Rating
4.3

Introduction

TOS isn’t just a suite of platforms made for the trading-obsessed — it’s made by them. They use real feedback to improve our platforms, giving you the innovative features traders ask for most.

If you are a sophisticated investor who often makes frequent or complex trades, TD Ameritrade has the right platform to make your investment venture more comfortable. 

The brokerage firm runs a platform known as ThinkOrSwim (ToS). And…it is packed with powerful investment tools that are sure to wow you especially if you’ve been struggling to make sense of the stocks and options markets lately.

We have done a detailed ThinkOrSwim review whereby we will look at the key features of this program and the costs that you will incur as you use it. In the end, it will be up to you to decide whether its benefits outweigh its drawbacks.

About ThinkOrSwim

ToS is a trading platform offered by TD Ameritrade, which is one of the leading brokerage firms in the US. Unlike TD Ameritrade’s central platform that deals with the retail market, ThinkOrSwim mainly targets established investors by presenting detailed and sophisticated information.

With this platform, you can trade just about any financial instrument, including stocks, bonds, options, futures, ETFs, and options on futures. Apart from trading, you can also use the program to perform complex analyses on potential trades and stocks.

Plus, it is available for Windows, Mac, and the web, in addition to a mobile app. That said, the mobile app isn’t really perfect for in-depth analyses…we’d prefer it for keeping tabs of your investment forays.

If you want to get more data options and customizability, we’d suggest that you use the desktop version.

Who are the Founders?

The software program was founded by Tom Sosnoff and Scott Sheridan back in 1999. With time, it became one of the most popular trading platforms globally, which led to its acquisition by TD Ameritrade in 2009.

Key Features of The Software

This program has a wide range of trading tools that both beginners and advanced traders can find helpful. Note that it may be a while before you are entirely comfortable using the software, but everything will be pretty straightforward once you are fully settled. 

Let’s now look at the main features that this program has to offer.

1. The Charts

The first aspect of this program is its charting features, and they are quite popular due to the versatility they offer. Some of the charting options available include candlesticks, Monkey Bars, Seasonality, OHLC bars, Candle Trend, Area, Equivolume, and Heikin Ashi charts.

 One thing we liked about the charts is that they are highly customizable, whereby you can use numerous color and scaling options with them. We were particularly impressed with the right-click menu, which offers both alerts and an order ticket.

2. Level 2 Data

Here is another basic yet essential tool for your stock trading venture. It displays the leading exchanges and ECNs, and most of all does not require any subscription.

3. Order Submission

This is a feature that established swing and day traders will find useful whereby you can send equities, funds, and options to specific venues.

Some of the common types of complex orders include Market, Limit, Stop, Trailing Stop, Trailing stop limit, Market-on-close, Limit-on-close, Blast all, and Order cancels other (OCO).

One feature that stood out for us on the order ticket is the toggle switch with which you can use to lock and unlock limit orders. If it (the switch) is in the unlocked position, the limit price will adjust whenever the market price changes.

4. Technical Indicators

There are numerous technical indicators and studies on this platform, and they are categorized into different groups such as trend studies, momentum studies, and moving average studies.

In addition to that, there are specific customized studies by stock market gurus, and they include John Person’s studies and John Carter’s studies.

5. Scanners

If you are familiar with FinViz or StockFetcher, you should not have any problem using this scanning tool. You can configure the scanner based on fundamental or technical criteria, and its versatility will help you find ideas and potential trades.

We liked the options scanner as it is a fantastic tool that can enable you to find options trades that meet specific setup criteria.

6. Research

The research that this platform offers will go a great way in helping you decide what you want to trade. When you look at the top menu, you will find the ‘Analyze’ and ‘Scan’ tabs under which you can find lots of amazing search tools. 

For instance, there is the ‘Stock Hacker,’ which is the platform’s equity screener and can search for trades based on numerous criteria. They include volume, industry, put/call ratio, bid/ask prices, % change, and many others.

There are also options search tools, for example, the ‘Spread Hacker,’ which searches for option spreads that are based on numerous search variables. On top of that, there is the ‘Spread Book,’ which offers trade possibilities for a number of stocks and funds.

We cannot forget the vital data released within the platform, and you can find recent releases that are based on:

  • Interest rates
  • Producer price indexes (PII)
  • House price indexes
  • Employment figures, and so on

Lastly, there is a backtesting tool that contains up to ten years of derivative trade data.

7. Alerts

We all know how monitoring different market variables can be time-consuming and tiresome. It gets even more frustrating when you follow something that you do not know when exactly it will be triggered.

So, with ToS, you can set alerts based on price or indicators, and this will allow you to focus on the current setups in front of you rather than be distracted by other factors.

8. Newsfeed

You will find this feature to be of great help when you are looking for information related to a particular stock. We liked how the newsfeed updates in real-time and momentum traders who like taking advantage of news-based price action will find it very useful.

It may not be as effective as standalone news services, but you will still get access to vital headlines that will help you in your stock market investment.

