Charles Schwab vs Fidelity vs Vanguard
Charles Schwab vs Vanguard vs Fidelity: Comparison Chart 2014
Vanguard vs Charles Schwab vs Fidelity Investments
The three firms in this comparison are among the seven largest brokerage houses in the United States.
Fidelity Investments and Vanguard are known mostly for their own families of mutual funds and ETFs. But they also offer brokerage services: through them you could
buy and sell stocks, options, bonds and other investments.
With Charles Schwab the situation is the opposite: the company is well-known for its brokerage services but few people know that it also offers its own
extensive selection of bond, equity, and asset allocation mutual funds advised by Charles Schwab Investment Management. All these funds have no loads and no
In 2011 Charles Schwab bought one of the top online brokers, OptionsXpress (see review),
that will be fully integrated into the parent company in 2014. OptionsXpress offers a superior set of trading tools, a suit of valuable yet free services, a simulated trading environment,
and a $100 bonus for opening a new non-IRA account and 50 free trades for IRA account. Mutual funds are $9.95 per transaction at OptionsXpress versus $76 at Charles Schwab!
Fidelity Investments priced stocks and ETFs at $7.95 per trade. Charles Schwab's cost is $8.95. Vanguard's rate depends on a customer's account
- $7 for the first 25 trades, $20 for subsequent trades for account with less than $50,000 (Standard Services)
- $7 for account with $50,000–$500,000 invested in Vanguard products (Voyager Services)
- $2 for account with $500,000–$1,000,000 invested in Vanguard products (Voyager Select Services)
- Free for first 25 trades, $2 for subsequent trades for account with $1 million (Flagship Services)
Fidelity Investments is the most expensive company for transaction-fee, no-load mutual fund investors: $75 per transaction. Charles Schwab priced these
funds at $76 to buy and $0 to sell. Vanguard, again, has tiered cost structure: Standard members pay $35 per transaction; Voyager and Voyager Select - $20;
Flagship - $8.
While Charles Schwab and Fidelity Investments do not charge account maintenance and inactivity fees, Vanguard imposes
$20 annual maintenance fee (waived if user chooses to receive statements and other information electronically).
Charles Schwab vs Fidelity Investments are the best ranking firms in customer service. These two companies also created very easy-to-use trading tools that
will satisfy everyone but day-traders. Fidelity Investments is also one of the best in the industry in providing clients with independent investment
research. Vanguard lags behind the competitors in all these three categories.
Fidelity Investments and Charles Schwab do not charge IRA accounts (ROTH, Traditional, self-employed) setup and custodial fees (sometimes called annual or maintenance fees).
There is, however, a fee if you decide to move your IRA or non-IRA account to a different firm.
The links to full lists of fees charged by the companies is available in their reviews (links to reviews provided at the bottom of the article).
Vanguard brokerage is good fit to those clients who mostly want to invest in Vanguard-family mutual funds and ETFs.
Fidelity Investments is great for customers who are looking for the best independent investment research
(top company in this categor) or plan to invest in Fidelity-family mutual funds and ETFs.
Charles Schwab is recommended for clients new to investing, though the firm is not as good in this area as some of the companies in our
Best brokers for beginner investors article.
For everyone else, especially for those looking for IRA account, mutual fund investors, options traders, and long-term investors, we recommend
Charles Schwab's OptionsXpress.
Much more information is available in detailed brokerage reviews, including firms pros and cons, all commissions and
important fees, and trading tools overview:
Charles Schwab review,
Fidelity Investments review,
Vanguard Brokerage review.
This article was updated on 3/15/2014.