TD Ameritrade Holding Corporation (NYSE: AMTD) is an online stock brokerage that executes 371,579 transactions on an average day. Both individuals and institutional investors use TD Ameritrade's service to trade common and preferred stock, ETFs, options, futures, foreign exchange, mutual funds and fixed income securities. TD Ameritrade also offers margin lending and cash management services.
TD Ameritrade's traditional revenue base comes from the transaction-based fees it charges to clients for brokerage and clearing services. This business model has been successful for online brokers because operating costs remain low in the online brokerage industry. TD Ameritrade also generates revenue from the cash in its clients' accounts, by lending out this money to other clients through margin accounts, and to third-party borrowers through affiliate banks.(Read more at Wikinvest )