Ameritrade $500 Opening Bonus + Free Trades for 45 Days
TD Ameritrade has a new $500 opening bonus. Unfortunately, it is a bit involved. First, you must open a new non-IRA account with at least $10,000. You then get 45 days of free trades. If during the first 3 months you make an average of 3 trades a month, you then get to Apex status and get the $500 bonus after 3-4 weeks. You must then maintain $10,000 of account equity for 9 months after getting the $500, or they take the bonus back.
So to start, you need to have access to $10,000 that you don’t need for 13 months. If you don’t have that, check out this $75 bonus ($2,000 to open) and $100 bonus ($5,000 to open). Read the fine print and keep in mind your money will be tied up for a certain amount of time.
Got $10k? If you are an active trader, I’m sure you can put the free trades to good use.
If you have some of other people’s money and want to stick with a safe investment? Here’s a possible strategy based on this FW post by tedteddy:
1) Open with $10,000.
2) Make 15 trades in a week, but don’t trigger daytrader classification (4 roundtrip trades in 5 rolling days). You could make 8 trades buying 1 share of a bond ETF like AGG/SHY/TIP/IEF, and then sell 8 shares in 8 trades six days later. You could even dollar-cost average buy getting 1 share each day to minimize volatility or something.
A more fun idea would be to find eight $1 stocks and have at it. Some random ideas are ALRG, FGNT, and TCX. Worst case scenario, you lose $8.
3) Keep the rest of your money in a sweep account. Ameritrade offers (but does not advertise) sweep account options including a money market fund (RFIXX) currently yielding 3.76%.
Another option is that they seem to offer some no-transaction-fee (NTF) funds. Might be something worth buying in there.
In the end, you’re actual “bonus” is any money in excess of what you could have earned otherwise. Top 1-Year CD rates are currently 5.25%. $500 of $10,000 is already 5%, and conservatively let’s say you get another 3.75% from the sweep interest. So that’s about (500+375-525) = $350 of taxable interest for your time. You can decide if it’s worth the trouble. Thanks to Steve and Elizabeth for the heads-up.
Here is the offer fine print:
Offer valid for one new Individual or Joint TD AMERITRADE account opened and funded with $10,000 or more by 06/30/2006. Receive unlimited free Internet equity orders valid for 45 days from account funding. Offer is not transferable and not valid for IRAs, internal transfers, current TD AMERITRADE clients, or with other offers. Limit one offer per client. To qualify for the $500 APEX bonus, your TD AMERITRADE account must have an average of 5 trades per month or $100,000 total account value in the first three months. Allow 3-4 weeks after account reaches Apex status for $500 bonus to post to your account. Your account must remain open with minimum funding for 9 months after $500 credit posts to account or TD AMERITRADE may charge the account for the cash awarded. Apex qualification is reviewed every three months… TD AMERITRADE reserves the right to restrict or revoke this offer.
Find more in Deals & Offers | 4/24/06, 11:28pm | Trackback
April 25th, 2006 at 4:59 am
it would be easier to put $10,000 in a CD that pays over 5% APY. You get at least $550 for 13 months without all this hassle.
Not a very good deal unless you want your free trades…
April 25th, 2006 at 6:28 am
Sweep account - can you give me a little guidance on where I can set this up? I have a number of Ameritrade accounts (regular and some IRAs), and I can’t find anywhere that allows me to set a sweep account for my available cash. And the help pages are less than, well, helpful.
Thanks.
April 25th, 2006 at 8:05 am
Think of it as a 8.5% APY CD that requires work but very little principal risk. As always, some people will deem it worth the effort and some will not. I already have an Ameritrade I-Zone account, so I don’t think I’m eligible anyways.
Tim - I would contact Ameritrade directly and ask them for “sweep account options” for your free cash. They ought to know what you are talking about. You may need to send in a form or something.
April 25th, 2006 at 12:49 pm
The ultimate, of course, would be to take 20k off of a credit card at 0%, then apply that towards this deal for both husband and wife.
For me, I can get 20k @ 0% for 9-months (75.00 fee), so I will have to float 20k for about 3-months to make this happen. Still, not too bad for an hour or two of work, thaks for the heads-up!
April 25th, 2006 at 2:21 pm
Tim- If you signed up for the sweep, in your “account balances” screen, you should see a list of you stocks w/ the last one being ZZZ00. That is the Reserve Money Market Fund. To sign up for the fund, you can send an email. They will send out a prospectus and signup form.
April 25th, 2006 at 5:36 pm
I am really enjoying your blog - I haven’t invested a cent yet - stuck on the asset allocation pie chart I am trying to bake - but I am learning a lot I think! This Waterhouse/ameritrade deal looks interesting if only I could decide what to buy - I have read a lot on these no fee no load no transaction fee mutual funds and many of the ones I’ve read about (requiring 2,500 to open) are available there. Liz
April 25th, 2006 at 9:49 pm
Hey Guys, if you get the 15 or so trades done ASAP, I believe you will get the APEX level and your bonus will come within 3-4 weeks thereafter. So, you only need to have your money tied up with them for 10 to 11 months. My wife and I are both doing this with CC money. Gotta love FREE MONEY!!!
May 4th, 2006 at 10:36 am
I just checked Ameritrade’s web page and maybe they changed the terms (from 3 trades to 5 trades a month). Now it says quote: “To qualify for the $500 APEX bonus, your TD AMERITRADE account must have an average of 5 trades per month or $100,000 total account value in the first three months.” So you open it for 10 thou and EITHER trade 5 times a month OR keep 100 thou balance for 3 months. I agree it makes sense to do the 15 trades quick like a bunny and you get your $500 bonus then 9 months later, so theoretically might tie up money only 9 months plus however many days you take to do 15 trades (PS is a “trade” a buy OR a sell?–if so you only need buy/sell 8 times right?)
May 4th, 2006 at 10:40 am
Oops, sorry, I see after reading further that the points I made were already made! Good heads up about day trading trigger–I tend to forget that. Really enjoy your money tips.
May 6th, 2006 at 4:20 pm
If you have an IRA account with TD Ameritrade, but not a regular brokerage account with TD Ameritrade, you would still qualify for this promotion. I have confirmed this with their representative through email.
May 12th, 2006 at 1:40 pm
Does anyone know if TDAmeritrade is still offering this promotion? If you go directly to its website (as opposed to linking through the above link) it is not advertising this promotion, but rather is listing less favorable sign up promotions.
May 18th, 2006 at 9:46 pm
It’s there, click on the apex link on the homepage. In fact I’ve seen commercials for it on TV and it’s in banner ads on several financial news/analysis websites.
May 22nd, 2006 at 1:33 pm
Since it has been about four weeks since this was posted has anyone actaully received the $500 posted to their account yet?
May 30th, 2006 at 8:20 pm
I just received my $500 posted to my account today. I made my 15th trade about two weeks ago.
October 5th, 2007 at 12:57 pm
please send me the bonus offer code for this promotion