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Charles Schwab review

Charles Schwab vs Scottrade

Scottrade vs Charles Schwab in 2015: Account Pricing, Commissions, Fees


Charles Schwab

  • Stocks and ETFs: $7
  • Stocks and ETFs broker assisted: $32
  • Stocks and ETFs interactive voice response (IVR) telephone system: $32
  • Options: $7 + $1.25 per contract
  • Mutual funds: $17
  • CDs, OTC Secondary Corporates, OTC Secondary Municipals, U.S. Treasury Bills, Notes, Bonds and STRIPS, New Corporate Offerings: subject to a markup or markdown
  • Listed Corporate Bonds: $35 + $3 per bond (minimum investment $1,000)
  • Unit Investment Trusts (UIT): $50 liquidation fee
  • Foreign Stocks Transferring In or Out: $60
  • Investment products: stocks, options, mutual funds, CDs, munis, U.S. Treasury, Canadian and foreign stocks, ETFs
  • Scottrade minimum deposit to open account: $2,500 ($0 for IRA accounts)
  • All Scottrade fees

  • Stocks and ETFs: $8.95
  • Stocks and ETFs broker assisted: $33.95
  • Stocks and ETFs phone trades: $13.95
  • Options: $8.95 + $0.75 per contract
  • Mutual funds: $76 to buy, $0 to sell
  • CDs, Corporate Bonds, Municipal Bonds, Government Agencies, Zero-Coupon Treasuries, including STRIPS and Mortgage-Backed Securities: $1 per bond, $10 minimum, $250 maximum
  • Preferred Stocks and REITs: $8.95
  • Commercial Paper and Foreign Bonds, Unit Investment Trusts: call for pricing
  • Investment products: stocks, bonds, mutual funds, futures, Treasury issues, options, CDs, insurance, ETFs, annuities, non-U.S. securities and ADRs, WEBs and Canadian foreign orders
  • Charles Schwab minimum deposit to open account: $1,000
  • All Charles Schwab fees

Scottrade vs Charles Schwab: Pros


Charles Schwab

  • No inactivity, account maintenance or hidden fees
  • No-fee IRAs
  • 500+ local branches for in-person assistance
  • Great support for beginner investors with a massive number of educational resources
  • Good banking services: savings, CDs, money market and free checking accounts (free ATM withdrawals, VISA check card, and free first order of checks)
  • Free real-time streaming quotes
  • Flexible and free dividend reinvestment programs (DRIPs)
  • Large number of mutual funds available - over 14,500
  • Instant funds deposits

  • Personal guidance is available at no additional cost
  • 300+ offices for personal visits
  • Rich selection of investment products, including large number of mutual funds - over 14,500
  • No surcharges on penny stocks, large orders, or after-hours trading
  • No account maintenance or inactivity fees
  • Great customer service
  • Free DRIPs (dividend reinvestment plans)
  • Investment research from a several companies
  • 198 ETFs with no commissions

Scottrade vs Charles Schwab: Cons


Charles Schwab

  • Outdated, cluttered website design
  • Additional 0.5% of the principal value commission for stocks under $1
  • No electronic withdrawals, but clients can use a debit card, checks, or ACH transfer from their bank
  • $25,000 account balance, or 9+ stock/option trades during the previous three months is required to use advanced trading platform (ScottradeELITE)
  • High $2,500 minimum to open regular brokerage account (but $0 for IRA)

  • High commissions on stocks, options, mutual funds, and ETFs
  • High margin rates

Charles Schwab vs Scottrade: Comparison Summary

Scottrade (Scottrade Review) offers lower stock and ETF commissions than Charles Schwab (Charles Schwab Review): $7 per trade versus Schwab's $8.95 per trade. With Scottrade investors could invest in over 2,600 NTF (no transaction fee) mutual funds commission-free and buy all other no-load mutual funds for $17. At Charles Schwab no-load mutual funds cost very steep $76 to buy but $0 to sell.

With Charles Schwab investors get decent banking services, wide selection of investment products and great customer service. But their website needs cleaner design and capabilities upgrade.

Both companies don't have account inactivity or maintenance fees, and do not charge higher commissions on large orders and extended hours trading. Scottrade, however, has a surcharge on penny stock (stocks priced under $1) trades.

Schwab and Scottrade do not charge IRA setup and annual IRA fees. Unlike many other brokers, Scottrade doesn't even impose IRA account closing fees, and it is one of the reasons the firm is rated as one of the Top Brokerages for IRA Account. In 2015 it is also made it into our list of Best Firms for Beginner Investors: the company offers tons of learning materials, easy to use tools, largest network of local branches where customers could talk with someone face-to-face, and helpful, proactive customer service.

Based on significantly lower commissions (especially on mutual funds), which for active investors could mean savings of thousands of dollars over the years, we strongly recommend Scottrade over Charles Schwab to all customers.

Scottrade Promotion - up to $2000

Charles Schwab Promotion - none
right now:

Charles Schwab review

This article was updated on 8/5/2015.

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