Investors looking for a good value in brokerage services should check out Merrill Edge and Fidelity. With low fees and good customer service, both brokers offer traders a lot for their money. Let's run the two firms through their paces and see which one is the better choice.
Commissions and Account Requirements
Buying and selling ETF's and stocks at Fidelity carries a $7.95 charge, while investors at Merrill Edge pay $6.95 for the same transaction. Derivative traders pay an extra $0.75 per option contract at both firms. Fidelity and Merrill Edge both have living, breathing agents who can assist investors over the phone to execute trades. At Fidelity, this service costs $32.95, and Merrill Edge charges a lower $29.95. A securities account with either company has no maintenances fees or inactivity fees. Fidelity customers must deposit at least $2,500 to open a non-retirement account, while Merrill Edge has no such minimum.
Merrill Edge wins in this category.
Investing in Funds
There are 3,580 NTF mutual funds at Fidelity. Around half of these also have no load. In total, Fidelity customers can trade over 11,000 mutual funds. Transaction-fee funds are $75 or $49.95 to purchase. The fee varies based on the particular fund. Although the buy side is a little expensive, a transaction-fee fund has no charge to sell.
Far fewer mutual funds are available at Merrill Edge. The broker has a grand total of less than 5,000 mutual funds. Only 800 of these are no-load and no-transaction-fee products. Mutual funds that aren't NTF cost $19.95. This charge is applied to purchases, sales, and exchanges. There is also a short-term fee of $39.95 if an NTF fund is sold within 3 months of purchase.
Investors at Fidelity can buy and sell 84 ETF's completely commission free. Regrettably, there are no commission-free ETF's at Merrill Edge.
Fidelity easily wins here.
Can I Buy Fidelity Mutual Funds Through Merrill Edge?
For anyone who is wondering "Can I buy Fidelity funds through Merrill Edge?", we wrote
that explores Merrill Edge's mutual funds offerings in detail.
Education and Research
The Fidelity website has very good learning materials. Equity reports are available for free. These come from a large number of independent researchers, including Zacks, Thomson Reuters, Ford Equity Research, and others. The broker also provides videos, articles, and webinars that cover a range of financial topics.
Merrill Edge also has an excellent assortment of informational tools on its site. There are many videos on topics such as diversification and rebalancing a portfolio. The broker offers stock reports from Morningstar, S&P Capital IQ, and Merrill Lynch at no cost.
A dead heat in this category.
Customers of Fidelity can reach a representative over the phone, or by e-mail, fax, or on-line chat. The phone system is staffed 24/7. The firm also provides a list of more than 100 international phone numbers for clients traveling outside the United States. Investors who want more personal service can find a Fidelity agent at one of the broker's 180+ locations.
Merrill Edge clients can reach a representative any time of the day. This includes both investment and technical experts. The broker also offers e-mail and snail mail contacts. A phone number is also available for customers who travel globally.
Fidelity wins here due to its nationwide network of branches.
Merrill Edge's website is laid-out well. There is a variety of information. Traders can buy and sell securities within the web browser. There is also TradeBar, a handy trade ticket that allows for fast order entry and vital trade information. An advanced platform is available for active traders.
Good charting tools are available on the Fidelity website along with portfolio analysis tools. Trades can be placed within the web browser or by using the broker's trade ticket. However, it's not as good as Merrill Edge's trade ticket. Fidelity customers can also trade on Active Trader Pro, a sophisticated platform designed for frequent traders.
Merrill Edge wins due to its advanced trade ticket.
Investors who don't want to trade on an old fashioned desktop should check out Fidelity's very good mobile apps. They can be used on iPhone, iPad, Apple Watch, Android and Windows Phone 8. Users can transfer funds, pay bills, contact customer service, and place trades. Bloomberg business news also is available on the Fidelity app at no cost. The broker has introduced an app for Apple TV as well.
The Merrill Edge app has news articles, but lacks streaming financial news. The broker's mobile platform is available on Android, iPad, iPhone, and Apple Watch. Several vital features are on the app, including bill pay, trade placement, funds transfer, and mobile check deposit.
Fidelity is victorious here.
The Cash Management Account is available at Fidelity. Checks and a debit card are automatically included at no cost. The account is FDIC insured up to $1,250,000. ATM fees are reimbursed nationwide.
A Merrill Edge trading account can have checks and a debit card added. Customers pay nothing for the addition. Brokerage clients receive free ATM withdrawals at Bank of America. Merrill Edge also reimburses up to $200 annually for non-Bank of America ATM's.
Merrill Edge loses again.
Fidelity vs Merrill Edge: Results
There was one tie, Fidelity Investments (Fidelity Review) was victorious in four categories, and
Merrill Edge (Merrill Edge Review) won two categories.
Fidelity is a better choice than the competitor to anyone just starting investing, though it did not make it into
our list of Best Brokerages for Beginners.
We recommend Fidelity Investments for a retirement account and to "buy-and-hold" investors. Merrill Edge is a good add-on service
for Bank of America customers, especially if they trade a lot and can maintain $25,000 in uninvested cash.