Scottrade vs Fidelity Investments: The Challenge
Fidelity and Scottrade are two widely-used brokerage firms who attract a lot of interest and offer a variety of securities services. So which firm is the better broker?
The following contest will provide the answer.
Commissions and Account Minimums
Scottrade’s fee for trading stocks and ETF’s is $7, while Fidelity charges a slightly higher $7.95. For options, Fidelity charges an extra $0.75 per contract, while
Scottrade is a little higher at $1.25.
Placing a trade with a living, breathing broker is $32 at Scottrade, while doing the same at Fidelity is a slightly higher $32.95.
Fidelity offers its customers 84 commission-free ETF's, while Scottrade has zero.
Brokerage accounts at both firms come with no account maintenance fees or inactivity fees.
The minimum initial deposit to open an account at both brokers is $2,500. No-fee IRA's are available at
both Scottrade and Fidelity Investments.
Fidelity and Scottrade are tied in this category.
Fidelity customers can trade more than 10,000 mutual funds, of which less than a thousand are no-load and no transaction fee. Mutual funds that carry a transaction fee
are $49.99 or $75 to trade depending on the fund.
Scottrade offers its customers more than 14,000 mutual funds. Nearly 3,000 come with no transaction fee and no load. No-load funds that do carry a transaction fee are
$17 to trade. Load funds are free to buy, although they cost $17 on the sell side.
This category goes to Scottrade.
Research and Education
Fidelity has a lot of research and educational tools available on its web site. There are free reports from Morningstar, Zacks, S&P Capital IQ, and others. Traders will find a helpful research tool for corporate bonds and other fixed-income offerings. Fidelity also has a virtual learning center where investors can access webinars, articles, and videos on a wide range of important topics.
Research and educational tools are inadequate at Scottrade. There are no research reports that traders can access. Scottrade does offer investment education on a page entitled Knowledge Center, where users will find videos and articles on a variety of financial topics.
Fidelity is victorious in this category.
Scottrade emphasizes its many retail locations across the U.S. The firm currently has more than 500 branches. Customer service over the phone is
available from 5 am to midnight (CST), Monday through Friday, and 8 am to 6 pm on the weekend. Scottrade is well known for proactive and helpful customer service.
Fidelity offers service via an on-line chat system, e-mail, fax, and phone. The phone service is available around the clock. Fidelity also offers a list of more than
100 phone numbers in foreign countries for customers who travel outside the United States. Currently, Fidelity has more than 180 branch locations in the U.S.
Overall, Scottrade wins in this category.
Scottrade’s website is fairly basic and unsophisticated. For traders who want more than the website, Scottrader Streaming Quotes is available, which is Java-based. The broker's most advanced trading platform is ScottradeELITE, a separate program available only to active traders.
Trading securities at Fidelity is easy with the broker's web browser platform, which includes a helpful trade ticket. Fidelity also offers Active Trader Pro, a sophisticated trading platform for investors placing 36 or more trades in a rolling twelve-month period.
This category goes to Fidelity because its website is more developed.
Fidelity has mobile applications for Apple, Android, and Windows Phone 8. The interface is user friendly. Customers can transfer funds between Fidelity and other financial accounts, contact customer service, make a mobile check deposit, pay bills, and place trades.
Scottrade has platforms for Android, Apple, and mobile web. Investors can search for options, read market news, and look over account and position data. Regrettably, users can't contact customer service or make a mobile check deposit.
The firms are tied here.
In order to provide its clients with banking capability, Fidelity offers the Cash Management Account. It has checks and a Visa Gold debit card at no cost. Furthermore, the account offers FDIC insurance up to $1,250,000, five times the regular amount. It does this by combining the cash balance in up to five independent program banks, each offering the regular $250,000 insurance.
Scottrade offers its clients an FDIC-insured bank that provides both checking and savings accounts with the standard protection of $250,000. A checking account comes with checks and a debit card free of charge. In order to open a Scottrade bank account, customers must have a minimum of $500 in a Scottrade brokerage account.
Scottrade does not allow its customers to transfer money via ACH out of a Scottrade brokerage account into an external bank account. Fidelity, on the other hand, does allow its clients to make such transfers.
Fidelity wins in this category, too.
Fidelity gives its customers access to foreign markets. Investors can trade on 25 national exchanges using 16 currencies. Scottrade does not offer the same level of
service for global investors. However, it provides a much more useful for most investors
Flexible Dividend Reinvestment Program that allows clients to invest dividends
into stocks of any company.
Scottrade wins here.
Scottrade vs Fidelity: Results
There were two ties, Fidelity came out ahead in three categories, and
Scottrade was also victorious in three categories. It's a tie. Because of lower commissions, which
could mean savings of thousands of dollars over the years for active investors, we recommend Scottrade to most customers. Fidelity is excellent for anyone wanting to
invest in Fidelity-family mutual funds and ETFs.
Updated on 6/16/2016.
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