advanced charting tools and robust technical analysis capabilities. This article provides a detailed comparison to help investors determine which platform best suits their trading style and needs.
Key Takeaways
- E*TRADE is ideal for long-term investors and regular traders who need an easy-to-use system with robust research capabilities and customer support.
- thinkorswim is ideal for experienced traders and forex and options-focused investors who need more sophisticated charting and technical analysis features.
- Both systems include free trading on stocks, ETFs, and mutual funds, but each has varying commissions for options and futures trading.
Comparison of E*TRADE and thinkorswim
What is E*TRADE?
E*TRADE, founded in 1982, was among the early companies to bring electronic trading to the marketplace. It caters to long-term investors and active traders through a user-friendly app, low fees, and thorough research tools. These features make it a good choice for anyone who prefers to handle their investments efficiently.
What is thinkorswim?
thinkorswim, which was founded by Tom Sosnoff and later acquired by TD Ameritrade owned by Schwab today, is a trading platform aimed at active traders. It’s famous for its advanced charting, personalizable indicators, screeners, options trading, and deep technical analysis, catering to those traders requiring sophisticated trading tools.
Platform Comparison
E*TRADE Platform Features
E*TRADE offers a solid brokerage platform via the Power E*TRADE platform, mobile app, and real-time data access via a funded account. It supports a wide range of tradeable assets including stocks, ETFs, mutual funds, options, futures, futures options, cryptocurrencies, and bonds.
thinkorswim Platform Features
Schwab’s thinkorswim has a downloadable desktop platform that features advanced charting, paper trading, and real-time data. It supports Schwab and TD Ameritrade accounts and provides trading of stocks, ETFs, mutual funds, options, futures, futures options, and bonds.
Feature Comparison
| Feature | E*TRADE | thinkorswim |
|---|---|---|
| Service Type | Brokerage Platform | Trading Platform (Schwab) |
| Key Features | Power E*TRADE, Mobile App | Downloadable Desktop Platform, Advanced Charting |
| Tradeable Assets | Stocks, ETFs, Mutual Funds, Options, Futures, Futures Options, Crypto, Bonds | Stocks, ETFs, Mutual Funds, Options, Futures, Futures Options, Bonds |
| Data Access | Real-time with funded account | Real-time with funded account |
| Platform Compatibility | N/A | Schwab |
Trading Tools & Features
E*TRADE Trading Tools
E*TRADE provides advanced charting and real-time data on its platforms. The E*TRADE Mobile App and Power E*TRADE app offer extensive market analysis and are backed up by excellent customer service and the option to invest automatically through DRIP.
thinkorswim Trading Tools
thinkorswim is distinguished by its customizable charting tools, paper trading mode for risk-free practice, and more analysis features like Level 2 data and profit/risk analysis tools. It also only offers forex trading, an option not offered by E*TRADE.
Feature Comparison
| Feature | E*TRADE | thinkorswim |
|---|---|---|
| Charting Tools | Advanced Charting | Customizable Charting Tools |
| Paper Trading | No | Yes |
| Forex Trading | No | Yes |
| Analysis Features | Real-time Data | Level 2 Data |
Fee Comparison
General Trading Fees
Both thinkorswim and E*TRADE offer free stock, ETF, and mutual fund commissions. They both have options contracts with $0.65 per contract fees. They charge differently for futures contracts, $1.50 per contract from E*TRADE and $2.25 per contract from thinkorswim.
Other Fees
They both have no inactivity fees. Futures options include activation via a phone by E*TRADE, but thinkorswim charges $2.25 per contract.
Fee Comparison Table
| Fee Category | E*TRADE | thinkorswim |
|---|---|---|
| Equity Commission | Free | Free |
| Option Commission | $0.65 per contract | $0.65 per contract |
| Futures Commission | $1.50 per contract | $2.25 per contract |
| Futures Options Commission | Has to call in to activate | $2.25 per contract |
| Margin Rates | Varies | Varies |
| Inactivity Fees | None | None |
Mobile & Online Experience
E*TRADE Mobile App
The E*TRADE Mobile App makes trading and investing straightforward, while the Power E*TRADE App provides advanced capabilities for active traders. Customer service is provided by email, phone, and chat.
thinkorswim Mobile App
The thinkorswim App is feature-rich with advanced charting, risk analysis, live news, and real-time data. Support includes real-time support by experts and interactive chat rooms.
Who Should Use E*TRADE?
Ideal For:
- Long-term investors seeking a simple platform.
- Active traders seeking low-cost trades without needing complex features.
- New investors who value outstanding customer support and educational content.
Key Advantages:
- Easy-to-use interface.
- Good customer support.
- Efficient mobile apps for on-the-go trading.
Who Should Use thinkorswim?
Ideal For:
- Professional traders who need a highly configurable platform with high-end features.
- Forex traders and options traders.
- Active traders who appreciate paper trading and technical analysis.
Key Benefits:
- Sophisticated screening and charting capabilities.
- Advanced risk analysis and specialty features.
- No extra charge for access by Schwab and TD Ameritrade customers.
E*TRADE vs thinkorswim: Final Verdict
Summary of Differences
E*TRADE is suitable for long-term investors and beginners due to its simple-to-use, intuitive platform and superior customer service. thinkorswim, on the other hand, is suitable for active traders and users who require sophisticated charting tools, technical analysis, and forex trading options.
Recommendation:
- Choose E*TRADE if you’re a beginner trader or prefer simplicity and low expenses.
- Choose thinkorswim if you’re an active trader or technical analyst that seeks personalization and sophisticated features.
Conclusion
Selecting the right trading platform depends on your investment goals, experience level, and trading style. Both E*TRADE and thinkorswim offer unique advantages, and it’s important to explore each platform’s features, such as paper trading, before making a decision. Consider your specific needs and preferences to choose the platform that best aligns with your trading objectives.
Frequently Asked Questions (FAQ)
- What is the difference between E*TRADE and thinkorswim?
E*TRADE is an investor- and trader-friendly brokerage site that offers an easy-to-use interface and excellent customer service. thinkorswim is Schwab’s active trader site designed for active trading, offering special charting features, custom indicators, and option trading. A practice paper trading account is included as well. - Does either E*TRADE and thinkorswim have a trading fee?
Both websites have commission-free trading in stocks, ETFs, and mutual funds. The cost of an options contract on both sites is $0.65 per contract. Futures contracts are charged at $1.50 on the E*TRADE website and $2.25 on thinkorswim. Neither platform charges for inactivity. - Which one of the two platforms is best for beginners to trade on: E*TRADE or thinkorswim?
E*TRADE is ideal for new traders as it has a less complex interface, tutorials, and decent customer service. thinkorswim, with its advanced features and technical analysis options, is ideal for experienced traders. - Does thinkorswim offer paper trading?
Yes, thinkorswim offers a paper trading feature where you can trade in virtual funds, risk-free, to improve your trading skills. - Which website has more mobile-friendly applications?
Both E*TRADE and thinkorswim have robust mobile applications. E*TRADE offers two apps: E*TRADE Mobile App for casual trading and Power E*TRADE for more functionality. thinkorswim’s app includes advanced charting, live news, and real-time data for active traders.
Related Trading Platform Comparisons
Interactive Brokers vs Robinhood
Interactive Brokers vs Tradovate
– Free trading journal template & cheat sheet PDFs
– Access our custom scanners and watchlists
– Access our free trading course and community!