9. Watch Lists

Some of the information you get on the watch lists in this platform include price change levels, dumpers, stocks trading at certain volume levels, and new highs/lows. You also get watchlist windows to add your watch list stocks and then link them with your charts.

And just like most of the other features on this platform, you can configure the settings to your preference.

10. Technical Analysis Education

There is a learning hub located under the ‘Education’ tab that will enable you to sharpen your technical analysis skills. You will also find resources that spell out how you can use the various drawing tools on this platform, such as the Fibonacci tool.

In the learning center, you will find a detailed description of every technical indicator on the platform. As if that’s not enough, you will also find instructions explaining how you can develop your own technical indicators.

Lastly, we liked the lesson on candlestick patterns where all the significant events, such as the bet hold, abandoned baby, and engulfing, are fully covered.

11. Chat Room

This is simply an online community made up of hundreds of traders with varying experiences and skills. The main advantage of such a platform is that it enables you to learn something new from other traders.

However, since it is a free service, take everything with a pinch of salt since some traders only enjoy hyping their positions. It would be wise if you conducted independent research before following a piece of particular advice or suggestion.

12. Customer Service

In case of any issues with the platform, the TD Ameritrade customer service is always there to attend to you. You could either contact the team via email or phone call or make use of the numerous resources and guides available online to solve your problem.

All in all, we were pleased with how swift they are in their responses. 

13. Options Trading

Initially, ThinkOrSwim was an options trading platform, and this only changed upon acquisition by Ameritrade. It features some of the best analyzers, tools, and calculators that options traders would find very useful.

Here, you can decide the strategy that you consider ideal so that you can see the possible profits or losses. From here, the program will review the strategies through their options strategy analyzer before executing them after meeting certain criteria.

The Cost of Using the Platform

ToS is free for all TD Ameritrade clients, and no fees, account minimum, or trading requirement will be needed from you to use the program. However, to trade within the platform, you will be put under a commission schedule.

Luckily for you, the commissions for most of the assets that you can trade within the platform have been lowered over time, and they are as follows:

  • Stocks, ETFs, and closed-end funds will cost you $0 per trade
  • Futures go for $2.25 per side per trade
  • Forex is priced on its bid-ask spread
  • Although options do not have a base charge, they incur a 65¢ per contract

When it comes to market data, the Level II quotes are free for both professional and non-professional traders. But there are some areas where the pros would have to pay data fees, e.g., the NYSE quotes where you have to pay $45 per month.

Types of TD Ameritrade Accounts

We will now look at some of the accounts available for TD Ameritrade clients. Note that all of them accept ToS as their platform.

Some of the accounts are individual or joint accounts, and all of them come with the following conditions:

  • There is no minimum deposit while the trade options require a minimum balance of $2,000
  • The electronic deposit minimum is set at $500
  • You can trade stocks, options, ETFs, CDs, mutual funds, bonds, and REITs

You could also go for individual retirement accounts, which could either be cash or cash and options accounts. Further, they do not have a minimum amount deposit set.

Other accounts that you can open with TD Ameritrade include education savings, trusts, investment clubs, trusts, and businesses. 

Which Trader is ThinkOrSwim Most Suited for?

A closer look at this program would tell you that options traders have the most to gain from it. They will find the options analytics and calculators very convenient since they can now easily determine the expected returns on different options strategies, including condors, spreads, and straddles.

Another group that would appreciate this service is the self-driven investors who would find the fundamental tools and videos to be very useful.

Newbies, too, would make use of the numerous educational resources found within the platform.

Is It Safe?

Yes, your funds will be safe with this program. This is because all the cash deposits are FDIC-insured while the brokerage funds up to $500,000 are SIPC-insured. 

Further, TD Ameritrade acquired a supplement plan from London insurers to provide extra protection worth $149.5 million for securities and $2 million for cash.

Is It A Good Value?

Yes, it is. First, opening an account on the platform is absolutely free while offering outstanding analysis for the stocks and ETFs you invest in. And if you find it too complex, you could always try out other alternatives such as Robinhood and Interactive Brokers.

Pros and Cons

At this point, we are in an excellent position to analyze the benefits and drawbacks that this software brings. Let’s look at both categories in brief.

Pros

  • The software and data feeds are available for free
  • Deals with multiple markets
  • Works for different types of traders such as skilled options traders, intra-day or portfolio traders
  • Features advanced charting and research tools
  • Has no monthly maintenance or inactivity feeds
  • Has constant updates

Cons

  • Impossible to trade fractional shares
  • Does not offer direct routing

Conclusion

If you were undecided about trying out this software program, we hope our article has made things easier and clearer for you. We have broken down all the tools that it has to offer so that you can understand the benefit that you will be getting from it.

In general, we believe that this is a powerful platform that day and swing traders would use to boost their success in options trading. 

And with the zero fees required to get started, we can say that ThinkOrSwim is the platform to beat for options trading.